17 September 2021

Moving the deckchairs on the Titanic - the Ministry for the Environment's pathetic incremental reforms of industrial allocation in the NZ emissions trading scheme

The Ministry for the Environment is running a consultation on reforming industrial allocation in the NZ ETS. It closes for submissions today.

Industrial allocation is the process where large trans-national emitters who have to surrender emissions units under the emissions trading scheme (that being the whole point of an ETS) are 'allocated' (given) free emissions units.

Remember that an emissions unit is the legal right in the form of a transferable permit to emit greenhouse gases. They are just like petrol vouchers. Or like a voucher to burn coal or a voucher to emit methane. The units say in effect "the owner of this unit has the absolute right and permission to burn some fossil fuel, up to a tonne of carbon dioxide equivalent emissions per unit". So every emission unit allocated to an emitter says to those emitters just go burn some carbon.

The process doesn't just reduce the carbon price. It makes it a wealth transfer and therefore a carbon refund. New Zealand Steel Ltd and New Zealand Aluminium Smelters Ltd are allocated more emission units than they need to surrender. The net effect of industrial allocation is that the two trans-national high-emitting companies have been net sellers of emissions units in every year of the emissions trading scheme since 2010.

After nine years of National Government amendments to the emissions trading scheme, the industrial allocation settings were basicly "free over allocation of emissions units to emitters for ever"

Since 2017 the Minister for Cimate Change James Shaw and the Ministry for the Environment have made one pathetically minor tweak to the industrial allocation settings. The eternal and un-ending entitlement to free units will decline by 1% a year from 2020.

Now the latest consultation proposes refining some of the minor detail of the baselines used for industrial processes that have the privilege of being eligible for industrial allocation free unit giveaway

I have just sent in my submission. So here it is. I argue a couple of basic points. There is a climate emergency. The only issue that matters is to rapidly reduce NZ's emissions of greenhouse gases. But MfE proposes incremental tweaks to industrial allocation settings in the ETS. This is just moving the deckchairs on the Titanic.

The industrial allocation rules should not be refined, they should be abolished. They have no place in an ETS designed to rapidly reduce emissions. I state that the only Government policy programme for reducing emissions that is worse than the ETS is the incremental process to reform the ETS

Submission to Ministry for the Environment on Reforming industrial allocation in the NZ ETS 17/09/2021

The world is facing a climate emergency. According to the IPCC Sixth Assessment Report (WG1), in order to limit warming to 1.5C with no or a limited overshoot, net global carbon dioxide emissions need to fall by 45% from 2010 quantities by 2030 and to then achieve net-zero emissions by 2050.

Given that urgency, the only issue or question that matters for emissions reduction policy is “does it reduce anthropogenic emissions of greenhouse gases rapidly and effectively”?

Based on that criteria, the New Zealand emissions trading scheme (NZETS) completely fails as a policy. The only other NZ Government policy programme that also fails to this same catastrophic extent is - the Ministry for the Environment’s current process of incrementally amending minute details of the NZETS. This consultation is no exception.

Therefore I disagree with and completely reject the minimalist scope of this consultation. I am deliberately going outside the scope of the consultation as the Ministry needs to be called out for this inadequate and frankly egregious approach.

When the critical and urgent need is for policies that rapidly reduce emissions of greenhouse gases, proposals such as this consultation for minimalist incremental changes to the deeply flawed industrial allocation rules are merely “rearranging the deckchairs on the Titanic”.

I am appalled that officials have proposed such limited policy actions that are so obviously not commensurate with the magnitude and severity of the climate emergency. I am appalled that the Government and the Minister have allowed this pathetically incremental approach.

I consider it is well understood what is wrong with the NZETS industrial allocation policy. I will list a few points.

  • There is a gross overallocation of emissions units to emitters,
  • It is a process that assumes existing allocations are property rights of emitters,
  • There is an implicit assumption that existing allocations have some logical basis in good policy rather than being the result of vested interest political lobbying and compromise,
  • a lack of a cap on emissions because of production-based allocation of emission units,
  • Baselines that show no logical relationship to the established IPCC emissions factors used in the Greenhouse Gas Inventory reporting and unit surrenders,
  • Baselines that include the Electricity Allocation Factor - which is an empirically invalid proxy for unverified unproven energy and electricity pass-through costs,
  • Major industrial emitters such as NZ Steel and NZ Aluminium Smelters Ltd are net sellers of units as they receive so many free emissions units,
  • allocation of units to non-participants of the ETS who have no surrender obligations (the hothouse horticulture sector), the 30-year timeline of incremental 1% or 2% or 3% annual phase-out of allocations (an emitter could maintain the same allocation of units, despite the 1% phase down, by producing 1% more output).

In summary, the NZETS is grossly deficient to the extent that it deviates from a simple and transparent design of a capped number of emission units applied without exception across all relevant economic sectors as in the GHG Inventory - with units to be surrendered by emitters with no free allocation.

Recommendations

The first-and-best policy recommendation I wish to make is that; "industrial allocation of free emission units should be immediately terminated".

The second best policy recommendation I would make is that “all industrial allocation of units is phased out within three years or a similar very short timeframe (much as the "two-for-one" units surrender discount was phased out from 2017 to 2019).

The third best policy recommendation I would make is that “any short-term industrial allocation of units must immediately exclude energy costs (the EAF) so that no emitters are net sellers of units under industrial allocation”.

The fourth best policy recommendation I would make is that “if there is a limited and short term period of rapid phase out of industrial allocation, and if baselines are validly needed, then the emissions baselines used should be the relevant emissions factors from the GHG Inventory”.

Consultation questions

Question 1: Do you agree with the five criteria to assess the proposals in this consultation document? Why, or why not?

I strongly disagree with the criteria. This sort of policy minutiae is rearranging the deckchairs on the Titanic. The first best policy is elimination of free industrial allocation of units over the shortest time period possible.

Question 2: Should allocative baselines be updated using new base years? Why, or why not?

I strongly disagree. This sort of policy minutiae is rearranging the deckchairs on the Titanic. When allocations are being eliminated as rapidly as possible, it will be irrelevant what baseline is used. Grandparenting allocations will be adequate if the public can see that all free allocation will end in the short term e.g. over three years.

Question 3: Should the reassessment be a one-off update, or a periodic update? Why, or why not?

I strongly disagree. Reassessment is completely pointless. It is rearranging the deckchairs on the Titanic. The first best policy is elimination of free industrial allocation of units over the shortest time period possible.

Question 4: If periodic reassessment is legislated, what would be an appropriate period – every year, 5 years, 10 years, or something else? Why?

I strongly disagree. Periodic reassessment is completely pointless. It is rearranging the deckchairs on the Titanic. The first best policy is elimination of free industrial allocation of units over the shortest time period possible.

Question 5: Do you agree the financial years 2016/17, 2017/18 and 2018/19 should be used as new base years to update allocative baselines? Why, or why not? I strongly disagree. This is completely pointless. It is rearranging the deckchairs on the Titanic. The first best policy is elimination of free industrial allocation of units over the shortest time period possible.

Question 6: Should the financial years 2019/20 and 2020/21 be included, but with a weighting provision? Why, or why not?

I strongly disagree. This is completely pointless. It is rearranging the deckchairs on the Titanic. The first best policy is elimination of free industrial allocation of units over the shortest time period possible.

Question 7: Should eligibility be reassessed using new base years?

I strongly disagree. This is completely pointless. It is rearranging the deckchairs on the Titanic. The first best policy is elimination of free industrial allocation of units over the shortest time period possible.

Question 8: Should new emissions intensity thresholds for New Zealand industry be developed? Why, or why not?

Strongly no. Developing new thresholds is completely pointless. It is rearranging the deckchairs on the Titanic. The first best policy is elimination of free industrial allocation of units over the shortest time period possible.

Question 9: Should more thresholds be added into the eligibility criteria? Why, or why not? How many would be appropriate?

I strongly disagree. This is completely pointless. It is rearranging the deckchairs on the Titanic. The first best policy is elimination of free industrial allocation of units over the shortest time period possible.

Question 10: Would a sliding scale threshold system better target eligibility and assistance? Why, or why not?

I strongly disagree. This is completely pointless. It is rearranging the deckchairs on the Titanic. The first best policy is elimination of free industrial allocation of units over the shortest time period possible.

Question 11: Should the New Zealand EAF be used when determining eligibility? Why, or why not?

I strongly disagree. The first best policy is elimination of free industrial allocation of units over the shortest time period possible. Even if there is retention of allocation for a short period, the EAF should be immediately abolished so that no emitter receives more units than they are required to surrender.

Question 12: Should periodic updates of the EAF trigger a recalculation of eligibility? Why, or why not? I strongly disagree. This is completely pointless. It is rearranging the deckchairs on the Titanic. The EAF should be abolished and not included in any very short phase-out term. If industrial allocation is to continue for even a short term, the rules must ensure no emitter is a net seller of units after allocation.

Question 13: Should the trade exposure test be changed? Why, or why not?

I strongly disagree. This is completely pointless. It is rearranging the deckchairs on the Titanic. The trade exposure test should be abolished even if industrial allocation continues for a very short limited period.

Question 14: What would be a more appropriate method to determine trade exposure?

This is completely pointless. It is rearranging the deckchairs on the Titanic. The trade exposure test should be abolished.

Question 15: Do you agree with the proposal to simplify the process to update allocative baselines, to reflect changes to emissions factors, EAF or other changes to methodology? Why, or why not?

I strongly disagree. This is completely pointless. It is rearranging the deckchairs on the Titanic. In the context of the need to rapidly phase out allocation (if not immediate cessation) there is no point updating baselines. The EAF should be abolished and not included in any very short phase-out term. If industrial allocation is to continue for even a short term, the rules must ensure no emitter is a net seller of units after allocation.

Question 16: Are there other changes to sections 161A-E of the Act that could better streamline IA processes?

It is absolutely too late to be ‘streamlining’ sections 161A-E of the Act. All sections of the Climate Change Response Act providing for free allocation should be repealed.

Question 17: Do you agree with the proposal to clarify the eligibility process for new activities? Why, or why not?

I strongly disagree. Free industrial allocation should be terminated as quickly as possible. No new entrants should be permitted.

Question 18: Should new activities be able to seek eligibility? Why, or why not?

I strongly disagree. Free industrial allocation should be terminated as quickly as possible. No new entrants should be permitted.

Question 19: Should there be any caveats on new activities seeking eligibility, such as proof of environmental benefits compared to existing activities?

Free industrial allocation should be terminated as quickly as possible. Future eligibility should be irrelevant. No new entrants should be permitted.

Question 20: Should firms that receive IA be required to report their emissions, revenue and production data annually? Why, or why not?

Yes. And unit surrenders should be reported. That is simple transparency and good governance of a market. It speaks volumes as to the inadequacy of the NZETS and it’s lack of transparency that firms receiving industrial allocation have not to date been required to report their emissions, revenues and production data.

Question 21: Would voluntary reporting be more appropriate, and still provide some oversight of leakage and over-allocation risk? Why, or why not?

I strongly disagree. That would be an abuse of transparency. That is the opposite of oversight.

Question 22: Should the five-year transition period for changes in eligibility status remain, or be changed? Why, or why not?

This is completely pointless. A five year period for changes in eligibility is a nonsense in the context of a rapid phase out of allocation. It is rearranging the deckchairs on the Titanic. The first best policy is elimination of free industrial allocation of units over the shortest time period possible.

Question 23: Should we look at an alternative mechanism to address emissions leakage? Why, or why not?

No, this is completely pointless. "Emissions leakage" is just the NZ Initiative policy of "fast follower" (e.g. climate policy laggard) dressed in sheep's clothing. Emissions leakage should be irrelevant now that the world has a universally agreed international treaty - the Paris Agreement - to reduce emissions to net zero near 2050. Under the Paris Agreement NZ is only responsible for its own emissions. Other countries are responsible for their sovereign emissions.

Question 24: What alternative mechanisms to IA would better address the risk of emissions leakage, and support domestic and international emissions reduction targets?

Emissions leakage should be irrelevant now that the world has a universally agreed international treaty - the Paris Agreement - to reduce emissions to net zero near 2050. Under the Paris Agreement NZ is only responsible for its own emissions. Other countries are responsible for their sovereign emissions.

Question 25: Should IA policy or any alternative explicitly encourage firms to reduce emissions? Why, or why not?

Frankly, given the state of the climate emergency, I can’t even understand why Ministry officials would even ask that question in a NZETS consultation. Reducing emissions is the only point of emissions trading.

Question 26: What method could be used to encourage emissions reductions?

A well designed, capped, no-industrial-allocation, all sectors all-auctions NZETS would encourage emissions reductions.

Question 27: Should IA decisions or any alternative include wider considerations – such as economic, social, cultural and environmental factors – when determining support for industry? Why, or why not?

No, absolutely not. Why on Earth would NZETS policy be based on any criteria other than reducing emissions? NZ has had 10 years of "wider considerations" in the NZETS and the result has been excessive wealth-transferring free industrial allocation to emitters. Effective policy incentivising rapid reduction in emissions must start immediately.

Question 28: How would these new considerations interact with the goal of reducing emissions leakage?

Honestly, this is ridiculous. See previous comment.

Question 29: Do you have any other comments, ideas or critical feedback that could help support the Government form final policy decisions?

Just to repeat. The world is facing a climate emergency. According to the IPCC Sixth Assessment Report (WG1), in order to limit warming to 1.5C with no or a limited overshoot, net global carbon dioxide emissions need to fall by 45% from 2010 quantities by 2030 and to then achieve net-zero emissions by 2050.

Given that urgency, the only issue or question that matters for emissions reduction policy is “does it reduce anthropogenic emissions of greenhouse gases rapidly and effectively”?

Based on that criteria, the New Zealand emissions trading scheme (NZETS) completely fails as a policy. The only other NZ Government policy programme that also fails to this same catastrophic extent is - the Ministry for the Environment’s current process of incrementally amending minute details of the NZETS. This consultation is no exception.

Therefore I disagree with and completely reject the minimalist scope of this consultation. I am deliberately going outside the scope of the consultation as the Ministry needs to be called out for this inadequate and frankly egregious approach.

When the critical and urgent need is for policies that rapidly reduce emissions of greenhouse gases, proposals such as this consultation for minimalist incremental changes to the deeply flawed industrial allocation rules are merely “rearranging the deckchairs on the Titanic”.

I am appalled that officials have proposed such limited policy actions that are so obviously not commensurate with the magnitude and severity of the climate emergency. I am appalled that the Government and the Minister for Climate Change Issues have allowed this pathetically incremental approach.

21 August 2021

Overseer: greenwashing nutrient pollution from intensive agriculture for 20 years

“Overseer” and dairy farming have been in the news a lot lately. ("Govt to assist development of next-gen waterways protection tool", Radio NZ, 11 August 2021, "Hawke's Bay farmers 'frustrated' by review of regulatory tool Overseer", NZ Herald, 11 August 2021 and "Major tool for managing farm pollution gets a fail from reviewers", Stuff, 11 August 2021)

What is Overseer?

According to a Government media release of 11/08/21;

"Overseer and its predecessors have been used for 30 years by many New Zealand (dairy) farmers to estimate nutrient budgets and understand how nutrients are cycled on-farm. Recently, it has been used by a number of Regional Councils as part of their plans and consents to manage nutrient loss to rivers and groundwater.“

An independent expert peer review of Overseer has just been completed and it’s conclusion is that Overseer is not fit for purpose and is unfixable.

The Review conclusion (pages 95 and 96) is;.

"...we do not have confidence that Overseer’s modelled outputs tell us whether changes in farm management reduce or increase the losses of nutrients, or what the magnitude or error of these losses might be."

Why was there an independent expert peer review?

Because the Parliamentary Commissioner for the Environment Simon Upton wrote a report asking for a review in 2018.

What was the original concern of Simon Upton?

Simon Upton said (on page 7);

“This investigation is about Overseer’s fitness for purpose in a regulatory context. Can we be confident that its estimates of nutrient loss provide regional councils with a basis for making regulatory decisions, notwithstanding the simplifications and approximations that are inevitable in having recourse to models?”

Upton was also concerned that privately owned proprietary software was not transparent and neither it’s model structure or results had been independently verified.

So what’s the big issue now this independent peer review has been released?

Well the answer is “No” to Simon Upton’s question; can there be confidence in Overseer’s estimates of nutrient losses when regulating agricultural intensification under the RMA?

However, the Government response is to fudge the issue. In the Beehive media release they down play the peer review conclusion in bullet points.

  • Report finds shortcomings in Overseer nutrient management tool
  • Overseer will be supported while a next generation of the tool is developed and/or additional tools are made available

Minister for the Environment David Parker states;

“Despite its shortcomings Overseer has been a useful tool to build awareness and influence practices to manage nutrient loss at the farm and catchment level”

Minister for the Environment David Parker is minimising and therefore denying the peer review's conclusion. Parker in an interview with Radio NZ stated that Overseer isn't fatally flawed. Look for my underlining

"The Overseer tool has been used by Regional Councils to estimate what the nutrient pollution coming from a farm into water ways and it turns out there's some problems with it. That doesn't necessarily make it fatally flawed but those problems are significant."

And he states that Overseer can indicate the relative change in nutrient flows after a change of farm practise:

"We need to look at whether its still got really sound utility as a regulatory tool on say on a flat dairy farm on which it probably is quite accurate on and lets face it that's where most of our dairying is on flat land but there are some councils who instead of using it just to measure the relative performance of a change on farm because even if its not accurate as to the absolute number it does give you an indication if you change your practice of things getting better or worse and that's very useful."

What’s wrong with what David Parker is saying?

The peer review gave a black and white answer. Overseer can't give reliable estimates of either relative or absolute nutrient losses from farms. Yet David Parker made a 180 degree contrary statement to Radio NZ that Overseer can usefully estimate relative nutrient losses from farms.

Parker and the Government need to accept that Overseer is fatally flawed. It isn't fit for purpose for regulating agricultural intensification. Parker is treating the issue as shades of grey. There are problems, but these can be addressed, work can be done, and Overseer can be supported and improved.

Parker's assertions completely fly in the face of the peer review's conclusions. I don't see how any sufficiently informed reader of the peer review could possibly see the Government work program and Parker's statements as logical and valid responses to the peer review's conclusion.

So how does this fit in with the context of resource consents and RMA regional plans?

In terms of the regulatory context that Simon Upton was concerned about, I draw three conclusions;

  1. Any resource consents that have Overseer conditions - those conditions are now unenforceable on the consent holder.
  2. The regional council process that led to the granting of consents for agricultural intensification relied for their conclusion of "adverse effects mitigated" on the inappropriate use of a fatally flawed model.
  3. Any regional plan rules (i.e. Manawatu Whanganui Regional Council’s One Plan) where Overseer was used to manage and therefore allow intensification were based again on the inappropriate use of a fatally flawed model.

What are the environmental organisations saying?

I agree with Greenpeace who said that Overseer had supported dairy conversions and intensification. Overseer was an excuse for allowing too much synthetic nitrogen fertiliser and too many cows to be crammed onto the land, despite worsening freshwater quality and drinking water contamination. Overseer justified the over-application of synthetic nitrogen fertiliser and had been embedded in resource consents.

“From the start, Overseer has been peddled by fertiliser companies as a means to sell more fertiliser – the very thing that is wrecking rivers and driving intensive dairying.”
“That’s no surprise given that Overseer is managed by the fertiliser companies that make a killing off farmers dumping synthetic nitrogen fertiliser onto the land,”

Overseer has been unequivocally unmasked as not just an imperfect tool used inappropriately in the RMA context to justify more intensive horticulture and dairy farming, but as propaganda for environmentally damaging agricultural intensification.

David Parker’s statements and intentions to continue with Overseer with incremental improvements show he is just a cheerleader for agricultural intensification and it’s ensuing adverse nutrient pollution of our freshwater bodies.

Well that sucks. What should be done about it?

I think the environmental NGOs need to get a declaration from the Environment Court that Overseer is unusable in any consenting or planning context. The Government needs to be stopped from propping Overseer up with incremental fudges so it can still act as a fig-leaf of faked mitigation for agricultural intensification.

An appendix on the independent peer review of Overseer

The citation for the independent peer review is Overseer whole-model review Assessment of the model approach, MPI Technical Paper no: 2021/12 Prepared for the Ministry for Primary Industries and the Ministry for the Environment by the Science Advisory Panel ISBN No: 978-1-99-100936-4 (online) ISSN No: 2253-3923 (online)

Here are the relevant conclusions from the independent review.

On page 90 in para 10.2.3 "The limitations of the overarching structure of Overseer notably impair the ability of the model to produce trustworthy absolute or relative predictions (see 10.2.1). These challenges with the overarching model structure are likely to overshadow any appropriately modelled behaviours represented by the model microstructure."

On page 93 "As highlighted in 10.2, Overseer’s structure, data, and behaviour suggest predictions of absolute and relative nutrient losses are likely inaccurate."

On pages 95 and 96 a summary of the panel's findings and conclusion.

"Our core concerns are that Overseer:

  • Is a steady state model attempting to simulate a dynamic, continually varying system;
  • Uses monthly time-steps;
  • Uses average climate data and, therefore, cannot model episodic events, or capture responses to climate variation;
  • Does not balance mass;
  • Does not account for variation in water and nutrient distribution in the soil profile;
  • Does not adequately accommodate deep-rooting plants;
  • Focuses on nitrate and omits ammoniacal nitrogen and organic matter dynamics; and
  • Lacks consideration of surface water and nutrient transport, as well as critical landscape factors.

As a result of these concerns, we do not have confidence that Overseer’s modelled outputs tell us whether changes in farm management reduce or increase the losses of nutrients, or what the magnitude or error of these losses might be."

07 June 2021

No mining on conservation land promise broken - mining greenwashed and greenlighted for 30% of conservation estate

No mining on conservation land promise broken - mining greenwashed and greenlighted for 30% of conservation estate.

Have you seen this?

An announcement by Acting Minister of Conservation Verrall "Government speeds up stewardship land reclassification".

It seems bureaucratic and innocuous. "National panels of independent experts will assess stewardship land areas and provide recommendations on land classification to the Minister of Conservation."

I am really appalled by it.

Verrall states:

“It’s vital that land with high conservation value is classified correctly to ensure it is protected for its natural and cultural heritage and safeguarded for the future."
“Reclassification fits with the Government’s manifesto commitment to protect, preserve and restore our natural heritage and biodiversity and is one of the Department of Conservation’s (DOC) core roles and responsibilities.

Both these statements are unequivocally false.

First, reclassification is not a means to the end of protecting all stewardship conservation areas. It is allocating the stewardship areas to mining - except the exceptions that make it through a bureaucratic RMA-style hearing panel process. This is like making existing protected conservation areas get resource consent - i.e. go through a tortuous resource consent process run by a hearing panel - just to have the status they already have - protected conservation land.

Secondly, breaking a clear and repeated promise "There will be no new mines on conservation land." (in the Speech from the Throne when Parliament convened on 8 November 2017 and confirmed by Minister of Conservation Eugenie Sage) can never be consistent with a Government's manifesto commitment.

Some background.

The Department of Conservation has a web page on Stewardship land which completely omits the fact that mining access can be approved on it.

The "backdoor" for access is under the Crown Minerals Act 1991. Under Section 61, mining companies can obtain mining access to any crown land after applying to the relevant Minister. That includes the conservation estate and the Minister of Conservation.

However, under Section 61A, a Minister "must not accept any application" for mining access for any area described in Schedule 4 of the Crown Minerals Act 1991.

Stewardship conservation land is not included in Schedule 4. The Minister may grant mining access agreements to stewardship areas in spite of the statutory purpose of management is conservation. This acts as a "back door" access route outside of the Conservation Act 1987. Pike River Coal Company is an example of a company that has (or had obtained) an access agreement.

I am appalled at the substance of this - confirming the minerals sector's ability to get mining access to stewardship land - and the PR spin given - that some conservation areas will be better protected when the opposite is true - a complete capitulation to the minerals sector that of today they are invited back to apply for mining access to 30% of the conservation estate.

I have a thought experiment/counterfactual to show how devious I think this is.

Say the Government had announced a process to allocate some stewardship land to mining. That panels of independent experts will provide recommendations on land parcels to be allocated to mining. That would go down with the ENGOs and the public like a cup of cold sick. That would be 40,000 people marching down Queen Street against Gerry Brownlee's 2009 proposal to allow more mining in other conservation areas. At least Brownlee had the honesty to back down in 2010.

But this counterfactual will have exactly the same overall result as Verrall's proposal. Mining access will be allocated to conservation areas. Except that in the counterfactual, the burden of proof is on mining and not conservation.

In the reclassification option, the burden of proof is on establishing conservation values. As of today, the mining industry is returned to the policy settings prior to Jacinda's promise "Mining on conservation land will be ended" - mining can have a go at mining access for all stewardship land - 30% of the conservation estate - with no risk of policy change. The burden of proof has been reversed and is now on conservation.

This is politically a classic trick of natural resource exploiters - reframe the narrative and reverse the burden of proof that applies. And then spin this as protection and promotion of conservation when it is destruction. That's why I am calling this egregious greenwashing and greenlighting of mining access to conservation areas.

The 'worthys' who have been nominated to these mining allocation panels, like the former PCE Dr Jan Wright, should resign from these panels, rather than be complicit in allocating conservation areas to mining all the while greenwashing that result as protection of conservation.

10 February 2021

Summary of the Climate Change Commission's emissions budgets and policy '2021 Draft Advice for Consultation'

I mentioned the He Pou a Rangi/Climate Change Commission's report 2021 Draft Advice for Consultation" published on 31 January 2021 to my millenial colleague. Who asked if it has infographics. Yes it does and hopefully they can help assist in providing a summary without anyone having to read either the 188 pages of the advice document or the hundreds of pages of the supporting evidence chapters.

First thing, let's get the citation right. "2021 Draft Advice for Consultation", He Pou a Rangi/Climate Change Commission, 31 January 2021.

It is a draft for public consultation until 14 March 2021. The report recommends three 5-year greenhouse gas emissions budgets to 2035 (and relevant policy) to the Government. To be finalised after submissions by 31 May 2021. The Government has to respond to it by 31 December 2021. So it will take all year.

The report adopts the Zero Carbon Act's approach of having a separate target for biogenic methane. Which is basically all of New Zealand's emissions from pastoral agriculture.

For the 'long-lived' gases (excluding methane from agriculture and waste), they recommend three 5-year emissions budgets out to 2035 and lots of policies to achieve them. The budgets mean a 26% decline in gross gases (excluding methane) and a decline of 36% in net gases (excluding methane) by 2035 from 2018. The ten percent difference being offset by exotic forestry carbon sequestration.

For 'short-lived' gases (agricultural methane plus waste methane), they recommend three separate 5-year emissions budgets to 2035. These represent less ambitious reductions in emissions - minus 16% to 2035 from the 2018 baseline

The summary 5-year budgets are to put Aotearoa on a path to 'net zero carbon' emissions by 2050. Absolute carbon emissions in 2050 will be millions of tonnes but they will be 'offset' to 'net zero' by forests storing carbon. There will be another round of three 5-year budgets for 2035 to 2050 to sort out the exact trajectory.

The forecast emissions pathways show a major decrease in transport emissions, modest decreases in agriculture and industry emissions, and major increases in carbon stored in forests.

The Commission have two emissions 'scenarios' to 2050; optimistic 'tailwind' and pessimistic 'headwind'. Both lead to net zero carbon by 2050.

For electricity generation, coal and oil have to be gone by 2030, gas is to be minimised, and wind generation increased a lot.

For food processing energy, coal is gone by 2035, diesel is squeezed, gas is halved and electricity and biomass generation are increased a lot.

For the dairy sector, methane emissions decrease marginally, milk fat production is stable, stock numbers drop very slightly through efficiency gains for each unit of dry feed. But - the Commission doesn't seem to know if dairying should be in the emissions trading scheme. Their recommendation to the Government is "Review regulatory regimes". This is very vague. A kick-for-touch response.

The whole point of having the Commission as an independent Crown agency is that it can make "free and frank" recommendations about applying politically sensitive policies such as carbon pricing to politically sensitive sectors such as the dairy industry. I find this quite disappointing.

For sheep and beef, methane decreases, meat production increases slightly, stock numbers drop through efficiency gains. But, again, the Commission doesn't seem to know if sheep and beef should be in the emissions trading scheme. They say "Review regulatory regimes". This is again a bit disappointing and a vague kick-for-touch.

Finally, James Shaw had asked the Commission how should Aotearoa's 2030 emission reduction target under the Paris Agreement work?

It's 30% below 2005 levels by 2030. The Commission says the target could be more stringent than the 5-year emissions budgets because credible international carbon credits could be imported. 'Credible' credits, they have to say that to distinguish them from the fake and fraudulent Russian and Ukrainian credits imported from 2013 as noted by the Morgan Foundation.

At the moment, there is no operative international carbon market. It also seems unlikely to happen under the Paris Agreement. The 'net zero by 2050' target incentivises countries to hold on to domestic carbon removals for offsetting their most emission intensive sectors. Any international sales (such as to Aotearoa) would only happen once domestic demand is met. A reliable credible supply of credits seems either unlikely to eventuate or alternatively be extremely expensive.

19 January 2021

Dear Federated Famers and Dairy NZ Pasture grazing livestock do not mitigate climate change

Grazed and Confused? How much can grazing livestock help to mitigate climate change? was a research report prepared by the FCRN in 2017.

FCRN’s coordinator and the lead researcher Dr Tara Garnett further explains the argument in a post titled Why eating grass-fed beef isn’t going to help fight climate change hosted by The Conversation.

Here is the video explainer which I dedicate to New Zealand's industrial pastoral agricultural lobby - Federated Famers and Dairy NZ.

02 June 2020

Dear James Shaw - continued excessive free allocation of units to big emitters is not a reform of the NZ Emissions Trading Scheme

Hon James Shaw
Minister of Climate Change
Contact Email j.shaw@ministers.govt.nz

Dear Minister Shaw,

I am writing to you to express my strong disappointment with your policy announcement "Emission trading reforms another step to meeting climate targets" of 2 June 2020.

This policy is a complete failure in terms of correcting the flaws in the New Zealand emissions trading scheme so that it prices emissions instead of insulating emitters from them.

The proposed "reforms" do not end the near-permanent excessive free allocation of emissions units to industrial emitters that the National Government introduced into the emissions trading scheme in 2012.

The reform proposed that I particularly object to is the Phase down of industrial allocation from 2021;

"Phase-out of industrial allocation at a rate of 1 per cent each year would start from 2021 and continue until 2030. The annual phase-out rate would increase to 2 per cent from 2031-2040 and to 3 per cent from 2041-2050."

Frankly this rate of phase out is a joke. It is not consistent with the Zero Carbon Amendment Act's 'Net Zero by 2050' goal.

Given that the free allocations are based on actual production, the quantity of units given to the biggest emitters like NZ Steel Development Limited and NZ Aluminium Smelter Limited, will in fact continue to increase out to 2050, in spite of the diminutive phase out rates you propose.

Let me estimate the phase out on an assumption of constant production at 2018 volumes.

I estimate that NZ Steel Development Limited (who were allocated 1,782,366 units in 2018 and if they maintain production at 2018 quantities) would still be allocated over 1 million units in 2048. They would still be allocated 942,202 units in 2050. That is only a reduction over the 30 years of 47%.

I estimate that NZ Aluminium Smelter Limited (who were allocated 1,324,556 units in 2018 and if they maintain production at 2018 quantities) would still be allocated over 1 million units in 2037. They would still be allocated 707,410 units in 2050. That is only a reduction over the 30 years of 47%.

As the free allocation of units (under Section 81 "Entitlement to provisional allocation for eligible industrial activities") is based on actual production quantities, emitters like NZ Steel and NZ Aluminium only need to increase annual production by 1% per annum in order to cancel out the 2021 to 2030 "phase down".

That seems quite likely as the free units allocated to NZ Steel Development Limited from 2011 to 2018 increased by 793,062 units. That equates to a growth rate in production of 6.35% per annum.

NZ Aluminium Smelter Limited's free allocation grew over the same period by 886,875 units or a growth rate of 9.56% per annum.

So to conclude, the proposed phase out rates of free allocation are not even likely to produce an absolute reduction in the free allocations to big emitters. As a policy for reducing emissions, this is completely perverse.

I also remind you that free allocations were only meant to be 'transitional' arrangements. That is to say, of a temporary nature. Of a finite duration. If the 2008 Labour Government version of the emissions trading scheme had been left as enacted, the industrial emitters would only be two years away from 0% free allocation. That scheme as you no doubt recall had a linear phase out of free allocations over a 12 year period. Transitional free allocations should not be 'phased out', they should just end.

I consider it completely egregious that you are proposing the continuation of free allocations to the big industries out to 2050.

It just completely undermines the good reputation you have earned with New Zealanders over your success in enacting the Zero Carbon Amendment Act and the Climate Commission. Frankly, what is the point of having either the Net Zero goal or the Climate Commission if the free allocations to industries continue to grow out to 2050?

Yours sincerely

01 June 2020

Ministers Sepuloni and Robertson announce discriminatory COVID 19 pseudo-unemployment benefit.

Hon Carmel Sepuloni
Minister of Social Development
Email c.sepuloni@ministers.govt.nz
Phone +64 4 817 8708

Dear Minister Sepuloni,

I am writing to you to express my strong disappointment with your policy of a new COVID 19 Income Relief Payment "a new temporary payment to support New Zealanders who lose their jobs due to the global COVID-19 pandemic" that you announced on 25 May 2020.

This is obviously a "Claytons" unemployment benefit/job-seeker payment targeted at people who can attribute their unemployment to the economic consequences of the pandemic.

As many welfare and community NGOs have noted, the proposed payment is significantly higher than the standard job-seeker benefit. Why are not all unemployed people deserving of the higher level of payment? You have retreated into right-wing prejudices of "deserving poor" and the "less deserving poor". I find that contemptible.

This arbitrary difference in the value of the payment is obviously unfair and discriminatory, I can't believe that it is happening under a Labour-led Government. "All this under a Labour Government" as Denis O'Reilly once said.

This ad-hoc policy is all the more galling given that you have rushed special legislation through Parliament to enact the policy. Where was the special legislation to enact all the majority of the 120 recommendations by the Welfare Expert Advisory Group that you have failed to adopt?

I do not see much "he waka eke noa" or "team of 5 million" or "be kind" in this policy. I think you are letting down the Prime Minister and everything she stands for in enacting such a discriminatory and anti-beneficiary policy.

Yours sincerely