The Kyoto numbers – mixed reaction to mixed messages

The surprising news in the latest Ministry for the Environment summary of our Kyoto Protocol unit position, which puts us in the green after previous estimated deficits, has been greeted warily by the media and rightly so.

The MfE report is available here. The important paragraph reads:

“As at April 2009, the net position is projected to be a surplus of 9.6 million Kyoto Protocol units during the first commitment period. The April 2009 update compares with a projected deficit reported in May 2008 of 21.7 million Kyoto Protocol units.”

But as Rob Hosking writing in the NBR notes, there is a high level of uncertainty about the figures:

“As for next year, pick a number, any number. It’s as likely as not to be accurate. This is going to continue until 2015, [Nick] Smith said, when New Zealand will either ‘have to write out a cheque, or receive a cheque, for Kyoto.'”

The Herald’s ETS watchdog Brian Fallow was also warning readers not to crack out the champagne:

“There is a wide margin of error or uncertainty around these numbers. It’s really a case of being 10 million tonnes in surplus, give or take 50 million tonnes.”

The blogosphere has also been running hot, so to speak, with discussion of the MfE revelations.

No Right Turn has some interesting analysis of the report details and points out that the newly positive positive is largely down to “methodological changes”.

“The entire change – all 30 million tons worth – is due to shifts in how we project and calculate agricultural and forestry emissions. Some of this – for example, better projections of animal numbers, predicting 400,000 fewer dairy cows in 2010 as a result of drought and lower dairy prices – is good, and adds significantly to the accuracy of the projections. But some of it is very dodgy indeed.”

Hot Topic rightly points out that the fluctuation may look good for the Government but is not influenced by the Government’s policies to try and limit greenhouse gas emissions.

“The volatility of the figures certainly doesn’t help the budget process, but has nothing whatsoever to do with making “sound climate change policy”. If you dig around a little in the FAQ, you find that the government’s only contribution so far has been to increase our liability.”

So what are we to make of all of this? The key take-aways would appear to be clearly laid out in the report – that, to use Nick Smith’s words our “bacon has been saved” by taking into account new information about forests planted after 1989 and by the impact on agriculture of the 2007-2008 drought. There’s a lack of sustainability underpinning both of those factors – the rate of new forest planting has tailed off rapidly and a boom period for agriculture could just as easily see emissions go the other way to the same degree.

Then there’s the methodology changes which would appear to contain a number of fish hooks. All of this would appear to suggest that the fluctuating numbers indicating our Kyoto Protocol unit balance and its monetary equivalent pretty much mean nothing, at least until it is time to settle up our account on the basis of the final tally.

In the meantime, there’s more need than ever for focus on what the Government is actually doing policy wise to make a significant impact on all the key indications so that going further into the green can’t be put down to luck and the tweaking of spreadsheets.