Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
Consultation Event Feedback Template
Instructions:
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inclusion in the overall analysis. In the first instance, the primary audience is Al en + Clarke, who wil focus thematic feedback,
but these wil also serve as our primary record/notes for each session.
• Use the prompts provided as suggestions to capture as much information as possible. However, you do not have to answer
every prompt, and can vary from the specific question if this wil better capture the themes and information provided in the
session.
• Capture as many Q&As as possible in the designated row, and duplicate the row for each new question. If you know that the
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Date:
3/11/2022
Meeting type:
Agriculture sector leaders in-person meeting
MfE/MPI staff:
Fleur F, Darran A, Hannah S, Hamish S, Charlotte D
Number of attendees:
12
1
Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
Date:
3/11/2022
Demographic of attendees (if Farmer leaders
possible, e.g. farmer, NGO,
Māori, general public):
Prompt
Stakeholder feedback
Emissions reporting
Who did attendees think should be
responsible for
reporting and paying
for
emissions?
What feedback did attendees have on
the
thresholds set for farms to report
emissions?
What did attendees believe would need
to be in place to
include collectives in
the pricing scheme?
Did attendees believe farms will have
the
necessary data for reporting by
2025?
2
Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
What feedback did attendees have on
registration requirements?
Did attendees raise any concerns
about
reporting and payment timing?
Did attendees believe there are any
opportunities to improve the proposed
approach to
reporting emissions?
Question:
New/thorny questions asked by
attendees
Answer:
[Duplicate this row as needed]
Pricing, revenue and incentive payments
Not allowing industry to sit at the table when methane price is set has many
What
concerns did attendees have
problems:
around the proposed approach to
setting levy prices?
o Its politicised
o People who are very far from agriculture who are making the
Did attendees offer any
improvements
decision.
to the proposed approach to
setting
o Have heard people saying “You can’t have agriculture set the price
levy prices?
they are going to pay”. That’s not what we are asking for – we just
want to be at the table. The CCC wil be at the table and they have
3
Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
their own agenda – we have a dif erent agenda sure but why should
that prevent us being at the table.
What feedback did attendees have on
the proposed
revenue recycling
strategy?
What did attendees think about an
advisory board for revenue
recycling?
What
transitional support did
attendees say was needed?
Do we need to have another discussion about GE? At the minute no one wants to
even talk about it… but we need to be able to have that discussion. It could make
What approaches did attendees support a big dif erence.
for
incentivising mitigation practices
or technologies?
Question: Is there GE technology available? Maybe not but there could be if we
can focus on it – there is huge potential here. We are in a bizarre scenario when
What
mitigation practices or
we are competing against synthetic meat – you can’t get more GE than that.
technologies did attendees think
should be
supported by an incentive
Biotech stuff – this should have been talked about 10 years ago.
payment?
New/thorny questions asked by
[
Themes of “lack of trust” / “farmer buy-in is what’s needed to drive change”
attendees
/ “carrots are better than the stick”]
4
Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
[Duplicate this row as needed]
Key to effective environmental policy key is buy-in from on-the-ground farmers.
Industry leaders were hanging on by the skin of their teeth to get buy-in to origin
HWEN proposal. So throwing out proposal has really undercut that trust there.
How do we mend that trust?
So many things that have impacted farmers. Put in submission, get ignored, put in
submission, get ignored. So lots in the rural community have disengaged from the
process. Lost social capital.
Driving real change isn’t about pricing – it’s about getting buy-in to the change. The
change we are after – we are all after – is reduced emissions from the agricultural
sector – not to price emissions per se. That’s what we need to focus on
My farm has ful -time biodiversity ranger, support native bush. Has some kind of
native nursery, planting natives. Under the Govt’s proposed model, none of this
matters.
o Model is carrot and stick. Want to hit someone with the stick until
they do the thing you want them to do. Under this model, what can
you do to get the Govt to stop hitting you?? There is nothing.
o This model could even drive farmers to stop doing the good things
they are already doing, as you might cut the good stuff in order to
afford to pay the levy
o 4 things measured: farm area, stock numbers, production figures,
synthetic nitrogen usage… so there are very few things I can do as a
farmer that influence those.
5
Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
Key to effective environmental policy key is buy-in from on-the-ground farmers.
Industry leaders were hanging on by the skin of their teeth to get buy-in to origin
HWEN proposal. So throwing out proposal has really undercut that trust there.
How do we mend that trust?
Driving real change isn’t about pricing – it’s about getting buy-in to the change. The
change we are after – we are all after – is reduced emissions from the agricultural
sector – not to price emissions per se. That’s what we need to focus on
It’s not about carbon or freshwater – its our home. We’ve gotta hold on until there
are things we can do to drive improvements [i.e, not implement a system with high
prices before there are effective mitigation options]… and those are changes we
want to make as this is where we live.
Community – policy is aimed at the individual… it needs to be focused at a
community level, that’s where you get change.
What do we do about the laggards? Wil get much better outcomes if we got those
people onboard with the carrot rather than the stick.
Gap between rural and urban have never been greater. Being involved in 3 Waters
– have no trust that this discussion wil feed back to Ministers. This feels like a fiat
accompli.
We need to take the time to get it right. Lots of trust has been destroyed and needs
to be rebuilt. At the same time, farming is a long-term career choice. Need to think
about the next generation – need to take some pain to secure our future.
6
Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
Farmers are the best innovators in the world. Support us by giving us achievable
targets and we’l smash them.
Farmer wellbeing is at a low at the moment… need to recognise that. 50-70% of
people out there who are confused, upset.
Key is to keep the system flexible, let farmers take ownership of it. Was talking to
farmer about how could use trees to offset emissions bil . Was told couldn’t as they
were spread around the farm. Response was, that’s okay, I’l put my cows in
smaller lots too.
[Theme – this is a significant shift from the Partnership’s proposal]
Question: When the proposal shifted from Partnership to Govt’s proposal,
what changed in your eyes?
New question
Whole proposal was balanced across all these dif erent land-uses, dif erent
challenges. NO2 in arable, sheep and beef had sequestration, etc. Eg for sheep
and beef, could see the sequestration and see what you could do to reduce levy.
It was a very fine balance across 11 partners. So tinkering with it upset that
balance.
7
Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
Question: Can you walk us in to how, by simplifying the model, what it is
we’ve lost specifically?
- Sequestration: by taking shelter belts out, making riparian have very low
payment rates.
- Pine shelter belts sequester much more carbon than native riparian. Are we
chasing biodiversity here, or are we chasing carbon? Why are we focusing
just on native riparian?
- Simple calculator vs complex calculator. Things we have control
over/dif erential ourselves (meat, slope) are not in simple calculator. AND,
Govt has not committed to moving from the simple system to the complex
one. DD says “we may” move to complex. There’s a good chance that wil
never happen.
[Discussed more below]
- Is there an appetite to administer sequestration? One thing is to allow the
science to evolve and better recognise things – but if you don’t recognise
something at the start then you hamper ability to innovate in the future.
o If the frame work is not right in the beginning, then you can’t easily
find you way back to a better place. Stuck with no room for
innovation.
The reason people are thinking about dif erent prices for dif erence prices is
because of the changes to the Partnership’s recommendations. Without the
mitigation measures the Partnership recommended, that soften price dif erences
between sectors – you get these dif erences between sectors. You can’t have an
equation on one side (the levy) without balancing it on the other side
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Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
(incentives/sequestration/etc). What’s driven the dif erence is the offset stuff in the
Partnership’s proposal has been taking out.
o Sequestration has become a hard topic because of international
rules, what counts for ETS etc etc. So that’s why interested in taking
into account other environmental benefits that are harder to connect
to emissions reductions but we know have big dividends.
And those triple bottom line things are also valued by our
customers – so could support us taking a great product to
market.
Detailed document was presented to Ministers by the Partnership, and now we’re
here. Trust is at a low ebb. Far better to have an incentive payment than a tax.
[Theme of “This is not really a farm-level levy – it’s simplified so much its
basically a processor level levy by another name. Need to be able to take
account on each farm’s specifics”]
In dairy industry, we super good at measuring everything. Problem with this model
– it’s an overall average across all farms. Emissions that are going to be modelled
are going to bear little relation to actual on-farm emissions.
- The calculator has been simplified down to such an extent that it’s basically
a process-level levy that is pretending to be farm-level.
- We want to hand our farms over to the next generation in a better spot. We
need access to all the tools so that ultimately we produce a more
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Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
environmentally friendly product. Farming community are able to innovate,
take ownership of emissions reductions – but we have to let them!
Farmers make decisions every day on how to operate their mil ions of ha of land.
How are we going to recognise the good decisions they are making? Otherwise
this just looks like another tax (like another 2c on your petrol) – and farmers will
focus on how they can get around the rules. It won’t drive outcomes we’re after.
The Partnership’s model recognised much more of the dif erence between farms.
Govt’s proposal has simplified things far too much. Farms that are very dif erent
wil be treated as exactly the same. So it looks just like another tax.
In waste there is some great research on NZ-average emissions from landfil
based on what type of waste comes in… great science but only an average.
Doesn’t look at what methane emissions are actually come out of each landfil (and
there are a lot of actions landfil operators take that influence this). This proposal
has exactly the same problem – based only on national averages.
Complexity of NZ farms. We through the 23 farm-types that were modelled
(the
HWEN case study farms? Not entirely sure what was being referenced) and none
of those represented our farm. Reflects the great diversity between farms.
[Theme of “we have already been improving carbon efficiency, and wil
continue to do so without this pricing scheme”]
10
Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
NZ farmers are already the most carbon-efficient, doing lots to improve emissions
intensity over time. That wil continue to happen over time.
We have a lot more time than we think to build this. Af orestation is already driving
land use change, water quality stuff is driving change in dairy industry. Labour
issue is also driving some change with smaller/less indebted farms. So emissions
wil come down in line with what Govt wants anyway. And technology that wil help
this system run (LIDAR) is coming on stream.
If we are the best at producing in the world [carbon emissions wise] – why are we
starting with a price system that wil reduce our production? The world should be
beating a path to our door saying we should improve global production, that would
reduce global emissions much better.
o It was noted that we can’t take our position of most efficient in the
world for granted – need to keep progressing/improving. Especially
as low-emissions technology that’s coming in the future wil be much
easier to implement in a feedlot system – so keeping our position wil
get harder.
o Is Govt’s proposed levy the best way of ensuring we stay on top?
[Asked with doubt]
On trade negotiations and importance of securing a strong position as a low-
emissions producer. Surely it doesn’t matter whether we can say ‘our farmers pay
for their emissions’. Surely it makes more sense to say: ‘We are aiming for 47%
reduction in methane, and have already reduced them by 20%.’ Pricing is not a
necessary thing to get us there.
11
Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
We have a hell of a PR job to resurrect this – coming out saying you’l reduce 20%
in a sector is a hard place to come back from. Govt needs to focus on getting
model up and running – not focus on price. We are on a downward path anyway.
Slow this process down and do it well
Hosted iwi on farm recently. We went into the native bush on the farm and the bird
song was deafening. That’s what we’re doing anyway. But if NZ looks like 21% less
agriculture activity [because of the impact of the Govt’s proposal] then that’s not
success.
On my farm, I’ve reduced emissions by 27% since 2017. Why should I need to pay
anything? [
Asked how they did this]
New/thorny questions asked by
o Reduced stock numbers to increase productivity per head. And
attendees
manipulation of kil dates. Under the proposed calculator, would this
be picked up?
[Duplicate this row as needed]
The earlier kil date would do be picked up, but increasing
productivity per stock would not be.
We need to know what the cost of the levy is going to be. Why would you sign up
to something if you don’t know what it’s going to cost you?
12
Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
[Theme of “this is just a tax”]
The model doesn’t make sense. If we were funding a levy that funded research to
drive research – let the industry drive the innovation – that’s something farmers
would buy in to. But what the Govt has proposed is basically a tax – with a levy
rate set in order to meet targets - which doesn’t have that buy-in.
This just feels like a tax designed to push out the marginal player in order to meet
the targets.
[Theme of “The cumulative impact of Govt reforms on farming”]
Thinking about the next generation – they’re looking at things are thinking ‘Why
would I want to do this?”. It’s getting harder and harder with more and more
regulation, people are not wanting to join the industry
There is an awful lot going on, lots of confusion (biodiversity, water, etc).
Desperate for an integrated farm plan that you can plug all these things into… slow
it down, do it right. There are lots of farmers who don’t engage in these processes,
we need something that’l work for those.
We need to look at this from a systems perspective – how everything is connected,
how diverse the sector is. Getting some sort of enduring solution is critical – all the
13
Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
parties in the Beehive together and having something that’l stick. So farmers can
make investments, processors can make investments.
Pricing carbon sequestration and nitrogen fertiliser
[With reference of Silver Fern Farm’s low carbon product] So the Govt’s proposal
What feedback did attendees have on
is saying it’s too dif icult to recognise sequestration in some cases (e.g. when it is
the proposed approach to
carbon
spread out across a farm). But in the private sector it is already being done. How
sequestration?
can we say it’s too hard?
What
barriers did attendees raise to
including new categories of
[Person recounting a situation when they were talking to someone about shelter
sequestration in the NZ ETS?
belts planting.] Person went off their heads that it isn’t natives… even though the
tui love them. Sometimes you try your hardest but you can’t please everybody.
Did attendees have any
concerns
System needs to focus on carbon sequestration, not whether something is a
about bringing
on-farm vegetation into native.
a farm-pricing system?
Did attendees prefer
pricing nitrogen
at the farm level or at the processer
level? Why?
14
Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
Future enhancements
Did attendees prefer a
tradeable
methane quota? What benefits did they
cite?
What concerns did attendees have
about
tradeable methane quotas?
Very little confidence that we’l have a farm-level model by 2025. Farm
Environment Plan is the template for that lack of confidence. So need to have a
What concerns did attendees share
modest processor-level levy that wil raise money for R&D at the start for the first
about an
interim processer-level
few years while we get the system ready.
levy?
What
alternatives to an interim
Aiming to go to the farm level was a theoretical mistake. It has to start at the
processer-level levy did attendees
processor level. Some farmers out there don’t agree with global warming – how
share?
are you going to get them on board with this kind of levy?
New/thorny questions asked by
[
Theme of “low confidence things wil be improved”]
attendees
Keep hearing “Something wil come in the future” – but if you close it down now
[Duplicate this row as needed]
then it won’t. Needs to be part of the system from the get-go. I.e., if we don’t
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Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
recognise something in the system from the start, very unlikely it wil be added into
it subsequently.
When involved with waste being brought into ETS in 2013 – Govt said this is not
perfect but we wil improve it over time. But the model has not changed yet and it’s
now 2022. So have no confidence that this process wil be quickly improved…
eventually it will, but will take a long time.
Impacts and support
Picking up on a comment: we all agree on the destination. For the red meat sector
– if the destination is cutting out 20% of the industry, then no we don’t agree with
that. If that’s where the Govt is heading, they wil never get buy-in.
How did attendees believe the system
would
impact them?
I have no problem with reducing emissions… but the Govt has gotten carried away
with targets. Govt should forget about targets and focus on getting the model up
What
support did attendees believe wil and running. Once there are more incentives/opportunities to reduce emissions,
be needed?
that’s when the Govt should start looking at targets.
What impact did attendees think the
What wil happen to the local meatworks/local stock agents? It’s not just what this
pricing scheme wil have on their
proposal wil do to farmers – big reductions in stock numbers wil have flow on to
communities?
other jobs/sectors.
16
Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
How can
rural communities be
supported?
Social cost of these decisions in 20 years’ time wil be huge. Lots of farmland wil
be covered in trees, which wil be foreign-owned.
Integrated nature of farming – we grow grain, but primarily for sheep, beef, deer.
So by affecting sheep, you’l affect us in the arable sector. Arable sector provides
all the seed for the pastoral sector – what impact wil that have? Al the feed that
goes into milk production, how wil that change? The complexity of our systems are
such that don’t think Govt could have a handle on it.
Did attendees share specific
impacts
for Māori?
How did attendees think the
Crown
should
protect relevant
iwi and Māori
interests?
[
Theme of “Impact of Sheep and Beef is too great” / Discussion of differential
pricing]
New/thorny questions asked by
Concern is that sheep and beef wil be hit too hard. Not fair – significantly
attendees
inequitable.
[Duplicate this row as needed]
Even going back to the HWEN proposals, don’t think that would be a good
outcome as that would stil have a disproportionate impact on the red meat sector.
17
Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
o Think an improvement would be have dif erential pricing… there’s an
opportunity to improve there.
o Also to reward nature-based solutions to get the triple solutions of
biodiversity gains, freshwater gains, emissions gains. It could be
made much more equitable
o
Can you explain different pricing more? A number of ways you
could do this – e.g. on species basis. One price for sheep, one price
for cattle, based on the impacts on lambing vs etc. Challenge is this
doesn’t help with beef vs dairy – so could make it more complicated.
o Could have some free allocation system – so sheep and beef have a
higher discount/higher free allocation.
Dairy is much more methane efficient… but the typical person wil think dairy is
more polluting. So it strikes people as odd that this policy disproportionately affects
sheep and beef. Some Govt policy (like this one) is focused on methane, other
Govt policies are focused on N… direction from Govt is mixed.
[Theme of “Availability of premiums for low carbon product”]
Is it realistic to get a huge premium for green dairy/lamb? No – would love it if we
could. I could half my stocking numbers and half my problems.
What sort of premium do SFF get for ZeroCarbon beef? Do get a ‘healthy’
premium – not going to disclose what it is. Went on to explain the system:
18
Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
o Farmers get paid for sequestration on farm, at $50/tonne. Captures a
lot of stuff not eligible for ETS. Vegetation on farm is satellite
mapped, age determined. ETS eligible trees excluded, the rest is
valued…
o Question was why we don’t we just use this model for
sequestration… and also allow collectives in this way.
o Commented that SFF’s model is not about creating a tradable
product (i.e., being able to sell carbon offsets to a market), it’s about
taking a market claim to market. NZ Merion is planning to make a
tradable product… so you can sell your emissions offsets.
-
Implementation, verification, compliance and enforcement
What feedback did attendees have on
the proposed
governance structure?
What did attendees think should be
included in the post-implementation
review in 2030?
What feedback did attendees have on
the proposed approach to
monitoring
and verification?
Did attendees support a
government-
run or third-party verification system?
Why?
19
Al en + Clarke
Agricultural Emissions Pricing Consultation – The Ministry for the Environment and the Ministry for Primary Industries
Who did attendees believe should
fund The system needs to be as accurate as possible, but don’t want ¾ of levy going to
the
administration of the scheme?
admin. Need to balance that.
Did attendees have feedback on the
proposed approach to
cost-recovery?
Question:
New/thorny questions asked by
attendees
Answer:
[Duplicate this row as needed]
Other/General
Did attendees have
any other
feedback on the proposals?
Question:
New/thorny questions asked by
attendees
Answer:
[Duplicate this row as needed]
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