Carbon efficiency v Carbon Tax
Dr William Rolleston is the Vice-President of Federated Farmers and originally published in the Dominion Post
The overwhelming scientific consensus is that human activity, including agriculture, plays a significant role in climate
change. Yet the Green Party’s proposal to tax biological emissions is bad policy for climate change and the economy.
Along with every other New Zealander, farmers already pay for their carbon dioxide emissions in the current Emissions
Trading Scheme. The issue, the Greens’ argue, boils down to biological emissions in the form of methane and nitrous
oxide.
Methane is a powerful but short lived greenhouse gas generated by bacteria in the stomach of farm animals. It lasts
around seven years before being converted back to carbon dioxide which is taken up by plants. The methane cycle is
complete when animals eat those plants in turn. Methane is measured as kilograms of carbon dioxide based on a one
hundred year timeframe. This timeframe has been chosen by international agreement but any period could have been chosen.
Because methane is short lived, but carbon dioxide from fossil fuels cumulative, this choice of timeframe materially
affects the calculation of methane in CO2 equivalent units and our perception of it.
Nitrogen enters farms from the atmosphere through nitrogen fixing plants and the application of nitrogen fertilisers.
Some of it is lost to the atmosphere as nitrous oxide, otherwise known as laughing gas, by direct bacterial conversion
or through animal wastes naturally breaking down. Nitrous oxide is longer lasting than methane but is also recycled.
Some would argue that the recycling of these gases tends to overstate agriculture’s contribution to climate change.
What is beyond doubt is that the world population continues to grow so does the demand for animal protein. New Zealand
produces less than one percent of the world’s animal protein so even if we stopped farming today, it would have little
effect on world prices since our lost production would be replaced by others.
It is here that views on what to do about New Zealand’s biological emissions diverge.
As the Green’s carbon tax proposes to tax dairy, with the door ajar for sheep and beef later, it would make us the only
country on earth to emissions tax primary food production. With no commercially viable tools to reduce farm biological
emissions, even the Green’s own report acknowledges ten percent of our dairy farms would be vulnerable, making our dairy
industry less competitive.
In order to significantly reduce our total biological emissions we would need to slash production. On current
technologies that is only achievable by cutting livestock numbers meaning less income for New Zealand to pay for our
roads, hospitals and the things we need from overseas. In 1990, the value of dairy exports was just over $2bn but in the
year to April 2014, it was a staggering $15.2bn.
Yet a carbon tax on New Zealand dairy farmers is bad for climate change. We need cool heads if you excuse the pun. Panic
only leads to poor decision making.
A carbon tax, Dr Norman argues, would encourage the development and implementation of new technologies to improve carbon
efficiency through increased productivity.
But such a tax perversely takes money from any industry that is better spent on developing low carbon technologies. If
Dr Norman’s statement is the measure then farmers’ actions prove it is not needed.
In 2011, Rosie the cow produced milksolids with 24 percent fewer emissions than her forebear did in 1990. At a
year-on-year improvement of 1.14 percent our dairy farmers have saved around five million tonnes per year of
CO2-equivalent emissions by becoming better farmers.
Even the United Nations Food and Agriculture Organisation (FAO) believe we have the most carbon efficient dairy farmers
on earth.
This is why reducing our production becomes a global emissions own goal since less efficient countries will fill the
gap. Given our carbon efficiency in dairy is almost twice the world average, if we transferred our dairy production
overseas, net global emissions would increase by a staggering thirteen million tonnes per year.
Hard as it is to accept we are doing our bit for global emissions by farming. I suspect there are elements within the
Green Party who understand this conundrum, which is why their response to agriculture has been ambivalent.
Furthermore, farmers are investing millions of dollars on research to mitigate agricultural emissions through the
Pastoral Agricultural Greenhouse Gas Research Consortium. In partnership with Government, the aim is to increase feed
conversion through reduced methane production while better utilising a valuable farming input – nitrogen.
The UN’s FAO report concluded that improving productivity is the key to reducing the impact of biological emissions on
climate change and New Zealand farmers are playing our part. We are also helping others and later this year, Federated
Farmers, the World Farmers Organisation and Government, will host a group of international farmers focussed on carbon
efficiency.
Increasing productivity increases carbon efficiency and climate change policies that deny this renders a carbon tax
misguided at best. Hard as I look, I cannot find any global or local benefits in a carbon tax on biological emissions
from agriculture.
ENDS