Vegetables NZ Inc

CLIMATE CHANGE AFFECTS ALL

COVERED CROP GROWERS

Words by Antony Heywood : General Manager, Vegetables New Zealand Inc.

Climate change discussion is heating up… as long as that heat is renewable.

Covered crop growers are in a battle to decarbonise their process heat resource. For most growers, the process heat used in their operation is a large capital cost item, costing upward of $500,000 to many millions of dollars in large operations. Moreover, the cost of running the plant is a significant variable cost, second only to labour each month. Given the significance of the input, growers are in a no-win situation if they are running a carbon process heat plant. Carbon energy, derived from coal and natural gas, is considered by this government as a non-desirable heat source because it contributes to climate change gases. Growers, like the government, realise carbon heat energy is not a long-term solution. Growers support the need to adapt for climate change to ensure their children have a future. Growers want to feed their children and the world. The two issues are not at odds but need a managed strategy or plan to ensure both are sustainable from the grower viewpoint. The government has placed time limits on the reduction of climate change gases. It basically states that by 2035, all process heat needs to be renewable energy. What the statement forgets to say is, how we are going to get there? Any change comes with costs. Most covered crop operations will need to change or modify their plant, at considerable cost, if they are going to use renewable energy. Then there is the cost of running the new plant. If we use electricity as an example, the cost of electricity needs to be at a level coal or natural gas was before 2020. Currently electricity is three times that level, and increasing at a fast rate. The government, to its credit, has a number of funds that give businesses a chance to compete for money in a co-funding process. This requires applicants to write a business case, which is considered by a panel. If accepted, the business needs to comply with reporting on milestones throughout the project. The issue here is that this takes time and involves a lot of compliance. These requirements can work for businesses large enough to have a project manager. But if you are a small business with limited human resources, where do you get time to apply compliance to your business, let alone project management for compliance? All capital investment needs checks and balances to ensure it is successful, but in this case, where the grower has no option if they are to remain in business, it would be preferable to look at the problem as an industry project, where capital is assessed at scale for multiple operations, and solution developed as a network of resources.

The reporting could also be aggregated, with individual growers grouped together to give a New Zealand focus to the issue. This would also create meaningful data for the government, while individual growers could be benchmarked to promote best practice in a grower-based improvement system. Growers need certainty. A stable economic and political platform is required to encourage investment. If the government is serious about climate change, it needs to work with the affected parties to build a codesigned transition plan. A managed strategy or plan will give growers the certainty they need to invest in their businesses. Given the time limit the government has placed on this change, it is also imperative that growers get access to capital funding to make the change. Again, this needs to be a co-designed system involving all parties: growers, the government, industry and suppliers. Here is our chance to build a network of knowledge and resources that will give a far wider perspective on energy than a single grower energy plant. Now is our time to be bold and involve growers, communities and the government in how we manage energy in the future.