Understanding climate science and emissions pricing

// Climate Change

Why does agriculture need to take action on warming? How do targets, metrics and pricing work? What would going into the Emissions Trading Scheme (ETS) mean?

Image of soil in hands

These are questions that are top of mind as we gear up for the agriculture emissions pricing consultation in February. We’ve asked world leaders in the science of climate change and its application in policy, Dave Frame and Adrian Macey, to talk about these issues and more in a one-hour podcast available now.

You can access the podcast here.

Find out more about the fundamentals of climate science as they relate to our sector, and about key considerations such as applying GWP*, the metric that’s getting a lot of attention because it better accounts for the different warming behaviours of short-lived gases such as methane – unlike the GWP100 metric used in international agreements which uses carbon equivalence. You can find out more about the GWP* metric in our earlier story

Dave and Adrian are strong advocates for the appropriate use of GWP* and in the podcast they outline where it makes sense to use this relatively new science and how it applies to He Waka Eke Noa and to the methane reduction targets. 

They explain how aspects of the options proposed by He Waka Eke Noa reflect the fundamentals of the science behind GWP* – particularly, having a separate price for methane and accounting for methane emissions based only on weight (without conversion using the GWP100 metric, which as noted above is an inappropriate metric for methane). 

The discussion outlines why it’s important that agriculture stays out of the ETS. If agriculture were to go into the ETS the price of methane would simply be linked to the carbon price, with no separate methane pricing, and it wouldn’t matter what progress was made on reducing agricultural emissions – instead, the price would be driven by what is happening with carbon.  

Dave talks about why it’s currently difficult to directly apply GWP* at the farm level – hear more about how getting the framework right and separately addressing the targets addresses farmer concerns in this respect. 

Dave and Adrian also outline their thinking about appropriate methane targets, noting that while the target of a 24-47 percent reduction in methane by 2050 is too high, the extent of agriculture’s warming impact and the urgency of needing to address climate change means we need to be careful to not aim too low. They note that while the sector has reduced its emissions, this was from a very high level and while there may have been no additional warming, the ongoing warming is still at a high level.  

This may challenge a point our sector is proud of – our 30 percent in absolute emissions since 1990. As a sector we need to keep discussing the implications of this point and how we balance improvements made with needing to take further action. 

B+LNZ does not agree with the current methane reduction targets in the Zero Carbon Bill and in a parallel process to He Waka Eke Noa we will be continuing to work to get these revised downward and ensure that they are fair and equitable.      

We encourage farmers to listen to the podcast as a useful backgrounder on the issues they’ll be asked to provide feedback on in February. 

What’s being consulted on in February 

The Primary Sector Climate Action Partnership – He Waka Eke Noa – has developed two alternative emissions pricing options as alternatives to the ETS.

These options are the result of work that has happened since the agriculture sector collectively convinced the Government not to bring us into the ETS – in order to preserve the hard-won ‘split gas’ outcome in the Zero Carbon Act, so that farmers wouldn’t be at the mercy of the rapidly escalating carbon price, and so that they could have more choice and control such as accessing better recognition for their on-farm sequestration. 

The two options are the farm-level levy and the processor-level hybrid levy. You can find out more about them in this summary document. Farmer input was sought during the development of these options, and since the information was released we’ve been undertaking targeted engagement with groups of farmers – the more detailed discussion document is being updated and revised to reflect what they and others have told the partnership, and the final consultation document will be released on 31 January so all farmers can have their say. 

Our focus is on ensuring that farmers have their say so that the resulting system works for them. 

The consultation process

During February, there will be two ways to make sure your views are heard. 

You can either attend a roadshow event (in-person at towns around New Zealand, or through one of our online webinars), or you can fill in the online feedback form that will ask a range of questions about what’s important to you, what your preferred option is and so on. 

All feedback received at events and online will be collated and analysed – and in B+LNZ’s case used to support our position at the He Waka Eke Noa partnership negotiating table. 

What to keep an eye out for

On Monday 31 January: 

  • the consultation document and supporting information
  • an updated summary document from B+LNZ and DairyNZ
  • the online feedback form.

During February:

  • roadshow events taking place near you.

Photo credit: New Zealand Agricultural Greenhouse Gas Research Centre