ANALYSIS: The next term of government will be crucial for charting New Zealand’s course for a low-carbon world. Here are the big decisions the next prime minister will have to make.
It’s a bit of a cliché to say that this election is the most important of our lifetime.
After all, no politician will say that the election they’re currently running in is less important than those that came before.
But for climate change, at least, the platitude is correct: The government in charge of New Zealand after this election will be saddled with making some of the most momentous climate decisions of the next 30 years.
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Chief among these will be responding to the recommendations of the Climate Change Commission next year and determining the amount of greenhouse gases the country will be allowed to emit over three subsequent five-year periods.
The new government in charge of New Zealand will be saddled with making some of the most momentous climate decisions of the next 30 years.
The Zero Carbon Act commits New Zealand to reducing greenhouse gas emissions (besides agricultural methane) to net zero by 2050 and to severely reducing agricultural methane emissions as well. Those emissions reductions must also be carried out in a manner consistent with limiting global warming to 1.5 degrees above pre-industrial levels.
In other words, even if the country could delay reducing emissions for a while before cutting them more sharply to ultimately reach the net zero 2050 goal, that probably wouldn’t be consistent with the 1.5 degree target, because it would lead to more total emissions over the period. Carbon dioxide remains in the atmosphere for decades, so every year we wait before reducing a tonne of emissions stacks up.
This is why international climate agreements and even our own climate targets don’t rely solely on a point year target – like net zero by 2050. Instead, they depend on emissions budgets – limiting the total emissions from a region or country over a longer period of time.
The Climate Change Commission was established by the Zero Carbon Act to propose three five-year emissions budgets. The first three will cover the period 2022-2025, 2026-2030 and 2031-2035, but the commission will propose a new budget every five years, so that at least 10 to 15 years of prospective budgets are known at any one time. It will also produce updated emissions reductions plans alongside each budget.
The emissions budgets will guide the country to its net zero goal while remaining mindful of the 1.5 degree requirement. They will also have other impacts on our climate change mitigation efforts, like setting the cap on the number of carbon credits available for purchase in the Emissions Trading Scheme. However, the government is not required to accept the commissions’ proposed budgets and plan – it can forge ahead with modified versions or budgets and plans of its own devising.
Although the commission was due to report back on February 1, the impact of Covid-19 has forced it to delay its deadline to May 31. By December 31, 2021, the government will be required to announce its emissions budgets and plan.
This is the most important climate decision the next government might make, as it commits New Zealand to a specific path for reducing emissions. The Zero Carbon Act requires the country to meet each budget, “as far as possible, through domestic emissions reductions and domestic removals”.
However, “if there has been a significant change of circumstance”, the government may close the gap between actual emissions reductions and the budget’s requirements by purchasing carbon credits from overseas. As the price of carbon is currently expected to rise to as high as $100 a tonne by 2030, this could be a costly endeavour.
The Climate Change Commission will also play a role in the other crucial climate decision that the government will have to make: Setting and then meeting our final Paris target.
Under the Paris Agreement, each country is required to produce an emissions budget for the next decade, from January 1, 2021 to December 31, 2030.
In 2015, the New Zealand government offered an interim Nationally Determined Contribution (NDC) of 601 million tonnes of emissions over the next decade. Annually, that would average out to a 10 per cent increase above 2005 levels over the decade.
However, Climate Change Minister James Shaw referred our NDC to the Climate Change Commission in April, asking them to determine whether it is “compatible with contributing to the global effort under the Paris Agreement to limit the global average temperature increase to 1.5° Celsius above pre-industrial levels” and what might need to change to make it compatible.
Ministry for the Environment officials have already advised that a budget of 516 million tonnes would be the upper bound of a target compatible with the 1.5 degree requirement.
The next government will be responsible for submitting New Zealand’s final target under the Paris Agreement ahead of a major climate summit in Glasgow in November of 2021. That will determine New Zealand’s climate ambition for the next decade in the eyes of the rest of the world.
The government will also be responsible for beginning to implement the emissions reduction plan and meet the Paris target.
As it stands, we’re currently projected to emit 707 million tonnes over the next decade – 106 million tonnes above the current Paris target and 191 million above a target consistent with limiting warming to 1.5 degrees. Net emissions are projected to rise to a peak in 2025, in part due to the cyclical nature of harvesting of plantation forests.
Nonetheless, scientists have found that the world needs to halve global emissions by 2030 if we want to have a chance of limiting warming to 1.5 degrees. That would require the emissions reductions promised in existing NDCs to be increased fivefold. Even limiting warming to 2 degrees about preindustrial levels calls for tripling the ambition of existing NDCs.
New Zealand’s NDC, for example, has been rated as “insufficient” by Climate Action Tracker. The group projects that if the rest of the world made the same commitments as we have, warming would exceed 2 degrees but not 3 degrees.
Whether or not to increase our ambition – and how to achieve a more ambitious goal – will be in the next government’s hands.