Farm-level pricing preferred option
EMISSIONS: Farmers are leaning towards system that would credit their moves to reduce their own emissions
ETS costs would make it harder for Kiwi farmers to remain internationally competitive — this would impact export earnings and agriculture’s contribution to the economy, affecting all New Zealanders.
Farmer consultation on an emissions pricing option for the agricultural sector has now closed, with the government due to be presented with a final option in May.
In 2019, the government announced the sector would have to start paying for emissions from 2025, and the industry was given time to develop a way to measure and price them.
The government said that, if no credible alternative was put forward, agriculture would be put into the Emissions Trading Scheme (ETS).
Industry partnership He Waka Eke Noa — which includes DairyNZ and Beef and Lamb NZ — has been consulting with farmers on two options for how farmers could pay for their on-farm emissions.
Under the first option, a farmer would pay for their net emissions at the farm level.
Under option two, emissions would be calculated at processor level, based on the quantity of product received from farms.
Dairy NZ chair Jim van der Poel said during the consultation process, farmers had expressed a preference for farm-level pricing, as this would mean they would be credited for work they did to reduce emissions.
“They want to know what their actual [greenhouse-gas] numbers are in if they undertake some mitigations or reduce the emissions,” he said.
“They actually want to actually be recognised for that work rather than be used as an industry average, which the processor levy would do, because it’ll just be a levy on meat, meat, slaughter, meat produced, or milk produced.”
It was also clear from the meetings with farmers which had been held over the past two months there were some who did not support either of the options and believed they should not have to do anything, Van der Poel said.
He said the reality was that the government had decided agriculture needed to start paying for its emissions and, if it did not present a better option, the sector would be put into the Emissions Trading Scheme.
“The government has already legislated to put agriculture into the ETS, so this is our chance to influence the solution.
“ETS costs would make it harder for Kiwi farmers to remain internationally competitive — this would impact export earnings and agriculture’s contribution to the economy, affecting all New Zealanders.”
Van der Poel said feedback from the roadshow would help He Waka Eke Noa decide what final option to present to the government in May.
“I’ve got a reasonable level of confidence that we will get there . . . I can’t speak for the government, whether they accept it, but . . . we’ve worked together with them in good faith on this.”