The ETS-waste regulations currently being consulted on by the Government include a loophole that will actually increase greenhouse gas production in order to save polluters money. This isn’t surprising given that the regulations were prepared for the Government by a company that will be best placed to help its clients develop systems to exploit this loophole by paying less whilst polluting more.
Rotting organic waste in landfills generates methane gas, which is bad for the climate. The ETS purports to want to reduce these methane emissions by charging landfill operators. This is intended to encourage gas capture and flaring (which is not subject to the ETS) and the reduction of organic waste going into landfills (i.e. being used to make compost, etc).
Under the proposed regulations waste to landfill is subject to a ‘default emissions factor’ (DEF). This default factor is based on an average composition of waste to landfills in NZ. The DEF is based on averages, so it assumes a relatively low amount of organic waste, because current practice is to divert greenwaste and use it for compost, mulch, etc.
Under the proposed regulations, any gas that is captured and flared is not subject to ETS charges (this is because methane is considered to be 21 times worse for the climate than the carbon dioxide that results from the flaring – burning – of methane). However, the proposed regulations do not have a default gas capture that matches the DEF (even though most experts say you can not get more than 60% capture). Gas capture is simply calculated by comparing actual gas captured to theoretical gas production under the DEF, which is essentially comparing apples and oranges. The outcome of this is that if a landfill operator increases the proportion of greenwaste entering the landfill (and the amount of methane production) they will pay less charges under the proposed regulations.
This works because the DEF sets a theoretical amount of gas production for a landfill, based on the weight of rubbish being disposed to the landfill. The ETS obligation is calculated by taking the actual gas capture off the theoretical production. The higher the proportion of greenwaste entering a landfill, the higher the methane production is compared to the DEF. This means if you have a lot of greenwaste in the landfill, the methane production is much greater than the DEF, meaning the gas capture is close to the DEF’s theoretical gas production (even though actual gas production is much higher).
Under the proposed ETS regulations, landfill operators only pay for the difference between the theoretical gas production and actual gas capture. This means putting more greenwaste into a landfill (and increasing actual gas capture relative to theoretical gas production) decreases the amount that will need to be paid under the ETS regulations, even though actual gas production is much higher. This loophole is already being exploited as some landfills are now reporting to have over 100% gas capture (which means they pay nothing under the proposed ETS regulations, regardless of their high actual gas production).
This can be simply resolved if the regulations require landfill operators using the DEF to use a default gas capture based on the national average (currently about 40%). Therefore, if landfill operators want to install a high tech gas capture system that is better than the default, they will also need to calculate a unique emissions factor for the waste entering their landfill. The regulations already provide for landfills to calculate unique emissions factors with SWAP Solid Waste Analysis Protocol surveys. That way, landfills wont be able to exploit the DEF by increasing the proportion of greenwaste.
So why is the Government proposing regulations with such a blatant loophole? The Ministry for the Environment has contracted out developing these regulations to a Technical Advisory Group (TAG) comprised of landfill operators already implementing this practice and the company that makes the gas capture systems (conflict of interest anyone?). This is probably because the Government’s cuts in spending to MFE have meant that it can not hire its own staff to do the job properly (or at least objectively). The following links have more detail:
The company that makes the gas capture systems: http://www.tonkin.co.nz/projects_environmental_LFG.htm
The regulations that this company drafted for the Government: http://www.climatechange.govt.nz/consultation/waste/recommendations-for-methodologies/
So what can you do about it? Submissions are still open on the proposed regulations. Make a submission by emailing the Government and telling them that the ETS waste regulations should require landfills using the Default Emissions Factor to use a default gas capture factor as well. More information about submissions can be found at: http://www.climatechange.govt.nz/consultation/waste/