Doing our fair share? Watch the Brits: assessing our Climate Change responsibilities

Well-known columnist Colin James recently observed that there are rumblings from on high in UN climate change circles that New Zealand risks losing its status as an earnest player and honest broker because the current ETS is “loose and without a cap”, and because the Government’s 2020 emissions reduction target “has so many conditions that it doesn’t amount to a row of beans.”

Quite.

The Green Party had formed this general view some time back, criticising Labour’s ‘08 ETS (while helping to vote it in) for being too weak, and opposing National’s ‘09 amendments for weakening it to the point of being totally supine.

The latest policy announcements by National flatten the current ETS to a scheme that will make it unlikely to cut gross emissions by one tonne, and relying exclusively on forestry to meet our modest Kyoto Protocol target.

One of National’s election pledges was to ensure that any changes to the ETS would be fiscally neutral.  Its latest moves would impose a net fiscal burden of $328 million – so a Question in the House was in order.

The Associate Minister’s reply was a model of (complete) circumlocution: the additional cost was consistent with the pledge because it ought not be a ‘tax-grabbing revenue earner’ from households and the productive sector.

In fact, as the penetrating book The Carbon Challenge makes clear, the current ETS is, exactly, a transfer of wealth from the households to the corporate sector.

The Minister’s second reason for the ETS changes was to serve the interests of the ‘wider economy’ rather than a narrow Government interest.

In fact, the underlying rationale for emission trading schemes, everywhere, is to protect the global economy, of which the New Zealand-wide economy is a component part, from short-term disruptions caused by extreme climate events that are beginning to occur already. We are all in this together – Government, households, corporates; farmers; rich countries, poor countries; everyone.

The Government unwittingly separates the GFC from the Global Ecological Crisis, preoccupied with the former, essentially unaware of the latter, and to extent it acknowledges global-national problems out there, wrongly believes it can ‘balance economic opportunity with environmental responsibility’.

I invited the Government to consider emulating the British model on national climate change policy.  The UK Climate Change Act 2008 establishes an independent Commission, a self-binding emissions reduction of 80% by 2050, and five-yearly carbon budgets along the way.  It is the product of several decades of political leadership over the past two decades, from successive British governments, both Conservative and Labour.

The New Zealand Minister had not heard of it.  Whatever.  He does not want Britain’s economic mess. We have a clear, credible ETS, over here which, incidentally, we must not unduly ‘ratchet up’ in these globally-fragile economic conditions.

Oh, and by the way, lest we get it wrong.  Deferring carbon obligations in the NZ ETS is not subsidising polluters – it is ensuring the absence of a cost on them.

There now.

21 thoughts on “Doing our fair share? Watch the Brits: assessing our Climate Change responsibilities

  1. The UK is slowly but surely backing away from the targets the Climate Change Act has set. They just cant afford it.

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  2. We can only hope the UN cast us aside entirely. Force-mongering failures of all they entertain. Which is their only saving grace, really.

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  3. “In fact, the underlying rationale for emission trading schemes, everywhere, is to protect the global economy”

    There it is again Dr Graham. We have to take up this gauntlet which has been slapping Greens in the face for decades. The ECONOMIC system is the problem, and the underlying issue is the requirement that is built into the current system of money, for continuous growth.

    Time to put some things in perspective.

    1. Fractional Reserve Banking – the underpinning principle of our economic system and every other nation’s economic system, requires continuous growth. Watch a current economist when you bring up the “d” word (Deflation) and note how the poor sap runs in terror from the very concept.

    2. The Society interacts with the Environment THROUGH the Economy. We can’t meaningfully alter our environmental impact except by modifying our economics.

    3. Productivity is a LIMITED virtue. Goods and services produced per person hour can only increase so much before the unemployed outnumber the employed.

    So so so… our approach to this – to date – has been wrong. Not that a Carbon Tax won’t help, but it won’t SURVIVE in the economic environment that we currently “enjoy”. No way to make it widespread enough and long-lasting enough without it being circumvented, rorted and eviscerated by the money people.

    What we have to do is reset the economic system. I suggest a close reading of Steve Keen.

    http://www.debtdeflation.com/blogs/manifesto/

    We have to have a MUCH stronger economic impact as a party… because we have to CHANGE our impact on the environment, and as I repeatedly point out, this is only possible by altering our economics…

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  4. …will make it unlikely to cut gross emissions by one tonne

    …the current ETS is, exactly, a transfer of wealth from the households to the corporate sector.

    Kennedy, both these statements have been true since day one. Nothing has changed, and these are exactly the measures that the Green Party has consistently supported.

    I’ve been whining about this on this very blog since at least 2005 and probably earlier.

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  5. No dbuckley, the current ETS is nothing like the measures that the Green Party supported when Labour passed its ETS legislation. That legislation would have had some effect, but the NACTs have changed it to the point where it is the tax payer that pays for the emissions, not the polluters.

    Trevor.

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  6. In what universe does anyone other than the end customer ever pay for anything?

    Any cost anywhere along the chain is paid for by the customer.

    Now you can try and use words to fudge that, but its basically a terminological inexactitude.

    The end user always pays.

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  7. The only way the ETS will reduce emissions if it makes power and fuel so expensive people stop using them. A successful ETS will take the food out of the mouths of hungry children in NZ as their mothers try to fill their fuel tanks. Don’t worry about the rich, they will be fine, it is the poor who will be hit cruelly by an ETS. And make no mistake the only people that pay are the consumers. Emitters pass all costs on.
    At the moment emissions have no cost, we are meeting our Kyoto obligation and would have done without an ETS. Not charging emitters is therefore not a subsidy because there is no liability. Not one dollar is taken from a taxpayer and paid to anyone because farmers aren’t paying for their bio emissions. Bio emissions are of course harmless, just like bio fuel.

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  8. @dbuckley

    Cost are not always passed onto the consumer directly.
    Profit can be affected by a rising cost of inputs if revenue remains static.
    This can occur in a market where there is intense competition or options for substitution, for example.

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  9. Robin – the number of mistakes that you have managed to insert into one or two paragraphs is truly impressive. In no particular order:

    If New Zealand reduces its emissions below our Kyoto commitments, then we can earn foreign exchange by selling the difference.

    While an ETS will increase power prices, emissions can be reduced by changing the way power is generated as well as by reducing demand for power. Higher power prices will make generation from renewable resources such as wind farms and geothermal more attractive and there are several renewable energy projects waiting for suitable economic conditions such as a more effective ETS before they will go ahead.

    Higher power prices will encourage investment in power saving technology such as double glazing and insulation. An effective ETS will also encourage fuel shifting to renewable resources such as firewood rather than gas or coal, or from electricity generated by gas or coal.

    Profit the government makes from an effective ETS can be returned to feed the poor by easing the tax regime and increasing benefits, or by other social expenditure (such as lowering medical costs).

    Bio emissions of nitrous oxides and methane are harmful.

    Trevor

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  10. The end user always pays. Not True! Yet “There Ain’t No Such Thing As A Free Lunch” (TANSTAAFL)… both statements beg several questions –

    For what?
    How Much?
    When?
    At what interest rate for any deferral?

    For energy.

    An unrealistically low price.

    Today – AND when the rest of the bills come due in 100-300 years from today.

    A series of promissory notes with balloon payments, with an uncertain amount likely to approximately one human civilization and 3-5 billion lives. Robin – you said “there is no liability” as though the CURRENT LEGAL liability was the only thing that counted. However, the liability being embraced by your attitude is quite massive. However the “CURRENT” costs are subsidised by future generations due to the “CURRENT” laws that leave the atmospheric commons completely unprotected. The fossil fuel energy producers are the ONLY industry group that is permitted to dispose of wast products at no cost. They wreck that unprotected commons and pay no price whatsoever.

    TANSTAAFL says that the bill will be paid, but NOT by whom.

    The “end user” may die before paying. The “end user” may be a simple (or complicated) thief. Actual costs may be distributed to any number of people who had nothing to do with and had no benefit from the “use” of something… across several generations. That statement “The end user always pays” is simply false. It is a good sound bite sort of thing, but it is actually QUITE wrong.

    We are the end users of the energy, and in this generation we are not used to paying anything like the full price… (which would be a doubling and more of energy derived from CO2 emitting sources in this country. In places like the US where the use of the CO2 emitting sources is even more subsidized by ignorance, it would likely more than triple) … as long as we can continue in blissful ignorance we will, and there are those among us who are determined to keep us ignorant for as long as possible rather than change their business model to account for the true cost of emissions.

    We should pay cash though. We can (and will) do what the economic laws (which are conveniently ignored in this case) expect and demand of us which is to use the cheaper – non CO2 emitting – sources of energy, and to use LESS energy by investing more in efficiency. Cheaper in the long run because the compound interest equivalent to “one habitable planet” isn’t paid.

    Rising costs for CO2 emitting energy sources and processes is NOT the same as rising costs for ALL energy sources… and the speed of switching from one to the other is something the market decides based on the price signals available to it. All a tax or ETS does is put a price signal in place that the market uses to to ultimately deliver goods and services that emit less CO2 as efficiently as possible.

    Returning the tax to the lower echelons of the economic milieu reduces the impact on the poor and leaves the government with no net increase in funds.

    The purpose is not to impose a tax, or to grow government, or to redistribute wealth. The purpose is to prevent the emission of CO2.

    If you insist that it make the poorer people in the country even poorer by returning the tax received as a result in some inequitable manner, the END effect will be to bring forward the revolution that more thoroughly ends the domination of the one-percenters. I’m good with that too.

    I don’t CARE at this level, as long as CO2 isn’t emitted in the process… because social justice WILL emerge eventually and be stolen again in the same endless cycle as has gone on for all of human history and the process won’t be interrupted by anything as inconsequential as the end of human civilization.

    At a more immediate level I regard the current social INjustice as being intolerable and QUITE revolting, and I wish to abridge the one-percenter’s and their current reign of error. Yet that purpose is quite significantly less urgent to me than the CO2 problem. The first requirement is to survive.

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  11. NZ is already under its Kyoto obligations, it could sell the surplus but no country will buy them, there is no demand. Secondly there is no integity to them, that is because our Kyoto target is set using gross emissions and our emissions during the commmitment period are calculated using net emissions. (net emissions are gross emissions less forestry removals)
    Net emissions have increased 59% since 1990, gross emissions by 20% but becasue our net emissions today are below our gross emisssions of 1990 we are in credit.
    If any one thinks there is any integrity in selling Kyoto AAU’s created by cheating in rhis way then they are more interested in finacial gain than saving the planet.
    Kyoto is a nonsense, the ETS is a nonsense because it takes food out of the mouths of little hungry children, old people in cold houses shivering in front of a tiny heater so that politicians can pretend they are doing something about global warming.
    Renewable energy is not reliable, it is expensive and the consequences of striving for such a utopia are hungry children and cold old ladies.

    Livetsock emissions add not one gram of methane to the atmosphere. No evidence exists in teh world to state otherwise. I suggest the onus is on those who want to tax these emissions to get proof that they alter the composition of the atmosphere by increasing the concentration of methane, (atmospheric methane did not increase at all last year, + or – 3 parts per billion with an uncertainty of 68%). With no proof there is no justification. I can tell you categorically there is no scientific link between livestock emissions and atmospheric methane.
    Cow belches methane -methane oxidises to CO2 – CO2 grows grass ( the more there is in the atmosphere the more it grows) Cow eats grass -cow belches methane.

    Any business which can’t pass on the ETS costs to the poor consumer,(and there are very few) cut costs eg jobs, even more unemployed.
    An ETS is an excellent way to ruin a country. And as for our trading partners, no country that stayed out of Kyoto has been punished by overseas consumers yet we were told they would. People buy on price that is why caged eggs are far more popular than free range, that is why we do not need an ETS to be able to sell our produce.

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  12. Robin said that renewable energy is expensive.

    Yet power companies in New Zealand and around the world are adding more and more renewable generation, using wind farms and photo-voltaic arrays. The main cost of renewable energy is the plant cost – the fuel is usually free (with biomass being an obvious exception). Interest rates are very low at the moment and likely to stay that way for a while, so the plant cost can be spread over a long period and still have a profitable system. As renewable energy technology improves, the plant costs and maintenance costs will fall and the plant lifetime will increase, making renewable energy cheaper.

    Meanwhile, peak oil, peak gas and peak uranium will ensure that well within the lifetime of your average non-renewable power plant, the fuel costs will increase significantly. Even the cost of coal can be expected to rise as the easily mined coal runs out and demand soars – unless renewables are used instead.

    Trevor.

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  13. Robin said “Renewable energy is not reliable…”

    That old chestnut again.

    No generation is entirely reliable, which is why all reliable generation networks have reserve capacity. A number of thermal power stations in New Zealand and around the world have had to reduce their output at times because they couldn’t get enough cooling water, or because the output water would have been too hot to discharge into the local rivers. And all generation systems need some regular maintenance during which they need to be shut down. In fact geothermal plants have some of the highest availabilities of the various forms of generation.

    Not all generation needs to be reliable to be useful. Intermittent renewables such as wind, solar photovoltaic, wave and tidal can still generate valuable contributions to the grid saving on thermal fuel or allowing water to be stored in hydro lakes. (Geothermal plants can also be used to store energy for later use.) Diversification of generation by method and/or location can help to reduce the chances of all the intermittent generators having high output simultaneously or having low output simultaneously. And demand management can be used to accept these peaks and troughs. A variety of energy uses can tolerate breaks in supply, such as pumping or desalinating water for irrigation use.

    However looking ahead, peak oil, followed by peak gas and peak uranium will ensure that non-renewable generation plants will be struggling to find fuel and will be the ones that are unreliable. Recently there were two large blackouts in India, caused in part by the coal fired power stations not having enough fuel to burn. A reliance on thermal generation will lead to hungry children and cold old ladies, to use Robin’s expression.

    The India power cuts started in the middle of the day, as air conditioning systems were fighting the heat. Solar photovoltaic arrays would have been generating at full output at that time, so their problem would not have been as severe if they had had more solar generation. Japan and the USA have had and are having similar problems meeting their summer loads.

    Trevor.

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  14. Robin – This map makes it clear that the agriculture and stockyards in the central valley are major sources of Methane.

    http://newscenter.lbl.gov/news-releases/2012/06/12/measuring-higher-than-expected-levels-of-methane-in-california/

    The nice thing about the central valley from this perspective is that it isn’t easy for the methane to escape, the higher concentrations just East of the stockyards are telling.

    Cow belches methane -methane oxidises to CO2 – CO2 grows grass ( the more there is in the atmosphere the more it grows) Cow eats grass -cow belches methane.

    Sorry to say, yes… the methane recycles into CO2 – EVENTUALLY and because of the timescales involved, your statement is simply an elaborate mistake. It takes Methane about 10 years to change over to CO2, and 100 years for the CO2 to make an exit, yet it only takes the cow a day or two to produce it. I would suggest that what you describe is roughly the cycle for the Methane, though it is more complex by far than that, and that during its tenure in the atmosphere it causes warming FIRST as CH4 and THEN as CO2, before it gets turned into something else by some biological agency.

    I suggest the onus is on those who want to tax these emissions to get proof that they alter the composition of the atmosphere by increasing the concentration of methane, (atmospheric methane did not increase at all last year, + or – 3 parts per billion with an uncertainty of 68%).

    The Methane concentrations are more variable than the emissions as there are more processes to alter it. Bulk global emissions are being altered by laws and economic incentives to prevent its release in industrial settings and mining as well as changes in the economy itself.

    http://www.uspowerpartners.org/Topics/SECTION6Topic-ReducingNatGasEmsssions.htm

    Complaining that the concentrations did not rise in a given year is not evidence that emissions are unrelated to human activity – though many emissions are indeed not related to it.

    The map I linked to at the top is as damning as anything relating to agriculture being ONE source of Methane emissions. The science however, would make it a less important source than many others. Its concentrations ARE going up… contrary to your assertion about a single year… but this is unlikely to be due solely to agriculture.

    http://upload.wikimedia.org/wikipedia/commons/a/a3/Mlo_ch4_ts_obs_03437.png

    http://en.wikipedia.org/wiki/File:Methane.jpg

    http://tamino.wordpress.com/2012/04/20/more-methane/

    http://www.realclimate.org/index.php/archives/2012/01/much-ado-about-methane/

    Still… I would be loathe to impose impossible conditions on agriculture. The methane produced by agriculture is not the MAJOR source, merely ONE source… Most methane is turned directly into CO2 by combustion of the Natural Gas resources we use so profligately.

    It WOULD be wiser to address and alter the climate impact of New Zealand through the things that can be effectively changed… and the emissions of livestock and agriculture are not easily or effectively changed.

    Smarter to cope with our emissions budget here by leaning on our wind and hydro resources to reduce our dependence on fossil fuels.

    THAT is the argument you could make effectively Robin, not the hot rhetoric of denial but the practical effort to deal with the actual problem.

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  15. bjchip, you forget the theory of global warming has it that man made activities are increasing the concentration of greenhouse gas in the atmosphere and that this is in turn increasing global temperatures. The key is the activity that therefore causes ‘warming’ has to increase the concentration of a greenhouse gas. We breathe out CO2 but we do not by that action increase the concentration of CO2. likewise with enteric methane, it is irrelevant how much cattle produce as long as that production does not increase the concentration of methane. As I said no scientific link between livestock production of methane and an increase in the atmospheric concentration of methane exists anywhere in the world. If you are worried about global warming stop driving your car, but you can carry on eating as much meat as you like.

    Fossil fuel is reliable, peak oil is a nonsense, they will continue to find more and more of it in more and more clever ways. I am fully supportive of investigating renewable, and one day they will be a match for fossil fuel, maybe in a few hundred years, but I do not support making little old ladies freeze in the winter because of high power prices caused by subsidies paid in the name of the ETS to prop up uneconomic power generation, no matter how renewable it is.
    And for those who think the money raised by the ETS can be used to compensate the poor, think again. Only a carbon tax can do that and the ACT Party was the only party to support that.
    An ETS means that an emitter pays a forester to sequester carbon. The forester is given an NZU by the Govt for every tonne of CO2 supposedly sequestered. The emitter then buys this from the forester, and then surrenders the NZU back to the Govt. The Govt gets no money, it just cycles NZU’s around, so it can not compensate the poor.
    A carbon tax I support, the green party should too because an ETS is a nonsense, unless of course you want to profit from trading in carbon. Big money to be made there thanks to the architects of our ETS.

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  16. Robin said:
    “Fossil fuel is reliable, peak oil is a nonsense, they will continue to find more and more of it in more and more clever ways.”
    This showing that Robin is one of only a few people who do not understand the concept of peak oil and don’t believe it. Yes, they will continue to find more and more oil in more and more clever ways, in harder and harder to reach places and at higher and higher costs, but the amount of oil that they will find will be less and less, because the rate new oil is being formed is a small fraction of the rate that we have been extracting it. Since the Earth is finite, there is only a finite amount of oil to find so it will run out.

    The oil production figures suggest that we may have already reached peak oil, in July 2008. See
    http://peakoiltaskforce.net/wp-content/uploads/2010/02/final-report-uk-itpoes_report_the-oil-crunch_feb20101.pdf
    for a discussion on peak oil.

    Also see http://royaldutchshellplc.com/2008/01/26/peakoilstorecom-breaking-news-leaked-letter-shell-ceo-admits-peak-oil/

    So even the oil companies are being forced to admit that peak oil is here or about to be here. And that oil prices will rise.

    Trevor.

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  17. The Green Party does support a carbon tax. However since neither Labour nor National were offering a carbon tax, they chose to support Labour’s ETS as better than nothing.

    Trevor.

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  18. BY TENNILLE TRACY
    U.S. energy officials estimate that oil and natural-gas reserves jumped in 2010 by the highest margin in at least three decades, lending weight to the idea that the U.S. can meet more of its own energy demand.
    The Energy Information Administration said in its annual report that proven reserves of crude oil jumped by 13%, with the highest increases seen in Texas, North Dakota and the Gulf of Mexico. Proven reserves of natural gas rose by 12%.
    http://online.wsj.com/article/SB10000872396390443545504577563511346753908.html?mod=WSJ_Energy_leftHeadlines

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  19. As I said no scientific link between livestock production of methane and an increase in the atmospheric concentration of methane exists anywhere in the world.

    Robin, the map I linked to was crystal clear. I suggest that you are guilty of wishing that this is so.

    I pointed out that AGREED with part of your point, that the contribution of increased agriculture and its emissions is not a *significant* driver of global methane concentrations. However, there is no way that that map which IS science, can happen with livestock that don’t alter methane concentrations.

    Fossil fuel is reliable, peak oil is a nonsense, they will continue to find more and more of it in more and more clever ways.

    The “peak Oil is a nonsense” part is wrong. Not just a little bit, but flat wrong. We passed the peak in conventional product, and the use of more expensive measures to get at more expensive product is EXACTLY what peak oil actually predicts.

    People are always getting that bit wrong.

    As for its reliability, having been through the Arab Oil Embargo back in the seventies, I can personally tell you that it is only as reliable as your ability to beat it out of the people who currently own it.

    NZ currently has stuff-all ability to do that… so our oil supply is not exactly a secure thing at all. SOMEONE may well have oil, but our reliable supply is at the sufferance of the major power’s willingness to allow us to buy it.

    Finally, of course, we are apt as not to see an ICE-FREE Arctic within a couple of years. That will focus people’s minds rather more greatly on the effects of our continued emissions. There is a cost to the CO2 emitted and it has to be put in place and when it IS put in place the cost of those fossil fuels will escalate past the values of the renewables.

    The Green party would FAR rather have had a proper Carbon Tax. Labour was not agreeable and we were never part of government… so we took what was offered. I do hope that we are a bit more in control next time, and that the end result repairs the damage that National has done this country.

    The Green party would I think, like to get rid of the fractional-reserve banking structure as well, with a monetary system built on a redeemable currency rather than debt. I know that I personally would.

    There are actually areas in which ACT and Greens actually have common views. Different reasons, but the results are similar.

    BJ

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