Zero Carbon Bill Submission

by Catherine Leining and Suzi Kerr.
The New Zealand government has recently consulted on its proposal for a Zero Carbon Bill. This would:

• set a new and more ambitious 2050 greenhouse gas emission reduction target
• establish interim five-year “emissions budgets” consistent with meeting those targets
• require the government to issue plans for achieving its emissions budgets
• require preparation of a national climate change risk assessment and national adaptation plan
• set up a new independent Climate Change Commission to advise the government and monitor its progress.

Our full submission on the Zero Caron Bill is available here. In this blog we highlight five key opportunities to improve the government’s proposal.

1. Considering a fourth 2050 target option, providing for net zero emissions of long-lived gases and significantly reduced emissions of short-lived greenhouse gases

The government proposed three possible 2050 targets: net zero carbon dioxide, net zero long-lived gases and stabilised short-lived gases, and net zero emissions. We prefer an alternative 2050 target: net zero long-lived gases and significantly reduced short-lived gases.

New Zealand should have the capacity to achieve net zero emissions of long-lived greenhouse gases by mid-century. This provision should be included in any target, with the flexibility to compensate for underperformance by purchasing international mitigation. This would provide a safeguard against unforeseen circumstances, such as sustained damage to our forestry estate due to pests, natural disasters or disease. 

There is a level of uncertainty around mitigation options and accounting methods (including metrics) for short-lived gases. A 2050 target formulation of net zero long-lived gases and significantly reduced short-lived gases would offer an ambitious, adaptable and durable framework for managing New Zealand’s targets over time.

It is not sufficient to stabilise emissions of short-lived gases at current or recent levels. A more ambitious stabilisation target for short-lived gases could be defined as a band with a top (ceiling) value significantly below today’s emissions and a lowest (floor) value of net zero emissions. The Climate Change Commission could provide advice on defining the values and setting future targets for short-lived gases within that band. This approach would guide both government and the private sector in preparing to meet highly ambitious but technically and economically feasible emission reduction targets in the long term.

2. Implementing a dual-target structure encompassing New Zealand’s mitigation effort at home and overseas

New Zealand has the capacity to contribute to global mitigation by both reducing domestic emissions and supporting emission reductions overseas. Our global contribution should extend beyond our domestic contribution, and should not displace the domestic contribution.

The government could create a dual target encompassing New Zealand’s domestic emission reductions and its broader contribution to global mitigation. This global contribution would be achieved by purchasing international mitigation and/or otherwise providing technical and financial mitigation support to other countries with less advanced economies. Even once New Zealand achieves net zero emissions domestically, it could continue to support mitigation overseas.

There could be a band of flexibility enabling the government to shift a share of its mitigation effort between the domestic and international parts of its target. If there are shortfalls in meeting New Zealand’s domestic target, any international mitigation used to compensate should be subject to constraints for both quality and quantity to ensure environmental integrity.

This approach would give New Zealand some additional flexibility in timing our reduction of domestic emissions toward net zero, while not diluting the ambition of New Zealand’s global contribution overall. Importantly, New Zealand’s contribution to mitigation overseas should be framed more broadly than just meeting a marginal portion of its 2050 domestic emission reduction target through purchasing international mitigation.

3. Looking beyond 2050 when setting targets and plans through 2050

When providing advice on targets, emissions budgets and plans through 2050, the Climate Change Commission should also provide advice on the emissions outlook post-2050 and the implications for the choices facing us today. How we choose to set and meet our 2050 target will influence how effectively we sustain net zero emissions or net negative emissions through 2100 and beyond. For example, deferring mitigation investment and relying too heavily on forestry to offset emissions pre-2050 could make it more difficult and costly for New Zealand to achieve and sustain net zero domestic emissions post-2050. Similarly, New Zealand might want to reserve some of its finite forest sinks potential to enable offsetting of residual emissions later in the century. 

4. Requesting advice from the Climate Change Commission on emission price pathways

There is an urgent need by government and the private sector for credible advice on desirable target-consistent emission price pathways as well as the social cost of carbon in the New Zealand context. Such advice could be applied by central and local government when making investment decisions in technology and infrastructure and when designing policies and regulations that impose an effective emission price. It could be used to guide government decisions on unit supply, price management and cost exposure (free allocation) under the NZ ETS as well as designing its purchasing strategy for international mitigation. It could also be applied by the private sector to complement emission price signals under the NZ ETS.

5. Enabling the Climate Change Commission to undertake independent work supported by long-term funding

It would be highly desirable for the Climate Change Commission to have the powers to undertake or commission independent studies, research, and modelling. This should be supported by long-term funding, instead of being limited to the government’s terms of reference and year-to-year budget allocations. This would help to insulate the Commission's work from political interference. All of the Commission’s recommendations and reports should be released to the public.

The ultimate effectiveness of the Zero Carbon Bill will depend on securing cross-party and broad public support not only for the targets it mandates but also for the policy pathways used to deliver on those targets. The Climate Change Commission can make an important contribution in this regard, but only if it is nested within a broader policy, institutional and engagement framework that underpins the development of New Zealand's long-term low-emissions development strategy.