Climate change commissioner James Renwick says he is confident the electric vehicle subsidy scheme will be brought back. (file image) Photo: 123RF
It will be more costly for New Zealand to try and become carbon neutral in the future if it does not pick up the pace now, one of the climate change commissioners warns.
On Wednesday, the Climate Change Commission released draft advice on how to slash enough emissions in the 2026-2030 period to be on track to be carbon neutral by 2050.
It recommended the government not to rely solely on forestry or the Emissions Trading Scheme (ETS) - which sets a price for carbon to incentivise businesses to change practices - to reach targets.
What's the problem with planting trees?
Climate Change Minister James Shaw told Morning Report by mid-2030s, the ETS in its current state could stop being of any help to reach any targets.
"This is actually the third time in increasingly urgent tones the commission has warned us that there is a problem here we need to deal with," Shaw said.
"We actually accepted their recommendation last year in our first emissions reduction plan and we have said we will review the ETS," he said.
"The draft advice they released yesterday helps with that because it provides more recent information and it brings it into much sharper focus."
"We really do need to pick up the pace" - Climate Change Minister James Shaw
While tree-planting still played a role in drawing carbon dioxide from the air, it was equally important to stop CO2 from getting in the air in the first place, he said.
"Our policy settings over the past 20 years haven't helped us to do that, so there is some progress that's starting to make a difference but we really do need to pick up the pace."
Commission chair Rod Carr said the ETS currently over-incentivised tree planting, and under-rewarded gross emissions reduction.
The scheme was now a "threat to achieving our targets", Carr told Nine to Noon.
"The way forests are treated in the ETS is, however, having the undesirable consequence of reducing the likelihood that we will achieve our targets of Net Zero by 2050 and hold Net Zero beyond" - Commission chair Rod Carr
Currently, New Zealand emits about 80 million tonnes a year of carbon, and forests sequester about 10 million tonnes.
"Over the next budget periods we see the forest sequestration nearly double, but gross emissions only come down somewhat," Carr said.
The government needed to say what it wanted, he said; gross emissions to be higher for longer, or for emissions to drop sooner and tree planting to absorb carbon to slow down.
The problem was forests would need to stay planted for centuries to keep the emissions' book balanced, robbing options from future generations to make decisions about the best use of land, Carr said.
By "hiding behind tree planting", New Zealand would miss the opportunity to develop and take up low emitting technology, which overseas markets would be increasing willing to pay a premium for, he said.
New Zealand was the only country in the world which allowed limitless tree planting on its carbon ledger, he said.
More renewable energy plants needed, says James Shaw
The commission also called for quicker action on new renewable energy generation and electric vehicle charging infrastructure.
A greater than forecast uptake of EVs, and the closure of the Marsden Point fuel refinery, have helped the climate accounts.
But headwinds include the Tiwai aluminium smelter remaining open, and the slower conversion of factory coal boiler to renewables compared to projections.
Climate Change Minister James Shaw says the country needs more renewable energy plants. Photo: RNZ / Samuel Rillstone
Shaw agreed on quicker action, saying the country needed about 70 to 80 percent more electricity than what was currently generated by the year 2050 to reach targets.
"[That is] to deal with electric vehicles, it's also to deal with all those coal fire boilers that turn milk into milk powder and so on, so our own industry also needs to make that switch.
"So, it's pretty significant, we have to build considerably more renewable energy plants. Although that is starting to happen now which is a good thing, both wind and solar."
Earlier this month, the government announced it planned to speed up renewable energy consents by making sure national significance was given more weight in Resource Management Act decision-making.
Lake Onslow project
There also needed to be solution to the dry years, where fossil fuels were being used to produce enough electricity, "whether it's Lake Onslow or another solution", Shaw said.
The Lake Onslow project in Central Otago was proposed by the government, with a price tag of almost $16 billion.
It is designed to serve as a giant battery to help protect against hydro electricity shortages and create more stability in the market. It normally functions like a hydro power station, but with water pumped back up when power is cheap so it can be used to generate electricity in dryer times instead of making up the shortage with fossil fuels.
"Lake Onslow is designed to deal with a problem that's not going away," Shaw said.
"That problem becomes more severe if we electrify the economy because we have this three-month period in middle of winter where our lake levels are low and if we have a dry year, that creates a problem for us, particularly if we expand the amount of electricity we need."
But the National Party is promising to cancel the project, should it win the upcoming election.
Some business groups also opposed the plan, saying it will come too late for the energy sector, and cited cost blowouts and cheaper alternatives.
'Taking the action now ... is going to be the most cost-effective'
Climate scientist James Renwick Photo: Supplied
Climate scientist James Renwick, who is also one of the commissioners, said the overall direction of the government had been good but they needed to be quicker.
"There have been a few 'whoops' along the way you might say, but I'm sure this government's policies are still very much in the direction of zero carbon dioxide emissions by the year 2050 as the legislation says," Renwick said.
"If this government or the next government doesn't sort of doesn't kick the can down the road and not do anything particularly in the next year or two, it's going to cost more in the future to take this action," he said.
"So, taking the action now, getting things in place now, is going to be the most cost-effective. So, it's really imperative we get on with it."
"We cannot plant our way out of climate change" - Climate scientist James Renwick
He would like to see faster changes brought in such as, increases in public transport funding, rolling out charging stations for electric vehicles (EVs), bringing back subsidies for EVs, and getting transport emissions down.
"Plus, it'd be great to see fossil fuels phased out completely in the energy and industrial sectors."
Carr agreed the government need to slash emissions harder and faster.
Between 13 million tonnes of savings needed to be found, over and above what was currently planned, in the second half of the decade to reach targets, Carr said.
Although the government had scrapped some climate policies recently to address the rising cost of living, Renwick said he was confident things like the subsidy for EVs would be brought back.
"Recent events have caused a few short term changes, I believe they're short term changes ... But of course, the Climate Change Commission just provides advice for government, we cannot tell the government what to do."