Government reduces 2050 methane emissions target and commits to a technology-led emissions reduction approach

On 12 October 2025, the Government announced a reduced 2050 methane emission target, in addition to other changes to New Zealand’s Climate Change Strategy.

These changes will take effect through an amendment to the Climate Change Response Act 2002 (CCRA), which the Government intends to pass into law, through an amendment Bill, by the end of 2025.

The changes demonstrate that the Government is taking a supportive approach in assisting farmers to reduce agriculture (biogenic methane) emissions through commitments to investments in technology.

Context and History

New Zealand’s domestic climate change targets are set out in the CCRA. The following targets were introduced in 2019:

• a 10% reduction of biogenic methane below 2017 levels by 2030;
• a 24% – 47% reduction in biogenic methane below 2017 levels by 2050 (with such reduction being maintained); and
• all long-lived greenhouse gas emissions must reach net zero by 2050 (with such reductions being maintained).

Following this, the Government’s climate change strategy was released in 2024 and, in conjunction with this, the Climate Change Response (Emissions Trading Scheme Agricultural Obligations) Amendment Act 2024 was introduced, which removed all agricultural activities from the New Zealand Emissions Trading Scheme.

Effect of Announcement

The Government’s announcement provides that 2050 biogenic methane target will be reduced from a 24% – 47% reduction in levels (relative to a 2017 base) to a 14% – 24% reduction (also relative to a 2017 base). The 2030 target of a 10% reduction in biogenic methane emission levels (relative to a 2017 base) remains unchanged, as does the 2050 target of net zero greenhouse gas emissions (except biogenic methane).

The Government has indicated that New Zealand remains on-track to meet both of the targets that have been maintained, however it felt that achieving the upper end of the current range of required biogenic methane emissions target (i.e. a 47% reduction) was unrealistic, that it created economic uncertainty, risked exacerbating land use change and could increase food production costs.

In addition to this, the Government notes that targets will be reviewed again in 2040 to ensure that these remain fit for purpose. It is intended that this review will take into consideration New Zealand’s progress relative to its trading partners and actions undertaken by the rest of the world.

The announcement also noted that the Government will be investigating aligning its “split gas” target approach with future international climate change targets. This approach separates short lived greenhouse gas emissions (biogenic methane) from more long lived emissions (carbon dioxide) and it will be important for New Zealand’s emissions reduction approach and progress to be compared to trading partners and international peers on a “apples for apples” basis.

Investment in Technology

In addition to amending the above target, the Government has confirmed that it will not implement a tax on agricultural methane emissions. Instead, the Government intends that efficiencies and, in turn, reductions, will be achieved through advancements in technology and gradual on-farm improvements.

To further this objective, the Government has pledged $400 million over four years to accelerate the development and adoption of emissions mitigation tools (including through joint ventures, such as AgriZero NZ). The Government estimates that the adoption of technologies by 30% of farmers prior to 2030 could result in a fall in emissions by 7% – 14% over the next decade.

The Government notes that promising and effective technology is becoming available already. This includes “EcoPond”, which is a system that reduces methane emissions from dairy effluent ponds by over 90% (which is currently being piloted on 250 farms). In addition to this, there have been efficiencies obtained through the development of low methane sheep genetics and a urease inhibitor coated fertiliser (which helps to maximise nitrogen available for plant uptake that, in turn, means that less nitrogen needs to be used in farming processes).

In addition to investing in technology, the Government is also putting in place systems and tools that farmers can utilise to drive efficiencies, such as an On-Farm Emissions Calculator.

Further Amendments Indicated

As a part of amending the CCRA, the Government also intends to introduce amendments that provide greater recognition of food production and that better align language that is used in this legislation with language that is used in the Paris Agreement. It is not clear at this point in time what form these changes will take, however this could involve a fundamental amendment to the “purpose” of the CCRA that could, for example, require reduction measures to be balanced against food production.

The amendments will also extend the deadline for setting New Zealand’s emissions budget for the 2036 to 2040 period by 2 years, to 31 December 2027.

Conclusion

The Government’s recent announcement demonstrates that it wishes to support farmers and to invest alongside them in technology that will drive reductions in biogenic methane emissions, rather than utilise taxation to disincentivise emissions. The Government notes that international export markets will also drive targets and motivate industry participants to reduce their emissions.

Formal amendment to the CCRA is expected by the end of 2025 which will bring the changes noted in this article into law. However, exactly how this occurs, and the wording of these changes, remains to be seen.

Want to know more?

If you have any questions about the contents of this article, please contact David Goodman, Reuben Adams-Cook or our specialist Rural and agribusiness or Climate change teams.

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