Paris is the venue for the next attempt to cut carbon emissions. New Zealand will be there, but what will we be bringing to the fight? Brian Fallow reports.

When delegates from almost 200 nations gather in Paris in December, their mission will be clear - though the details will be anything but: come up with an agreement to curb greenhouse gas emissions after the year 2020.

That's when current promises to reduce emissions expire, so the goal is to agree on what happens after 2020, hopefully out to 2030.

Some countries have already revealed their plans. Others - New Zealand included - are still thinking it over.

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In the next few months the Government is going to have to decide on its emissions reduction target for the 2020s, to be tabled at the Paris negotiations.

The consultation paper it produced last month does not propose one. Nor does it invite submitters to suggest a target - though some have.

But a clue to the sort of number the Government is thinking of may be the central scenario it asked economic modellers at Infometrics and Landcare Research to model - a 10 per cent reduction from 1990 levels.

That would be a modest improvement on the current target of 5 per cent below 1990, and only 10 per cent lower than New Zealand committed to at Kyoto 18 years ago.

But compared with where officials project New Zealand's emissions to be by 2030, it will be a stretch.

By 2030 they expect our national emissions, including the net contribution from forestry, to be about 85 million tonnes of carbon dioxide equivalent. That would be 31 million tonnes more than allowed by a target of 1990 minus 10 per cent. That target, in other words, would mean reducing projected emissions by more than a third.

The Greens call for a target of 1990 minus 40 per cent; that implies a reduction of 49 million tonnes, or 58 per cent in 2030 compared with projected levels.

But these are assumed to be "responsibility" targets. They do not require emissions reductions to occur within New Zealand.

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As physical reductions in emissions in this country fell short of the target, New Zealand would have to buy "carbon" - credits for emissions reductions which have occurred elsewhere in the world.

In recent years New Zealand emitters with obligations under the emissions trading scheme (ETS) have been able to buy those credits for a few cents per tonne of carbon - a far cry from the estimated $25 a tonne when the ETS was designed.

From 2020, however, the modellers were asked to assume that the international carbon price will rise from $25 a tonne in 2020 to $50 by 2030.

On that assumption, it would be economic to meet only 5.7 million tonnes a year by domestic reductions, Infometrics found. That would be about a fifth of the target if it was 10 per cent below 1990, and a correspondingly smaller percentage for a more ambitious target.

What would change for a more ambitious target would be the cost of importing more carbon. A minus 40 per cent target would cost the average household about $10 a week more than a minus 10 per cent target, or 0.6 per cent of its projected income, on these modelling assumptions.

In her submission, the Parliamentary Commissioner for the Environment, Dr Jan Wright, highlights some of the problems with this approach.

Dr Jan Wright says carbon credits do little to encourage investment in low-carbon technologies within New Zealand. Photo / Paul Taylor
Dr Jan Wright says carbon credits do little to encourage investment in low-carbon technologies within New Zealand. Photo / Paul Taylor

It does little to encourage investment in low-carbon technologies within New Zealand, she says.

The object of the exercise, after all, is not only for New Zealand to bear its fair share of the cost of the international effort, but to help the country make the transition to a low-carbon future.

And relying so heavily on imported carbon is hard to reconcile with the principle - contained in the Kyoto Protocol and in the draft negotiating text for the Paris agreement - that the use of international carbon trading should be "supplemental" to domestic actions for the purpose of meeting commitments. It is a semantic stretch to describe 80-plus per cent of something as "supplementary" to the rest.

The environmental integrity of any imported carbon credits is also important. Wright believes that test has not been met by the flood of cheap emission reduction units which have subverted the ETS, and which the Government is relying on to meet its commitment for the current period out to 2020.

She recommends that New Zealand's offer to the Paris process include a statement that the Government will limit the purchase of carbon units to those which represent real and verifiable emission reductions.

Labour's ... Dr Megan Woods says that while setting a target is important, we also need a plan for getting there.

Labour's climate change spokeswoman, Dr Megan Woods, says that while setting a target is important, we also need a plan for getting there. On that score the consultation paper is cryptic. It devotes a paragraph to the potential for electric vehicles and another to biofuels. It is hopeful that New Zealand's world-leading research into ruminant methane emissions will bear fruit.

"New Zealand would appear to be limited in the action it can take to lower its agricultural methane emissions, short of significant technical breakthroughs," Woods says. "But we should certainly aim to have ambitious targets on lowering carbon dioxide emissions from energy use, including transport. In principle, those targets should at least be comparable to what the European Union has undertaken to do within its overall target of a 40 per cent greenhouse gas emissions reduction below 1990 levels by 2030."

The European Commission has proposed a 30 per cent energy savings target for 2030.

New Zealand's transport emissions have risen by 23 per cent since 1990 and represent almost a quarter of national emissions. "The ability to transition heavy vehicles to electric is a long way off," says Woods. "Biofuels need to be part of it and also not relying on land transport for everything."

Labour would set up an independent climate commission charged with establishing a carbon budgeting process to achieve emission reduction targets. The Greens have a similar policy.

"A carbon budgeting process based on, for example, a five-yearly budget cycle would remove the short-term thinking of a three-year electoral cycle," Woods says. "It is imperative that the process be independent of the government of the day."

A long-term challenge like climate change requires policies which endure across changes of government and give emitters certainty about the rules. Labour is open to seeking such a consensus, Woods says.

Labour is committed to retaining and repairing the ETS (including retaining free allocations of units to emissions-intensive, trade-exposed firms) but the Greens would scrap it and replace it with a carbon tax.

Labour Party MP and environment spokeswoman Megan Woods says we need a plan as well as targets. Photo / George Novak
Labour Party MP and environment spokeswoman Megan Woods says we need a plan as well as targets. Photo / George Novak

"The really big problem we have is lack of afforestation," Woods says.

New Zealand has been able to offset its emissions growth since 1990 with carbon credits generated by "Kyoto" forests - trees planted since 1989 on land that was not previously forested.

The catch is that when planation forests (including pre-1990 ones) are harvested, the carbon they contain is deemed to be emitted.

By around 2020, give or take a couple of years, New Zealand's plantation forests will flip from being a net sink to a net source - increasing net emissions, not reducing them.

Plantation forests are not expected to revert to being a net sink until the late 2030s - assuming that the forests harvested in the 2020s are in fact replanted.

The New Zealand Farm Forestry Association, which represents small-scale forest owners, argues in its submission that a large expansion of the forest estate has the potential to buy time for other initiatives, such as research on agricultural emissions and improving the economics of liquid biofuels, to deliver long-term emission reductions.

"If a radiata pine forest was created by planting the same area each year for 10 years, it would sequester around 30 tonnes of CO2 per hectare a year by the time the oldest trees were 14; and then maintain that rate until maturity," it says. "That suggests a new forest of a million hectares could sequester 30 million tonnes a year - enough to reduce New Zealand's present gross emissions of 81 million tonnes a year to a net 51 million tonnes - for around 15 years."

New Zealand has nearly one million hectares of underused and erosion-prone land suitable for forestry, it says. "New planting therefore has the capacity to achieve an emissions target of 20 per cent below 1990 gross emissions by 2030."

The New Zealand Farm Forestry Association, argues in its submission that a large expansion of the forest estate has the potential to buy time for other initiatives. Photo / Alan Gibson
The New Zealand Farm Forestry Association, argues in its submission that a large expansion of the forest estate has the potential to buy time for other initiatives. Photo / Alan Gibson

Ambitious but fair targets sought

When New Zealand eventually tables its offer for a post-2020 emissions reduction target, it will have to explain why it considers it is "fair and ambitious, in light of its national circumstances".

The leaders of the Group of Seven largest industrialised democracies, meeting in Germany this week, called for an "ambitious, robust and inclusive" outcome to the global climate change conference in Paris in December.

They noted that the latest report from the Intergovernmental Panel on Climate Change recommended cuts in global greenhouse gas emissions of 40 to 70 per cent below 2010 levels by mid-century.

But they stopped short of agreeing on any immediate collective targets for reductions.

Climate Action Tracker (CAT) - a group of four European research organisations which closely follow climate policy - has studied the emissions reduction offers tabled ahead of the Paris conference by the G7 and the European Union.

CAT concludes that they go only between 20 per cent (by 2025) and 30 per cent (by 2030) of the way to where those powers' emissions need to be in the 2020s, if global warming is to be limited to 2C.

If President Obama's climate action plan were fully implemented, US emissions would fall to 10 per cent below 1990 levels by 2025. Photo / AP
If President Obama's climate action plan were fully implemented, US emissions would fall to 10 per cent below 1990 levels by 2025. Photo / AP

Those offers need to be significantly improved on, CAT says, but they do represent a clear improvement in ambition compared with the present targets for 2020.

The EU has tabled a target of reducing its emissions to 40 per cent below 1990 levels by 2030, and CAT reckons that on present policies it will get close to that target. In the United States, current policies would still lead to an increase in emissions, CAT says.

However if President Obama's climate action plan were fully implemented, US emissions would fall to 10 per cent below 1990 levels by 2025 -- close to the 14-17 per cent below 1990 implied by its offer to the Paris negotiations.

China, which is not a member of the G7, has said it "intends to achieve the peaking of CO2 emissions around 2030 and to make best efforts to peak early..."

CAT says Canada's and Japan's policies fall far short of what would be needed to meet their proposed post-2020 targets.

New Zealand's economy is emissions-intensive: it has the fifth-highest emissions per head ... among developed nations.

New Zealand has yet to table an offer for the Paris negotiations, but official projections for where emissions are heading on present policies have them way above, not even modestly below, 1990 levels by the end of the 2020s.

The Government's discussion document emphasises the challenges New Zealand faces in reducing its emissions, given that nearly half of them arise from the bodily functions of livestock, and most electricity generation is already from renewable sources.

"While it is difficult to estimate precisely, because of our national circumstances ... for the same level of cost as the European Union's target, New Zealand's target would be approximately 10 to 20 per cent above 1990 levels," it says.

New Zealand's economy is emissions-intensive: it has the fifth-highest emissions per head of greenhouse gases among developed nations, but ranks only 18th for per capita GDP.

Generation Zero's submission points out that every OECD country would have sacred cows. "Other rich countries may need substantial reforms to their car industries, their power industries or their mining sectors." Being unique is not unique, it says, and should not be an excuse for inaction.