We set a goal to get to net-zero, rather than zero emissions, in 10 years because we aren’t sure that we’ll be able to fully get rid of farting cows and airplanes that fast.

This will be New Zealand in 2030 or 2033, depending on whether a Labour-Green government wins power in the 2029 election (possible) or 2032 (almost a dead certainty):

The country’s coalition government agreed this week to introduce the world’s first carbon emissions tax on agriculture. It will mean new levies on livestock starting in 2030.
…
The key details of Denmark’s plan include:

  • Estimated cost per cow: 672 kroner ($96) annually, based on average emissions of 5.6 tons of CO2 equivalent per cow.
  • Initial tax rate: 300 kroner ($43) per ton of CO2 equivalent
  • Tax rate by 2035: 750 kroner ($108) per ton of CO2 equivalent
  • Effective tax after 60% tax break: 120 kroner ($17) per ton in 2030, rising to 300 kroner ($43) by 2035.

We get a mention in that article, thanks to the new National-led government scrapping the “burp tax”.

What that writer doesn’t know, what most New Zealanders don’t know – and by “most” I mean probably 99.8% – is the implications of New Zealand (whether led by National or Labour) being signed up to the UN Framework Convention on Climate Change (UNFCCC) and the Paris Agreement.

However, tucked away in the website of MFAT (Ministry of Foreign Affairs and Trade) is a little section called “Climate Finance”, and under that you’ll find that we’ve already paid most of our first installment of $1.3 billion to developing countries to “help” them out on climate change:

As part of our support for international action on climate change, Aotearoa New Zealand has committed $1.3 billion in climate finance for 2022–2025. This is funding we provide to support other countries’ efforts to reduce greenhouse gas emissions and adapt to the impacts of climate change …. We are doing this alongside other countries around the world. It is part of our commitment under the Paris Agreement, and the United Nations Framework Convention on Climate Change.

Well, what’s the big deal you may say? Just another version of foreign aid surely, and you would be correct.

However, under the plans of Net Zero 2050, which the current government constantly refers to, we’re going to be on the hook for a lot more than a measly $1.3 billion, courtesy of our Emissions Trading Scheme. Under that scheme our target is to reduce net greenhouse gas emissions in 2030 by 50 per cent below the gross emission levels of 2005, on the way to a 100% reduction by 2050.

To hit that target, our emissions for this decade (June 2021-June 2030) must not exceed 571 megatonnes of carbon dioxide equivalent gases (Mt C02e). So how are we doing?

We are 40% through the decade and 62% through our limit. To hit our 2030 target we’d have to be emitting no more than 42.2 Mt C02e per year starting now. As Sir Humphrey once said, these are heroic assumptions.

We are not going to hit our 2030 targets for GHG emissions reductions and thus we will have to buy carbon credits. That report concludes the same and then plays out three scenarios for the resulting gap, from worst-case to best-case of 114.1 Mt, 99.2 Mt, and 88 Mt.

So what’s that going to cost? Well this is where even more assumptions get applied, this time to what a carbon credit will cost in 2030 and beyond. The Treasury estimates appear to be $95.1 (Avg current prices), $41 (developing nations), and $227 (advanced nations), resulting in a cost ranging from $3.3 billion to $23.7 billion (clearly they weren’t using the gap estimates from that report). Why developing nations would sell us their cheap credits instead of leaving us to trade with the likes of France is not examined.

My estimate, assuming we can cut the emissions by 5% per year from here on, is a gap of 148.7 Mt, meaning a cost of $33.75 billion some time after 2030, if we have to buy from other developed nations.

So clearly, dairy farmers are going to be paying the Danegeld after 2030, while a lot of other New Zealanders are going to be paying via direct and indirect costs. Whether we’ll be pissed off at that money not going to healthcare, education, transport and other things is one question. Yet another is whether any amount of public anger could force any government to back out of the agreement, but perhaps people like the Danes and other countries will have revolted ahead of us?