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Cost Effectiveness of Policy Options for Air Quality Management in Tokoroa

TR 2008/23
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Report: TR 2008/23

Author: Sandra Barns

Abstract

Air quality in New Zealand by OECD standards is generally good. However, poor air quality, largely attributable to domestic heating, exists in some areas. Tokoroa has been identified as one of these areas.

National environmental standards (NES) developed by the Ministry for the Environment (MfE) in 2005 included air standards to be achieved by 2013.

The air standards target small (less than 10 microns in diameter) air particles defined as PM10, which in most developed countries come from motor vehicles.

New Zealand PM10 standards specify a daily limit for emissions of 50µg/m3 over 24 hours and 20/m3 annually.

Tokoroa exceeds the daily limit on some days in winter by up to 55 per cent. This information comes from measurements made over a seven year period which also identifies the primary source of PM10 emissions as domestic wood burners.

Policy options addressing this problem, including regulations and incentives, were analysed for cost effectiveness (heating, health and productivity losses) on the basis of daily and winter emissions. Under regulatory policies it is generally the user who pays, in contrast to incentive policies which may be government funded. This dichotomy is addressed by measuring policy acceptance by the community.

Policy acceptance probabilities were estimated from two surveys of representative stakeholder groups.

The permutations of 36 individual factors for each policy were analysed using a decision support tool developed for this project.

None of the options investigated would achieve the emissions target reduction as stand alone policies. The greatest emission reduction was through a regulatory policy, achieving a 32 per cent reduction - well short of the 55 per cent required.

It is recommended that a policy incorporating regulation and incentives is the best option, providing the potential to include a large proportion of the community and therefore achieve higher emission reductions than any stand alone policy.

Social and economic implications of inadequately heated homes and homes heated with unflued gas appliances are discussed along with a bulk purchase scheme of suitable heating appliances. The reliability of new compliant heating is questioned and unquantifiable costs identified.

The role of the decision support tool was seen as pivotal in being able to assimilate new information pertaining to the assessment of policy cost effectiveness. The tool should be invaluable for other communities addressing similar policy issues.

Cost Effectiveness of Policy Options for Air Quality Management in Tokoroa [PDF, 379 KB]