Plan to price agricultural emissions shows little reduction, angers environmentalists
Environmental groups are in uproar over a draft plan to price and reduce agricultural emissions as hammered out by the sector and Government.
None of the pricing options identified in the document would reduce emissions by more than 1 per cent on 2017 levels, meaning the Government would likely fail its own goal to reduce methane emissions by 10 per cent in 2030.
Instead, the plan relies on incentives and research being paid for by the fees from the possible levies to spur farmers to become more efficient. Other Government policies such as the National Policy Statement on Freshwater were projected to have a greater impact.
In 2019, Labour and the Greens reneged on an election promise to price agricultural emissions, allowing New Zealand’s highestemitting sector to continue to pollute freely, while other industries pay through the Emissions Trading Scheme (ETS).
Farmers have long argued that they have no good option to reduce emissions and remain competitive in the world market, unlike other sectors.
Instead, the Government launched a partnership policy programme between the agriculture sector, Māori, and the Government called He Waka Eke Noa, aimed at designing a policy to price emissions by 2025, preferably at the farmlevel. As a backstop it passed a law introducing agricultural emissions into the ETS by 2025, in case no scheme was designed in time, and said that could happen as early as 2023 if sufficient work was not completed.
The first major policy document from that partnership was released yesterday.
The draft plan looks at the ‘‘backstop’’ option of agriculture entering the ETS as well as options for a farm-level levy and a hybrid levy calculated by the processor that allowed some farms to get payments for reducing emissions themselves.
Each scheme has benefits and costs – farm level levies are expected to be far more costly and complex to manage than processor levies, but would reward things individual farms did to reduce emissions.
The prices are either based on expected ETS prices, with a 95 per cent discount that the Government has indicated would apply for agriculture in 2025, or a ‘‘unique levy rate’’ set by the Minister.