Opinion: Time to take up the climate gauntlet

2 February 2016

Gerri Ward, Sustainability Manager from Z Energy, challenges New Zealand businesses to tackle climate change.

The world’s leaders agreed in Paris last month to an ambitious target of limiting global temperature increases to 1.5°C by 2030; for context, scientists say a two degree increase – just half a degree above the agreed target – could sink some island nations, worsen droughts and drive a third of the globe’s species to extinction.

It’s a challenge the world cannot afford to overlook. As US President Barack Obama said to the United Nations last year, this is the first generation to experience the effects of climate change, and the last that can do something about it. The global stage has been set for unprecedented action on climate change, and it’s now up to us, as individuals and businesses, to get into action while we can still limit the worst social, economic and environmental impacts of climate change.

Failure to prepare for climate change has been identified as posing the greatest risk to the global economy over the next decade in a World Economic Forum survey released last week. For a company whose products currently account for about five per cent of New Zealand’s total greenhouse gas emissions, Z’s role in meeting this challenge may seem counterintuitive. This is the thinking that business can show real leadership on – rather than focusing on the costs of taking action on climate change, what are the opportunities that come with leading?

Like most businesses now, Z acknowledges and accepts the science of climate change. We accept that the products we sell contribute to the problem and we believe that, as a transport energy company with no oil and gas exploration interests, we are in a unique position to move from being part of the problem to the heart of the solution.

We believe that being a part of this solution includes working alongside other Kiwi businesses to take up the gauntlet thrown down by the global climate framework, and take action in incorporating carbon action plans into our strategies. Everything we now see and hear is that customers are increasingly demanding this level of action and commitment from the businesses they choose to support and are prepared to reward those companies that lead in this space.

The upcoming review of the New Zealand Emissions Trading Scheme provides a timely opportunity to develop a meaningful policy response in order to meet this global target. But facing into the climate change challenge isn’t simply the job of government – it requires leadership and commitment from business and, ultimately, from consumers.

As an example of providing this type of leadership and commitment, Z will this year open a $26 million biodiesel plant in South Auckland. The plant will produce 20 million litres of sustainable biodiesel per year, and is the only plant of its type in the world to have been built without a government subsidy or mandate. For the first time, commercial and retail fuel consumers in the upper North Island will in April have the choice to use a sustainable, locally-produced biodiesel as part of their own small steps in tackling the climate change challenge.

While business must increasingly lead, policy can and should facilitate and encourage meaningful, ambitious action on climate change. Businesses will be much more likely and able to act boldly in the shift to a low carbon economy if long-term political ambition is clear and consistent.

Z acknowledges the uncertainties around the policy and financial instruments needed to tackle New Zealand’s unique emissions profile, and that any carbon market mechanism must be equitable, and sensible. We also recognise that this is one of the most complex policy challenges of our time.

However, we do not see New Zealand’s emissions profile as being an insurmountable barrier to the ability to lead innovative and meaningful change in the creation of climate change policy solutions.

The global climate agreement gives us the context to develop a meaningful response that must result in profound, long-term change. It’s up to us all to interpret how to move on that, and quickly. New Zealand’s current commitment (30% below 2005 levels by 2030, or 11% below our 1990 baseline) would lead to a 3.5° temperature increase by 2100.

Fundamentally, for a carbon market mechanism to result in action and change, it must be fungible, linked internationally, and carry a price per tonne that will make business and consumers take notice and, most importantly, change.

If the New Zealand public, and New Zealand business, are up for this, then what’s stopping us from leading on this? Why couldn’t New Zealand be the first country in the world to enable an effective market-based solution to global climate change? New Zealand has a global reputation for leading on the things that really matter and businesses understand the opportunities of being at the leading edge – particularly when it comes to the products and services that fit the changing demands of a low-carbon economy.

As a company which has set some bold and ambitious sustainability targets without a clear roadmap as to how to achieve them, we want to partner with Kiwi businesses to be bold, to take advantage of New Zealand’s trusted international reputation, and to create opportunities which result in social, economic and environmental sustainability.

The climate change gauntlet has been thrown. The worst thing we could do right now is not pick it up.

Gerri Ward is Sustainability Manager of Z Energy.