Nigel Tutt Chief Executive of Priority One

Business adaption to climate change is a topic that is top of mind currently. A few weeks ago, our government announced that New Zealand farmers would pay for emissions from 2025, we also have the UN climate change conference COP27 underway in Egypt.

Adaptation to climate change, and in particular reduction of emissions, is a challenging issue for a country like New Zealand. The foundations of our economy are agriculturally based and the methane and carbon emissions from this sector are significant; unfortunately, those emissions are not easy to reduce without creating side-effects that will cause problems. The dairy industry is important for our country and accounts for about one-quarter of export earnings.

Big gains not easy

Emissions from the wider business sector are far-ranging, and to date the areas that have come most into focus are industrial process heat – factories using heat to create products usually by using natural gas – transport and waste. While many businesses can make some degree of positive change, big gains are not easy to come by – there are very few emissions free alternatives to heat something to 400 degrees or to transport 30 tonnes of product from Auckland to Wellington. Technologies are in development but realistically these are several years away from deployment.

There is also the difficult question of how much pain our country wants to take in this area given our relatively small contribution to global emissions. Reducing emissions carries financial and productivity trade-offs. While we want to reduce emissions, we also need to feed a large amount of people, keep businesses profitable enough to trade and to improve living standards. The direction of change is clear but how we transition effectively to a low emission environment, without causing other issues, is the question. This is where government's focus should lie.

Not a choice

Regardless of if you agree with man-made climate change or a particular government policy, I don't think emissions reduction will be a choice for NZ anyway. We are an exporting nation and the customers for those exports will demand low emission products in the future. A good example of that is in the UK, where Tesco has committed to be carbon neutral by 2035 and net zero by 2050. The EU has also proposed a levy on imported carbon-intensive products. If Kiwi exporters want to trade, they will need to be clean, and for that we will need to act fast.

Opportunity

There is opportunity in this change of course; if we can take a leadership position around emissions reduction, we should be able to command a premium for our products internationally, and we are already in a great position with some of our horticultural products. I believe there is also a big opportunity for NZ in alternative proteins; locally this may take the form of food grown in the marine environment (algae, seaweed, shellfish etc), where we have all of the ingredients for success. While that may not be a big industry now, look for it to expand rapidly over the next decade.

For more information on transport emissions, alternative fuel options and Electric Vehicles within our region, we are hosting an EV showcase event with Farmer Autovillage, Mount Maunganui this Thursday, November 17 at 5pm. The event is open to business and the public. For more information and to register, visit: https://www.priorityone.co.nz/event/drivingourfuture