Abstracts Category : Other

Assessing the consequences of the Lake Taupo Nitrogen Trading Programme in New Zealand, using a landscape approach

by E Anne Spicer

This thesis investigates the consequences of implementing a local policy regime that potentially enables a viable agricultural sector to operate within environmental limits. The Lake Taupo Nitrogen Trading Programme is an exemplar cap and trade regime located in New Zealand. It is the only cap and trade programme, to date, in which a limit on non-point source nitrogen discharges is applied at both the watershed and the farm levels. This study uses a landscape approach to assess the effects of this cap and trade implementation in order to achieve a rich understanding of the changes in land-use and farm practices that have occurred, the driving forces involved, and the five landscape paths that have evolved. The study finds that the cap and trade regime is insufficient on its own to achieve a viable agricultural sector in the regulated area. Investigation at different landscape scales, for instance, showed that factors such as the lack of low-nitrogen mitigations and land-uses, the gatekeeping role of the OVERSEER programme and the perceived effect of nitrogen sales on land values discouraged on-farm innovation and nitrogen trading. These and other drivers have led some landowners to make adjustments that may not have been expected under a cap and trade regime, and some of these potentially make a negative contribution to developing a viable agricultural sector. The latter include: semi-retirement, investment outside of farming, reductions in productive capacity without apparent reinvestment, and relocation of part of the farm outside of the regulated area. Adjustments that may make a positive contribution include: secondary processing on farm, farm amalgamations, and investment in higher value land-uses (dairying, dairy support and carbon forests). Some farmers that have opted for business as usual were reluctant to sell nitrogen because of the potential negative effect on land values and the ability to sell, and so further significant land-use change as a result of trading nitrogen currently appears unlikely. Overall, land-use change that may make a negative contribution to a viable agricultural sector occurred on 42% of the land in the study area while changes that may contribute positively to a viable agricultural sector occurred on 32% of the land. Business as usual is estimated to have occurred on 25% of the study area. As a consequence, it currently appears that the future landscape trajectory for pastoral land in the Catchment is one of reduced production. Thus, complementary research and technology policies, and the capacity to find new ways of making a living from rural land, are essential additions to a cap and trade regime in order for a viable agricultural sector to operate under environmental limits.