Climate Commission warns of 'boom and bust' for forestry and emissions trading scheme
The Government has been given a firm shake-up from the Climate Commission, with new advice warning it must urgently rethink the emissions trading scheme and its over-reliance on planting exotic forests. The warning comes in the commission's draft advice for the Government's second emissions reduction plan , which will cover the years 2026 to 2030 and form part of the roadmap for how the Government will meet its net-zero carbon goal by 2050 . "The current pathway we are on seems to reward sequestration in forests above gross emissions reduction ...If we are on that pathway, the commission's conclusion is, we will not meet the target," chair Dr Rob Carr said. "Every time we offset an emission you or I make today with another hectare of forest, we are committing New Zealanders to maintain that forest cover for a very long time, so we are removing choices, options and opportunities from the future." READ MORE: * 'Hodgepodge' climate proposals could hang over climate minister's trip activists * Climate Change Commission report: A climate finance perspective * Climate Change Commission's 'lack of ambition' challenged The plans and the 19 urgent recommendations for the government are out for public consultation. The report calls for a refocus on changing the way New Zealanders live and work to meet climate goals, through creating more climate-friendly cities with better electric and public transport options and more renewable energy. A final version of its advice will go to Government by December 31, and is separate from New Zealand's international climate change obligations through the Paris Agreement. When Prime Minister Chris Hipkins pledged to ease households economic pressures, many of the policies he dropped were climate-related, raising fears he was not overly concerned with the issue. Meanwhile, the report warned, a shortage of workers and supply chain issues will make it harder to lower emissions, with Transpower alone estimating thousands more highly-skilled workers are needed for the electricity sector to meet increasing demand. The commission is asking the government to commit to a gross level of emissions, with a target of 362 million tonnes for 2026 to 2030, and 322 million tonnes for 2030 to 2035, and to keep forestry separate from the emissions trading scheme. The only source of removing carbon from the air now is by planting forests. Trees absorb and store carbon, but this is released again when they die in the coming decades. However, climate change is expected to increase the risk of forest fires, strong winds, storms, droughts, pests and pathogens all of which kills trees. The devastation Cyclone Gabrielle brought to much of the North Island showed how extreme weather could damage and destroy forests. A finite amount of carbon can be stored on land, so reaching net-zero carbon dioxide and nitrous oxide emissions through planting exotic trees under the ETS structure risked creating a "boom and bust" for both emissions prices and the forestry sector, he said. Forestry was important for meeting emission reductions targets, but it shouldn't mean industry and sectors didn't have to reduce emissions. If we are prepared to kick the can down the road there are some risks in sequestering forests that they burn down, blow down or die, but meanwhile we deny ourselves the uptake of low emitting technologies. Those pressures are then passed on to the next generation, he added. A sheep farmer would earn about $400 per hectare after tax, while forestry credits will give about $1500 after tax, which was driving land conversions. As much as 60,000 ha of new, exotic forests were planted in 2022 a significant increase on previous years. Up to 90% of exotic forestry is pine, and the rest is douglas fir and Redwoods. Maori and rural communities were disproportionately effected by the policy, he said. The main thing for urban New Zealanders is how do I get around? For rural New Zealand, it's about sustainable agriculture, water quality, animal husbandry. In forestry, iwi Maori matter. The Commission warned the government should have another look at its objectives through the ETS because the scheme could stop working as early as the mid-2030s. This was because the large amount of forests being planted would flood the market, depress the price for the units, and stop driving emissions down. The commision asked the Government to clarify how it would reduce emissions at the source, and warned the lack of clarity on its approach to achieve net-zero would create ongoing uncertainty and impact decision-making in the public and private sectors. Clarity is likely to increase the sense of urgency and willingness to take up lower emitting technologies, he said. Meanwhile, the scheme only covered half of New Zealand's emissions. The commission also recommended that the second emissions budget will need to slash the amount of greenhouse gases being emitted by 43.5 million tonnes. The largest share of this will come from energy and industry, which includes processing and manufacturing goods, totalling 17.4 million tones, or 40% of the total goal. Transport, agriculture and forestry will need to cut between 7 and 8 million tonnes, and the last 3.3 million tonnes will come from waste and fluoridated gases. New Zealand needed to produce more renewable energy to replace fossil fuels. Gross electricity demand is expected to increase by 28% by 2035 and 68% by 2050, when compared with 2020. To meet this demand, two new wind farms would have to be built every year. Offshore wind had significant potential to create energy. The Government has a target to reach 100% renewable energy by 2030, but the Commission found it was only on track to meet 96% and market intervention would be needed. Carr called for a better consenting processes which took into account better energy, water, housing supply, infrastructure and climate change outcomes. The growing uptake of electric vehicles would put pressure on the energy sector, and the commission recommended that the next emissions' reduction plan allowed for vehicle charging infrastructure to be upscaled. Transport contributed to 17% of the gross emissions, but there wasn't enough investment in public transport options. The Commission will make a formal assessment on the emissions reduction plan mid-2024.