New Zealand's incoming Government is hoping to make the nation greener by planting 100 million trees each year, ensuring the electricity grid runs entirely from renewable energy, and spending more money on cycle ways and rail transport.

Key points: Incoming prime minister Jacinda Ardern signs coalition deal with NZ First and the Greens Party

Incoming prime minister Jacinda Ardern signs coalition deal with NZ First and the Greens Party Ms Ardern says the country aims to generate 100 per cent of its electricity from renewable sources by 2035

Ms Ardern says the country aims to generate 100 per cent of its electricity from renewable sources by 2035 She also plans to raise the minimum wage by 27 per cent

Prime minister-elect Jacinda Ardern and NZ First Leader Winston Peters — who will serve as deputy prime minster and foreign affairs minister in the new Government — signed the coalition agreement on Tuesday and outlined their priorities.

In addition to the environmental initiatives, Ms Ardern also outlined plans to raise the minimum wage, stop foreigners from buying existing homes, and possibly change how New Zealand's Reserve Bank operates.

The 37-year-old will be New Zealand's youngest leader in more than 150 years and hopes to take the country on a more liberal path following nine years of rule by the conservative National Party.

"I don't need to be influenced on climate change," she said.

"It will sit at the heart of what this Government does."

Ardern aiming for 100 per cent renewable energy

Ms Ardern's plan is for New Zealand to reduce its net greenhouse gas emissions to zero by the year 2050.

Some of the targets will require only incremental changes.

New Zealand already generates about 85 per cent of its electricity from renewable sources including hydroelectric, geothermal and wind.

Ms Ardern plans to increase that to 100 per cent by 2035, in part by investigating whether solar panels can be used atop schools.

She said the country would need to double the amount of trees it plants each year, a goal she said was "absolutely achievable" by using land that was marginal for farming animals.

Her plans also call for the Government's vehicle fleet to be green within a decade.

Not everybody is happy with the plans. Many farmers are worried they will be required to pay more if they are absorbed into an emissions trading scheme.

"There is concern that if this should happen, New Zealand will become less competitive with other food-producing nations," said Katie Milne, the president of advocacy group Federated Farmers.

Ms Ardern also said she agreed with a Greens' proposal to legalise recreational cannabis and said a referendum was needed to deal with the issue.

The country's drug use ranks among the world's highest, according to a New Zealand Drug Foundation study.

Increase to minimum wage

The Government also plans to raise the minimum wage to $NZ20 per hour over the next few years, a 27 per cent increase over its current level.

And Ms Ardern said a review of the way the Reserve Bank operates would take into account factors such as employment levels and price stability.

Currently the bank primarily considers inflation when setting interest rates.

Ms Ardern also outlined a plan to spend $NZ1 billion a year on the country's smaller towns and regions to improve rail and other infrastructure.

"You'd be hard-pressed to find a region that hasn't experienced neglect," she said.

Sorry, this video has expired Jacinda Ardern to be NZ PM after 'robust' negotiations

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