Sustainable Business and Finance: NZ on the line in Dubai for COP28

COP28 is being held in Dubai this year.

Whoever Prime Minister-in-waiting Christopher Luxon sends up to Dubai for COP28 as his Climate Change Minister will face a rude awakening.

New Zealand political leaders have talked a big game on climate change. But their optimistic words have yet to be matched by sufficient major reductions in greenhouse gas emissions in the pipeline, at a sufficient tempo for this country to meet its Paris Agreement commitments.

The first Global Stocktake (GST) of the Paris Agreement will conclude this year. Foreign affairs officials portray this as an opportunity to look at how New Zealand is progressing and what we need to do about it.

“By identifying gaps in the climate response, we have an opportunity make decisions to course-correct and get back on track to meet the goals of the Paris Agreement.

“Other key outcomes will include constructing a framework for the global goal on adaption, and work on a fund and funding arrangements for loss and damage. Work on a wide range of issues will be undertaken, including climate finance, agriculture, just transition, mitigation and carbon markets.”

But the brute reality is that New Zealand is not on track to reduce its greenhouse gas emissions by 30 per cent below 2005 levels by 2030.

This is the Nationally Determined Contribution (NDC) which we agreed to as part of the Paris Agreement.

The Global Stocktake will show New Zealand has great deal of work to do.

There is a cost to tardiness. If we do not make sufficient moves within the country it will face costly action to invest in offsets elsewhere — up to potentially $23.7 billion by 2030.

The Paris Agreement took effect in 2020. New Zealand’s commitments to reduce greenhouse gas emissions, our NDC, kicked in from 2021.

The UN Framework Convention on Climate Change (UNFCCC) was established in 1994 to curtail “dangerous” human interference with the climate system. The 198 countries that have since ratified the convention are known as Parties to the Convention (COP). It’s at their annual COP meetings — like the one due to happen in Dubai from November 30 to December 12 — that world leaders, ministers and officials take decisions on the global response to the climate crisis including the implementation of the Paris Agreement.

Irony abounds

It is a matter of acute irony that COP28 will be held in Dubai, a city that made its wealth from the ultimate fossil fuel — oil.

The United Arab Emirates does not levy income tax on individuals. Its capital, Dubai, boasts the second-highest number of five-star hotels in the world and the tallest building, the Burj Khalifa, which is 828m tall.

This is also the tower where Dame Jacinda Ardern’s image, embracing a Muslim woman in the wake of the Christchurch mosques terrorism attack, was lit up large.

The UAE, as host, is expecting more than 80,000 delegates — and a significant business presence including from New Zealand. COP is increasingly becoming a platform for countries, NGOs, businesses, youth, and indigenous organisations to run side initiatives and events that seek to get ahead of the global rules, showcase world-leading climate action, clean tech businesses and innovative transition tools.

Often more than three quarters of the 30-40,000 participants at COP are not negotiators.

Sultan al-Jaber, the oil executive picked to be president of this year’s COP28 meeting, had himself spent years advancing his nation’s fossil fuel interests. It’s not been plain sailing for the UAE.

Reports underline that tense negotiations at the final meeting on an international climate-related loss and damages fund — to help poor countries hit hard by a warming planet — ended with participants agreeing the World Bank would temporarily host the fund for the next four years. The United States and several developing countries expressed disappointment in the draft agreement, which will be sent for leaders to sign at the COP28 climate conference.

Agribusiness rap?

There are some positives for New Zealand businesses to highlight in Dubai. Fonterra has partnered with Nestlé to develop the country’s first net zero carbon emissions dairy farm.

The “Net Zero Milk” project looks to increase awareness and adoption of low-carbon techniques and technologies that the wider farming sector can implement in order to decarbonise the industry.

After running for five years, the project will assess the new dairy farm’s total carbon output, looking to reduce emissions by 30 per cent by mid-2027 and achieve net zero emissions in 10 years’ time.

Fonterra CEO Miles Hurrell observes that New Zealand, which is the world’s leading dairy export producer, already provides some of the most sustainable nutrition in the world through its pasture-based dairy system.

Hurrell is looking to the partnership to further reduce emissions, increasing the country’s low-emissions advantage over the rest of the world.

New Zealand has the lowest carbon footprint for milk in the world, but dairy makes up about 50 per cent of the country’s agricultural livestock emissions, a quarter of which comes from dairy biological emissions (N2O and methane).

The Ministry of Primary Industries has also formed a partnership — AgriZeroNZ — between agribusiness and the government to act as a catalyst and investment fund with an ambition to reduce agricultural emissions by 30 per cent by 2030.

The Government is a 50 per cent shareholder, in partnership with ANZCO Foods, Fonterra, Rabobank, Ravensdown, Silver Fern Farms and Synlait.

With access to over 70 per cent of New Zealand’s farms, the partners bring real clout to their task.