ETS change to cost farmers, says Feds
The Labour Party’s proposal to move agricultural emissions into the Emissions Trading Scheme (ETS) could cost New Zealand farmers up to $83 million in its first year, says Federated Farmers.
Labour’s plan would have agriculture moved into the scheme in stages. By the time farmers were paying for 100 per cent of their emissions, the federation estimates it would cost the primary industry more than $830m per year.
Climate change spokesman Andrew Hoggard said New Zealand farmers were among the world’s most efficient food producers. It was illogical to put the sector at a competitive disadvantage against export competitors, effectively shifting production to less efficient producers overseas, he said.
‘‘That will just add to overall global greenhouse gases, not reduce them.’’
Putting agricultural emissions into the ETS along with other new taxes being proposed by Labour had the potential to cause a lot of cost and upheaval in provincial New Zealand, he said. The calculations for costs from year one where farmers paid for 10 per cent of emissions were based on 2015 herds numbers. They were broken down to $41.2m for dairy, $39.8m for sheep and beef and $1.5m for deer. This is based on methane from enteric fermentation and nitrous oxide to farm soils and assumed a $25 per tonne emissions price for carbon.
Hoggard said Labour’s policy was missing any indications that research into reducing biological agricultural emissions would receive further funding. Research was making strides into areas including methane inhibitors, breeding techniques and vaccines that inhibit methane production.
‘‘Federated Farmers firmly believes that until our trading partners also treat their agricultural sectors’ biological emissions in a similar fashion, and we have effective mitigation techniques that will enable us to further reduce our emissions, then agriculture should stay outside the ETS.’’