To Nick Smith from Neil H 7 September 2010

Dear Minister

Thank you for taking the trouble to come and speak about the ETS in Gisborne. I apologise for not identifying myself to you when talking with you after the meeting.

I made a point during question time about the amount of warming that livestock methane could produce. You expressed doubt about my figures. I did not get the chance to fully explain myself later, so here is the explanation. The maths is very simple. I am amazed someone has not done it sooner. The basics were done by Dr. Wilson Flood, a Scottish chemistry teacher. He starts with the assumption that doubling CO₂ raises the temperature by two degrees. CO₂ makes up 390 parts per million (ppm) in the atmosphere. Methane is 1.8 ppm. We multiply by 21 because of its Global Warming Potential (GWP). But we adjust it down because the molecular weight of methane is only 16 as opposed to CO₂ at 44, meaning it takes more molecules of methane to make up a kg. This makes methane’s relative effect to CO₂ 13.75 ppm. So if doubling CO₂ raises the temperature two degrees, doubling methane will raise the temperature by 0.07°Livestock make up about 15 % of the methane emissions, so that means if they double their emissions the temperature rise is an insignificant 0.01°globally.

I still have not received a plausible explanation from MAF or any other Government Agency as to why all livestock methane is being charged to farmers. Everybody tries to justify it on the basis of its higher GWP. But this is a total red herring. For a farm with constant livestock numbers and constant production, the breakdown of methane is exactly equal to the production of methane. I was shown an excellent analogy recently. A forestry company plants an equal amount of forest every year and harvests the same area each year. The credits they earn from their growing trees exactly equals the liability from the trees they harvest. They have no carbon liability and they have no net carbon credits to collect.

The only potential liability for agriculture would be for changes in numbers and/or production levels, and these liabilities would be for a finite time based on the half life of methane. You stated in answer to a written question that this is seven years. Therefore the liability would halve in seven years, drop to 25% after 14 years etc.

But as shown above, the ‘damage’ caused by this rise in methane is so minute it cannot be measured. You made much in your talk of the need to ‘insure against the possibility of damaging global warming.’ The cost of the methane emissions only (no nitrous oxide) at a carbon price of $25/tonne is $5.50/sheep and $27.80/beef cattle beast. I can assure you that if an insurance company came up with a premium to insure my house that looked like this they would be laughed out of town. It would be far cheaper to live with the risk.

There are many of us who believe that the main driver of the climate is the sun. A graph of solar activity and temperature has a far better correlation than the CO₂ and temperature graph you showed. The scientists who study the solar cycle believe we are heading for a period of cooling. As you pointed out, your graph shows a dip in temperature over the last decade or so. This is the beginning of this trend. This then begs the obvious question. If you believe in insuring against global warming, should we also be insuring against this possibility of global cooling? I put this question to MAF. Their reply was;

“You asked about the cost of not acting on global cooling, as propounded below, but the press release mentions that this process is supposedly "unstoppable" (which makes sense if the process is driven by the sun) which would suggest no action will be effective in preventing it.”

This is exactly the point. If we can’t stop global cooling caused by the sun we have equally no hope of stopping global warming caused by the sun.

Several points in your address carried no relevance to the justification of the need for an ETS.

You showed a slide of editorial content from the four main daily papers. So what if they support the idea of an ETS. That is not justification. I am very surprised if you are not aware that all four of these papers are very biased in favour of AGW. We have letters from many people opposed to AGW complaining they cannot get their views published. They would not cover the petition we presented to Parliament last November. The NZ Herald initially refused to accept an advertisement we wanted to place to advertise the petition!!

You showed ways people could save energy and so cover their ETS costs. If people have not already taken those measures to increase their disposable income I consider it is rather a naive assumption to believe they will do so now to recoup their ETS costs.

You also strongly emphasized that livestock will not come into the ETS in 2015 unless our trading partners made progress and there were ways farmers could reduce their emissions viably. But you spent a good portion of your time outlining all the things going on in many parts of the world. Talking with you after, it is clear you believe that nitrogen inhibitors are well along the way and also methane reductions are likely. This leaves me with a strong suspicion that you could easily declare that enough progress has been made to keep the 2015 start date for livestock. This will merely put another cost onto farmers. They will have the option of paying the ETS charges or paying the cost of the emissions reduction technology. If this technology does not bring in productivity gains greater than the cost of the technology, but is only made economic by the savings in the ETS costs we will be worse off. Costings of various changes to farming practices shown in a recent series of seminars put out by MAF and DairyNZ reveal that is almost certain to be the case.

I am also extremely concerned by your reliance on trees to meet our emissions targets. You admitted that it is not a long term solution. So why are we doing it? The whole aim of an ETS is to make our country a better place for those coming after us. But if we plant pines to cover our emissions we are simply pushing our problem into the future.

You also defended the need for an ETS to maintain our clean green brand. I would not say that planting trees to cover our emissions then carrying on emitting as usual is clean and green. I do not believe our trading partners are nearly as concerned about this as you would lead us to believe. However I would not expect them to give a ‘green tick’ to an obviously unsustainable practice of planting trees to cover emissions. If emissions are dirty they need to be stopped.

As I said at the meeting, I do not believe CO₂ levels are anywhere near toxic levels. But if you do then you should be acting to cut emissions. The more I think about it the more I believe that an ETS is a blunt instrument if this is your aim. We should have had a tax on fossil fuel. There would be no incentive to forestry to cover up our continuing emissions. A tax can be used to modify behaviour. You did it last February to discourage smoking. A recent news item suggests it is working as tobacco sales are down. However it is well known that behaviour is not affected until the price increases significantly. This will hurt the economy. It is not possible to have it both ways. If you want our emissions per capita to fall you will have to see economic performance fall. There is no other way. Perhaps you fit in the mould of many in this world. They are eager to lower emissions to save the planet. It is the politically correct option. But when it comes to putting their money where their mouth is they are not nearly so keen.

Perhaps you should give yourself a reality check. You joined in the protest against the ‘fart tax’. You had much to say against the carbon tax in 2005, and said we needed to bury this lemon. I believe it is high time the ETS lemon went the same way. CO₂ is not harming us. Even if all the countries in the world took action they would not improve the climate. All we would do is precipitate massive economic collapse. Some people want us to do that. Don’t be a puppet in their hands to advance their agenda!!

Yours faithfully

Neil H 

To read Nick Smith's reply, click here