Climate wishlist
The global climate summit in Glasgow could have billion-dollar consequences for New Zealand. Olivia Wannan looks at what New Zealand is fighting for at the negotiations.
For two weeks in November, Climate Change Minister James Shaw will rub shoulders with United States President Joe Biden, British Prime Minister Boris Johnson, Australian Prime Minister Scott Morrison and the Queen.
But he also faces gruelling negotiations during the COP26 meeting, with billion-dollar consequences for the Government. Shaw said his first priority was to salvage the landmark Paris Agreement, signed in 2015 but now in limbo because world leaders can’t agree details of how it will work.
‘‘The consensus around Paris has really frayed,’’ he said. ‘‘This conference is all about getting the show back on the road and building momentum.’’
Shaw will travel to Glasgow with a negotiating mandate, parameters within which he can negotiate without having to consult the Government. But any departure from that will mean he needs to place a call home.
One focus of the talks is the smooth running of a new international carbon market. A remaining area of debate is who gets to claim the traded carbon credits.
For example, many airlines will be buying carbon credits under an international aviation agreement.
An airline might pay a country to plant trees – but that country also needs to cut emissions to meet its Paris Agreement pledge. Some countries, including Brazil, think the emissions savings sold to the airlines should also be counted in their Paris tallies.
But many leaders argue this is double counting, and would undermine global goals.
There is also disagreement on the sale of old carbon credits in the new market and on surcharges to create funding for countries vulnerable to climate change.
A functioning carbon market is particularly important for New Zealand because the Government pledged to cut the country’s climate impact by 30 per cent by the end of the decade. (This target is expected to be increased before the end of the climate talks.)
The problem: no major political party has a plan that would get us there through domestic policies alone. The Government will have to buy its way out – likely using the international carbon market.
The other option is to set up bilateral agreements with other countries, though this would require protracted negotiations.
The Climate Change Commission calculated the current target could result in a $2.4 billion bill, if carbon credits cost $30 per tonne. At $140 per tonne, taxpayers could fork out $11.2b.
The National Party criticised Shaw for attending the climate talks with nine other New Zealand-based delegates, arguing it took away MIQ spots from returning Kiwis.
National Party MP and climate spokesperson Stuart Smith said the importance of carbon markets meant New Zealanders should attend the summit. ‘‘That should be a key focus of our negotiations. That is incredibly important,’’ he said. ‘‘I have no objection to the minister going with a small delegation . . . I don’t think he needs half the people he is taking with him.’’
In addition to the travelling group, the minister will be joined by five others from overseas government offices.
Shaw said there were about 30 negotiation rooms at the summit, running in parallel sessions.
‘‘So if we are going to participate in those negotiations, you need a sufficient number of people to be in a number of rooms at the same time. It is as simple as that,’’ he said. ‘‘The negotiations often run for 16-20 hours plus. You tend to relieve each other in shifts, which means you actually have fewer rooms that you can actually cover.’’
At the last summit, Shaw co-chaired a discussion group on the carbon markets.
He views this as a way to achieve global goals, rather than exert power for domestic priorities. ‘‘New Zealand is seen as a high-integrity country. And because we are not one of the ones with massive vested interests, we can act in a facilitative role between countries that do have very fixed positions on things.’’
The announcement of the Government’s new climate target (known as a Nationally Determined Contribution or NDC) should also come before the end of the COP26 summit. The Paris Agreement requires countries to pledge increasingly ambitious targets.
Prime Minister Jacinda Ardern said in January that the target of 30 per cent by 2030 would be increased, though no new target had been announced at the time of writing.
Asked if there was an increased NDC the National Party would support, Smith said he had no particular target in mind for 2030.
He opposed the Government’s decision to quadruple the country’s climate funding, which he said could be seen as an insult by businesses affected by the pandemic.
The cash boost appeared to be a distraction from the Government’s poorly received Emissions Reduction Plan consultation document, Smith said.
‘‘It was held up by ministers not getting their backsides into gear.’’
But Smith did want to see the country’s NDC split greenhouse gases by type. Under the Zero Carbon Act, by 2050, all greenhouses gases must be at net zero, apart from biological methane, which must fall by 24-47 per cent.
‘‘That is something National pushed very strongly for.’’
The pledge should also promote an alternate method of accounting for gases, called GWP*, Smith said. In international greenhouse tallies, all gases are typically converted into an equivalent amount of carbon dioxide using GWP100, meaning their impacts are averaged over 100 years.
Notably for New Zealand agriculture, GWP* is friendlier to countries with stable or sinking amounts of methane.
Agricultural groups such as Beef + Lamb also back the use of GWP*. Sam McIvor, Beef + Lamb’s chief executive, said reporting the country’s emissions using both GWP100 and GWP* metrics would promote the latter, both in New Zealand and around the world.
Essentially, the concept tries to account for methane’s shorter lifespan. It hangs around in the atmosphere for about 12 years, before reverting to carbon dioxide.
Others point out using GWP* outside of science, to design climate policies can privilege developed farming countries – particularly New Zealand. Because established farming systems have high baseline methane emissions, the GWP* system gives them credit for reducing methane. A country with a smaller, but growing, agricultural industry would be comparatively punished by the metric.
Shaw said the promotion of GWP* was not on his agenda for the summit, because the use of GWP100 was a globally settled question.
‘‘It would fall on deaf ears, because there is still plenty to negotiate,’’ he said.
‘‘Furthermore, we would be seen as attempting to change the global system in order to suit our largest industry. That would not do our largest industry any good at all. It would badly affect their reputation.’’
The international rulebook did not stop New Zealand from using its choice of metric in domestic policy, Shaw said.
But, he said, the Government’s decision to split the gases in domestic legislation had already caused international reputational damage.
‘‘This conference is all about getting the show back on the road.’’ Climate Change Minister James Shaw