Prime Minister Jacinda Ardern says she has "absolutely not" sold out to farmers over emissions, and the delay for including agriculture in the Emissions Trading Scheme was not a concession to Labour's government coalition partner New Zealand First.
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On Thursday morning the government announced farmers will not have to start paying for their emissions until 2025, as long as they make progress in finding ways to measure and price emissions at the farm level.
And when they do get levied for emissions, farmers will get a 95 percent discounted rate.
One of Labour's 2017 election campaign promises was to restore the Emissions Trading Scheme (ETS) and bring agriculture into the scheme by the end of its first term as government.
Ms Ardern says the change of tack is not a compromise to satisfy NZ First.
"I wouldn't even describe it as that… We followed the advice of the Climate Commission."
But on Thursday afternoon, New Zealand First claimed responsibility for the new plan.
"New Zealand First promised the farmers we would not have a tin ear, that we knew how critical they were to our economy, and we also believed they were as interested - the responsible ones - in reform as we were," party leader Winston Peters said.
But Ms Ardern says the decision was about overall consensus.
"Our goal is to reduce emissions, to stay within 1.5 degrees and to get consensus and that's exactly what we've delivered today," she told Checkpoint's Lisa Owen.
Greenpeace has criticised the government's scheme, saying it shows that pleas from tens of thousands of New Zealand students for climate action have fallen on deaf ears.
Federated Farmers meanwhile, is adamant it does not want agriculture in the ETS, and it has committed to work alongside the government on pricing emissions.
A review in 2022 will allow the government to include agriculture into the ETS, if it finds the sector's work has been inadequate.
The Prime Minister says the plan means by 2025 New Zealand will be the first country in the world to have a pricing mechanism for agricultural emissions.
"Ultimately our goal has to be to maintain the position as exporters to the world, of being sustainable food producers."
Under the plan, it is hoped that by 2025 the agriculture sector will be able to measure its own emissions, farm by farm.
But Greenpeace says every serious climate change policy advises a price signal for emissions - a financial incentive to drive change.
Ms Ardern says an Emissions Trading Scheme model like a levy per kilogram of milk solids is not ideal for farmers as it does not incentivise behaviour change and may not bring down agricultural emissions.
"My hope is we'll have processors like Fonterra continue to step up, they've already said they're going to pay for every farm to have a farm environment plan."