Why did climate-heating synthetic fertilisers get a (temporary) free pass?

There’’s a ready-to-go solution to start cutting the greenhouse gas nitrous oxide from fertilisers but the Government took it off the table in 2019.. Olivia Wannan reports..

There’s an oven-ready solution for climate-polluting nitrogen fertilisers on farms, the Government’s independent board of climate advisers says – but it was ruled out in 2019 and hasn’t been revisited.

Nitrous oxide is a potent and long-lived gas that contributes 10 per cent of the country’s emissions. However, to date it has escaped climate regulation.

One of its major sources is excess nitrogen on farm paddocks. Farm animals concentrate the nitrogen in their urine, making it hard for the growing grass to absorb it all. Soil microbes turn some extra nitrogen into climate-heating gas. One way to shrink the output is using less fertiliser.

In its new report, the Climate Change Commission noted fertilisers could be charged the same levy that is already put on every litre of petrol. By pricing fertiliser under the Emissions Trading Scheme (ETS), the country could start making inroads on the greenhouse gas now.

However, the Government took this option off the table in its deal with the agricultural industry – a 2019 partnership called He Waka Eke Noa, set up to solve the thorny problem of how to measure and price greenhouse gases from sheep and cows.

That solution won’t take effect until 2025, which will give the country just 25 years to get nitrous oxide to net zero.

Methane from animals needs to be reduced by between 24 and 47 per cent by 2050 under the Zero Carbon Act. Nitrous oxide is 12 times more powerful and lasts nearly 10 times longer than methane, which is why the legislation sets a tougher target of net zero. By 2050, any remaining nitrous oxide will need to be balanced by buying carbon offsets, including trees.

Asked about the advice on fertilisers, Climate Commission chair Rod Carr said he supported He Waka Eke Noa. The commission will vet the group’s proposed emissions-cutting tool next year to determine if it’s comprehensive and ready to be rolled out.

‘‘There’s no point having a lovely on-farm measurement and management system if it doesn’t reduce emissions,’’ Carr said.

But the clock is ticking on cutting nitrous oxide: ‘‘Some farmers are delaying action because they think they could be ‘benchmarked’ against their emissions in 2025,’’ the commission wrote in its final advice. Our Zero Carbon Act uses 2017 as the yardstick.

Livestock produces most of the emissions, such as the methane belched by cows and bubbling out of manure in paddocks and piles.

Animal urine, with its concentrated nitrogen, contributes about 5 per cent of the country’s total greenhouse gas each year in the form of nitrous oxide. Synthetic nitrogen fertilisers, such as urea, make the urine problem worse, by adding more nitrogen into the whole system. But even on farms without animals, application of

these fertilisers can produce nitrous oxide emissions.

Nitrogen fertilisers are one of our fastest-growing sources of emissions. When our ETS was designed in 2008, emissions from both nitrogen fertilisers and livestock were destined to join. Some harder-to-measure gases from agriculture, waste and refrigeration were to enter in 2013, allowing extra time to prepare.

Waste and refrigerants entered as planned. However, the National Government delayed agriculture’s entry, first until 2015 and then indefinitely.

Even so, businesses selling fertilisers have been reporting their nitrous oxide emissions annually for nearly a decade. (Those processing meat and milk also report livestock emissions.)

Administratively, it would be simple for nitrogen fertiliser sellers to buy carbon units to cover emissions. The carbon price in the ETS is rising, so costs to buy fertiliser would progressively increase. Using it efficiently would save money.

Under this system, farmers don’t have the hassle of calculating their fertiliser footprint or paying cash to the government.

But they also get little control. He Waka Eke Noa is intended to give farmers more power. From 2025, they must calculate their greenhouse gas bill, but in exchange they can choose from various options to reduce emissions.

For example, one farmer could apply a nitrous oxide inhibitor on patches of animal urine, paying less than a neighbour who does nothing. Many fertiliser users – such as fruit, vegetable and fibre growers – don’t have livestock, so don’t need to worry about methane emissions from ruminant burps, pats or urine.

If fertilisers end up in the onfarm scheme, each orchard and plantation would also have to calculate emissions and report to the Government each year.

The Fertilisers Association, which represents the big sellers Ballance and Ravensdown, would prefer to see fertilisers in He Waka Eke Noa’s on-farm measuring system.

Chief executive Vera Power said this would mean livestock farmers could choose how they prefer to cut emissions. Many farms already need to follow nutrient management and environment plans, so they are tracking their fertiliser use and can do emissions calculations off the back of this work, she added.

Growers may need help from an industry body or the fertiliser firms, she said, though mixed farms are common.

Could carbon pricing aimed at fertilisers incentivise companies to cut the emissions-intensity of their products? ‘‘That drive is already there,’’ she said. ‘‘Fertiliser prices go up and down quite a lot and any carbon price will quickly become invisible in those changes.’’

Greenpeace senior campaign adviser Steve Abel believes onfarm emissions pricing takes the heat off the big fertiliser companies. He sees no reason why synthetic fertiliser sellers aren’t already paying a carbon price. However, Greenpeace’s preferred tool is not pricing, but a deadline for these fertilisers to be phased out completely. ‘‘There’s no substitute for direct regulation.’’

Bell Gully climate lawyer Simon Watt said that if the commission was concerned a delay to pricing fertiliser could interfere with meeting our climate target, ‘‘it would have signalled this in its report’’.