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Carbon tax impact for energy-intensive sectors


Government recognises impacts of carbon tax for energy-intensive sectors.

The Vegetable and Potato Growers Federation sees Government’s announcement today on energy efficiency and innovation as a positive move to address the impacts of the Carbon Tax.

“Government has to be commended for its approach in recognising that certain energy-reliant industries will be badly affected by a carbon tax and that it is prepared to work with these businesses to ease the effects of the tax with the benefits of technology.

“However, we still don’t agree with the Government’s carbon tax approach to meeting NZ’s Kyoto obligations” says Tony Ivicevich, Chair of Vegfed’s Fresh Tomato Sector.

The Federation has doubts about the potential benefits of the grants scheme for the already very efficient glasshouse crops sector and the irrigated outdoor vegetable crops sector. We are concerned about some of the preferred technologies mentioned in the background information for glasshouse crops and irrigated arable crops, which it is presumed includes outdoor broad acre vegetable cropping.

Tony Ivicevich says “I am concerned at what Government sees as some of the solutions to energy reduction/efficiencies as they may require a lot more factors to be taken into account and don’t provide solutions for a large number of growers”.

“High efficiency lighting in glasshouses uses more, not less energy. Neither does it take into account New Zealand’s natural high light levels compared with European countries where these lights are becoming more popular. And, thermal screens only suit some crops at certain times of the year.”

“Outdoor vegetable growers irrigate crops to get an economic return and are already very conscious of the costs of pumping and moving water for irrigation and the benefits of soil moisture probes.

“And don’t forget that millions of litres of diesel are efficiently used to produce and distribute NZ’s food. The price of diesel could rise by up to 10 cents a litre depending on the level of the carbon tax yet to be announced. That increase could either come off the grower’s bottom line or be funded by consumers,” Tony Ivicevich said.

“Nowhere in the Government’s statement is there recognition that most industries are already at, or exceed, world’s best practice because of the highly competitive market conditions domestically and internationally.

“Glass house and outdoor vegetable growers are already ultra-efficient in their use of energy and as such will not derive much pleasure or see benefits from the measures announced today. On the contrary, the more efficient you are as a grower now just adds to the unfairness of the impact of the carbon tax from 2007,” Tony Ivicevich concluded.


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