With Labour’s announcement about bringing forward the ETS there has been a bit of hype about what that means. John Key talks about it as if the ETS is like throwing our dairy industry to the wolves with similar comments by others.
There has been a lot of rhetoric but few hard figures. How much impact will this have on the dairy industry?
Luckily for the quality of debate in this country, the Ministry for the Environment knows the answer to that:
The cost of emissions for farmers will depend on a range of factors including the size of the farm, the farm type, and the intensity of operations. Initial analysis suggests that in 2015, at a carbon price of $25/tonne CO2-e, farmers will face the following costs on average:
around 2.5 cents per kilogram of milk solids
Yes, you read it right. 2.5 cents. How much does a farmer get for selling a kilo of milk solids? $8!
The first person to tell me what percent 2.5 cents is of $8 gets a green star.