Climate Change: The Challenges Facing The Primary Sector

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Climate Change The Challenges Facing The Primary
Sector
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Five Challenges To Achieve Sustainable Farming

• Finding the energy needed to power the economy
  and
• Transitioning to a more sustainable energy future
• Managing the potentially huge bad - and good -
  impacts of climate change
• There are another two challenges faced especially
  by the primary sector
• Allocating precious fresh water resources, and
  for the first time in the primary sectors
  history
• Avoiding a head on collision with the aspirations
  and values held by the majority of New
  Zealanders. Ill explain further later in this
  address.

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Climate Change The prudent know the debate is
over

• The evidence is firming
• Trivial debates here mask the major trends and
  the choices we have
• We can be annoyed or see opportunities
• We can give up on meeting emission targets or
  join the middle majority who are up to giving it
  a go
• We can keep heads in the sand or profit
  through health, community and business benefits
  of properly managing climate change challenges
• New Zealanders are incredibly proud, optimistic
  and determined to protect the environment and our
  quality of life (74 view it as an urgent and
  immediate problem)
• The time has come, not for prevarication, but
  positive participation

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Climate Change What We face

• NIWA projections for New Zealand in the 2080s
• Mean winter air temperature up 1.6 to 2.2 Deg C
  estuary and coastal sea temperatures rise,
  affecting aquatic ecosystems
• More intense storms Maybe same number, but with
  stronger winds, more rain
• More El Nino-like Westerly wind stream over New
  Zealand
• More sediments and damage from wind and waves
• Sea rise of 30-50cm by 2100, accelerating coastal
  erosion, sedimentation, salt intrusion into
  freshwater

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Climate Change What We face

• NIWA projections for New Zealand in the 2080s
• Agricultural production may rise in some areas
• Changing land uses in some areas will carry extra
  costs
• Hotter summers will bring new pests and diseases
• Snowlines and glaciers are expected to retreat,
  changing water flows in major South Island rivers
  (and aggravating the contest for fresh water
  allocation)
• Most significant economic costs arise from
• Fourfold increase in flood risk in most regions
• Twofold to fourfold increase in drought risk,
  especially in eastern regions eroding and
  retreating coastlines and changing biosecurity
  risks.
• The costs of these impacts are likely to be
  highly significant for New Zealand. The February
  2004 flood cost was about 0.3 billion. The late
  1990s droughts cost well over 1 billion
• We can choose to profit from research on
  emissions reductions

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Climate Change How We Face It

• 2005 Business Council research project
  Establish principles to guide climate change
  policy in New Zealand
• Followed on other related research and proposals
  on
• securing our energy future to 2050, and
• reducing transport emissions by paying cash
  incentives to buyers of climate friendly cars
• The good news
• We have plenty of energy and some emission
  control options

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Statement of Principles

• The Business Council accepts the view of
  scientists that climate change is occurring and
  is most likely caused by human activity including
  the use of fossil fuels.
• The Business Council believes that it is prudent
  to take reasonable steps to reduce emissions of
  gases that contribute to global climate change.
  The Business Council is therefore committed to
  Kyoto and/or a better alternative, should one
  become available.
• New Zealands approach should aim to establish
  lowest cost mitigation and adaptation methods by
  sector.
• It is important to identify the long term
  signals, such as carbon pricing and supporting
  policies, to reduce uncertainty and enable
  business to respond positively to the policy
  implications by incorporating them into their
  investment and business planning.

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Statement of Principles

• 5. Adaptation is an important complement to
  greenhouse gas mitigation policies as managed
  systems can often deal with the impacts better
  than natural systems.
• Climate change policy frameworks require a
  longer-tem perspective and mechanisms to allow
  adjustments and further development over time.
  It must be based on the principle that everyone,
  in every part of the economy, takes some
  responsibility for reducing emissions.
• The Business Council acknowledges that it is
  unlikely that nations with the highest reliance
  on fossil fuels and the most rapidly growing
  emissions will enter into a Kyoto style agreement
  in the current form. Further action must be
  taken to more fully involve the rest of the world
  in a solution to address the challenges of
  climate change.

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Recommendations
The Business Council believes that the basic
criteria for a good climate change policy

• must have a broad scope applying to all sectors
  of the economy and to multiple GHG.
• must be economically efficient sending price
  signals for lowering atmospheric carbon intensity
  through energy conservation, fuel selection,
  technological innovation and new capital
  investment.
• must reduce GHG gradually over a long time
  starting now
• should align with other energy policy objectives
  - recognising the value of a diverse energy
  supply.
• must provide benefits - independent of reducing
  GHG emissions.

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Key Recommendations to Government

• Commitment to entering an international cap and
  trade regime post 2012, with multi party support
  for this an an emissions path
• Invite business to identify projects which will
  reduce emissions (at the same cost as would
  otherwise be paid in Kyoto obligations)
• Allocate grandparent emissions credits to cover
  off existing investment
• Require significant emitters who want
  grandparenting rights to measure emissions
• Require significant emission-producing projects
  starting before 2012 to certify they can pay the
  world price of carbon
• Talk with other governments and sectors where
  there may be competitiveness issues and agree on
  an appropriate sharing the cost of lowering
  carbon in the atmosphere (e.g. Australian dairy
  industry)
• Multilateral lending agencies fund low-carbon
  plants

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Other Challenges For Sustainable Farming

• Fresh water security
• First in first served not sustainable
• Farmers are losing to cities worldwide
• World demand for water tripled in past century
• The number needing food rises from 6.1 billion to
  9.1 billion by 2050 (an opportunity for New
  Zealand)

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Other Challenges For Sustainable Farming

• Take part in developing a fresh water allocation
  policy
• Build broad based solutions
• Shaping policy is better than fighting it later
• Funding change out of growth is easier than
  funding out of failure

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Potential Collision with Middle New Zealand

• Like you, New Zealanders are innovators and want
  growth with a major condition
• Preserve the New Zealand Quality of Life. New
  Zealanders highly value clean air and streams.
  The ability to go fishing and swimming is part of
  our core identity. For New Zealanders lifes a
  beach
• A failure to effectively respond to fix polluted
  waterways, while being excused from immediate
  emissions reductions will not win Middle Majority
  New Zealand support for the primary sector.
  (Initiatives like the Fonterra-led Dairying and
  Clean Streams Accord are making a difference and
  are better than regulation)

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Potential Collision with Middle New Zealand

• 12 soft voters are willing to switch on water
  security
• 49 soft voters say they might switch to a party
  placing greater emphasis on preserving the New
  Zealand quality of life

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Economic instruments or regulation?

• Economic instruments like tradable emission
  credits, and water rights will deliver greater
  security of investment
• These can create new profit centres and
  opportunities
• Avoid the voting imbalance between town and
  country
• Let us seize the new opportunities to
  collaborate, introduce new technologies and
  benefit your businesses, the environment and
  improve the quality of life for New Zealanders

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Climate Change - Summary

• Climate change is real
• Countries will want other countries to share the
  cost of adjustment
• Fix what can be fixed cost effectively first
  (transport emissions)
• Methane from sheep and cattle will probably take
  longer to fix than even clean coal technology and
  sequestration
• Invest more in research on reducing methane from
  ruminants
• Join in and influence the debate and policy