Land-use Change as a Mitigation Option for Climate Change

To meet our targets   
help horticulture to grow,   
let forests respond.    

The main project objective is to predict the likely extent and nature of land-use change as part of a cost-effective response to land-sector mitigation targets and the potential economic, and social impacts of these changes. We also explore:

• how those land-use changes, and the intensity of effort required to achieve them, vary with the timing and stringency of targets and with different assumptions about new land uses and technology; and
• national impacts on gross domestic product (GDP), production of key export commodities, and employment.

We use three models:

• Motu’s Land Use in Rural New Zealand model (LURNZ),
• Manaaki Whenua – Landcare Research’s New Zealand Forestry and Agricultural Regional Model (NZFARM), and 
• Infometrics’ Energy Substitution, Social Accounting Matrix (ESSAM).

The land-use models simulate how land use might change to achieve a given emission target in the lowest cost way. Essentially both land-use models take a common reference scenario for land-use patterns in future years and then shift land uses from high emission uses toward lower emission uses until the emission target is met. Each model takes a different approach (statistical versus optimisation) to identify the combination of land-use changes that is likely to achieve this at lowest cost. In both models this is done through modelling the effect of an implicit price for emissions on the economic returns to landowners for different products. We consider a lower level of pressure to reduce biological agricultural emissions than to encourage additional forestry to reflect the current Government’s intentions.2 This allows for the use of various policy levers to achieve changes in land use and does not assume that agriculture will be included in the Emissions Trading Scheme (ETS).

We consider the impact of on-farm mitigation only in terms of how an assumed level might affect the land-use changes needed. The potential for mitigation via changing farming practices but not land use is covered by a separate project. For new technologies (we examine horticultural expansion and a methane vaccine – or equivalent other mitigation technology such as an inhibitor or significant change in farm practice) to be viable, New Zealand will require policies that will facilitate, encourage, or require their uptake.