Thursday, May 19, 2022

Next step in emissions pricing options

FEEDBACK from farmers and growers on greenhouse gas emissions pricing options closed on Sunday, but work is already well under way to make sure there is a strong and cohesive recommendation presented to the Government before a May 31 deadline.

Jim van der Poel says about 2500 farmers took part in He Waka Eke Noa consultation meetings organised by DairyNZ and Beef + Lamb NZ.

Feedback from farmers and growers on greenhouse gas emissions pricing options closed on Sunday, but work is already well under way to make sure there is a strong and cohesive recommendation presented to the Government before a May 31 deadline.

DairyNZ chair Jim van der Poel, whose industry good organisation is part of the 13-strong partnership that makes up He Waka Eke Noa, says HWEN’s steering group has been collating responses from farmers and growers ahead of a meeting of the group that is being held on Monday to discuss an initial report on feedback received.

Van der Poel says despite the challenges posed by the arrival of Omicron just as a DairyNZ/Beef + Lamb New Zealand consultation roadshow was about to begin, around 2500 people took part in face-to-face meetings and webinars to discuss the pros and cons of a farmer-facing levy, a processor-hybrid approach or going into the Emissions Trading Scheme (ETS).

He said earlier registrations for meetings were higher than that, but he’s not surprised that some chose not to attend in person due to the pandemic.

Inevitably, he said, initial stages of meetings saw those attending voicing opinions on the need to do anything, NZ’s pastoral sector’s efficiency and the Paris Accord highlighting the importance of protecting food production.

However, Van der Poel said that although valid points on those subjects were raised, those at the meetings and webinars soon took on board that HWEN would not stop their representatives advocating those views but there were other decisions that had to be made.

He said of the HWEN options of a farmer-level levy, a processor-hybrid option or going into the ETS, there was an overwhelming preference for the farmer-facing response.

“Farmers really want to go to a farmer-facing levy,” Van der Poel said.

“They want to be responsible for their own emissions, not the industry average and they want to know what they can do on their farms to lessen their contribution.

“If they can find ways to mitigate or offset or reduce their emissions, while maintaining their business profitability, then they want the right to do that.

“We support that.”

He said the challenge to making that happen is being able to put forward a credible pathway before the end of May.

“That’s why we talked to farmers about transitioning, maybe starting off with a processor-hybrid type but only with the intention of transitioning to an on-farm one,” he said.

Van der Poel said some of the concerns that farmers highlighted were making sure that sequestration efforts they were already making were not being recognised.

“There’s a lot of farmers out there who believe the ETS is too narrow as far as recognising sequestration,” he said.

He said farmers also want to make sure that money they put into levies will go towards R&D focused on mitigation, which is industry’s long-term strategy to meet GHG targets and obligations, without having to reduce production or output.

Farmers also want to make sure that they, or their representatives, have a say in how future levies are set and who says how that money will be spent.

He said the big challenge the HWEN steering group faces is finding a fair and equitable pathway that everyone involved buys into.

“Everybody’s got to look at it and say, while they may not like it, I mean no one’s going to like a levy, but if we have to put something in place, is this better than the ETS?” he asked.

“And if it is, how can we make sure that when it starts to operate that it’s fair and equitable to all farmers?

He is confident that they can come up with a cohesive and strong proposal.

“We wouldn’t be doing this otherwise,” he said.

“It’s beholden on us to make sure that we achieve that because the alternative is not that flash.

“We’ve been given an opportunity and we need to make sure that we deliver.”

By the end of 2022, Climate Change and Agriculture Ministers James Shaw and Damien O’Connor must put forward a report outlining the system that will price agricultural emissions as an alternative to the ETS.

One way or another, by January 2025, agricultural emissions in NZ will be priced.

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