Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


NZ farmers miss out on a $120 million a year windfall

New Zealand farmers miss out on a $120 million a year windfall, Canterbury expert says

July 23, 2014

New Zealand farmers would be paid to pollute if they participated in the country’s emissions trading scheme under current policy settings, University of Canterbury forestry expert Professor Euan Mason says.

If farmers had joined the scheme, they would have received about $120 million to pollute each year, he says. Professor Mason will give a paper at a seminar on campus tomorrow night (Thursday July 24, 7 pm, Forestry Building).

“This rather strange outcome is a direct consequence of Government policy that allows unrestricted imports of carbon credits, including hot air credits from former Soviet countries. Farmers do not participate in the scheme right now, but it was proposed that they would have been liable for only 10 percent of their greenhouse gas emissions, which are currently around 35 million tonnes of carbon dioxide equivalent a year.

“They would have been gifted New Zealand units, which are our domestic carbon credits, for the remaining 90 percent so that they could submit credits to account for all their greenhouse gas pollution each year. This practice of gifting is known as grandfathering and it is happening for all emission intensive and trade-exposed enterprises apart from farming right now.

“New Zealand emissions trading scheme is failing but could be fixed. However, the scheme allows imported credits to be submitted to account for pollution instead of New Zealand units. The vast majority of imported credits are hot air emission reduction unit credits imported from former Soviet countries.

“These credits represent no change in people's behaviour in response to climate change and they are so numerous that they are currently worth 11 cents each in New Zealand. New Zealand units on the other hand are worth $4. So polluters are effectively paid to pollute in our emissions trading scheme. They are grandfathered credits worth $4 and can submit instead credits worth 11 cents.

“If farmers had been in the scheme, we would have paid them the equivalent of 90 percent of their emissions multiplied by the difference between the price of grandfathered New Zealand units and imported emission reduction units. Between 2010 and 2012 we grandfathered credits to other trade exposed industries such as the Tiwai Point smelter enough credits to effectively pay them more than $36 million to pollute at today's credit prices.”

Professor Mason says that by changing a few key policy settings the emissions trading scheme could be made to work really well. These include stopping imports of hot air credits, ceasing grandfathering, requiring New Zealand unit surrenders each year only for target greenhouse gas reductions, and treating all productive sectors equally.

He says New Zealand has so far failed to respond adequately to climate change and its emissions are among the fastest rising in the world.

ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Company Results: Air NZ Rides The Tourism Boom With Record Full-Year Earnings

Air New Zealand has ridden the tourism boom and staved off increased competition to deliver the best full-year earnings in its 76-year history. More>>

ALSO:

New PGP: Sheep Milk Industry Gets $12.6M Crown Funding

The Sheep - Horizon Three programme aims to develop "a market driven, end-to-end value chain generating annual revenues of between $200 million and $700 million by 2030," according to a joint statement. More>>

ALSO:

Half Full: Fonterra Raises Forecast Milk Price

Fonterra Co-operative Group Limited today increased its 2016/17 forecast Farmgate Milk Price by 50 cents to $4.75 per kgMS. When combined with the forecast earnings per share range for the 2017 financial year of 50 to 60 cents, the total payout available to farmers in the current season is forecast to be $5.25 to $5.35 before retentions. More>>

ALSO:

Keep Digging: Seabed Ironsands Miner TransTasman Tries Again

The first company to attempt to gain a resource consent to mine ironsands from the ocean floor in New Zealand's Exclusive Economic Zone has lodged a new application containing fresh scientific and other evidence it hopes will persuade regulators after their initial application was turned down in 2014. More>>

Wool Pulled: Duvets Sold As ‘Premium Alpaca’ Mostly Sheep’s Wool

Rotorua business Budge Collection Limited (Budge) and sole director, Sun Dong Kim, were convicted and fined a total of $71,250 in Auckland District Court after each pleading guilty to four charges of misrepresenting how much alpaca fibre was in their duvets. More>>

Reserve Bank: Labour Calls For Monetary Policy To Expand Goals

Labour's comments follow a speech today by RBNZ governor Graeme Wheeler in which Wheeler sought to answer critics who variously say he should stop lowering interest rates, lower them faster, or that inflation-targeting should no longer be the primary goal of the central bank's activities. More>>

ALSO:

BSA Extension And Sunday Morning Ads: Digital Convergence Bill Captures Online Content

Broadcasting Minister Amy Adams has today announced the Government’s plans to update the Broadcasting Act to better reflect today’s converged market... The Government considered four areas as part of its review into content regulation: classification requirements, advertising restrictions, election programming and contestable funding. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news