Kiwi Emissions Trading Scheme vs Aussie Carbon Farming Initiative

Living at a rural delievery address in NZ you get numerous free farming publications in your letterbox. Last week in the “Straight Furrow” publication there was a interesting article on how New Zealand farmers are much worse off than their Aussies counterparts reagrding carbon emissions. The ETS Review Panel have estimated that the Emissions Trading Scheme will cut New Zealand farm incomes by 11% in 2015 but tried to suggest that Aussies farmers are being subjected to the Carbon Farming Initiative (CFI). When you look at what the CFI actually entails the Aussies farmers are so much better off.

ETS – New Zealand farmers will pay for livestock emissions of nitrous oxide and methane
CFI – Australian farmers do not pay for any of their livestock emissions but they can be paid for reducing them.

It really is a carrot and stick situation. The CFI pays farmers to reduce or avoid emissions and as there is money to be made farmers will tend to do it. However the NZ ETS offers farmers no incentive to reduce livestock emissions. Farmers in Australia can also sequester carbon by planting trees or by increasing soil carbon and receive payments for this. Farmers in New Zealand have the same opportunity with regard to tress but not soil carbon. Furthermore Australian farmers will be paid for any activity which avoids an emission – eg. not felling an existing stand of trees.

The truth of the matter is that when NZ needs to buy carbon credits it is likely that they will be buying them off their Aussie counterparts.

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