NZ businesses' carbon scorecard 'not the greatest' as invite issued for a tougher pledge

Wednesday, 24 July 2019

The Sky Tower will be lit in green this evening to mark the Climate Leaders Coalition's first anniversary.

Businesses belonging to New Zealand's Climate Leaders Coalition are probably pumping more greenhouse gases into the atmosphere than they did when the coalition was a founded a year ago, admits the group's convenor, Z Energy chief executive Mike Bennetts.

But while Bennetts acknowledged the coalition's scorecard was 'not the greatest in the world', it is celebrating its first anniversary with a fresh 'pledge' for stronger climate action and by lighting up Auckland's Sky Tower in green.

It is one year since 13 of New Zealand's largest companies created the coalition, promising to do their bit to cut greenhouse gas emissions.

Since then, the number of firms belonging to the coalition has mushroomed to 109, responsible for 60 per cent of the country's gross emissions.

Twenty-four of the businesses have reported collectively shaving their annual carbon emissions by 569,000 tonnes, which the coalition equated to taking 264,618 petrol cars off the road.

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But 15 have instead increased their emissions, by an amount that Bennetts believed would more than offset the reductions that the others had achieved.

'I would speculate it is probably not a 'net reduction' because that is New Zealand's issue, we take one step forward and perhaps two steps back because for some of these companies, their business activity grows.'

To put the 569,000 tonnes of savings achieved by the coalition's top performers into context, New Zealand's total annual carbon emissions have been hovering at about 80 million tonnes of CO2 equivalent since 2001, according to Statistics NZ.

Bennetts said people could take from that a recognition that technology solutions needed to be found for the 'really big issues', such as emissions related to agriculture and transport, and that leadership was required from both the public and private sector.

'We can do some sensible things like replacing lights with LEDs, reducing travel and using more renewable electricity.

'All of those things help. They don't make the big difference, but if we didn't do those things, then the pressure on the really big things becomes even more profound.'

Fonterra's move to bring forward a commitment to stop installing coal boilers at its milk plants appears one sign of progress.

He reiterated Z's support for the Government's 'feebate' plan to subsidise the importation of electric cars and other low-emission vehicles through fees on higher-emissions cars.

Climate Change Minister James Shaw forecast the savings achieved by coalition members could double this year, and again in 2020.

Many of the businesses that had joined the coalition had 'no idea' what their emissions were prior to signing up, so that in itself was progress, he said.

'It just does take time to start to see real gains. Obviously everybody wants to go faster, but as a first step, I'll take it.'

Bennetts singled out as one highlight in the coalition's first year, Fonterra's decision to bring forward a commitment not to install any more coal boilers at its milk plants by 11 years – from 2030 to today.

A growing number of companies were reducing staff air travel and offsetting their carbon emissions through forestry, he said.

The Climate Leaders Coalition is now inviting members to sign up to a strengthened pledge.

That is intended to reflect a growing consensus among scientists that global warming from pre-industrial levels needs to be kept to below 1.5 degrees to avoid the worst effects of climate change, rather than the 2 degree cap on which the 2015 Paris Agreement was based.

While the United Nations has warned the tipping point for 'irreversible changes in major ecosystems and the planetary climate' may already have been passed, Bennetts indicated chief executives were being motivated to take action because they saw it as part of their corporate responsibility, perhaps more than out of personal fear.

'I wouldn't use the word 'fear' because chief executives shouldn't be fearful but what I would say is it is 'front and centre' for many chief executives from a risk perspective.

'As business leaders one of the things we are paid to do is assess and mitigate risks, and the effects of climate change is a risk that is growing.'

Fiduciary duties aside, Climate Change Minister James Shaw says he is now starting to see a level of personal concern about climate change among business leaders.

Nevertheless, they were also 'human beings, mothers and fathers' and just as likely to be personally affected by climate change, he said.

'They are not just doing this to satisfy shareholders.'

Shaw agreed that if leaders were taking UN warnings about climate change fully to heart, then more action would be underway than was occurring, including from Fonterra.

'In New Zealand we have allowed ourselves to be lulled into a false sense of security that we can fix climate change without really changing anything.'

But he said he was starting to see a level of personal concern among business leaders.

'The shift in consciousness about climate change that you are seeing in broader society is reflected in this group of CEOs.

'It is starting to come through. They are all looking at the same information that you and I are.'

Notable companies that have not at this point joined the coalition include Genesis Energy, transport giant Mainfreight and infrastructure company Infratil.

Shaw encouraged each of them to sign up.

'There will be some businesses that have got a substantial emissions profile, but I would say 'just take the step'.'

Those companies have been approached for comment.

Genesis spokeswoman Emma-Kate Greer said it did not rule out joining the coalition but had been focussed on its own initiatives to measure and reduce emissions, which include an 'intention' to phase out coal-powered generation at Huntly by 2030.

'We share the ambition to shift to a low carbon economy. Genesis has cut more emissions than any other New Zealand company – a 57 per cent reduction in generation emissions since they reached their peak in 2006,' she said.

Bennetts said businesses outside the coalition were often deeply committed to action, but some might not feel ready to meet the commitment to sign a pledge that they would measure their emissions and publicly report on them – or commit to working towards a goal that could be independently verified as consistent with the UN's emissions targets.

'Different company cultures determine what position they think they need to be in before they can sign up,' he said.