In some ways, there may be less than meets the eye to the Government announcement yesterday that the He Waka Eke Noa proposal for farmers to pay for greenhouse gas emissions has been scrapped.

The spectre of farmers still having to pay at some point in the future remains.

That, however, hasn’t stopped Greenpeace from crying “catastrophe” and ACT claiming victory.

And interestingly, though the Government is promising to remove agriculture from the Emissions Trading Scheme, not only is that largely symbolic since, for practical purposes, it is not currently part of the scheme but there is no mention of any legislative change to the methane limits laid down in the Zero Carbon Act.

So, the limits still apply, though Agriculture Minister Todd McClay promises they will be reviewed. The main issue now is how farmers might pay for their emissions.

Ironically, the answer appears to be that the limits will be reviewed and, if necessary, a payments regime set by a slimmed-down version of the review group that established He Waka Eke Noa, which the Government scrapped yesterday.

He Waka Eke Noa was unveiled in 2022 as a consortium of 13 agriculture groups that proposed that all farmers have environmental plans that measure their greenhouse gases.

Those plans were supposed to be in place by October this year with mandatory pricing to start in October next year.

If there was no agreement on a pricing mechanism by then, agriculture would be included in the Emissions Trading Scheme.

It is that threat that McClay removed yesterday.

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From the day Waka Eke Noa was launched, it was clear that Federated Farmers president Andrew Hoggard was uncomfortable with it.

Even though his organisation was part of the consortium that had drawn up the plan, he refused to join the leaders of the other member organisations on the launch stage.

He is now an ACT MP and an Associate Minister of Agriculture.

Unveiling the ACT’s agriculture spokesperson before the election, the party’s then-agriculture spokesperson, Mark Cameron, boasted that the ACT had led the way in standing up for farmers in Parliament.

“ACT was the only party to vote against the Zero Carbon Act. We were the only party willing to oppose He Waka Eke Noa from the beginning,” he said.

However, the Zero Carbon Act is staying in place, and with it, in the meantime, the two methane targets for farming will be a 10 per cent reduction by 2030 and a 24 – 47 per cent reduction by 2050.

However, time is on the farmers’ side.

One unexpected consequence of the Zero Carbon Act at the ETS has been the substantial conversion of farmland into forestry.

Because of that, dairy cow numbers have been declining by around one per cent a year since their 2014 peak of 6.5 million, and sheep and cattle farming, which uses land more suitable for trees, is estimated by the Climate Change Commission to have been reduced by 17 per cent by 2050.

Thus, agriculture is expected to reach the 2030 target through land use change and will get near the 2050 target the same way.

McClay said yesterday that it was time for a fresh start on how we engage with farmers and processors to work on biogenic methane.”

But what derailed the whole Waka Eke Noa process was the growing influence of a rump of climate-change-denying farmers who set up the Groundswell organisation.

They were further incited by the Labour Government’s 2022 response to Waka Eke Noa, which, through the bungled presentation of the impact of methane pricing, convinced many farmers that the Government wanted to forcibly remove 20 per cent of them from their farms.

McClay said the Government would now engage directly with levy bodies and sector organisations representing the pastoral sector – DairyNZ, Beef + Lamb New Zealand, Deer Industry New Zealand, Federated Farmers, Dairy Companies Association of New Zealand, and the Meat Industry Association.

The terms of reference have not yet been agreed upon, but McClay said one of the group’s roles would be to develop a new 2050 reduction target rather than the 24 – 47 per cent spread currently in the Zero Carbon Act.

“The independent review will come up with exactly what the target needs to be based on no additional warming,” he told POLITIK.

“And then we will work together to find the solutions informed by not closing down farms or sending production overseas.”

McClay is emphatic that farmers must have tools to reduce their emissions.

“If you are going to impose a price on them where there’s nothing they can do other than produce less, then it is as punitive as that ute tax was.

“It’ll just send jobs and production overseas, making New Zealand poorer.

“And that’s why the government is announcing the $400 million ongoing investment into R&D and commercialising some of the technological solutions being developed.”

In its recent draft advice on New Zealand’s Fourth Emissions Budget, the Climate Change Commission revised upwards the estimated emissions reduction target that New Zealand farmers might meet by adopting new technologies which would likely be available between now and 2050.

It said recent changes in land use and smaller dairy herds meant emissions from the dairy sector were starting at a lower point since The Commission’s original emissions budgets in 2201.

“Our analysis shows it is possible to achieve a 39% reduction of biogenic methane relative to 2017 levels by 2050,” they said.

“This compares to 2021, where our analysis suggested Aotearoa New Zealand could only reach the less ambitious end of the target range – based primarily on implementing already available practices.”

However, farmers are excited by the promise of a host of technologies, including some that require genetic modification (GMO).

McClay told POLITIK that he is working with Science Minister Judith Collins on proposals to relax some of the regulatory requirements on GMOs in New Zealand.

DairyNZ chair, Sir Jim van der Poel, was pleased with yesterday’s announcement but was cautious about becoming overly optimistic about technology.

“To remain internationally competitive, all paths forward must be grounded in a science-based approach. This will ensure a profitable and sustainable future for dairy – and for the rest of New Zealand,” he said.

“While there are currently no significant technologies to reduce methane emissions from New Zealand pastoral farms, our farmers continue to make strong progress towards measuring on-farm emissions, and we look forward to contributing to the Government’s methane-reduction work. “

“DairyNZ continues to work alongside farmers and research partners to accelerate affordable and effective tools and technologies for reducing emissions at the farm level – including testing methane-reducing compounds and delivery options for our pasture-based farms and exploring low-emissions forages and genetics.”

Federated Farmer’s reaction to the news that He Waka Eke Noa had been scrapped was summed up in a headline on their press release: “Federated Farmers say goodbye and good riddance.”

Greenpeace (predictably) were opposed to the Government’s action.

“The National-led coalition Government has today confirmed the demise of He Waka Eke Noa and a new Pastoral Sector Group for tackling agricultural climate emissions, which Greenpeace says is just more dairy industry collusion and climate denial by the Luxon Government,” said their spokesperson Niamh O’Flynn.

“It’s no great loss to see the end of He Waka Eke Noa.

“It was designed by the dairy industry to delay climate action and succeeded.

“It was only ever a tactic in their decades-long strategy of predatory delay, and a new Pastoral Sector Group announced today is just another version of that.”

There is another additional factor conditioning this debate: the reaction of the processor companies, particularly Fonterra.

It is targeting a 30 per cent reduction in emissions per tonne of milk solids by 2030.

McClay acknowledges the role that the processors will play but told POLITIK that ultimately, the Government was responsible.

“But actually, we need to do this together so that farmers can achieve what they need to and that we can keep the economy going,”

Doing it together was what He Waka Eke Noa was all about in the first place. It may be that the change in land use, the advent of new technologies, and the pressure from the processors mean that this time, the waka will actually get to its destination.

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