20bn needed annually to achieve emission reduction targets


Agriculture is big business in Ireland, but is dwarfed by estimates of the potential price tag that accompanies the Climate Action and Low Carbon Development Bill 2021, say legal analysts.

The International Monetary Fund (IMF) recently estimated that Ireland will need to invest €20bn each year up until 2030 to achieve the emission reduction targets set by the government, noted Peter McLay, William Carmody and Vanessa Byrne of the Mason Hayes & Curran business law firm.

They said the agriculture sector, a very important indigenous industry, providing roughly 173,000 Irish jobs, expects to be hit hard by any climate-related measures, but this needs to be considered in the context of the enormous estimated cost of Ireland’s climate change mitigation measures.

“The scale of this projected investment over the coming decade puts into perspective the size of the transitioning task that confronts Ireland, and suggests that placating the agricultural sector will be but one of many obstacles that need to be overcome,” said the Mason Hayes & Curran legal team, in their look at the consequences for agriculture of the proposed climate legislation.

The legal experts said climate justice requires that climate measures share the burdens and benefits, and just transition requires that the government maximise employment and support persons negatively affected by the transition.

But, due to Ireland’s unique emission profile (agriculture accounts for 35% of greenhouse gas emissions), and strong reliance on agriculture, farmers expect to be hit hard by climate-related measures.

And the statutory “in so far as is practicable” qualification in climate justice and just transition obligations makes it very difficult for affected parties, like farmers, to assess the likely impact of the Bill and to formulate a coherent challenge, said the Mason Hayes & Curran team.

Farmers’ fears have increased, as all amendments proposed by opposition parties in the Climate Bill legislative process were rejected by the Government. 

There were 239 proposed amendments, but Minister for Environment, Climate and Communications Eamonn Ryan said the only amendments he was likely to accept were his own.

For example, the government rejected an amendment in favour of treating biogenic methane produced by agriculture, and particularly cattle, differently from other methane emissions. 

It was proposed by Denis Naughten, TD, who said there appears to be a movement to drive down livestock numbers and to move the use of agricultural land towards crop production. He noted that there is much marginal land in Ireland that is not suitable for crop production and that cattle farming is the only commercially viable use for it.

During Oireachtas debates on the Bill, the point was also raised that methane emissions should be measured on a European level, and emissions should be reflected in the consuming country, rather than in the producing country (most of the food produced in Ireland is exported).

And, in an open letter to the Minister, one farmer highlighted that 717 tons of carbon were produced on his farm, according to a Bord Bia audit for 2020. However, the grassland and forestry on the farm removed approximately 1,026 tons of carbon from the atmosphere, resulting in a net sequestration of 309 tons.

In countries like France and New Zealand, the carbon sequestered by a farm is deducted to give a net carbon footprint. Under the Irish Climate Bill, however, it is only the carbon produced that counts in calculating carbon footprints.

It was pointed out that it will be important to keep farmers onside if the government intends that farmers use their land for planting trees as carbon sinks. 

However, farmers were not reassured by the “last-minute” amendment on carbon removals before the Bill completed its passage through the Seanad.

IFA President Tim Cullinan said, “This proposed Government amendment has not yet been published, but we understand that it will enable the Government to take carbon removals into account, but won’t specify how it will be done. 

"Therefore, we need a clear commitment from the Government that they will take removals into account and clarity on how they will account for them."

Immediately reorganising land use to generate “negative emissions” through efforts such as reforestation will be essential for the EU to achieve net-zero by 2050 in a societally cost-optimal way, said the McKinsey worldwide management consulting firm in its recent “How the European Union could achieve net-zero emissions at net-zero cost” report.

The report said using more efficient farming practices could reduce agricultural emissions, by far the hardest sector to abate, because more than half of agriculture emissions come from raising animals for food, and can't be reduced without significant changes in meat consumption, or technological breakthroughs.

McKinsey’s proposed cost-optimal pathway requires offsetting agriculture emissions with negative emissions in other sectors and increasing natural carbon sinks.

In the US, there has been early progress towards this objective, with farmers allowed to make money from carbon-sequestering practices, since 2010. They sell into a carbon offset market worth about $1 billion dollars in the US, from which companies buy offsets against their greenhouse gas emitting activities.

The Senate in Washington passed a bill recently which could put the full force of the federal government behind these efforts, if it moves successfully through the House of Representatives and Presidency, and becomes law.

Such legislation is some way off in the EU, but the EU Green Deal and Farm To Fork strategy will examine ways to incentivise farmers to encourage carbon farming initiatives.