Farms, forests, and fossil fuels

That’s the title of the new report from Simon Upton, Parliamentary Commissioner for the Environment. In a pattern we’ve become used to, James Shaw, Minister for Climate Change, immediately released a statement to say that the report’s main recommendation – that forests not be allowed to offset fossil emissions – was not on the table. But the same day on the radio, the interviewer Guyon Espiner appeared to put Shaw on the spot:

Espiner: [Apart from the Emissions Trading Scheme and the Zero Carbon Bill] What are you doing to bring down emissions?

Shaw: Well, I mean, there are things right across the economy that we’re doing…
Espiner: Just name a couple of big ones
Shaw: OK, we stopped new exploration of offshore oil and gas…
Espiner: The advice was that that wasn’t going to reduce emissions at all.
Shaw: The advice was incorrect.
Espiner: What’s your advice?
Shaw: 100% of the gas that you burn adds to global warming…
Espiner: What is the year that it will begin reducing our emissions?
Shaw: I can’t tell you a year.
Espiner: It’s not terribly convincing, is it?
Shaw: The whole point is that fossil fuels are not our future, over the coming decades we want to phase that out
Espiner: What else [are you doing to reduce emissions?]
Shaw: The main thing we’re focussing on is reforms to the ETS [mentions ZCB again], the Green Investment Fund, the work that Genter and Twyford have been doing on transport that will shift $14b into public transport, walking, and cycling…
Espiner: So what are your projections about when we could begin to see our emissions decline because of those things?
Shaw: We’re estimating that they’ll peak sometime around the mid-2020s and then decline from that point on.
Espiner: So we’ve got another 5, 6, 7 years of emissions increasing.
Shaw: It could take that long, and that’s why planting trees in the near term is the best option that we’ve got.

Perhaps what Shaw means there is that planting trees is the best option the Government’s got, or the best option they can get away with. Because accepting that emissions won’t start reducing until the mid-2020s is a big disappointment from a Government that has made climate change a priority.

Simon Upton’s credentials for looking at this issue are rock solid. He was Minister for the Environment in the 1990s, when he first grappled with New Zealand’s response. He’s chaired the OECD round table on the environment and in 2010 was appointed head of the OECD Environment Directorate. His report opens with a moving introduction accepting some responsibility for the situation that New Zealand – and the world – is now in, through his influence on 25 years of global climate change policy. He (almost) admits that he got it wrong in the 1990s, by allowing New Zealand to imagine that other countries would pay us to plant trees. It’s hard not to read the report as an attempt to make amends.

New Zealand has 25 years of experience that shows that planting trees is not a guaranteed method to reduce net emissions, or that that time it buys us will be used to stop burning fossil fuels. So far, we haven’t faced up to that. The report studies one way of dealing with the issue.

If forestry were only allowed to offset farming emissions, and not fossil emissions, then (under a falling cap on emissions, as is currently planned) carbon prices would rise higher and fossil emissions would fall faster. The effect on net emissions would depend on how the overall target for the biological sector.

Relying on forestry is risky for other reasons too. Upton made this point strongly in an interview with Carbon News:

Using trees as a low-cost way of avoiding making reductions in gross fossil carbon emissions is not a good idea. Blanketing the country in pine trees could leave New Zealand more vulnerable as forests are susceptible to fire and to diseases. The right trees need to be planted in the right place or problems emerge – for example with logjams and silt runoff from harvesting forests on steep slopes.

It’s also vulnerable to the precise method of carbon accounting. Upton’s report, like last year’s report from the Productivity Commission, relies on a model from Motu that credits pine plantations with sequestering 32 tonnes of CO2 per hectare per year – an enormous amount. Just 2.5 million hectares of plantation, which is a lot but is feasible, would offset our entire gross emissions, fossil and biological. The catch is that this only last for 21 years. After that, the sequestration rate is counted at 0, even though (to keep storing carbon) the forest has to be maintained forever. This accounting method front-loads all the gains, and puts the risks and costs of all future forest maintenance on to future generations.

There are other details hidden in the modelling, too. Currently in New Zealand, “Export intensive trade exposed” industries get a 90% discount on their ETS obligations, making them essentially nil for practical purposes. The idea behind this is that there is no point making these industries uneconomic in New Zealand, forcing them out of business and shifting emissions to other countries. The Government may soon bring agriculture into the ETS at a 95% discount. However, in the models in this report, “Free allocation was initially set at 95 per cent for biological emissions from agriculture. In all cases, free allocation diminished over time before being phased out.”

This phase-out is supposed to be implemented as the ETS is reviewed over time, perhaps on the recommendation of the Climate Change Commission, but it will clearly be a political hot potato however it is handled. Thus, our model of decarbonisation requires that all countries decarbonise in a smooth, harmonious way.

Perhaps inevitably, the report is being incorporated into the debate on the future of agriculture in New Zealand. Its other main point, that we need to stop burning fossil fuels, is being obscured. In both the conventional and the proposed models in the report, this has barely started by 2032, and all the heavy lifting is left to the 2040s. In fact, to limit warming to 1.5ºC, we need to cut fossil fuel emissions by 6% per year if we start now. That would mean cuts of 2.4 million tonnes of CO2 per year, equivalent to taking 1.2 million petrol cars off the road each year.

Part of the report’s lack of urgency is related to the choice of a 2075 timeline:

It was also decided to investigate a time horizon out to 2075, rather than 2050. While 2050 has been the subject of political commitments, there is no magic about the year 2050. At the international level, the Paris Agreement simply indicates the need to balance sources and sinks in the second half of this century.

Except that’s not the whole story of the Paris Agreement. The crucial clause 4 states:

In order to achieve the long-term temperature goal set out in Article 2 [Holding the increase in the global average temperature to well below 2 °C above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5 °C], Parties aim to reach global peaking of greenhouse gas emissions as soon as possible, recognizing that peaking will take longer for developing country Parties, and to undertake rapid reductions thereafter in accordance with best available science, so as to achieve a balance between anthropogenic emissions by sources and removals by sinks of greenhouse gases in the second half of this century, on the basis of equity, and in the context of sustainable development and efforts to eradicate poverty.

Equity, and the 1.5ºC limit, are not mentioned in the report. They require much stronger action to start cutting fossil fuel emissions now.

Robert McLachlan