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Māori Impacts from the Emissions Trading Scheme: Detailed Analysis and Conclusions

Acknowledgements

Foreword

1 Introduction

2 Māori Contribution to New Zealand Greenhouse Gas Emissions

3 Māori Economic and Socioeconomic Position

4 Likely High-Level Generic Impacts of the ETS

5 Likely ETS Impacts on Māori – Absolute

6 Likely ETS Impacts on Māori – Relative to Non-Māori

7 Summary of Findings

7 Summary of Findings

Relative to earlier New Zealand climate change policies, the proposed ETS policy framework provides far greater certainty for Māori interested in exploring possible economic development interests, especially in the primary sectors. While important ETS details remain unresolved, Māori can now investigate development options with greater confidence given this certainty, especially where such development may involve third parties.

The measures encouraging afforestation are seen as being positive for Māori with qualifying land by creating new land development options for such land that have to date been seen as unattractive to investors (eg, due to terrain characteristics or distance from connecting ports to offshore markets). Furthermore, these measures will enable the planting of alternative tree species including options around native tree species important to Māori.

Māori can be speculated to contribute a relatively low share of New Zealand’s total greenhouse gas emissions, although this is not clearly so. Māori households also tend to spend more on electricity and liquid fuels than non-Māori, and also a greater share of their total weekly spend on such items. While a greater impact on Māori households can be predicted for ETS-related electricity price rises, this is possibly not the case in respect of liquid fuels, given more affluent Māori households tend to spend a relatively higher share of their weekly spend on fuels than do other Māori and similarly affluent non-Māori. This raises a possible case for greater targeting of support to households for ETS-related rises in electricity prices.

The ETS is predicted to have greater impacts on Māori than non-Māori in some sectors such as pre-1990 forestry and perhaps fishing, but also possibly in post-1989 forestry. While the former two represent possibly disproportionately negative impacts, the latter is possibly disproportionately positive. A disproportionately positive impact is also possible (but not assured) for Māori interests in geothermal energy (particularly for electricity generation, but not for industrial processes). The negative impact of the ETS on pre-1990 exotic forestry raises particular and differing issues in relation to past and future Treaty settlements.

Like non-Māori, Māori farmers should prefer a relatively generous treatment for agriculture relative to that of pre-1990 forestry, though not to the same degree as non-Māori farmers. However, the impact on Māori agriculture interests relative to non-Māori is hard to discern absent details of how free NZU allocations are to be made, and how emissions costs levied on agricultural processors are to be passed on to farmers. Given these important details remain unsettled, Māori will have a keen interest in the governance processes by which they are resolved. The risk for Māori is that free NZU allocations will favour intensive and high-emissions farming, constraining Māori moving out of less-intensive and low-emissions farming into higher-intensity farming, further exacerbating the relative under-development of Māori land.

The ability of Māori to mitigate any disproportionately negative impacts, or to take advantage of post-1989 forestry opportunities, will be constrained relative to non-Māori given transaction costs and constraints particularly related to the ownership and use of Māori land. Furthermore, compliance costs and ETS-related penalties, as well as ETS-related restrictions on land-use opportunities, could further constrain Māori land use, and raise the risk of land forfeiture.

These issues raise questions as to whether targeted information and support is required to better enable Māori to avoid adverse ETS impacts and to take full advantage of ETS-related opportunities. Where Māori are able to take advantage of ETS-related opportunities, this may enhance their ability to overcome other constraints in land use (eg, capital constraints leading to relative under-development), giving rise to spin-off benefits. Conversely, where ETS-related costs reduce development opportunities, they will give rise to spin-off disadvantages.

Currently institutional barriers exist preventing Māori fully and actively participating in targeted R&D towards both emission reduction technologies and new climate change related technologies. R&D has been identified by Te Puni Kokiri as being a key enabler of Māori economic development and indeed New Zealand’s economic development. A more targeted structure for Māori R&D is needed.

An opportunity exists for Māori to differentiate carbon sink credits generated in New Zealand for added value. Such differentiation could include carbon credits being derived in accordance with Māori indigenous cultural values, and as a means to support Māori community development. Successful branding should result in premium value for properly accredited credits, but will likely require certification to an internationally acceptable standard for any such premium to be fully realised.

Determining where the overall Māori preference lies in relation to the ETS is both misdirected and impossible given available data. Since there is no unitary “Māori economy” it is not possible to discern a single Māori preference regarding the different features of the proposed ETS. Moreover, without knowing the precise mix of land and other interests of particular Māori organisations and individuals it is not possible to determine whether the ETS on balance helps or harms their net interests. There is a very real need and urgency around assembling detailed inventory and mapping of Māori forest land ownership and published data on Māori and non-Māori interests in pre-1990 and post-1989 forests to enable important development options for Māori.

Given the high and growing Māori participation in key sectors like forestry, farming and fishing and the identified exposure Māori have especially in terms of employment in these key sectors, continued Māori engagement and participation in the policy and related regulatory process will be essential to ensuring Māori do not bear a disproportionate burden from and post-ETS rollout.

Finally, Table 7.1 overleaf summarises outstanding ETS details with potential implications for Māori.

Table 7.1: Outstanding ETS details with potential implications for Māori

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