Agricultural partnership He Waka Eke Noa has achieved partial success in persuading the Climate Change Commission of the viability of its proposal to measure on farm emissions outside the ETS using a split gas approach. But it will have a harder job trying to convince Ministers to ignore the Climate Change Commission’s advice not to allow carbon sequestration for vegetation which falls outside the ETS and measurement of nitrous oxide at the farm level. It also faces criticism from Groundswell which maintains HWEN’s measurement model is not fit for purpose, as it fails to account for net warming.
The CCC report released in July states the Commission’s belief eligible farmers can be ready to participate in a farm-level system by 1 January 2025. It rejects including on-farm vegetation, not already eligible for carbon credits in the ETS, for reasons of complexity, cost and inequity, while recommending pricing synthetic nitrogen fertiliser at the processor level in the ETS. The CCC believes farmers can be rewarded more appropriately for on farm vegetation through improving the ETS and recognition of enhancements to water quality and biodiversity through some sort of “separate mechanism”; nitrogen fertiliser emissions could be recognised at the farm level in the future when the science of measuring emissions improves.
Beef + Lamb NZ does not accept either of these points and will work with its partners in HWEN to convince Ministers both can be measured accurately and in time to meet the 2025 deadline. In its detailed submission to HWEN’s consultation process Chartered Accountants ANZ fully supports the measurement of emissions at the farm level, although it questions whether this can be achieved cost-effectively across 100% of farms by 2025 unless the sector leverages the relationship between farmers and their accountants.
CA ANZ estimates its members already hold 80% of the information needed for emissions reporting, having helped sheep and beef farmers to complete their Beef + Lamb calculators last summer. The remaining information relates to fertiliser application and vegetation which can be obtained from fertiliser history and farm mapping.
The key to achieving 100% farm coverage at a realistic cost will be avoiding double data entry into farm accounting and emissions calculators. Depending on the GHG calculator format, it will also be possible to enter the emissions data directly or through third party accounting software into the IRD’s IT system like a tax return. The government, not the HWEN partners, will have to take responsibility for setting up an IT reporting system which is capable of accepting and processing information from 24,000 farmers from the 2025 deadline compared with 2,000 businesses in the ETS. The public service track record in implementing IT systems does not provide massive confidence this will be ready to operate without problem or delay.
Groundswell believes New Zealand agriculture to be already climate neutral and therefore any agreement with government to a methane reduction target above 3% by 2030 will in effect subsidise non-agricultural emissions at the expense of farmers. However Kelly Foster, HWEN’s Programme Director argues that between 1990 and 2020 emissions from agriculture have increased by 17%, primarily due to an 80% increase in the national dairy herd and an increase in the application of synthetic nitrogen fertiliser by approximately 700% since 1990. These increases have been partially offset by decreases in the populations of sheep, beef cattle and deer by 55, 15 and 15 per cent approximately over the same period.
Environmental spokesperson for Groundswell and agricultural consultant, Steven Cranston, takes issue with DairyNZ and Fonterra for agreeing to the methane emission target of 10% by 2030 in the Zero Carbon Bill in 2019 which he says should have been based on emissions calculated using the GWP* method not GWP100. Cranston also maintains the HWEN partners failed to advocate sufficiently for emissions measurement to account for both warming and cooling effects of agriculture and the inclusion of all on farm sequestration, not just what is permitted under the ETS.
B+LNZ chairman Andrew Morrison says agriculture achieved some major outcomes in 2019 including keeping agriculture out of the ETS and acceptance of a split gas approach, making New Zealand the only country to date where this will apply. He agreed with Cranston however, that the methane targets are too high and should be based on GWP* which was new science at the time and has much wider understanding now. B+LNZ never agreed to the targets and will be challenging them as part of a separate process in 2024.
Morrison says that during B+LNZ and DairyNZ’s consultations with farmers earlier this year they made it very clear they wanted all their sequestration offsets included from day 1. While it would ultimately be preferable to account for more sequestration through the ETS, this is highly unlikely to happen by that time, and there are no biodiversity credits in the Biodiversity NPS which the government has been working on for years, so this would also be highly unlikely. According to Morrison “We cannot allow a situation where farmers face a price for their emissions and are unable to get full credit for their sequestration.” National’s agricultural spokesperson, Barbara Kuriger was also very disappointed with the CCC’s recommendation on sequestration.
Morrison argues it should also be relatively easy to include the additional sequestration in HWEN as there are tools already available to measure sequestration at the farm level, such as through Overseer and Toitu. It would be much simpler to do this than setting up another separate system.
The decision to accept HWEN’s recommendations in full or go with the CCC report must be made by the end of this year to ensure the passing of legislation in time to meet the deadline, although there may still be some amendments. All parties to the decision agree the final form of the legislation must be based on the correct science.
Current schedule and saleyard prices are available in the right-hand menu of the Rural section of this website.
P2 Steer
Select chart tabs
6 Comments
Seeing as dairy was the main target above, who pays for livestock emissions, the farm owner or the livestock owner? Remember that 50/50 share milking agreements are still common.
Probably the very only thing I agree with groundswell on, GWP100 is political bollocks, GWP*is relative science.
I don't actually know. But there's been a habit in the past of nobody doing anything until an industry body decides for everyone. Usually that goes in favour of the farm owner.
Equitably it needs sharing as otherwise it will disproportionately affect the party left with the bill. Certainly if herd owners pay it all they also have no direct way to sequester carbon as a owner has.
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.