| Commentary | Impact Summary | Emissions Target Analyzer |
  Kyoto Emissions Targets for New Zealand                
  Latest update: 12th November 2009 Please visit again, we are updating this model based on feedback.  
  For nearly two years there has been consultations, debates, arguments about the implications of NZ's response to the fact it ratified the Kyoto Protocol relating to climate change. Did any of the signatories understand what they were signing up to? Probably not.  
   
   
  We have designed a Target Analyzer to look at the implications of many different policy and market related scenarios relating to the Emissions Trading Scheme. However at this early stage, below is a taste of what you can find out - click on the drop-down menu. The core definable variables are below:  
   
   
  Greenhouse gas emissions reductions target - minus %. Emissions Credit price $      
                     
  Cover the cost animal emissions through energy Unspecified emissions savings m tonnes CO2e  
  Unspecified emissions savings are those that can be achieved with little or no cost by doing things better.  
   
  Select the question you want an answer to. Click the Start over button to use the variables on the next page.  
                       
     
                     
  The following page has an Impact Summary designed to get a handle on the the overall costs that would be incurred if the ETS applied to everything from today. It looks at the mitigation costs in relation to the benefits from forestry in particular.  
   
   
  There are many people coming up with a range of Greenhouse Gas emissions reduction suggestions without having a clue as to what they mean in terms of deliverability or cost.
The Analyzer on the next page can be used to get an indication of what the full implications are of various user definable scenarios. 		 
   
   
  The starting point is the target percentage figure below 1990 emissions. The Government has signalled a range of minus 10% to minus 20%. Others are promoting minus 40%. At $40 per tonne for emissions units, the mitigation costs of the minus 40% option are over $1.4 billion per year or over $1,060 per household. If we were going to avoid purchasing emissions units from overseas this would require planting over 120,000 hectares of new Pinus Radiata forest per year from now until 2020. The harvest emissions gross liability for each year's plantings at year 30 would be $3.75 billion if carbon prices stay constant, a highly unlikely scenario in a free-market environment.  
   
   
   
   
   
   
  There are going to be instances where new technologies and greater efficiencies will result in a reduction of emissions. In the model there is a column for "Technology Savings". By entering a % figure in one or more of these cells, the cost of the emissions that have to be mitigated will be reduced. The model takes no account of the capital costs involved in the development or implementation of such technologies.  
   
   
   
  Agriculture is a major issue because methane is deemed to be 21 times more harmful than carbon dioxide. (There is talk of this figure increasing to 25 times!) The other significant emission from farming is Nitrous Oxide which is deemed to be 310 times more harmful than CO2. Burning the animal methane emissions would reduce the warming factor by 21 times. Unfortunately, that "technology" is not an option.  
   
   
   
  The emissions calculations are leveraged from the Statistics NZ September 2007 (the latest) Energy use report for the previous 12 months. From this the total emissions are calculated and the mitigation of those emissions costed. The energy/fuel cost increases required to purchase the mitigation units shown by the model may surprise you!  
   
   
  Because Agriculture is such an important driver in NZ's economy, there is an option to see the implications of loading the full mitigation costs onto the energy sector. Again you may be surprised at the level of those cost increases - 7.6c per litre for diesel and 6.6c for petrol.  
   
  The other area of interest for Agriculture is whether it suffers of proportional share of the mitigation burden or benefits from the fact that its increase in emissions is below the overall average since 1990. This can be factored into the calculations.  
   
  We then come to the thorny issue of how any mitigation costs are apportioned. In 1990 sheep farming was the major emitter. Today it is the dairy sector. The calculator can determine the mitigation cost based on 1990, 2005 and current emission levels.  
   
  Conclusion  
  The development of this calculator has been complex but the informaion provided adds some facts to the debate about the costs of various policy scenarios. Comments and/or suggestions are welcome.
For anyone wishing to use this on a commercial basis, we will be happy to discuss a Licence. This model expires in late September. 		 
   
   
  target@valueaddpartners.com