It’s time NZ followed the UK’s lead to significantly reduce our greenhouse gas emissions, says the Parliamentary Commissioner for the Environment.
In a report out this week, Jan Wright says New Zealand needs to “change the direction in which we are travelling and make large and lasting reductions in our greenhouse gas emissions”.
Despite a succession of carbon-reduction targets set by politicians over the years, New Zealand’s emissions have increased 64% since 1990. She believes the UK’s Climate Change Act, which established the independent and high-powered Committee on Climate Change to set five-year carbon “budgets”, provides a template for this country and would lift climate policy beyond the reach of short-term political whims.
Her office has analysed how the UK system has worked since it became law with overwhelming cross-party support in 2008. The climate committee has so far developed five carbon budgets, the most recent of which requires the Government to achieve a 57% cut in carbon emissions by 2030 compared with 1990 levels. The long-term target is to cut emissions by 80% by 2050. So far, UK emissions have fallen 42%.
The five-year budgets stipulate the total volume of greenhouse gases that can be emitted by the UK in that period. The Government is then required to come up with policies that ensure emissions don’t exceed the budget.
The committee is made up of experts in climate science, economics, behavioural psychology and business, and it has a permanent staff of about 30. In drawing up the carbon budgets, it is required by the Act to consider factors such as the latest climate science, the economic impact, energy costs and the risk of fuel poverty among citizens. All its evidence is published.
The UK Government doesn’t have to adopt the committee’s recommended budget, but if it refuses to do so, it is required by law to explain why. The legislation has “stood the test of time”, says Mike Thompson, who leads the London-based committee’s carbon budget work. “It’s had three different colours of government in that time and each of those has gone along with the advice of the committee.”
Cuts in wide range of sectors
Thompson told the Listener that although the UK has had some “easy” reductions, such as shifting the electricity system from coal after the discovery of North Sea gas in the 1990s, the carbon-budget framework has driven cuts in a wide range of sectors. For instance, substantial reductions have been achieved by minimising the amount of waste to landfill, and tougher energy efficiency standards for boilers and appliances have cut household electricity consumption by 17%, and gas by 23%, since 2008.
The introduction of a carbon tax – currently £18 – to top up the price of carbon in the EU emissions trading scheme has helped to “almost push coal off the system”: it’s fallen from about 25% of electricity generation in 2012 to just 5%. Last year, the UK Government announced all coal-fired power stations would be forced to close by 2025.
“We are basically looking to follow the cheapest path to [the 2050 target],” says Thompson. “You need to have a steady build-up of effort. That means doing the things that are easy now and doing the things that will be needed in the future, like preparing for the electric vehicle (EV) market. EVs are expensive now, but they are going to be important in the future, so you have to develop the market and the charging infrastructure … Offshore wind is another example. It’s expensive, but the price is coming down and you have to deploy it to get the costs down.”
The committee is also required to report annually on progress towards meeting carbon budgets. In its latest report, it acknowledged that although good progress has been achieved, that is now “stalling”, with emissions from transport and buildings on the rise.
That planning is largely absent from New Zealand’s current policy framework, according to Wright’s report. Emission reduction targets are not anchored in legislation and there is no direct link between climate policy and New Zealand’s target under the Paris Agreement of reducing emissions by 11% compared with 1990 levels.
Unlike the UK, New Zealand has not set any carbon budgets “or any other kind of plan for reaching the targets”, she says. Climate policy is scattered across multiple government departments “and can be crowded out by other priorities”. And although the Productivity Commission has been instructed by Climate Change Minister Paula Bennett and Finance Minister Steven Joyce to look at how to “maximise the opportunities and minimise the costs and risks” of reducing emissions, Wright notes that its overall mandate is to provide advice on economic policy.
The New Zealand Government’s main greenhouse gas reduction policy is the Emissions Trading Scheme, which is touted as an “all sectors and all gases” approach, but it doesn’t include agricultural emissions, has no limit on the total number of carbon units and in the past allowed unrestricted purchase of overseas carbon credits.
The Government is counting on using international credits to balance its carbon books under the Paris accord, although it announced this week it plans to set a limit on the number of offshore credits allowed in the ETS. But Wright warns there is no guarantee New Zealand will continue to have access to other carbon markets. Her warning echoes that of the chair of the UK Committee on Climate Change, Lord Deben, who told the Listener recently that the Government’s reliance on international carbon trading to meet its obligations was “extremely dangerous” and “fiscally risky”.
Wright acknowledges New Zealand’s emissions profile has been influenced by certain factors that make it different from the UK. Our population has grown faster, for instance, and half of our emissions are methane and nitrous oxide from agriculture, compared with only 8% in the UK.
But she says “specious” arguments are often made that because New Zealand’s electricity system is already mostly renewable, it is harder for us to made cuts. “The point is how easily further gains can be made. New Zealand is rich in geothermal energy, and with the best wind in the world, we have a great opportunity for decarbonising transport.”
Wright recommends a new Climate Change Transition Act to set up a commission with the job of developing carbon budgets based on scientific, technical and economic evidence. As in the UK, it would be the Government’s responsibility to develop policies to enable the budgets to be met.
She says carbon budgets are “stepping stones” to a smooth transition to a low-carbon economy and would remove the unpredictability from climate policy that she says is a major concern for businesses.
She has directed her recommendation at all members of Parliament, because “being serious about climate change needs commitment not just from the current Government but from successive future governments”.
This article was first published in the August 5, 2017 issue of the New Zealand Listener.