Responsibility for reducing greenhouse gas emissions will be falling firmly within the farm gate if the Government accepts the He Waka Eke Noa partnership’s recommendations for how agriculture is to reduce emissions and sequester carbon.
The group has made its recommendation based on extensive farmer meetings, research and feedback from stakeholder groups.
The plan will require farmers to “know their numbers” in terms of their gas losses, determine the value of those losses once methane is costed, and work to reduce them in order to achieve the sector’s 10% methane reduction by 2030.
Modelling indicates the scheme will deliver reductions in methane of 4-5.5%, in addition to reductions made through current policies and changes in management practices, making the 10% by 2030 target achievable.
The plan will require every farm business to report their emissions numbers, put a GHG management plan in place and pay levies related to the amount of methane and nitrous oxide emissions that particular farm releases.
The recently released Government emissions reduction plan included $6 million to support price discovery of methane.
This will be central to determining the value of every farm’s gas emissions and therefore how farmers will move to mitigate that gas’s cost.
The plan will now be taken to Government and if approved will be implemented from 2025 giving the sector four seasons to demonstrably prove the reductions can be achieved.
Farmer roadshows earlier this year had indicated farmers generally supported a farm gate reduction plan, but were hesitant about moving straight into such a scheme, with some meetings indicating only 35-30% wanted to go directly into that.
The red meat sector has urged the Government to accept the scheme, with B+LNZ chair Andrew Morrison saying the recommendation is not perfect but was significantly better than the Emissions Trading Scheme (ETS) option the industry was faced with.
“Finding solutions that work across all sector groups has been extremely challenging, and we have all had to make compromises for the greater good,” he said.
Having to opt for the ETS would mean the primary sector would lose its hard-fought split gas outcome that recognises the shorter life of methane in the atmosphere, and methane would simply be linked to longer lived carbon dioxide prices.
It was also likely the sector’s efforts to have farm vegetation which sits outside the ETS recognised would have been also lost.
But the scheme, if accepted, does not come without some reservations in the red meat sector.
Morrison said initial analysis underestimated the impacts on many red meat farms’ profitability and underestimated the emissions reductions likely to occur.
“The original analysis could imply a far higher price per kilogram for methane is needed to meet the 2030 targets, but this higher price would be crippling to many sheep and beef farmers and would likely see an overshot in the targets.”
The partnership recommended an 11c per kg price for methane over the programme’s first three years, but Morrison says reductions will happen at far lower prices.
Initial modelling indicated the scheme may cost dairy farmers about 15c/kg MS and 16-22c/kg for red meat.
The farm gate proposal is supported by Deer Industry NZ, but the group continues to have concerns over the likely impact of GHG pricing on some deer operators.
Deer Industry chair Ian Walker said the greatest change DINZ had got for members was levy relief for those farms unable to plant trees for carbon sequestration, such as those in districts where exotic trees cannot be planted due to wilding pine risk and outstanding natural landscape limitations.