oecd environmental performance review - new zealand 2017 - launch presentation

OECD Environmental Performance Reviews

New Zealand 2017Simon Upton

OECD Environment Director

A very stable, consistent

economic performance

2

50

60

70

80

90

100

110

120

130

140

150

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Real GDP. Index 2000=100New Zealand

OECD

Source: OECD (2016), "OECD Economic Outlook No. 100 (Edition 2016/1)"

But growth in GDP per capita is held back

by slow labour productivity growth

3

-1

0

1

2

3

4

5

Labour resource utilisation

Labour productivity

Breakdown of GDP per capita growth during 1995-2015

OECD: Population-weighted average.

Source: OECD (2017), National Accounts and Labour Market Statistics databases.

Broader assessment: a good score

on the OECD Better Life Index

4Source: OECD (2016), OECD Better Life Index, www.oecdbetterlifeindex.org.

New Zealand doing its share to achieve

Sustainable Development Goals

5

0

10

20

30

40

50

60

70

80

90

100

Scores New Zealand OECD

Source: Based on OECD (2016), Measuring Distance to the SDGs Targets

Economic growth in New Zealand is

lower when accounting for pollution

6

-1.4

-1.2

-1.0

-0.8

-0.6

-0.4

-0.2

0.0

0.2

0.4

0.6

0.8Percentage points

Pollution adjustment of GDP growth, top and bottom six OECD countries,percentage points of output growth, annual average 2000-13

Source “Environmentally adjusted multifactor productivity: Methodology and empirical results for OECD and G20 countries”, OECD Green Growth Papers, No. 2016/04

OECD top 6 OECD bottom 6

7

NZ has a low-carbon energy mix & the 4th

highest share of renewables in OECD

88%

46%45%

40%

32%

29%28%

27%

22%22%

18%17% 17%

16%

14%

12% 12%11%

10%9% 9% 9% 8% 8% 8% 8%

7% 7% 6%5% 5% 5% 5%

1%

% share of renewables in total primary energy supply, 2015

88%

n.a.

Source: IEA (2016), IEA World Energy Statistics and Balances (database).

8

Small GHG emitter but growing emissionsTop OECD emitters.

New Zealand is among the ten most

energy-intensive OECD countries


0.00

0.05

0.10

0.15

0.20

0.25

Energy supply per unit of GDP, 2015Selected OECD countries

toe/USD 1 000 0.41

GHG emissions per unit of GDP are among

the top five in the OECD

0

0.1

0.2

0.3

0.4

0.5

0.6

Tonnes of CO2 equivalent per USD 1,000 GDP, selected OECD countries, 2014

OECD (2016), "Greenhouse gas emissions by source", OECD Environment Statistics (database).

Low effective tax rates on carbon favour

a more carbon intensive economy

11

CHN (P.R. of)CAN

AUS

KOR

USA

JPN

MEX

TUR

DEU

NZL

CHL

GBRIRL

ISL

FRA

CHE

DNK

NOR

SWE

0

20

40

60

80

100

120

0 100 200 300 400 500 600

CO2 emissions per unit of GDP (t/USD million, 2010 PPPs)

Tax rates on energy-related CO2 and CO2 intensity of the economy

Notes: Tax rates as of April 2012, except July 2012 for AUS. CO2 emissions: 2014 data. CAN and USA: taxes at federal level only.

Source: IEA (2016), IEA CO2 Emissions from Fuel Combustion Statistics (database); OECD (2015), Taxing Energy Use 2015: OECD and Selected

Partner Economies.

Economy-wide effective tax rates on carbon emissions from energy (EUR/t CO2)

12

Climate targets appear hard to

achieve with current measures

Source: OECD (2016), "Greenhouse gas emissions by source", OECD Environment Statistics (database); MfE (2016) Inventory Submission to

the UNFCCC; OECD (2016), OECD National Accounts statistics (database).

2020 pledge

2030 Intended Nationally Determined Contribution (INDC)

0

20

40

60

80

100

120

140

160

180

200

220

240

1990 1995 2000 2005 2010 2015 2020 2025 2030

1990=100

GDP (real)

GHG (excl. LULUCF) Business as usual

Half of emissions stem from agriculture

Source: OECD (2016), "Greenhouse gas emissions by source", OECD Environment Statistics (database).

GHG emissions by sector, 2014

The highest share of agriculture

in GHG emissions in the OECD

0% 10% 20% 30% 40% 50%

New Zealand

Ireland

Latvia

Denmark

France

Iceland

Chile (2010)

Australia

Mexico (2010)

Sweden

Contribution of agriculture to GHG emissions, top ten OECD countries, 2014

Source: MfE (2016), New Zealand’s Greenhouse Gases Inventory 1990-2014; OECD (2016), "Greenhouse gas

emissions by source", OECD Environment Statistics (database).

Energy consumption - and associated

emissions - have increased in all sectors

60

70

80

90

100

110

120

130

140

2000 2002 2004 2006 2008 2010 2012 2014

Energy consumption, index 2000 = 100

Commercial

and services


Industry and

construction

Residential

Agriculture

Transport

Per capita emissions of CO2 from road transport, selected OECD countries,

2014 or latest year available (tonnes/inhabitant).

High per capita emissions from motor

vehicles compared to other OECD countries

16Source: OECD (2016), "Air emissions by source", OECD Environment Statistics (database).

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

Per capita emissions of NOx from road transport, selected OECD countries,

2014 or latest year available (kg/inhabitant).

17Source: IEA (2016), IEA CO2 Emissions from Fuel Combustion Statistics (database);

0

2

4

6

8

10

12

14

16

18

High per capita emissions from motor

vehicles compared to other OECD countries

Environmentally related tax revenue as percentage of GDP and total tax revenue, OECD countries, 2014

Revenue from environmental taxes

is low in international comparison

18

0

2

4

6

8

10

12

14

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5%% % of GDP % of total tax revenue (right axis)

a) Poland: 2013 data; Australia, Japan and Netherlands: 2013 data for % on total tax revenue. Data for Latvia are not available.

Source: OECD (2016), "Environmental policy instruments", OECD Environment Statistics (database)

Tax rates on road fuels are

among the lowest in the OECD

Tu

rke

y

Neth

erla

nd

s

Norw

ay

Ita

ly

Unite

d K

ingd

om

Gre

ece

Ge

rma

ny

Fin

lan

d

Sw

ed

en

Be

lgiu

m

Fra

nce

Sw

itze

rla

nd

Ire

lan

d

Den

ma

rk

Isra

el

Po

rtu

ga

l

Ja

pa

n

Au

str

ia

Slo

va

k R

ep

ub

lic

Cze

ch

Re

pu

blic

Ko

rea

Slo

ve

nia

Sp

ain

Lu

xe

mb

ou

rg

Esto

nia

Ice

lan

d

Hun

ga

ry

Po

lan

d

Ne

w Z

ea

lan

d

Chile

Au

str

alia

Can

ad

a

Un

ite

d S

tate

s

Me

xic

o

0

5

10

15

20

25

30

Tax rates on road fuels on an energy basis, 2012

Petrol (road use) Diesel (road use)

Tax rate (EUR per GJ)

Note: Tax rates are as of 1 April 2012, except 1 July 2012 for AUS. Figures for CAN and USA include only federal taxes. NZL applies a road-user

charge to diesel that is not included in the figure. Tax rates converted using standard carbon emission factors from the Intergovernmental Panel

on Climate Change and energy conversion factors from the IEA. Source: Adapted from OECD (2015),Taxing Energy Use.

On the positive side:

Fossil fuel support among lowest in OECD

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

22%

24%

Total consumer fossil fuel support as a share of the energy tax revenue in selected OECD countries, 2014

43%

Note: Data for Australia include the country’s large Fuel Tax Credits, which alone explain the relatively high ratio observed for that particular country. This measure serves to

rebate some of the excise taxes that businesses pay on their purchases of fuel there. Data for Greece are for the period 2010/11 only.

Source: OECD (2016), "OECD Inventory of Support Measures for Fossil Fuels",

Freshwater abstraction for agriculture

is high in international comparison

737

566563545

426

329

5846

NewZealand

UnitedStates

MexicoSpainJapanAustraliaCanadaFranceSwitzerlandUnitedKingdom

Per capita freshwater abstraction for agriculture, Selected OECD countries,

2014

2014 or latest available year. UK refers to England and Wales.

Source: OECD (2016), "Water: Freshwater Abstractions", OECD Environment Statistics (database).

Nitrogen balance has worsened more

than in any other OECD country

- 8

- 6

- 4

- 2

0

2

4

Changes in nitrogen balance (bars) and agricultural production (dots), 1998-2000 to 2007-09

- 13 - 33

Agricultural production: based on the sum of price-weighted quantities of different agricultural commodities produced after deductions of quantities used as seed and feed

weighted in a similar manner. Index 2004-06=100. The OECD total excludes Chile, Estonia, Israel and Latvia.

Source: OECD (2013), OECD Compendium of Agri-environmental Indicators.

Northland

Auckland

Waikato

Bay of Plenty

Gisborne

Hawke's BayTaranakiManawatu-Wanganui

Wellington

Nelson and Tasman

Marlborough

West Coast

Canterbury

Otago

Southland

-10

0

10

20

30

40

50

-25 0 25 50 75 100 125 150 175 200 225 250

% increase in nitrogen pollution/year

Change in land area used for dairy farming (1 000 ha)

Predicted changes in nitrogen pollution of freshwater forecasted

with large-scale land-use change to dairy farming: 1996-2020

Land-use change to dairy farming

is predicted to increase nitrogen loads

Source: PCE (2013), Water quality in New Zealand: Land use and nutrient pollution

01020304050

National marine protected areas

Additional area

88%

0 10 20 30 40

Germany

Greece

New Zealand

UK

Spain

France

Chile

Japan

Iceland

Australia

Ireland

United States

Mexico

Canada

Korea

Strict natural reserves, wilderness areas or national parks

Natural monument, habitat/species management area

Protected landscape, protected area, or no category

Regional or international designation

Aichi target

A very high share of the territory is

protected areas

IUCN categories:

% terrestrial and marine area under protection, selected OECD countries, April 2016 data. Preliminary results.

Source: OECD calculations based on WDPA , April 2016

Population is growing

in largest cities and towns

Auckland + 30% since 2000

Hamilton + 31%

Tauranga + 36%

OECD Environmental Performance Reviews

New Zealand 2017Simon Upton

OECD Environment Director