Budget 2022: Climate change-focused funding to boost farming tech

Bay of Plenty farmers have welcomed Government investment in emissions-reducing technology but one says the plan is little more than "grandiose money spending".

The Government announced a raft of climate-focused plans and funding this week, focused on reducing the country's emissions.

There was an emphasis on decarbonising transport and industry as well as agriculture and forestry futures.

It announced its very first Emissions Reduction Plan on Monday and said it was allocating an initial $2.9 billion through the budget for the reduction work with a further $1.5 billion to be allocated in future budgets.

The plan aimed for a high-wage, low emissions economy.
Its target was for long-lived greenhouse gas emissions to be net zero and biogenic methane emissions be 24–47 per cent below 2017 levels by 2050.

Aspects of the plan received funding from the Government's new Climate Emergency Response Fund in Budget 2022.

Prime Minister Jacinda Ardern said the issue of climate change could not be left until it was too late to fix.

"This is a challenge I know New Zealand can succeed in. Our plan is achievable because it includes a role for Government as well as for every community and sector of the economy."

Climate Change Minister James Shaw said over the past four years the Government had put in place a framework for enduring climate action and consequently the country was on track "to bend the curve of its emissions downwards for the first time in its history".

Impact on industry

Potentially the most contentious aspect of the plan was the implications for the agricultural sector.

Agricultural emissions make up 50 per cent of Aotearoa New Zealand's gross
emissions and the sector will get $710m over the next four years to help lower them.

The key points for agriculture in the plan were that an agricultural emissions pricing mechanism would be introduced by 2025 and $339m to fund new technology and establishing a Centre for Climate Action on Agricultural Emissions.

He Waka Eke Noa explored alternative pricing approaches to the New Zealand Emissions Trading Scheme and Its final advice will be provided to ministers by May 31.

Expected emissions reductions will depend on the details of the recommended
pricing mechanism, such as what mitigations are recognised and rewarded, and
how revenue is recycled to support further reductions.

University of Otago Agricultural Innovation Programme director Professor Craig Bunt said the plan did not excessively add more restrictions on farming activities.

But Kaharoa farmer Lachlan McKenzie did not agree.

Kaharoa farmer Lachlan McKenzie has welcomed funding for farming tech but says they can't use what they already have. Photo / Andrew Warner

"Taxing into submission does not work."

He was supportive of further research into technologies as he had seen the benefits over the years himself but said farmers were unable to utilise innovation that is already available to them with barriers like regulation and resource consents.

He said the announcement was "grandiose money spending" and would not be effective.

"Empower the farmer to do the right thing as opposed to the regulation which stimies innovation, reducing efficiency."

Climate change minister James Shaw responded by saying many farmers were already taking action to reduce emissions and the Government will continue to support them.

"In fact, a key focus of the emissions reduction plan is on helping farmers make the changes we already know can make a difference to emissions, and to drive further reductions by accelerating investment in new mitigation tools and technology."

Bay of Plenty Federated Farmers president Darryl Jensen said while he had not known what to expect, he felt the news was "relatively positive".

"We were scared that agriculture would be thrown under the bus."

Aspects of it he did not agree with, however, particularly instances of high-producing farmland being converted to carbon sinks.

He himself utilised the less productive areas on his dairy farm by increasing native biodiversity.

"Don't just chuck in a pine there for the sake of putting a tree in there."

He welcomed investment in technology and research, saying "there needs to be good science-based decisions".

NIWA Carbon Chemistry and Modelling principal scientist Dr Sara Mikaloff-Fletcher explained the Emissions Trading Scheme incentivised planting exotic trees over indigenous for rapid growth and potential carbon absorption.

But she said the Emissions Reduction Plan supported a transition towards planting permanent indigenous forests instead.

While she said the strategy laid out showed a shift towards long-term thinking, there were risks associated with forest carbon uptake.

"Multiple lines of evidence from overseas research show that forest carbon uptake has started to slow or even reverse due to forest degradation and climate change ... a clear view of how our changing climate will impact native forests is essential to ensure the success of this plan."

Rotorua-based crown research institute Scion chief executive Dr Julian Elder said it was pleased to see the direction that the Government's Emissions Reduction Plan had taken.

The Government also made some pre-Budget commitments to significant new investments in forestry to increase the supply of woody biomass for bioenergy and biomaterials, to grow the carbon stored in timber and wood products, and to meet the challenges of establishing significant new areas of indigenous forests.

"The announcements are still light on detail, and we're looking forward to working with our stakeholders to help figure those out.

"But we can already see that this is a significant opportunity for our sector and for supporting regional economies."

He said its research was already driving innovation to help.