ETS not a popular option

He told Rural News that at the first few farmer meetings last week, "a vast majority" agreed with the other two options on the table - a farm-level levy and processor-level hybrid levy.

Van der Poel spoke at meetings in Waikato and Bay of Plenty last week. Discussions were "constructive".

"Once people get to know what we are seeking, they start to engage," he says.

Van der Poel says farmers realise that under an ETS, costs will escalate.

"It will become another tax; not too many people think an ETS is the best option."

The Primary Sector Climate Action Partnership (He Waka Eke Noa), which includes DairyNZ and B+LNZ, will report its recommendations to Ministers by May 31.

Van der Poel says the two options proposed by the partnership would deliver more positive outcomes for farmers and New Zealand than the NZ ETS.

"A farm-level levy and processor-level hybrid levy are more practical and reward positive change, while still achieving environmental outcomes.

"Some of the money raised will be invested back into R&D and on-farm work to reduce emissions."

Following initial farmer feedback on the options in December, the partners are also putting forward a two-phased approach, starting with the processor-level hybrid levy option and transitioning to a farm-level system in future.

B+LNZ chairman Andrew Morrison says doing nothing is not an option.

"If we don't move on this, the Government will put agriculture in the NZ ETS. They have already put this into legislation but have agreed to listen if we come up with a credible alternative," he says.

"We know this is a challenging and uncertain time for farmers but we need to keep going with this consultation and find the right solution," he says.

"We pushed hard for as long an extension as possible and the Government agreed to a month - this was the longest they felt fitted with their legislative timeframe. It's not ideal, but going for longer and ending up in the ETS is also far from ideal."