Addressing the agricultural emissions question

Oct 19, 2016

Biological emissions from agriculture (methane and nitrous oxide) make up almost half New Zealand’s total greenhouse gas emissions. There is still little agreement, however, on how to address farming emissions.

Motu Economic and Public Policy Research brought together a group of New Zealand climate change and agriculture specialists to investigate cows, sheep, economics, and science as background for the Parliamentary Commissioner for the Environment’s recent report.

The two Motu working papers that resulted take as a baseline that, for the climate to stabilise, net long-lived gases - carbon dioxide and nitrous oxide emissions - must be the central focus of mitigation efforts and must ultimately be cut to (net) zero.

“Agriculture is unique because nitrous oxide emissions cannot go to zero: we need food, and any food that requires inputs of nitrogen will result in nitrous oxide entering the atmosphere,” said Dr Suzi Kerr, Senior Fellow at Motu.

“So, when it comes to nitrous oxide the emphasis must be on efficiency. This means that Kiwi farmers need to focus on producing low-emission nutrition that balances emission reduction with producing enough food. Any remaining nitrous oxide emissions will need to be offset by actively taking carbon dioxide out of the atmosphere,” said Dr Kerr

“In contrast, methane emissions could be reduced to zero but while reducing short-lived methane emissions will make it easier to achieve the target of limiting warming to two degrees, methane emissions do not need to decline to zero for the climate to stabilise.”

The first Motu working paper makes it clear that while leading scientists disagree on the importance of reducing methane in the short term, this isn’t because they disagree on the science. Individuals make different judgements about politics in New Zealand and internationally. Some are concerned that focus on methane will reduce effort to reduce carbon dioxide – a bad outcome.

Judgements about when climate change will be most damaging – and how quickly we will adapt - also differ. If we are strongly concerned about climate damage now we should put more effort in now to reduce methane; if our key concern is long term ‘peak’ concentration, then current action should be focused on a smooth long-term transition to a low methane future. There is no ‘correct’ answer to how methane should be addressed.

The second paper explores policy options both within the Emissions Trading Scheme (ETS) and outside it. The findings of this paper were strongly informed by the agriculture and low-emission future dialogues run by Motu since 2009 that have included farmers, iwi, industry, not-for-profits and government officials.

Delaying the adjustment of the farming sector toward low methane emissions may require that adjustment to happen very quickly in the future, if climate damages and greenhouse gas prices are even higher than anticipated.

“To protect rural communities, policies and actions should encourage farmers to start the transition to low-emission techniques and products now.”

Dr Kerr believes that all the policies suggested by the Parliamentary Commissioner for the Environment are important to consider.

“There isn’t a single mitigation option that is appropriate for all farms, so regulation needs to be flexible,” said Dr Kerr. “However, some regionally specific performance benchmarks and land-use restrictions may be appropriate.”

Promoting the freshwater reforms, with an emphasis on reforestation as well as improved farming practices, and developing a capital gains tax on rural land could also help.

Dr Kerr strongly suggests, however, that agriculture be brought into the ETS soon. That would provide a clear signal to farmers, rural communities and those who support them in education, industry and research that they need to apply creativity, effort and resources to develop new low emitting products that we can produce and sell profitably.

“An idea that I think has good legs on it, is for larger dairy farms to be brought into the ETS at the farm scale. Farmers could be offered a fixed-price option that is periodically marked to the market, rather than requiring that they buy and surrender units,” said Dr Kerr. “We need to start soon, with a gradual introduction, so that we can transition to an ETS that has full farm-level obligations.”

The Motu reports acknowledge that New Zealand farmers have already made substantial efficiency gains that have constrained the rise in total agricultural GHG emissions. However, total agricultural emissions are projected to continue to rise in the short to medium term because of planned production increases. Continuing current efforts is not enough.

“Because our agricultural industry is both productive and becoming more climate-smart than many other countries, it is in New Zealand’s interests for agricultural emissions to be included in the climate mitigation strategies of all countries,” said Dr Kerr. “Our government and farmers could work with developing countries to transform their agricultural sectors.”

The recent academic papers, one by Dr Kerr alone and the other by Michele Hollis, Cecile de Klein, Dave Frame, Mike Harvey, Martin Manning, Andy Reisinger, Suzi Kerr, and Anna Robinson, outlines these issues in more depth.