Debate resumed from 18 June 2008.
ERIC ROY (National—Invercargill) Link to this
This is a rare moment of multitasking in the House. Today’s second reading takes us back to June last year when I sought the call, and then the House rose after I had occupied a brief 10 seconds of my speech. I say to the House that in terms of process, as a presiding officer, my speaking on a bill is a little bit unusual, but not rare. I will not be presiding over any part of this bill, and that is understood by members.
I understand a fair element of why this bill was perhaps generated by the Greens. They have had a concern that New Zealand has been underperforming for quite some considerable time with regard to its commitments to Kyoto. In fact, under the previous administration, New Zealand went back faster than any other country in category 1. So I understand the genesis of the Resource Management (Climate Protection) Amendment Bill whereby Jeanette Fitzsimons, wanting to be proactive, has brought the bill into the House. One understands why the bill was introduced, but the questions we have to ask are whether it will actually work, how well it will work, and whether it will achieve the outcomes we require in order to get some improvement in New Zealand’s profile for greenhouse gas emissions.
I think that one should categorise where one sits on this issue. I tell new members in the House that I have said a number of times that I have a particular concern about climate change. I believe that the combustion of fossil fuels is increasing the natural cycle of rising temperatures and various other climates changes in relation to that increase. I believe that effect, so I have some real concerns that we need to be proactive in this matter.
I say to the House that I do not think this bill will achieve the outcomes that are desired by the member in charge of it. For a start, I have some real difficulties in saying that the resolution of this problem is something we should shovel from central government to local authorities. Given that there are about 76 different local authorities around this country, I can see some real opportunity for a variety of applications for this legislation should it be passed by the House.
The second point I make is that I think the Resource Management Act is the wrong vehicle with which to try to resolve the issues around climate change. The Resource Management Act is being litigated at the moment, or going through a kind of negotiated process through consents. At the moment it is a very arduous and expensive course for anybody wanting to gain a consent, or to establish a new industry or a new activity. The process is costly and time consuming, and it is for that reason that National has introduced into the House a number of amendments to the Act.
This bill was crafted and delivered to the House before the House had agreed to or started to deal with an emissions trading scheme, which actually kind of overrides the necessity for this bill. We in National would say that an emissions trading scheme is a far better mechanism with which to deal with this issue.
Then there are issues of practicality. One would have to say that in the 76, or whatever number, local authorities around the place, the level of expertise required in order to deal with considering the implications of climate change in terms of passing consents leaves some opportunities for huge litigation costs and ongoing processes surrounding how those decisions are made. And dare I say it; the quality of decisions from one local authority to the next may be somewhat less than perfect.
Then there is the issue of timing. When a company or an individual applies for a consent under the Resource Management Act, that is the very initial stage of the development, and the company or individual will want some certainty around it. If, for example, the consent process adds another doubt as to whether a project may be advanced, the financial backing—and we know a little bit about the financial environment at the moment—becomes much more difficult, which adds another reason why it may be difficult to get something off the ground. It will be difficult to find the finance to go forward, because there will be some questions about the implications of the consent applied by the local authority if this bill is to be passed.
Secondly, the emissions trading scheme will be another method for those offsets. One does not know just what the implications of the emissions trading scheme will be at the initial stages of a company or an individual going for consent. So there are a lot of questions about timing at the consent stage, in terms of the implications of whether something should go forward.
Then there is the element of how well a decision would be made. I preface my remarks by saying that consent is not something for a regional or local authority to try to develop a national imprint on. In fact, it may well be the case that it is not something a national entity should try in order to determine an outcome that has an international repercussion. Let me give members an example. In the fair electorate of Invercargill we have Rio Tinto, one of the premier smelters in the world, in the respect of producing the finest grade of aluminium in the world. That, one hopes, will help it to ride out the various difficulties the aluminium smelting industry has at the moment. Prices for aluminium have dropped from about $3,000 a tonne to something like $1,400 a tonne.
The illustration I will give will horrify some members. For every tonne of aluminium smelted at Rio Tinto at Tīwai Point, 2 tonnes of greenhouse gases are emitted. People will say we should shut down that sucker because that is not what we want, at all. If Rio Tinto was to apply for an expansion or something like that, then it would be a local decision. It is horrifying, but for several reasons it is not. For a start, the product Rio Tinto is making, aluminium, has more offsets than the transport industry by 20 to 1. For every kilogram of aluminium that is used to replace a metal part in a vehicle the payback is 20 times those 2 tonnes in the saving of emissions, unless carbon fuel is being combusted to run the vehicle’s engine.
Secondly, if the process because of the local decision was to shut down Rio Tinto’s Tīwai smelter, then it would simply move to a category 3 country like China, where there are currently 23 different smelters. As I said, the profile of the greenhouse gas emissions from Tīwai is 2 tonnes per 1 tonne of aluminium smelted. If we look at China we see that the emissions are about 8½ tonnes per tonne. That is why I say that is not just a local authority or a regional decision for a national problem; it is actually a global decision.
Hon Simon PowerI missed the member’s comment, but the point I make is simply that I understand why this bill has come to the House. My response is simply that it is the wrong mechanism and the wrong bill when there are more effective ways to approach the issue. We need to be looking at national standards and emissions trading schemes, and engaging in the process on a national basis.
Hon DAVID PARKER (Labour) Link to this
There is no doubt in my mind that the world is living beyond the environmental means of our planet, not just because of climate change but on a variety of other measures. Fisheries are terribly depleted around the world. Habitats for many different species are shrinking, not just in Africa but also in our own country. Desertification is spreading at an alarming rate, not just in Africa but also in food-producing parts of China and in Australia. Freshwater aquifers are dropping in height because we are taking more water out of them than is being replenished into them. Enormous inland lakes such as Lake Chad and various others around the world are shrinking to a mere fraction of their former size because their water is being used for human purposes before it gets to them.
The stand-out signal of them all is climate change. The reality is that if the world does not get these problems under control, we will see more than just the loss of species as a terrible outcome; we will visit upon future generations a lifestyle and a conflict that is very scary to think about. I am not talking about that happening just to people many generations ahead of us. Our own children will probably be faced with conflicts caused by environmental woes, a lack of food, a changing climate, and flooding. If water levels go up by 1 metre, 30 million Bangladeshis will have to move—30 million. It beggars belief.
John HayesThat is a very good point. They are moving right now because of a flood, without any sea level rise. In fact, I heard an amazing statistic a little while ago, and it has stuck in my mind.
More people have already died in Bangladesh since World War II than died as a consequence of the bombing of Hiroshima and Nagasaki combined. Hiroshima and Nagasaki are writ large in the memories of most people of my age and older as being the worst environmental tragedy that the world has ever suffered. Yet already, without climate change or an increase in water levels, what has befallen Bangladesh has already been worse than the combined effect of Nagasaki and Hiroshima. A rise of the sea level by a metre would mean that 30 million people have to move somewhere else. That sort of event causes war.
Climate change obviously has very serious consequences, so what can we do about it? The sensible thing would be to price emissions properly. That does affect the decision as to whether we buy something. It changes behaviour. It means that a wooden ladder becomes cheaper than an aluminium ladder, because a wooden ladder does not have emissions. At the margin there will be a few more wooden ladders, fewer aluminium ladders, and fewer emissions in the world. Similarly, people would be encouraged to drive cars that have more aluminium than heavy steel. That is another good thing that emissions pricing does. But it works only if we have it, and it works only if we have a price that is high enough to change behaviour. At the moment we do not have that because the Government has suspended the emissions trading scheme. The investment signals are not yet in the economy, and, as a consequence, we will not have the same reduction in emissions that we would have with emissions pricing.
That is where I know Jeanette Fitzsimons stands on this issue. She says we need emissions pricing, but in the absence of emissions pricing we have to rely upon regulation. If we do not have emissions pricing or regulation, we will not have much at all to force change and reduce emissions, and we would have a very unpleasant future.
We hear National saying we ought not to be world leaders on this issue. New Zealand has never been a world leader on this. We should be ashamed of how much we have been laggards. It is true that in the last 3 years or so we have started to make progress, but it is not true that we have been world leaders. At one stage we were the only country in the southern hemisphere that agreed to take on a Kyoto commitment, but we have not been world leaders when it came to implementing policies to reduce our emissions.
It is true that we are world leaders in a little part of it, in terms of research into reducing agricultural emissions, and so we should be. We are good at improving the efficiency of farming as well as reducing emissions, and we will profit from that investment. To say that we should back away from the steps we have already taken—modest though they are in New Zealand, because apparently we should not be world leaders—is to abrogate our responsibility.
The reality is that if a country as rich in endowments as New Zealand—with its low population densities, its enormous endowment of resources, including land, soil, water, and forests—cannot get it right on environmental issues such as fisheries management or climate change response, we must ask ourselves what hope there is for the rest of the world. I am afraid that the reality is quite stark. If a country like New Zealand cannot get these issues right, there is very little hope that the world will. That is not a future that this Parliament should countenance.
If New Zealand does not show how these things can be done, we are effectively saying that the world will not. And if the world does not, then we do our children, their children, and all of the children of the world a great disservice, not to mention the other species on the planet that will become extinct as a consequence.
A response to climate change is absolutely necessary. I agree with Eric Roy that the pricing of emissions is probably more important than the measures in this bill, but we have not yet got that. The price has to be enough to change behaviour otherwise it is not worth doing; it is just a fig leaf that hides inaction. Unless we have an appropriate price on emissions, we must pursue regulatory alternatives. Those regulatory alternatives in New Zealand in respect of matters that effect the environment naturally sit under the Resource Management Act.