Shaping New Zealand’s Contribution to a Low-Emission Future

By Catherine Leining (Policy Fellow) and Suzi Kerr (Senior Fellow), Motu Economic and Public Policy Research

In the international climate change negotiations, countries are currently preparing their emission reduction proposals for the period post-2020.  For many countries, these are likely to include quantified emission reduction targets plus a supporting explanation.  The New Zealand government is starting the consultation process on its proposal. 

At the global level, if countries want to limit the future temperature rise to no more than two degrees Celsius above pre-industrial levels, then two target numbers really matter.  The first is zero. We need to achieve zero net annual CO2 emissions globally by 2100. The second is one trillion. Global emissions need to peak and decline in order to limit cumulative net CO2 emissions to no more than one trillion tonnes of CO2 (as carbon) starting from the pre-industrial period. Under business as usual, we are projected to exceed our cumulative limit before mid-century. While many countries acknowledge the importance of the global temperature goal, most won’t commit to anything that appears to threaten their citizens’ development needs.

To turn those targets into reality, countries need to define collaborative pathways that will deliver a zero-net-emission future while meeting development needs. Recognising the uncertainties inherent in future technologies, markets and politics, what might transformational pathway choices look like for New Zealand?  Here are nine possibilities as a starting point for discussion.

Global goal: New Zealand pledges to support the two-degree global goal by joining global effort to achieve both zero net annual CO2 emissions and cumulative net CO2 emissions (as carbon) below one trillion tonnes by 2100. New Zealand shows global leadership in the development of an international policy framework that facilitates collaboration, ensures accountability and recognises global development needs. 

Joint action: New Zealand pools research funding and shares our expertise through joint emission-reduction ventures with other countries, especially in the areas of renewable energy, agricultural technology, forestry and emission pricing.  

Emission pricing: New Zealand reforms the New Zealand Emissions Trading Scheme (NZ ETS) to deliver a rising price of emissions with a price floor and environmentally sound linkages to other systems. In addition, the government factors the full social cost of carbon (i.e. the economic cost of climate impacts from each tonne emitted) into its investment decisions.  

Stationary energy: New Zealand commits to achieve 100% renewable electricity and zero-net-emission industrial production by 2050, supported by both emission pricing and backstop regulations that deter further fossil fuel investments and enforce the phase-out of fossil-fuelled generation. 

Transport: New Zealand positions itself as a fast adopter of low-emission transport technologies, especially recognising our potential to lead in piloting electric vehicles and biofuels, while reducing personal vehicle use by boosting public and active transport modes and improving urban design and telecommunications capacity. 

Agriculture: The government incentivises ultra-efficient food production systems by maintaining emission pricing for agricultural energy use, applying progressive methane efficiency targets to livestock production, limiting nitrogen through water-quality limits, enabling supply-chain performance recognition and rewards, investigating diversification of agricultural production, and continuing to fund agricultural research. 

Forestry: The government restores market incentives for afforestation and against deforestation by guaranteeing a minimum value for forest carbon through the NZ ETS and complementary forest-sector mechanisms designed to support biodiversity and enable a secure future biofuel supply.

Community transitions: National and local government enables a just and rewarding transition to low-emission economic opportunities and lifestyles for New Zealanders through: funding for low-emission R&D and community-led behaviour change initiatives; partnerships with Iwi and across the public, private and NGO sectors to test and deploy new technologies and business models; increased education and retraining in low-emission careers; accelerated regulatory support for new technologies and more stringent emission standards; and transitional support for communities disproportionately impacted by emission-reduction measures.  

Collaborative approaches: The government appoints an independent Climate Commission to provide advice on climate change science and policy, and launches long-term multi-stakeholder engagement processes to develop a broadly accepted national low-emission development strategy which continues to evolve over time. 

These nine pathway possibilities support a positive vision of a thriving low-emission future for New Zealand and signal clearly where collaborative effort, investment and accountability should flow.  Instead of making excuses for inaction and resting on the laurels of our natural endowment, New Zealanders could choose to turn green into gold by capitalising responsibly on emerging opportunities and demonstrating leadership on climate change. By achieving a positive vision through sound and stable policies designed with stakeholder input and bipartisan support, we could make decarbonisation an attractive long-term reality for New Zealand.

These reflections were derived, informed and inspired by discussions among participants in Motu’s Low-Emission Future Dialogue.  The authors take responsibility for the content.