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Climate change burden, benefits must be spread fairly

By Gavin Evans

June 4 (BusinessDesk) - Setting stringent climate change targets without understanding their cost or feasibility risks placing an unfair burden on some sectors, climate change professor David Frame says.

Moving New Zealand to a net-zero carbon economy will have benefits but also real costs and it is important both are shared across the community. That will probably require creative approaches from region to region and from sector to sector, he said at the New Zealand Minerals Forum in Dunedin last week.

Policymakers need to focus on emissions – rather than the resources they come from – and find a way to broaden the discussion beyond electorally-easy targets like heavy industry and coal. Agriculture also receives a lot of pressure that “isn’t really justified,” he said.

“I think they’ve got the process wrong,” Frame said in a panel discussion on coal use and climate change.

“Making a big ask is a good way of interrogating good questions, but I also think choosing things that are feasible and that have public support over many decades is really important,” he said by video link from Wellington.

“The setting of stringent targets before we have really investigated much in the mitigation potential, or figuring out paths for sectors, is a wrong-headed way of approaching the problem.

“We should have had a much better idea of what is possible before we start making very strong promises.”

The government has introduced its Zero Carbon legislation to parliament but may struggle to advance it. National believes the methane targets – seeking a 10 percent reduction by 2030 and at least a 24 percent reduction by 2050 – are too severe and should have been left to the yet-to-be-formed Climate Change Commission to advise on.

The government is also yet to respond to the advice of the Interim Climate Change Committee on how agriculture should be treated in the emissions trading scheme and how the government’s 100 percent renewable electricity target should be advanced.

The group’s April report is yet to be released, but the committee believed the 100 percent target was unnecessarily expensive when the sector was already on track for 90 percent-plus renewable generation. It also favoured an interim levy be placed on agricultural processors while a system of farm environment plan targets was established, possibly also levy-based rather than operating through the ETS.

Early last month, the committee told the government it will start preparing “high-quality and credible” emissions budgets the commission can pick up. They will be built up at a sectoral and economy-wide level and its priority will be on land use and transport, given they make up about 70 percent of the country’s gross emissions.

Frame, based at Victoria University’s school of geography, environment and earth sciences, noted that some of the focus on agricultural emissions seems to be driven more by a desire for “victory over the dairy farmers” than sensible climate policy.

In terms of priority, he said he would be more focused on reducing emissions from dairy processing than reducing the national herd.

Frame said that, globally, coal contributes a lot to climate change and that means users here will remain under political and social pressure to stop. He doesn’t see much of a future for coal unless users can reduce their emissions by using biomass or carbon capture and storage.

But he says there needs to be a greater focus on transport here, even though that will be politically harder than letting voters point the finger at other “upstream” players like coal mining, oil and gas, or steel making.

“Going after our transport emissions - which are a real problem, a bigger problem than just about any other sector in my view – on the other hand would annoy voters and that would struggle to get electoral support. But it’s really important that we do that.”

Fonterra energy manager Tony Oosten told the panel that electrification of cheese plants is relatively easy given their lower heat requirements and that blending coal and wood waste is a viable way to reduce emissions at milk powder plants.

But he said there may need to be a national plan for wood stocks given a large dairy plant could consume all the available wood waste in a region and would be competing with existing users like board makers.

Pioneer Energy, which operates hydro dams, windfarms and uses coal and wood blends at its industrial heat plants, said coal was likely to be needed for another 20 years. It may be possible to replace 10 percent of the coal use on the South Island – where there is no piped gas supply – within 10 to 15 years, chief executive Fraser Jonker said.

John Kidd, head of research at energy consultancy Enerlytica, warned that people seem to have lost sight of the industries that would shut if carbon prices rose high enough to deliver projected “hockey stick” growth in electrification of transport and industry.

The country doesn’t have to operate an aluminium smelter, a methanol plant, a steel mill, or an oil refinery, and could import their products instead.

“If they are no longer economic here then we will achieve our carbon objectives, but the economic price for that will be enormous,” he said. “Be careful what you wish for.”



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