Talks to build a grand coalition on an emissions trading scheme (ETS) were held last night, but those taking part are refusing to comment on them.
Climate Change Minister Nick Smith and his Labour shadow Charles Chauvel were understood to have met for an hour yesterday evening to see if the two major parties could reach a compromise on the controversial policy.
They were the first talks in some months after negotiations stalled over crucial design features of the ETS.
Dr Smith's spokesman said there would be no comment about the talks as the Government did not wish to negotiate with the media.
A review report on the existing ETS, enacted by the previous government and put on hold by National, was released last week.
It set out 34 broad recommendations but Labour, the Greens, ACT and the Maori Party put in dissenting minority reports.
Both parties agreed in principle to all sectors of the ETS, but National believed the version in the law now would cause too much harm to the economy.
It wanted an ETS closer in design to Australia.
Labour argued that National's version would not do enough to reduce emissions and both sides were haggling over a compromise.
Labour Leader Phil Goff wrote to Prime Minister John Key some time ago outlining areas where his party could not agree.
Yesterday's talks were the first since that letter.
An ETS would put limits on the amount of greenhouse gases different sectors of the economy could emit.
Those that exceed their limit would have to buy carbon credits from those who were under their cap.
The Government wanted to be able to take a finalised ETS scheme to the negotiating table at the next major international meeting on climate change in Copenhagen in November.
United Future leader Peter Dunne who chaired the review committee said the key to success for an ETS was long-term commitment from both major parties.
Labour had supported 32 of the 34 committee recommendations.
Areas of difference were around timing of entry of agriculture and intensity based approach or not.