Summary of Options
Sustainable Land Management and Climate Change
The Government’s proposed Plan of Action would contain a set of goals for
agriculture and forestry to guide action on climate change and identify actions that
could be taken now and in the long term. The Plan of Action is supported by four
policy ‘pillars’, with a range of possible policy options under each pillar. The
government is seeking feedback on which mix of options might make up a balanced
policy package that achieves tangible emission reductions, best positions the land
based sectors to adapt to climate change and to ensure these vital sectors continue
to thrive. No decisions have been made. The government will consider a preferred
package of sustainable land management policies following widespread consultation
closing on 30 March 2007.
Pillar 1 – Adapting to Climate Change
Actions that will help land managers adapt to the environmental and economic
effects of climate change.
The land management sectors will bear the brunt of the increases in storms and
droughts from climate change. We need to work with the sector to develop resilient
land management practices. Ideas of what could be in a package of initiatives
include: more research investment, better information and coordination, improved
awareness and building on programmes already in place, like the Sustainable Water
Programme of Action, Water Enhancement and Adverse Events Planning and
Recovery, and flood risk.
Pillar 2 – Reducing emissions and creating carbon sinks
Measures to reduce greenhouse gas emissions from agriculture and deforestation,
and to create new forests.
Agricultural emissions account for nearly half our greenhouse gas emissions and are
increasing significantly. If deforestation continues at the current rate, increased
emissions could reach the same level as the increases from agriculture. On the
other hand, new forests can make a major contribution by removing carbon dioxide
from the atmosphere. These policy options are aimed at ensuring that future land use
takes into account the environmental and fiscal implications of greenhouse gas
emissions.
There are 16 possible options listed in Pillar Two: ten in agriculture and six in
forestry. The Government is looking for guidance on which to choose before
deciding on a preferred policy package. The options are:
Agriculture options (10 options)
(a) Actions for the long term
1.
Research:
Increased government-sector research into how to reduce agricultural
greenhouse gas emissions and increase farm productivity.
2.
Technology transfer:
Skills and technology to improve farmers’ knowledge about how to reduce
emissions and adapt (eg demonstration farms, training, discussion groups
and advisers).
3.
Voluntary reporting:
Development of a system for the voluntary reporting of emissions by
individual farmers.
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Any or all of these three long-term options could run alongside any of the options
numbered 4-10.
(b) Action for encouraging emissions reductions now
4.
Incentive to use nitrification inhibitors
A government-funded incentive to encourage farmers to use nitrification
inhibitors to significantly reduce nitrous oxide emissions from agricultural
soils.
5.
A charge on nitrogen fertiliser
A government imposed charge that reflects the environmental cost of nitrous
oxide emissions from fertiliser use, calibrated to the international price for this
greenhouse gas.
The government envisages these two measures would work hand in hand, and that
any inhibitor incentive would be balanced with a nitrogen charge (and vice versa).
Options 6, 7, and 8 below are broader than Options 4 and 5. They could run alone,
or as part of a package containing a mix of emissions reduction activities.
6.
7.
8.
Tradeable permit regime to reduce agriculture emissions
The government allocates tradeable agriculture permits for greenhouse gas
emissions (based on farmers’ current level of emissions) which farmers can
buy or sell to reflect whether they are increasing or reducing their emissions.
Offset scheme for agricultural emissions
Farmers can offset growth in their emissions by other activities such as
planting trees, using nitrification inhibitors or improving energy efficiency.
Resource Management Act Standards to control agricultural greenhouse gas
emissions
A National Environmental Standard, prepared by the Minister for the
Environment, would require local authorities to put limits on a farmer’s
greenhouse gas emissions.
(c) Action focusing on changing land use from forestry to agriculture
9.
RMA standards to control new agricultural land use after deforestation.
A National Environmental Standard would require local authorities to control
increased greenhouse gas emissions (compared to emissions from previous
forested land) and other environmental effects (such as water quality) when
formerly forested land is converted to agriculture.
10.
Charge when deforested land is used for agriculture
Land owners would pay a one-off government charge on expected
agricultural emissions created when deforested land is used for agriculture.
The charge would be set at a rate per tonne of carbon dioxide equivalent, for
the additional emissions created from the new agricultural use.
Option 10 could be used in conjunction with Deforestation Option 1 (a simple flat
charge for deforestation)
Forestry option (6 options)
(a) Afforestation options
Both these options apply to forests established from 2007 onwards.
1.
Afforestation Grant Scheme (AGS)
People can tender for a grant to establish new Kyoto-compliant forests post
2007. (The Crown would retain all sink credits and associated liabilities.
Preferred tenders could be weighted based on other environmental benefits.)
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2.
Choice between AGS and devolved Kyoto credits and associated liabilities
Land owners choose either the AGS or opt to receive forest sink credits plus
their associated liabilities.
(b) Deforestation options
These options apply to pre 1990 non-Kyoto forests. Mature radiata pine forest is
estimated to absorb and store around 800 tonnes of carbon dioxide. When land is
deforested, the loss of stored carbon is estimated to create a liability to New Zealand
of about $13,000 per hectare at current forecast prices for carbon.
1.
Flat charge on land use change from forestry to another use for the loss of
stored carbon
A charge, set at a rate per tonne of carbon dioxide equivalent, would be
imposed for converting forests to another land use.
2.
Tradeable permit regime
The government allocates tradeable deforestation permits to forest land
owners. Those who deforest are liable for emissions above the level of
permits they hold. There could be a threshold so that small areas of
deforestation do not face a cost including deforestation for weed control.
3.
Centrally determined deforestation levels
Pass legislation to make it illegal to deforest land unless government approval
has been granted (to ensure total deforestation remains within a government
established target.
4.
RMA controls on deforestation.
A National Environmental Standard would require local authorities to
prescribe limits for greenhouse gas emissions for the explicit purpose of
controlling deforestation.
Pillar 3 – Capitalising on the business opportunities from
climate change
Actions to help land-based businesses take advantage of new business
opportunities.
A world focused on climate change creates many new business opportunities.
Researching, developing, commercialising and marketing new ways to address
climate change requires an integrated and managed approach. Options include
identifying new business opportunities, overcoming barriers to development,
identifying research needs and raising public awareness of the advantages and
importance of adopting new technologies.
Pillar 4 – Working together
Ways that the land management sectors and the Government can work together,
now and in the future, to respond to the challenges and opportunities of climate
change.
Because climate change issues will be on the agenda for years to come, the
Government wants to build a constructive and durable relationship with the land
management sectors. This could include exploring collaborative arrangements in
areas such as rolling out new practices and technologies, demonstration farms, and
sector advice to government on industry and export issues.
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Key Facts – Climate change, agriculture and forestry
Climate Change

Climate change means a change of climate due to global warming, which is
attributed directly or indirectly to human activity, and which is in addition to
natural climate variability.

Greenhouse gases trap heat radiated from the ground (the greenhouse
effect), causing the earth’s atmosphere to heat (global warming). The main
greenhouse gases (covered by the Kyoto Protocol) are carbon dioxide,
methane, nitrous oxide and some industrial gases.

The Kyoto Protocol is an international agreement, which sets legally binding
targets for emissions on countries that have ratified the agreement. New
Zealand’s target is to return to its 1990 level of greenhouse gas emissions
between 2008-2012 (the first Commitment Period) or take responsibility for
excess emissions.

In 1990, our total greenhouse gas emissions were equivalent to almost 61.5
million tonnes of carbon dioxide - enough to fill about 10 million hot air
balloons every year. The most recent data indicate that total greenhouse gas
emissions in New Zealand have risen by 21.3 percent since 1990 and we will
be above our emissions target during 2008 to 2012 if we do nothing to reduce
our emissions.

The principal growth in New Zealand's emissions comes from increased
carbon dioxide (CO2), primarily from the energy sector which has grown by
almost 33.8 percent relative to its emissions in 1990. Most of this increase
has come from transport and electricity generation. Agricultural emissions
have grown by about 1 percent each year since 1990 but start from a larger
base (currently 49 percent of total emissions). There has been a major
increase in emissions from deforestation over the last three years.

New Zealand is ranked 12th in the world for greenhouse gas emissions per
head of population.
Climate Change - Agriculture

In New Zealand, nearly 50 percent of greenhouse gas emissions come from
agriculture, mostly from methane from farm animals (belching), and nitrous
oxide from soils. Globally, 14 percent of greenhouse gas emissions come
from agriculture. Agricultural emissions are higher as a proportion of our
total emissions compared to other developed countries, which predominantly
release carbon dioxide from energy production, transport and industry.

Our emissions per unit of agricultural production are low compared to other
agricultural producers, a reflection of our farmers’ efficiency in pastoral
production.

Even though we produce less than one percent (0.2 percent) of the world’s
greenhouse gases, the physical impact of climate change will affect New
Zealand’s productive base far more than non-agricultural countries through,
for example, severe droughts and increasing floods. New Zealand wants the
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world to take action to reduce the worst effects of climate change. We can
only influence others’ actions if we are seen to act ourselves.

Greenhouse gases are rated according to their global warming effect.
Methane is 21 times more powerful than carbon dioxide. (Over 100 years one
kilogram of methane produces 21 times the global warming effect of one
kilogram of carbon dioxide).

Nitrous oxide is 310 times more powerful than carbon dioxide. In agriculture,
nitrous oxide is produced when nitrogen from animal urine and nitrogen in the
soil breaks down. It increases when more nitrogen is present in the soil, for
example when nitrogen fertiliser is added. Nitrous oxide concentrations have
risen considerably in the past two centuries with the expansion of pastoral
farming and use of nitrogen fertilisers.

More research is needed to find ways of reducing agricultural emissions.
There is currently no viable way to reduce methane other than cutting stock
numbers. However there are opportunities to reduce nitrous oxide.
Climate Change – Forestry

Growing forests absorb carbon dioxide from the atmosphere and lock it up in
plant material. These are known as “forest sinks”. Significant quantities of
carbon dioxide are released when trees are cut down. In the first
Commitment Period of the Kyoto Protocol, countries earn credits for each
tonne of carbon dioxide absorbed by forests planted after 1990. This is offset
by any future carbon emissions from that forest, for example from harvesting.

New forests have many benefits other than for climate change. They control
erosion, reduce the risk of storm and flood damage, improve water quality
and enhance biodiversity. This contributes to sustainable land management.

Deforestation is the conversion of forest land to another land use such as
farm land. It is not simply the harvesting of forests provided they are
replanted and kept as forest.

Under current forecasts, deforestation is likely to result in as many emissions
as is projected by the growth in agriculture. It doesn’t take much land to
generate major emissions from deforestation. On average each hectare of
mature pine forest that is deforested generates around 800 tonnes of carbon
dioxide emissions. At an estimated carbon price of $15.92 per tonne, this
would cost the country about $13,000 per hectare from 2008.
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Sustainable Land Management and Climate Change
Questions and Answers for Media
What is in the discussion document?
The government wants to put in place an enduring and broad Plan of Action to deal
with the risks and opportunities of climate change for the agriculture and forestry
sectors. A number of ideas are canvassed in the document to help the sectors adapt
to the impacts of climate, reduce emissions and create carbon sinks, and capitalise
on possible business opportunities. This includes opportunities for the government
and sectors to work together to address climate change.
What is the government’s overall intention?
The government wants a balanced set of policies that manages the huge risks of
climate change, supports economic growth and outlines actions to take now and in
the future. It wants to achieve tangible reductions in agricultural and deforestation
emissions, and increases in forest sinks. It wants to help the sectors prepare for a
more demanding future in which there will be a cost on greenhouse gas emissions.
What are the additional benefits of taking action to reduce greenhouse gases?
There are many broader environmental benefits arising from actions to reduce
greenhouse gases such as improved air and water quality, reduced erosion and flood
risk and the protection of flora and fauna. These are sustainability benefits.
Are specific policies put forward in the discussion document?
Yes, particularly in Pillar 2 where actions and policy options to reduce emissions and
create carbon sinks are well developed and quite specific. The government is
seeking feedback on these before deciding on a preferred policy. Specific feedback
on 16 options for agriculture, afforestation and deforestation is sought. Sections on
adapting to climate change, making the most of business opportunities and working
together are less specific and the government is hoping to provoke some original and
creative thinking on policy options.
The only way to reduce agricultural methane emissions is to reduce stock
numbers – so what can farmers do?
The government accepts that the agriculture sector faces particular challenges in
reducing methane emissions. That’s why the discussion document focuses on
reducing nitrous oxide emissions as an option, because it could achieve some
immediate gains. Every sector of the New Zealand economy is expected to do its bit
to reduce emissions and the land management sectors are no exception. Other
actions farmers can take to reduce emissions longer term, are also canvassed in the
document (Pillar 2). They include investing more with the government in research on
methane emissions, offsetting emissions with more tree planting, and developing
crops like biofuels.
Is there already a government view on what actions it would like to see in final
policy?
No decisions have been made. The options are being discussed with the sector
before decisions are made.
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Why is climate change an important issue for New Zealand?
New Zealand’s climate is already changing as a result of global warming. Research
from NIWA forecasts a range of environmental effects of climate change including
more severe droughts and heavy rainfall events, temperature and sea level rises and
increased risk of forest fires. Economically, a recent report for the UK Treasury by Sir
Nicholas Stern said climate change risks were “as great as those associated with the
great wars and the economic depression of the first half of the 20th century”. This
would have huge implications for New Zealand’s agriculture and forestry.
What is the importance of building a strong partnership with the sector?
Climate change will be on the agenda for decades to come. The government wants
to build a strong and enduring working relationship with the agriculture and forestry
industries so that the issues are addressed in the long term.
What is the government hoping to get from the sector during consultation?
The government is looking for free and frank discussions on the various policy
options available. It’s encouraging farmers and foresters to help develop a balanced
package of policies that will help the land management sectors adapt to the impacts
of climate change and reduce emissions. It’s about getting ready for a future that will
be more demanding and include some price-based measures.
Where to from here?
Ministry of Agriculture and Forestry staff will be holding consultation meetings and hui
around the country early next year. The closing date for submissions is 30 March
2007. Submissions can be completed in the tear-out forms at the back of the
document or online from January.
For more information on land management and climate change see:
www.maf.govt.nz/climatechange
For more general climate change information including the government’s various
policy consultations, see
www.climatechange.govt.nz
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