26 July 2009

The Government Says 40% Greenhouse Gas Reductions Can't Be Achieved By 2020. I Say They Can.

The New Zealand Government has just announced that it has ruled out New Zealand adopting a 40% target for greenhouse gas reductions on 1990 levels by 2020. Countries are required to go to this year's Copenhagen climate negotiations with a target on the table, and the New Zealand Government has recently been consulting on what target New Zealand should go in with.

Climate science says that we need developed countries to take on a 40% reduction target, but the New Zealand Government has rejected this as too expensive and unworkable. I think they're wrong, and in the paper I submitted to the consultation process, I outlined how we could meet a 40% target. I wasn't going to post this here, feeling it was too long and too specialised, but I've changed my mind.

The struggle isn't over: New Zealand's final target will be set during the negotiations. The 40% target isn't going to go away, whether the Government likes it or not. A lot of people will be watching to see what target they do adopt, and whether it reflects the needs of the biosphere and of future generations, or the lobbying of those who have most to love from the change away from a high-emissions economy.

A Pathway Towards Achieving a 40% Responsibility Target for Emissions Reductions on 1990 Levels by 2020
by Tim Jones


The recent Government-initiated consultation process on New Zealand's interim greenhouse gas reductions responsibility target for 2020 has seen a strong push by environmental and development NGOs for the Government to adopt a target of a 40% reduction on 1990 levels by 2020, in line with what climate science indicates is the overall minimum level of reductions necessary by 2020 to significantly lessen the risk of runaway climate change, and with New Zealand's responsibilities as a developed country. Meanwhile, major greenhouse gas emitter interests have argued for a minimal reduction target. The Government has responded to the 40% call by NGOs by asking them to demonstrate how this target could be achieved.

This briefing note outlines a pathway towards a 40% responsibility target. It is neither a comprehensive analysis, nor a detailed set of policy recommendations. (As Greenpeace has noted, the NGO community does not have the resources to perform such an analysis in the time allowed by the Government's 2020 target consultation schedule.)

The nature of the target

A responsibility target:
The public discussion of the 2020 target has often appeared to assume that all of the required reduction on 1990 levels must be met onshore. This is incorrect. The 2020 target is a responsibility target, which means that New Zealand can pay for some of the required reductions to be made offshore by credible means, e.g. by means of green CDMs or their post-2012 equivalent. For both diplomatic and equity reasons, however, it is preferable to make the greater part of these reductions within New Zealand.

The raw numbers: The discussion below is based on a 1990 emissions baseline of 61.9 Mt CO2 equivalent (CO2-e), compared with 2006 emissions of 77.9 Mt CO2 equivalent (CO2-e). To achieve a 40% target by 2020 entirely onshore would require domestic emissions to be reduced to 37.1 Mt CO2 equivalent (CO2-e).

The rules: The discussion of how to reach a 2020 emissions reduction target tends to be framed in terms of how such a target could be reached under the current Kyoto Protocol greenhouse gas accounting rules. It is almost certain that these rules will be different in a post-2012 greenhouse gas accounting regime. In particular, changes to the rules affecting land use, land use change, forestry and the use of forest products, agriculture, and soil carbon could have a major impact on the best methods open to New Zealand to make emissions reductions that qualify towards the target.

A negotiating position: Finally, New Zealand will not be able to set its own target. While we will enter the process of negotiations with an initial offer, we will end up being assigned a target as part of any agreement reached.

Where can domestic emissions reductions be made?

The three biggest contributors to New Zealand's greenhouse gas emissions are agriculture (currently 48%), stationary energy, including household and industrial energy use (24%) and transport (20%). These percentages are round figures and are based on 2006 emissions. The notes below focus on these three sectors, and on native and exotic forests, the biggest potential sources of increased biological carbon storage (excluding soil carbon, which I have not considered in this discussion.)


48% of New Zealand's current greenhouse gas emissions come from agriculture. It is a common misperception that there is no method available to reduce emissions in this sector.

In fact, work done by the Sustainability Council shows that 13% of total agricultural emissions (which would to equate to about 6% of total emissions) could be reduced at a profit to farmers, by methods including the use of nitrification inhibitors, biodigestion, stand-off pads, and changes in grassing policies. These options have generally been successful where used, but, in part because the farming sector's lobbyists prefer to claim that emissions reductions are not possible within agriculture, they have so far suffered from a lack of promotion.

Beyond this 13% of total emissions, further gains would chiefly come from land-use changes within agriculture, particularly the decline in sheep and beef farming and the conversion of land marginal for pastoral farming into "carbon farming". A further 8% reduction in agricultural emissions can be achieved by these means, meaning a total reduction of 21% in agricultural emissions on 2006 levels by 2020, thus contributing a reduction of 7.6 Mt in overall emissions.

Stationary Energy (including household and industrial energy use)

Across the household and industrial sectors, there are many opportunities to reduce emissions. In the household sector, opportunities to reduce emissions have been available for some time, but are only now starting to be implemented.

Key opportunities include a further expansion of the household insulation programme (which will have emissions reductions as well as health benefits); the installation of genuine smart meters (as opposed to the pseudo-smart meters being installed at present) and a moratorium on the installation of "dumb" meters; the much wider uptake of solar water heating; the use of efficient wood burners; and the full uptake of energy-efficient lighting and heating. These individual measures should be backed up by a major revision and modernisation of the Building Code.

It is the falling percentage of renewable energy generation which has been the leading factor in increasing emissions in the stationary energy sector. A commitment to a minimum of 90% renewable generation in the electricity sector needs to be not only made but acted upon, with fossil thermal limited to peaking generation only.

With a firm commitment to baseload renewable generation, aggressive energy efficiency measures in the household sector, and fuel switching in the industrial sector, a 35% reduction on 2006 emissions can be made within this sector, contributing a reduction of 6.4 Mt.


99% of New Zealand domestic transport is powered by fossil fuels. The biggest long-term emission reductions (and gains in efficiency) come from replacing fossil fuels by renewable sources, primarily electricity but with a contribution from biofuels. Such fuel and vehicle substitution has the potential to make a very significant impact by 2050, but will have comparatively little impact by 2020.

By 2020, two main areas can lead to significant emissions reductions:

1) Transport policy changes. A major switch in transport policy, from the current emphasis on roading (in particular state highways) and the private motor vehicle, is needed. In freight, the emphasis should be on substituting sea and rail freight for road freight wherever possible. In passenger transport, the present emphasis on building new state highways needs to be abandoned, and the investment instead put into the development of public transport systems, incentives from carpooling and for working from home, and new rules on urban forms designed to minimise travel times.

2) Fossil fuel pricing/availability. The high fuel prices, and especially the periods of rapid fuel price rises, during 2007 and 2008 resulted in increased uptake of public transport and decreased motor vehicle use where the option of public transport was available to transport users. In its most recent report, the International Energy Agency forecasts that the oil supply crunch that they had previously predicted for 2010 onwards will be delayed to 2013-2014 due to reduced demand caused by the recession. Since a supply-driven sustained rise in fuel prices may not occur soon enough to make a sizeable differences to transport emissions by 2020, the Government should consider implementing either an increasing fuel tax, or a tradeable individual fossil fuel quota which reduces over time, to drive further reductions in fossil fuel use.

By aggressive use of transport policy options excluding fuel pricing and/or quotas, transport emissions can be returned to 1990 levels, a contribution of 5.3 Mt of emissions reductions.

Fuel pricing or quotas can be set to provide a desired level of reduction: for example, a 5% per year reducing quota beginning in 1990 would by itself return transport emissions to 1990 levels, while a 9% per year reducing quota beginning in 1990 would by itself take transport emissions to 40% below 1990 levels in 2020.

Land Use, Land Use Change and Forestry (LULUCF)

In this area, the potential gains are in increased carbon storage and retention in natural systems. Though this debate tends to focus on exotic plantation forestry – which clearly has an important role to play in biological carbon sequestration – the greatest and most cost-effective opportunities for reducing net emissions may lie in the area of pest control and the associated regrowth and expansion of indigenous forests.

The greenhouse gas accounting rules in this area are the subject of active negotiation, and it is difficult at this stage to predict what will and will not be included in a post-2012 agreement. However, the overall trend is towards complete carbon accounting, which means that LULUCF rules will become more encompassing over time.

A strong argument in terms of policy action in this area is that it is usually win-win: for example, indigenous forest restoration not only stores carbon, but mitigates the effect of the greater number of extreme weather events, and consequent flooding, expected as the climate changes; control of possums not only benefits forests and reduces the risks of bovine TB, but also generates substantial numbers of jobs.

The key message here is that New Zealand should work to ensure that the major carbon storage opportunities open to us in plantation forestry; improving the health of existing native forests; and regenerating native scrub and forests are brought within the scope of the post-2012 agreement. Furthermore, all forestry and land use incentives must be properly accounted for domestically, to ensure that perverse incentives do not result in, for example, clearing regenerating native bush to plant pines. Under the right set of rules, major progress can be made in this area at a lower cost than in any other area.

Until the post-2012 LULUCF rules are known, it is difficult to know the scale of net emissions reductions possible to New Zealand in this area, but I have estimated that changes under the current rules could result in 3Gg of net reductions by 2020.


The emissions reductions outlined above do not take into account post-2012 changes in greenhouse gas accounting rules, and do not include additional sectoral price or quota-based measures beyond the ETS (such as a tradeable personal fossil fuel quota). Nevertheless, even with these limitations, the following sectoral emissions reductions can be made by 2020:

Agriculture 7.6 Mt
Stationary energy 6.4 Mt
Transport 5.3 Mt

TOTAL 22.3 Mt

In other words, the measures outlined above can contribute 22.3 of the 38.5 Mt reduction needed by 2020 to reach 40% below 1990 levels. The remaining 16.2 Mt reductions required can be achieved by a mixture of purchase of appropriate reductions offshore, enhanced net reductions made possible by changes to the LULUCF rules, greater shifts in agricultural production, and pricing or quota measures in transport.

The purpose of this briefing note is not to provide a formula for reaching the 40% target. It is to show that reaching such a target is possible, and that there are methods available to New Zealand to do so.


Philip S said...

It will be interesting to see if there's any response to your analysis, which certainly looks doable at first glance.
I get the impression that in Climate Change debates in NZ (and it is only an impression) that nuclear power rarely gets a mention. Cost issues notwithstanding, if there's some sort of taboo surrounding that energy source, there really shouldn't be, not any more.

Tim Jones said...

Thanks, Philip. The Government seems to have settled on a 15% target, but the details haven't been released yet. In my view, it's too unambitious - but it's considerably better than the major GHG emitter interests have been angling for.

Setting aside safety & proliferation arguments, the key point about nuclear power in NZ is that it's not needed - we already generate 60-70% (on average) of our electricity from renewable sources (mainly hydro), and with major wind projects coming on stream and the potential of tidal & solar, could ramp that %age up to at least 90%. It wouldn't require a nuclear power plant to fill that 10%.