The government’s climate change legislation may have to be amended to give more time for a farmgate emissions pricing plan to get off the ground as it looks increasingly unlikely that it will be in place by 2025, a dairy industry leader says.
DairyNZ chair Jim van der Poel said there is a lot of pressure coming to meet that 2025 deadline – and if it’s not met, farming emissions are set to be folded into the ETS.
“There is legislation drafted at the moment that will have us in the ETS in 2025 and we have to get that changed,” he said.
That legislation – the Climate Change Response (Emissions Trading Reform) Amendment Bill – puts agriculture into the ETS at farm level for livestock emissions, and processor level for fertiliser emissions in 2025.
It also agreed to work with the farming sector to come up with an alternative pricing model for on-farm emissions.
“We think there’s absolutely a risk,” Van der Poel said.
The biggest barrier in meeting the deadline is waiting for the government to make a decision on the industry’s emissions pricing plan, he said.
“They basically have to stand it up and they have to decide. We had an agreement in place before Christmas and the industry has met all of its deadlines and now we’re waiting for the government to say whether they still support that or that they have a different view.”
He said he understands that a decision is imminent.
“If you are going to put something in place, it has to lead to reductions, it can’t just be a tax and that’s why we continue to advocate for a farmer-facing levy.
“We see ourselves as part of the solution but it has to be something that is logical and practical.”
The latest draft advice from the Climate Change Commission (CCC) also emphasises the need to firm up an emissions price by 2025.
While he has not yet had a chance to properly read through it, Van der Poel said that too is a concern.
He will be pushing for the new post-election government to amend the legislation to get that date changed to allow more time.
It will also need cross-party support to avoid it being re-litigated every three years. Van der Poel said the National Party is generally supportive of DairyNZ’s position.
The industry is progressing well in getting farmers informed of their emissions numbers, so they can compare them to their peers’ data and make improvements. Around 95% of farmers know their numbers, with that number expected to reach 100% by the end of the year, he said.
The industry has also made good progress around rolling out farm environment plans that included actions to make them more carbon-efficient.
It will also give the industry a good idea of where it is placed for further emissions reduction.
The CCC’s latest draft report also calls for the streamlining of technology to assist farmers making a transition to lower carbon farming.
Van der Poel said there are already technologies available that farmers can use. Once the next target is determined and farmers know their numbers and have action plans via their farm environment plans, they will now what job needs to be done.
“What we do need to continue to fund is mitigations because, long term, the way we are going to resolve this is through mitigations.”
These mitigations could include boluses, better genetics, feed additives or different pasture or forage species.