Media Release: Tuesday, 29 April 2008

Fine-tuning of emissions trading policies recommended

The Government is being advised to strengthen measures to enhance energy efficiency and provide clear national guidelines to protect natural resources from potential degradation as it moves to address the country’s greenhouse gas emissions.

The advice comes in a scoping report by Nelson based Cawthron Institute into potential environmental effects of the Government’s proposed Emissions Trading Scheme (and associated carbon reducing measures) over the period 2008 to 2020.

The report comes hard on the heels of the release of data showing New Zealand emissions for 2006 totaled 77.9 million tones, half a million more than in 2005, and 20% higher than in 1990.

Report Lead Author, Cawthron’s Sustainable Business Group Manager, Jim Sinner says the report clearly identifies a number of positive effects from an Emissions Trading Scheme.

These include:
* reduced soil erosion and sediment yield to rivers and coastal margins, gains in biodiversity in some areas, and better water quality from new forest plantings and reduced deforestation;
* improvements in air quality and human health due to reduced use of fossil fuels and increased walking and cycling; as well as,
* a reduction in greenhouse gas emissions over the longer term.

The Report recognises that existing infrastructure and investment are likely to limit initial transport and energy demand response without more active management from the Government, such as increased funding for and promotion of public transport.

Some benefits will be delayed, predominantly because it will be 2013 before Agriculture is included in the Emissions Trading system.

“There is a risk that these benefits will be lost,” Jim Sinner says, “if farmers don’t start factoring the future costs of emissions trading into their investment decisions now. So the Government should look at measures to encourage early emissions reductions in the agriculture sector, which would have other environmental benefits.”

Because the whole point of such a scheme is to shift behaviour towards business activities and lifestyle choices that generate less emissions, Jim Sinner says, “changes to land and resource use and operational practices will also inevitably impact on our environment potentially in both positive and negative ways.”

He says “this Report provides the Government with an opportunity to fine-tune the scheme and introduce complementary measures to mitigate those effects.”

Potential adverse effects identified in the report include loss of biodiversity via planting of pine trees on sites with significant native species, and increased pressure to alter rivers and other valued ecosystems and landscapes for generation of renewable electricity – e.g. from hydro, wind, wave or new technologies.

Jim Sinner says “because protection for these high value sites is currently variable, and poor in some regions”, the Report recommends the Government should fine tune the Scheme to minimise the risk to regenerating forests and other native vegetation, and introduce policies to guide and assist regional councils to better identify and protect areas of natural character and landscape, “as a matter of urgency”.

He says this would mean a concerted national effort to map areas of significant biodiversity and high value landscapes, with guidance through, for example, the NZ Coastal Policy Statement.

“Such land should be ineligible for planting pines to earn emission credits”, and while the mapping exercise was undertaken he says, “councils could also be required to undertake site assessments prior to any new plantings to confirm eligibility.”

The Report points out that the long term benefits of retaining indigenous biodiversity (including its potential for more permanent carbon sinks) more than outweighs the slightly more rapid short-term carbon sequestration rates of exotic trees.

Because the desire for renewable energy is likely to significantly increase pressure to dam or divert more of New Zealand’s rivers, the Report suggests one possible response would be to give preference for expansion of capacity on existing facilities or on rivers already damned or diverted, rather than exploitation of new river systems.

It also recommends strengthening measures to enhance energy efficiency, especially in relation to electricity; and a strategic environmental assessment of the role of hydro in a sustainable energy system for New Zealand. This should lead to guidance on the use of freshwater for hydroelectric power through the Government’s Sustainable Water Programme.

The Report acknowledges the Resource Management Act already provides some tools to address identified potential adverse effects, but Jim Sinner says “experience has shown local authorities struggle to keep up with the pace of land use change.”

He says it would therefore be “unwise to rely on local authorities to attempt to manage them without clear national guidance that goes beyond anything currently in place.”

The “Scoping Report For An Environmental Assessment Of The NZ Emissions Trading Scheme” was commissioned by the Government Emissions Trading Group following the introduction of the Climate Change (Emissions Trading and Renewable Preference) Bill in December 2007.

It also recommends monitoring and further investigation into:
* The likely effects of increased use of bio fuels on both New Zealand and global CO2 emissions and on the domestic environment – land, water and air;
* The most appropriate role for Electric Vehicles and environmental implications of flow-on effects in the electricity and waste systems;
* Factors influencing responsiveness of transport demand to price changes and how demand response can be enhanced; and
* The long term effects of nitrogen inhibitors – a fertiliser additive that can increase nitrogen availability to plants and reduce losses to air and waterways.

A more comprehensive investigation is also proposed to consider the role of additional large hydroelectric plants in New Zealand’s energy future, so that appropriate guidance can be provided to local authorities.

The authors of the report are:

Jim Sinner Sustainable Business Group Manager, Cawthron Institute
Judy Lawrence PS Consulting
Roland Sapsford Sustainability Solutions
Paul Blaschke Blaschke & Rutherford

ENDS

Cawthron website: www.cawthron.org.nz
For the Government media release, go to www.beehive.govt.nz/minister/david+parker

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Cawthron provides high quality research, technologies and testing. They specialise in supporting the aquaculture industry and in management and sustainable use of coastal and freshwater systems.
Operating since 1919, Cawthron is a private, independent, not-for-profit research centre.
Situated in Nelson, they employ over 150 scientific and technical staff. Cawthron generates revenue from competition-based research contracts and commercial enterprise.

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