Executive summary: Reviews of the 2050 target and international shipping and aviation emissions

He Pou a Rangi Climate Change Commission has reviewed Aotearoa New Zealand’s 2050 target for reduction in greenhouse gas emissions, and is recommending the target is amended.

As required by the Climate Change Response Act 2002 (the Act), we have reviewed the country’s 2050 emissions reduction target, and also considered whether to include emissions from international shipping and aviation in the target.

The 2050 target sets clear, long-term requirements for Aotearoa New Zealand’s reductions in greenhouse gas emissions. It guides the Government’s climate change policies, decisions and actions. It also provides long-term clarity for households, businesses and communities so they can plan long-term action and investment.

When the target was set, Parliament recognised that circumstances can change. For that reason it required that the target be reviewed every five years. This is our first review.

The Act sets clear conditions for that review. It details the factors we have to consider, and it provides that we can recommend amending the target only if significant changes have occurred, and those changes justify amending the target. This test reflects the importance of keeping Aotearoa New Zealand on a steady course to low emissions, while still allowing the country to adjust when necessary along the way.

Our review of the evidence shows that significant changes have occurred since the target was set by Parliament in 2019. After assessing the evidence, consulting with the public, and revising our analysis based on what we learned, our assessment is that the changes are significant enough to justify amendments to the 2050 target.

On the following pages we summarise our analysis and set out our recommendation for the 2050 target.

Significant changes since 2019

• Many comparable countries have by now set targets that are more ambitious than the current target of Aotearoa New Zealand.

• Also, scientific evidence is increasingly clear that global action is insufficient to limit global warming to 1.5°C outright. This implies that even greater reductions are needed in the near and longer terms to limit as much as possible the amount by which the world exceeds 1.5°C, and then to potentially bring the temperature back down again.

• The impacts of global warming are greater, in both severity and scale, than was understood by the global science community when the target was set.

• The increased risks and impacts of climate change have implications for Aotearoa New Zealand’s future. Delaying action transfers costs and risks to future generations.

Our 2050 target recommendation

We are recommending that the target be amended to require:

• net emissions of all greenhouse gases other than biogenic methane to reach at least net negative 20 MtCO₂e by 2050 

• emissions from international shipping and aviation to be included in this net negative 20 MtCO₂e target

• gross emissions of biogenic methane to reach at least 35–47% below 2017 levels by 2050

• there are further reductions and removals of greenhouse gases beyond these levels after 2050.

Why amend the target?

• The significant changes since 2019 all point to Aotearoa New Zealand moving further and faster to reduce emissions than the current 2050 target provides for.

• The recommended target responds to these changes and reflects Aotearoa New Zealand's commitment to global action on climate change.

• The recommended target also takes account of what is realistic and feasible for the economy and communities.

Why include emissions from international shipping and aviation?

• Emissions from Aotearoa New Zealand’s international shipping and aviation are equivalent to about 9% of Aotearoa New Zealand’s net domestic greenhouse gas emissions.

• Including these emissions in the target is feasible and would mean these sectors become part of Aotearoa New Zealand’s emissions reduction planning. This would increase certainty, transparency and accountability in Aotearoa New Zealand’s efforts to limit warming.

• Including these emissions in the target would also align Aotearoa New Zealand with trading partners and international industry efforts to reduce these emissions.

Impacts

The recommended target:

• is consistent with an emissions pathway in which the country causes one third less warming by 2100

• is compatible with ongoing economic growth

• would bring Aotearoa New Zealand’s target closer to other countries

• has potential co-benefits such as improved energy security, better health outcomes and closer alignment with international market preferences

• would reduce the risk of a harsher and costlier future transition.

This document presents the first independent review of the 2050 target for reduction of greenhouse gas emissions by He Pou a Rangi Climate Change Commission (the Commission), as required in the Act. It also presents a one-off review, also required in the Act, into whether international shipping and aviation emissions should be included within the target, and if so how.

It sets out our approach, the evidence we examined, and our findings and recommendations.

Aotearoa New Zealand’s 2050 target

One of the Act’s purposes is to provide a framework for Aotearoa New Zealand’s contribution to international efforts aimed at limiting global temperature increase to 1.5°C above pre-industrial levels.

To support that purpose, the Act sets a target for reduction in Aotearoa New Zealand’s greenhouse gas emissions by 2050. The Act sets the 2050 target for emissions of all greenhouse gases other than biogenic methane to reach at least net zero by 2050 and beyond, and for gross emissions of biogenic methane to reduce to 10% below 2017 levels by 2030, and 24–47% below 2017 levels by 2050 and beyond.[1] This ‘split-gas’ approach reflects the different impacts of these gases on global warming.

While the current target covers Aotearoa New Zealand’s domestic greenhouse gas emissions, it does not include emissions from international shipping and aviation.

The 2050 target guides government decisions about emissions budgets and emissions reduction plans, which in turn influence government policy decisions on matters such as transport, energy, building, land use and much more. Ultimately, those policy decisions affect every individual, household, business and community in Aotearoa New Zealand.

Our approach to these reviews

Both of our reviews reflected the Act’s requirements. For the 2050 target review, we considered whether there had been significant changes since 2019 relating to climate change. We then considered whether those changes justified a recommendation to amend the target. We considered the implications of amending the target for Aotearoa New Zealand. We also considered whether and how any amendments to the target would support the Act’s purposes.

The Act allows us to recommend amendments to the target only if significant change has occurred since it was last set. This reflects the importance of ensuring stability and clarity for households, businesses, and communities, while still allowing flexibility for the country to respond to significant changes in circumstances.

For our review of emissions from international shipping and aviation, we considered whether to include those emissions in the 2050 target, and if so how.

In all of our work, the Act requires us to consider a range of factors including science, technology, the economy, social and environmental circumstances, intergenerational impacts, te ao Māori, and international responses to climate change.

In June 2024, the Government commissioned an independent panel to review methane science and the 2050 target, in order to determine the level of methane emissions that would be consistent with ‘no additional warming’ beyond 2017 levels. While we acknowledge that context, our review is separate and is conducted according to the 2050 target and international shipping and aviation review requirements set out in the Act.

Building insight and evidence through consultation

Our reviews of the 2050 target, and on whether to include emissions from international shipping and aviation in the target, were informed by public feedback.

During 2023 we ran an initial call for evidence, in which individuals and organisations provided evidence relevant to both of our reviews. We also drew on existing evidence from previous engagements with iwi/Māori and stakeholders. Between July and December 2023, we met with some of the organisations that had submitted evidence, including representatives from the agriculture, shipping and aviation industries.

In April 2024 we released discussion documents for both reviews. During April and May we conducted further engagement including regional meetings, online webinars, hui with sector groups and other stakeholders, hui with iwi/Māori, and more. We received 192 submissions about our review of Aotearoa New Zealand’s 2050 target, and 158 on our review of whether emissions from international shipping and aviation should be included in the target.

We carefully considered all feedback we received, and investigated any new evidence presented to us. The consultation shaped our analysis and influenced our final recommendations – at times contributing to changes in our analysis as discussed below.

In late 2024 the Commission has also provided advice on Aotearoa New Zealand’s fourth emissions budget, covering the period 2036–2040. That advice is aligned to the current 2050 target. It does not take account of this advice about the 2050 target and inclusion of international shipping and aviation emissions in the target.

While each piece of advice has a specific focus, they both deal with Aotearoa New Zealand’s journey to becoming and maintaining a thriving, low emissions economy by and beyond 2050.

Together they provide decision-makers and citizens with a clear view of options for Government decision-making that will affect the country’s actions, planning and investment for the next 20–30 years.

Global efforts are not sufficient to limit warming to 1.5°C and other countries are adopting more ambitious targets

Since 2019 many comparable countries have adopted emissions reduction targets that are more ambitious than Aotearoa New Zealand’s current 2050 target. Trading partners such as Australia, the United States, the European Union, Japan, Singapore and Ireland have adopted targets aiming for emissions of all greenhouse gases to reach net zero by 2050.

Aotearoa New Zealand’s 2050 target aims for net zero for some greenhouse gases, and for reduced gross emissions of biogenic methane, rather than for net zero emissions overall. In 2019 Aotearoa New Zealand was among global leaders in setting a long-term emissions reduction target. That is no longer the case. Many comparable countries’ responses to climate change have shifted significantly since the 2050 target was first set.

Since 2019 it has also become increasingly clear that current global action is not sufficient to limit warming to 1.5°C above pre-industrial levels. Average global temperatures are already close to that threshold. It is highly likely that average warming will exceed 1.5°C within the next 10 years, bringing increased risk of severe and widespread climate impacts. This implies that even greater reductions in global emissions are needed in the near and longer terms to limit as much as possible the amount by which the world exceeds 1.5°C, and then to potentially bring the temperature back down again.

The impacts of climate change are greater in both severity and scale than previously anticipated

The impacts of global warming are greater in both severity and scale than was understood in 2019. Research has found that greater impacts are being felt at lower temperature levels than previously expected. Harmful impacts from climate change are becoming more severe and more widespread as the planet warms. Scientific understanding of these impacts has advanced since the 2050 target was first set.

Those impacts include high-profile events such as tropical cyclones, heatwaves and droughts that cause devastating impacts in many parts of the world. Climate change has also disrupted food and water supplies for hundreds of millions of people in recent years. It is causing damage – some irreversible – to land and ocean ecosystems. Recent science suggests that, for every fraction of a degree of warming, people and nature are both more likely to be affected, and more likely to be badly affected.

Aotearoa New Zealand is also affected. The country has, in recent years, already experienced significant harm from cyclones, floods, landslips, droughts and wildfires. Climate change is increasing the frequency and impacts of these events, which cause damage and impose significant costs on Aotearoa New Zealand’s communities.

The burden from climate change is being transferred to future generations

The balance of intergenerational equity shifts when Aotearoa New Zealand accelerates or delays action to reduce emissions. That balance has shifted since the 2050 target was set. Because of the decreasing likelihood that the world is on track to limit average warming to 1.5°C above pre-industrial levels, and because the impacts of climate change are more severe and widespread than previously understood, future generations will face a greater burden from climate change. Not only are they likely to face more severe climate impacts, it is likely they will also have to do more to reduce emissions.

The current 2050 target does not reflect these growing risks

The current 2050 target reflects Parliament’s judgement of how much Aotearoa New Zealand should reduce emissions in order to contribute to global efforts to limit warming to 1.5°C. That judgement was based on information available when the target was set in 2019. We can recommend amending the target only in response to significant changes since that time.

Our review has found that significant changes have occurred. Those changes all point towards Aotearoa New Zealand moving further and faster to reduce emissions. Other countries have adjusted their targets and emissions reduction plans as it becomes increasingly clear that the world is no longer on track to limit warming to 1.5°C, and as understanding of the risks and impacts of climate change increases.

Aotearoa New Zealand’s greenhouse gas emissions are small on a global scale, but high per capita. If every country caused the same warming per capita as Aotearoa New Zealand, global warming would exceed 5°C in coming decades.

The United Nations’ 2023 and 2024 emissions gap reports concluded that the world will need to reach net negative emissions of carbon dioxide by 2050 if average global warming is to remain even close to 1.5°C during this century.[2]

The 2050 target must enable clear and stable policies for Aotearoa New Zealand’s economy and communities

Amending the target to require further reductions in emissions would have impacts on Aotearoa New Zealand’s economy, society and environment. There would be both costs and benefits.

The mix of impacts would depend on Government policy, and on decisions made by individuals, households, businesses and communities. The target sets a long-term goal for emissions reduction, but does not determine how the goal is reached.

Some options for reducing emissions would require up-front investment to phase out fossil fuels in transport, electricity generation and as many industrial processes as possible. Many of these investments would pay for themselves over time through reduced costs.

Our analysis indicates that Aotearoa New Zealand can reduce emissions further than the level of the current target while the economy continues to grow. Transitioning to a lower emissions economy can bring other benefits. It can strengthen energy security and independence. It can reduce energy costs, improve productivity, increase resilience, and benefit public health.

Aotearoa New Zealand’s international shipping and aviation sectors can contribute to emissions reduction

Aotearoa New Zealand’s emissions from international shipping and aviation are currently excluded from the 2050 target, but cause warming. Emissions from these sectors are equivalent to about 9% of Aotearoa New Zealand’s net domestic greenhouse gas emissions. If no action is taken to reduce emissions from these sectors, by 2050 they will likely grow to be equivalent to more than one-third of the country’s domestic net emissions.

International shipping and aviation organisations are also coordinating efforts to reduce emissions, and Aotearoa New Zealand has obligations to support that work. Major economies such as the United Kingdom, the European Union, and the United States are already putting policies in place to reduce emissions from international shipping and aviation. Aotearoa New Zealand’s economy depends on tourism and trade. How the country manages international shipping and aviation emissions affects access to international markets. Businesses in these sectors are already having to account for their emissions to international customers and trading partners. This trend is likely to continue.

There is potential for the international shipping and aviation sectors to reduce their emissions, especially by adopting alternative fuels. Reducing emissions from these sectors could support Aotearoa New Zealand’s contribution to global efforts to limit warming. Reduced emissions could also bring other benefits to the environment, health and international relationships.

We considered public feedback as part of our review

During our public consultation, many submitters referred to the growing impacts of climate change, and called for Aotearoa New Zealand to take more urgent and ambitious action. Some wanted Aotearoa New Zealand to adopt a net zero target covering all greenhouse gases, or a net negative target covering gases other than biogenic methane. Many were concerned about negative impacts for Aotearoa New Zealand if it does not adopt a more ambitious target. Some referred to worsening climate impacts. Others said there would be risks to the country’s international reputation.

Some submitters were concerned about impacts on rural communities if farmland is converted to forestry or if the methane target is too ambitious. We took that feedback into account when developing our final recommendations.

Of submitters who considered international shipping and aviation, most supported including those emissions in the target. Many also emphasised the importance of clear Government policy to guide emissions reductions.

The 2050 target provides long-term guidance on emissions reduction. Amending the target would have impacts across Aotearoa New Zealand’s economy and communities. The exact mix of impacts would depend on Government policy, and on decisions made by households, businesses and individuals.

Our analysis has found that many options for reducing emissions also deliver cost savings over time. Options such as electrification of transport, increased use of renewable energy, and greater energy efficiency also bring other potential benefits. Depending on the mix of policy options adopted, some potential co-benefits from emissions reduction include:

• increased productivity – e.g. from energy efficiency, and because renewable electricity is more efficient and cheaper than fossil fuels
• greater energy security and independence – with reduced reliance on imported fossil fuels
• greater innovation – through opportunities to research and develop low emissions solutions, especially in food production
• maintaining global competitiveness – as customers increasingly choose to purchase lower emissions products and services, e.g. in food production and tourism
• healthier people and reduced health costs – from reduced air pollution, more active transport, and warmer homes
• increased resilience – e.g. through land-use changes that reduce erosion, or by designing electricity and urban networks for emissions reduction
• avoiding the costs and risks arising from inaction – including market risks, and the risk that delayed action leads to a harsher, costlier transition in future.

We are recommending the Government amends the 2050 target to require further reductions in greenhouse gases beyond what is required under the current target.

Recommendation

We recommend that the Government:

Amend the emissions reduction target (the 2050 target) to require that:

• net accounting emissions of greenhouse gases other than biogenic methane, including international shipping and aviation emissions, are at least negative 20 MtCO2e by the calendar year beginning on 1 January 2050
• gross emissions of biogenic methane in a calendar year –
  • are at least 10% less than 2017 emissions by the calendar year beginning on 1 January 2030; and
  • are at least 35–47% less than 2017 emissions by the calendar year beginning on 1 January 2050
• there are further reductions and removals of greenhouse gases beyond these levels after 1 January 2050.

Calculate emissions from international shipping and aviation using the following measures:

• for aviation: refuelling taking place in Aotearoa New Zealand based on bunker fuel use by all international operators
• for shipping: an estimate of 50% of the emissions to/from the next overseas port by all international operators and 100% of their emissions travelling between ports in Aotearoa new Zealand and while docked.

And to:

• reconsider the inclusion of other climate impacts[3] from international shipping and aviation in the 2050 target in future reviews
• develop measures for meeting the 2050 target that ensure a specific focus occurs on gross emissions reductions for international shipping and aviation.

By meeting the recommended target, Aotearoa New Zealand would increase its contribution to global efforts to limit warming

This recommendation retains the structure of the current target. It responds to significant changes since 2019 in the risks and impacts of climate change. It reflects Aotearoa New Zealand’s commitment to global efforts to limit warming to 1.5°C above pre-industrial levels, and it takes account of the potential implications for Aotearoa New Zealand of reducing emissions beyond what is required by the current target.

The recommended target parameters (35%–47% reduction in biogenic methane, and net negative 20 MtCO2e for all other gases) strengthen the foundation for clear and stable policies that reduce emissions in response to the growing risks and impacts of climate change, while being realistic for Aotearoa New Zealand’s economy and communities.

We are not recommending any change to the target’s 2030 requirement for biogenic methane, because meaningful emissions reduction in response to a new recommended target (and subsequent budgets and plans) would require immediate changes, with widespread impacts on methane-emitting sectors.

We found no evidence that would support weakening any part of the target.

Our analysis, refined through consultation, has found that there are credible pathways to achieving the recommended target. For both components of the recommended 2050 target, meeting the recommended target requirements would depend on governments providing clear policy direction.

The net negative 20 MtCO2e component of the recommended target reflects analysis of what is likely to be possible if Aotearoa New Zealand pursues a pathway based on high levels of technology and systems change – for example, through faster electrification of transport networks and growing use of renewable energy. There are significant potential benefits from steering the country along this pathway.

For biogenic methane, the lower end of the recommended target range reflects a pathway that, according to our analysis, is largely possible with current technologies. The higher end reflects what is likely to be possible with significant changes in technology, in particular if methane inhibiting technologies become available in Aotearoa New Zealand.

We are not recommending any change to the target’s split-gas structure, which reflects the different warming effects of different greenhouse gases. While carbon dioxide is a long-lived greenhouse gas, other emissions also matter. Biogenic methane accounts for more than half of the warming impact from Aotearoa New Zealand’s greenhouse gas emissions. Reducing these emissions would have an immediate impact on Aotearoa’s contribution to global efforts to limit warming. The recommended target reflects the importance of every sector contributing to Aotearoa New Zealand’s efforts to cause less warming.

The recommended target would mean Aotearoa New Zealand makes a greater contribution towards global efforts to limit warming to 1.5°C than the current target provides for. Our analysis indicates that an emissions scenario that meets the recommended target for domestic emissions would put Aotearoa New Zealand on a path to cause around a third less warming by 2100, than a scenario aligned to the current target. Adding international shipping and aviation emissions to the target is likely to further contribute to reductions in warming.

Our analysis also shows that achieving negative 20 MtCO2e and a 47% reduction in domestic emissions of biogenic methane would bring Aotearoa New Zealand very close to net zero emissions of all greenhouse gases when using the internationally standard metric GWP₁₀₀. This is a result of analysis and assumptions rather than a set goal. Since 2019 Australia, the United States, the European Union and several other economies (including some economies with relatively high methane emissions) have adopted net zero all gas targets.

Including emissions from international shipping and aviation in the target would also be consistent with action by other countries and would ensure that emissions from those sectors are included in Aotearoa New Zealand’s emissions reduction policy. It would not necessarily mean those sectors are included in the New Zealand Emissions Trading Scheme. That would be a policy decision for the Government. Based on our analysis, the recommended net -20 MtCO2e target is feasible with international shipping and aviation included.

We considered several options on how to measure emissions from international shipping and aviation. Based on available evidence and feedback about refuelling trends, the recommended options are the most accurate for capturing these emissions. These options provide the best incentives to reduce emissions. They avoid double counting as far as possible. They are also the options submitters preferred during public consultation.

The recommendation to further reduce or remove emissions after 2050 recognises the importance of global efforts to reach net negative emissions after that date.

Meeting the recommended target would require lower emissions at levels that are realistic for Aotearoa New Zealand

Meeting the recommended target would require the country to reduce emissions beyond what is required by the current target. But it also reflects what is realistic and feasible for the country’s economy and communities. Through our analysis of significant changes since the target was set, the implications of the recommended target, and how the recommended target meets the purpose the of the Act, the Commission is satisfied that the significant changes justify the change to the target.

The recommended target is compatible with continued growth in GDP, and with higher employment in most regions. Reducing the use of fossil fuels could bring economic and social benefits, including long-term cost savings. Amending the target now could also reduce the risk of Aotearoa New Zealand being forced into a harsher and more costly transition in future.

Moving to a lower emissions economy will have both positive and negative impacts, and those impacts will not be spread evenly across sectors and communities. Clearly signalled transition plans and policies can reduce uncertainty and provide time for sectors and communities to plan and change.

[1] Gross emissions are the total amount of greenhouse gases produced from the energy, agriculture, industry and waste sectors. Net emissions take into account how much carbon dioxide has been emitted and removed from the atmosphere from forests, subtracting that amount from gross emissions calculations. In Aotearoa New Zealand, removals are currently achieved through planting trees, which take in and store carbon dioxide from the atmosphere as they grow. Biogenic methane is methane emitted in the agriculture and waste sectors, mainly from ruminant animals and decomposing waste.

[2] A ‘net negative’ target means a country is removing more greenhouse emissions from the atmosphere (for example, by planting trees) than it is emitting.

[3] ’Other climate impacts’ refers to impacts on climate change that are not caused by emissions of the greenhouse gases included in New Zealand’s Greenhouse Gas Inventory.