Brian Fallow: A virtuous marriage blessed by Kyoto

Meridian Energy's proposed deal with the Dutch over carbon credits from the Te Apiti wind farm is the Kyoto Protocol in action.

It demonstrates two of the virtues of that enfeebled agreement: It is an international deal, recognising that global warming is a global challenge and it is immaterial to the atmosphere where on the planet greenhouse gas emissions are reduced, so long as they are.

And it uses one of Kyoto's "flexibility" mechanisms designed to ensure that the most cost-effective measures to cut emissions are taken first, regardless of where that is.

But it is only one of the means policymakers in different countries have adopted to bridge the gap between the cost of wind power and the incumbent technologies.

The US has around 5000MW of wind power generation capacity, aided by a tax credit worth 1.7USc a kilowatt hour. That subsidy is nearly twice the gap between what wind power costs in New Zealand and the present wholesale price.

The Australians rely on regulatory fiat, requiring a small percentage of electricity generated to be from renewable sources.

A US delegation, led by senior climate negotiator Harlan Watson, was here last week to finalise agreements between US and New Zealand agencies for collaboration on climate science and technology projects, including distributed electricity generation, fuel cells and the feasibility of using low-grade coal seams to sequester COinf2.

It is easy to dismiss such agreements as tokenism in the face of the US withdrawal from Kyoto, its predilection for gas-guzzling SUVs and an energy plan that envisages the construction of more than 1000 more fossil fuel power stations.

Easy but facile.

In the end, dealing effectively with man-made climate change is a problem that will require the marriage of good public policy with good science and technology. Neither is much use without the other.

One of the more poignant ironies of the present situation is that the US, while a laggard on the policy front, is a leader on the technology front.

As the largest emitter of greenhouse gases the US is such a large part of the global problem that it has to be part of any effective solution. It can therefore stay out of the multilateral process for as long as it likes, knowing that it can rejoin whenever it wishes, and probably on whatever terms it likes, just because it is the largest emitter.

New Zealand is not in that comfortable position; unilateralism is not an option.

That means gratefully accepting Kyoto euros from the Dutch with one hand, and US R&D dollars from the Americans with the other.