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FAR's response to HWEN split gas farm-level levy recommendation

FAR supports the farm level approach, because:

  1. We believe it will provide arable farmers with the greatest recognition of the work they have done to reduce emissions from their farming businesses.
  2. Following our consultation period earlier this year, this approach emerged as the clear preference for arable farmers.
  3. It is a far more palatable options than the ETS – which was the alternative.

We believe that of the options consulted on, the Farm-Level Split Gas Levy will:

  • Provide arable growers with the most control over what they pay
  • Only pay for what you emit 
  • Recognition for emissions reductions.
  • Will actually result in the greatest reductions in on-farm emissions.

We acknowledge that some growers will find the economic impacts of emissions payments under the Farm-Level Split Gas Levy challenging, but we believe that this system will be vastly more suitable than the alternative of entering into the Emissions Trading Scheme.

NB This is only the HWEN recommendation to Ministers. There is no guarantee that the government will run with this recommendation.

Next steps

  • Climate Change Commission provides advice to Ministers on assistance, progress and farmer readiness for pricing (May/June 2022).
  • Government considers He Waka Eke Noa recommendations – final decisions Dec 2022.
  • Legislation and system implementation by 2025.

FAR will work with growers to understand the pricing recommendation and what they need to know and do as more details emerge.