Do We Want a Country Covered in Pine Trees?

Congratulations to the Government on introducing the Zero Carbon Bill. It appears to have been hard won, so Climate Minister James Shaw will no doubt be having a few shandies tonight after getting it across the line. The fact that the National Party and New Zealand First have signed up to most of the recommendations is a real win. 

The commitment to reduce emissions in line with 1.5 degrees of warming globally is particularly encouraging. Although it's  incredibly unlikely we'll achieve that outcome, it does suggest New Zealand will be at the forefront of reducing net emissions. The key word there is net - we will come back to that. 

Even the split target for methane is not the shortfall that some claim. It is in line with science that suggests we need to reduce methane emissions but not get them to zero. That is because methane emissions are short lived, so consistent emissions eventually end up at stable levels in the atmosphere. 

No, the main problem with this Zero Carbon Bill is the potential for too many pine trees. This is where the net emissions becomes important, because New Zealand is unique in allowing our emitters to plant trees instead of reducing their carbon emissions.

You are probably thinking "Too many trees? I thought trees were good?" They are, but you can have too much of a good thing, for a few reasons. As Parliamentary Commissioner for the Environment Simon Upton pointed out earlier this year, trees are risky, temporary, and might depress our carbon price. 

Trees are Risky

In Nelson this summer we saw the danger of too many pine trees. The fires were devastating for the community, but also for our emission targets. All the carbon in those trees is back in the atmosphere now. Trees are also increasingly susceptible to disease, invasive predators and forest collapse. We can't bank on them locking carbon up forever. 

Trees are Temporary

Trees only soak carbon up for a limited amount of time, but they need to stay there forever to keep the carbon locked up. Even if we use land for pine plantations, we have to keep replanting the forest. Therefore, for the one-off benefit of soaking up some carbon we lose an eternity of flexibility over how we use that land.

It makes complete sense to turn our erosion prone land back into native forest. But for the rest? We need eventually to get our emissions down to zero eventually, so why not do it as soon as possible? 

Tress Depress Our Carbon Price

New Zealand’s carbon price is currently $25.50 per tonne of carbon dioxide. That’ll encourage some emitters who burn fossil fuels to reduce their emissions. But if it were closer to $50/tonne (as it is in Europe, in line with estimates of the true cost of carbon) and heading toward $100/tonne, emitters would scurry to change their ways.

Of course, as a mechanism, the carbon price alone isn't enough. But it is a big part of the equation for electricity providers and businesses. 

However, our carbon price is unlikely to rise much in the immediate future. We have heaps of marginal land, which emitters can buy up and plant into forest. While that might be good in some areas (e.g. native forest on erosion-prone land), this offset will keep our carbon price artificially low. And this won’t help us achieve zero emissions. 

Commissioner Upton's solution

Simon Upton has proposed another solution that needs much closer scrutiny: that we should treat not only methane differently, but also trees. In fact, that we should deal with land use in a different way to fossil fuel emissions. 

While the details require a lot more thought, this proposal would still see costs shoot up for emitters. And it wouldn't be a free ride for agriculture either – or certainly less so than what New Zealand First has negotiated in this deal. 

At the very least, we should put a cap on using forestry as an offset as Europe has done. 

This is important stuff. We are shaping property rights that will last for generations and have a huge impact on what our country looks like in 30 or 100 years’ time. We need to get it right.