Last year was a momentous and uneven year for New Zealand’s climate risk and our response to it. In some ways it was a reset for the country, embedding climate change into government policy and setting international goals. In other ways it was a disappointing business-as-usual year as Covid dominated the headlines and the actions.
2022 must be the year of climate delivery. The Climate VC Fund is making a start but the transition to a low-emissions world can’t be left to individual efforts. We need systemic change. Last year at least set up some systems. Let’s take a brief look at some.
Back in January, the Climate Change Commission / He Pou a Rangi issued its initial recommendations to Government. Under the Climate Change Response (Zero Carbon) Act, the Commission’s task was to recommend the design of New Zealand’s first ever emissions budgets, extending to 2035. Over 15,000 public submissions were received, many saying that emissions reductions in the early years were insufficient. By May, the final recommendations were submitted, with the expectation of a formal national Emissions Reduction Plan from the Government by the end of the year.
In July, Lawyers for Climate Action filed proceedings in the High Court seeking judicial review of the Commission’s recommendations, saying they were not consistent with either the Zero Carbon Act or New Zealand’s commitments under the Paris Agreement.
In October the Ministry for the Environment said the Emissions Reduction Plan would be delayed until mid-2022, and published a 130-page discussion document on what it might include. The document was notable for its uneven coverage of New Zealand’s emissions footprint. Some sections offered considered and detailed ideas and recommendations, while others are short and perfunctory. For example, the section on transport (which represents 20% of NZ’s gross emissions) is 27 pages long and includes dozens of existing and possible new initiatives. By contrast, the section on agriculture (accounting for 48% of NZ’s gross emissions) is just four pages long.
Also in October, Climate Change Minister James Shaw produced a more ambitious target for emission reductions in Aotearoa by 2030. This is crucial as climate scientists believe prompt and substantive action to reduce emissions in 2020s is necessary to reduce the risks of climate change.
The new target of a 50% reduction on 2005 net emissions by 2030 is certainly more ambitious than the previous headline reduction of 30%. On a basis which is comparable with the previous 30% goal, the new target is equivalent to a more modest 41% reduction. Under the Government’s upgraded target New Zealand would need to source most of its net emissions reductions up to 2030 by buying international carbon offsets. These are still subject to some incomplete rules around accounting, trade and certification. This plan is contrary to the advice of the Climate Change Commission which opposes a “plant and pollute” model.
Internationally, COP26 in Glasgow in November saw the first UN-level commitment to “phase down” coal use, as well as commitments to reduce methane emissions and end mass scale deforestation by 2030. But crucially, Western countries are still delaying providing much needed climate finance to developing countries to assist with their energy transitions.
Policy needs actions
Meanwhile it is more evident almost every week that climate risks are being realised, both in New Zealand and internationally.
For example, flooding in Canterbury in May took out the Ashburton bridge, cutting State Highway 1. A report by MetService and Victoria University said the floods were made 10 to 15 per cent worse by climate change. The effect is caused by air which is warmer than normal holding excess moisture which then falls as rain. Two months later, a similar effect brought heavy flooding to the West Coast, Tasman and Marlborough.
Internationally, the US for example experienced a historic drought, record-breaking heatwaves, massive wildfires and huge levels of tornado damage – in each case likely to have been exacerbated by climate change.
So 2022 needs to be the start of the delivery of a decade’s long effort to decarbonise. James Shaw has promised that 2022 “will be a climate budget”, with a new Climate Emergency Response Fund using the proceeds of the Emissions Trading Scheme at its centre. This is much-needed, as New Zealand needs to invest now both to adapt to the effects of climate change and to mitigate climate risk by reducing emissions.
At the Climate Venture Capital Fund, we are investing in early stage companies which are commercialising technologies which can materially reduce greenhouse gas emissions. These reductions are all the more needed in 2022, after the missed opportunities and ever clearer climate risks evident in 2021.
Rohan MacMahon is a partner in the Climate Venture Capital Fund: