Half of ‘critical’ carbon-cutting policies are off track

A progress report on the state of the climate response delivered to ministers two months before the elections shows a growing number of policies were already veering off track.

Since then, the new Government has pledged to cancel or delay three of six foundational climate policies, worsening the risk that New Zealand fails to meet our climate targets.

In August, a board of public sector chief executives set up to coordinate the climate response sent ministers the second twice-yearly check-in on the response. The report, released by the Ministry for the Environment, warns nearly half of the most critical emissions reductions policies aren’t on track, alongside a third of the key adaptation policies.

“More urgency and greater focus on delivering the actions within [the adaptation and emissions reduction plans] are needed to ensure New Zealand is resilient to the effects of climate change and is set up to meet future emissions budgets,” officials warned.

This was because, on adaptation, there’s no clear way to measure resilience and “there is a sense among agencies and the scientific community that impacts are arriving earlier, and our actions may not be delivering fast enough”. On carbon emissions, the first climate target is set to be met in 2025 but only due to methodological changes to how pollution is calculated rather than actual policy.

A growing number of climate policies were facing delays, compared to the first report from February, mostly due to funding and staffing issues. These were heightened by the cyclone response, which diverted officials and resources from the climate response to the immediate recovery.

One “critical” adaptation policy that was labelled behind schedule was the implementation of the Department of Conservation’s adaptation action plan, because “resourcing is currently uncertain”.

Two emissions reduction policies were marked Red, on a Green/Amber/Red scale. One was to set targets to reduce personal car use in major cities by the end of 2022, which hadn’t been met. Another was the legal requirement to implement emissions pricing for agriculture by the start of 2025, which had been deferred to the end of 2025 by the previous government. The new Government has promised to push the deadline out to as late as 2030.

Megan Woods, Labour’s climate spokesperson, said the report showed there was still more work to be done to meet climate targets.

“In its first fortnight in office, the National-led government has already trashed New Zealand’s international reputation for strong action on climate change by restarting offshore oil and gas exploration. It has also indicated it will cut funding for successful programmes that are critical to achieving emissions budgets and result in a meaningful reduction in emissions such as the Government Investment in Decarbonising Industry (GIDI) Fund and Clean Car Discount,” she said.

Climate Change Minister Simon Watts said the Government would deliver on climate actions when the previous government hadn’t.

“Our government will take the actions required to deliver our climate change targets. The end goal hasn’t changed. What has changed is how we get there and how we implement our plan,” he said.

All of this comes against a backdrop of worsening climate impacts in New Zealand and globally, officials said.

“There is a clear sense from agencies that we are not moving fast enough. This has been underscored by Cyclone Gabrielle and other extreme weather events experienced in New Zealand over this reporting period, and the likelihood that events like these will occur at a faster rate than previously expected.”

There was some good news, including a sharp increase in the rate of electric vehicle adoption, the announcement of more than $20 million to help with adaptation in Westport and a sense that climate considerations were being embedded across the public sector.

Figures from Statistics New Zealand showed GDP has continued to grow over the past decade while emissions flatlined and – in recent years – fell. This is the holy grail of climate policy, a growing economy while emissions decline.

A dashboard of emissions indicators was broadly positive, but the report hedged some of the optimism here. For electric vehicles, for example, while uptake is high it still isn’t high enough to turn over much of the fleet very quickly.

“Uptake rates will need to lift considerably over the remainder of the decade given over 98 percent of the overall fleet is composed of internal combustion engine vehicles that use fossil fuels. We have 12 years to move from 1 percent to 35 percent of the light fleet being zero emission vehicles. Even at today’s higher ZEV sales rates (shifting about 1 percent of the fleet every two years), achieving that goal would take about 60 years.”

When the first report went to ministers in February, it noted that the climate board would search for policies to plug a significant gap in future emissions budgets created through Chris Hipkins’ “policy bonfire”. Now, officials have concluded there aren’t very many obvious options here, which puts further pressure on “already challenging” transport emissions targets.

The first emissions budget covers 2022 to 2025. The next two cover 2026-2030 and 2031-2035, respectively. Officials said the Government needed to focus on both policies that reduce emissions in the here and now as well as laying the foundations for much more drastic cuts to carbon pollution over the next decade.

“It is critical to ensure the effective delivery of a small number of actions that provide the key ‘building blocks’ to deliver or support substantial abatement over” emissions budgets two and three, they advised.

The six specific building blocks were the review of the Emissions Trading Scheme, subsidies to help large emitters decarbonise, agricultural emissions pricing, transport mode-shift, the transition to a renewable energy system led by the Energy Strategy and scoping and delivering the second Emissions Reduction Plan in 2025.

The new Government has already pledged to cancel the first two building blocks, delay implementation of the third by up to five years and deprioritise the fourth through defunding cycleways.

“The Government has immediately stopped work on the Emissions Trading Scheme (ETS) review to provide certainty and stability to the market. We fully back the ETS as the Government’s key tool to reduce emissions and assist to meeting our emissions budgets and targets,” Watts said.

Other risks include the possibility that even the parts of the adaptation programme that are on track may not be fast enough to keep up with accelerating climate impacts. The cyclone recovery also risks embedding poor resilience into a rebuilt East Coast, since the frameworks for adapting to climate change aren’t in place but the recovery needs to go ahead now.

A few new opportunities were highlighted in the report, including the possibility of leveraging the NZ-EU trade agreement to speed up the climate response and a new work programme into using non-forest carbon sequestration to reduce emissions and meet climate goals.