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Agricultural Emissions Can Be Cut 13% - At Profit

Agricultural Emissions Can Be Cut 13% - At a Profit Today

Media Statement – 2 April 2009

A report completed for MAF dispels the convenient untruth that pastoral farmers have no cost-effective options to reduce their greenhouse gas emissions.

Over 13% of the nation’s agricultural emissions can be cut not just cost effectively, but at an overall profit to the farmer today. This is equal to some 5 megatonnes of emissions with a value of $150 million a year at a carbon price of $30/tonne.

The Sustainability Council has calculated these results after obtaining the ICF International report from MAF under the Official Information Act. The report surveys a range of ways in which farm emissions can be lowered and its baseline figures have been read for the technical potential of each technique in 2010, with adjustments (see attachment).

The report confirms the Council’s 2007 findings that: •The agriculture sector is easily New Zealand best source of emission reductions. ICF estimates it accounts for 73% of the potential for emission reductions across the economy that cost less than $30/tonne in 2010; •The emission cuts are not only low cost, many are profitable to farmers today; •These savings can be implemented quickly – in time to still make a significant difference to New Zealand’s Kyoto bill.

If the savings identified by ICF were exploited to the fullest between 2010 and 2012, this would reduce the nation’s total emissions by 16 megatonnes and eliminate the currently projected Kyoto deficit of 14.7 megatonnes.

Those savings will not occur unless farmers are held financially accountable for their emissions. Farm practices will otherwise change too slowly. Responsibility for emissions needs to be introduced progressively but needs to start in 2010.

At present the sector is completely exempted before 2013 – a net subsidy to pastoral farmers of over $1.3 billion up to that time (assuming a price of $30/tonne). This subsidy is paid mainly by other small consumers.

Half New Zealand’s emissions come from agriculture and it is time the sector’s leaders acknowledged there is a big potential for savings now instead of constantly claiming more time is needed for research. The ICF study shows that three quarters of the potential that is economic to implement in the next few years is agricultural.

It is vital that New Zealand moves on from setting itself up internationally as a special case because of its agricultural emissions. They provide its greatest opportunity to make real change that will benefit the nation, and its best opportunity to demonstrate climate change leadership internationally.

Cutting Agricultural Emissions at a Profit The following table is based on data set out in a report commissioned by MAF from ICF International.1 It describes the technical potential of the leading options for reducing agricultural emissions that ICF identifies.

- The first four options below have the potential to deliver 4.7 Mt of emission reductions a year at a substantial profit to farmers.

- The remaining three have the potential to deliver a further 0.7 Mt a year, probably also at a profit or break even, but at worst at a cost below $30/tonne.

- In total, 5.4 Mt is available annually at a profit overall.

- So between 2010 and 2012, there is the technical potential so save 16 Mt - slightly more than the currently projected Kyoto deficit.

At a carbon price of $30/t, its value is nearly $500 million.

1 ICF International, Analysis of the Potential and Costs of Greenhouse Gas Emissions Reductions, August 2008.

ENDS

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