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Forestry and the Emissions Trading Scheme

Forestry and the Emissions Trading Scheme

This month I attended an excellent seminar in Rotorua presented by the Royal Society of New Zealand, entitled ‘Ten things you didn’t know about climate change …’

Professors Tim Naish and James Renwick are entertaining speakers who presented scientific data in an easy to understand format to support each of the Ten Things

A few of the Ten Things presented:

  • The last time we had a record cold year was 1909. Temperatures vary up and down from year to year, because of El Nino and La Nina events, or due to other natural events. However the warmest years on record have been repeated in 2014, 2015 and likely to continue in 2016.
  • Scientists are almost 100% sure that global warming is human induced.  The carbon that has been added to the atmosphere has the chemical signature of fossilised wood - coal, oil and gas. Oxygen levels in the atmosphere have been decreasing as carbon dioxide levels have increased, due to the combustion of oxygen by burning fossil fuels. This proves warming is not a result of natural earth warming and cooling cycles.
  •  The modelling based on pledges made as part of the Paris Agreement will limit global warming to around 2.7 degrees Celsius. The modelling based on current policy settings indicates global warming of 3.5 degrees Celsius. To achieve the 2 degrees Celsius target agreed in Paris, emissions must peak very soon and all emissions of carbon dioxide must be reduced to zero before the end of the century. The current global trajectory projects warming of 2 degrees Celsius to occur by 2035, less than 20 years away!
  • New Zealand’s per capita emissions are above the global average, and per capita we are in the top ten globally. Although the proportion of agricultural emissions contribute to this position, the biggest growth in emissions in New Zealand in recent years has actually been in transport and energy. Both are sectors where emissions reductions technologies are immediately available for implementation if there were political commitment and willingness to make a change.

The question and answer session that followed the Ten Things seminar was informative and thought provoking. I’d thoroughly recommend attendance if the seminar comes to a town near you.

The Ten by Ten: Climate Change series presented by the Royal Society of New Zealand

Price Update

The NZU market price has continued to increase and is currently trading at around $17.80-17.90 per NZU.

The figure below shows the recent carbon credit prices for EUAs, CERs, NZUs and ERUs. Note that from 1st June 2015 only NZUs or New Zealand AAUs are valid units in the NZ ETS. EUAs are valid units for trading within the European Union.

Figure 1: Recent Carbon Prices - NZ$/t CO2e – Real (CPI adjusted)