Frequently Asked Questions

Forestry in the New Zealand Emissions Trading Scheme

The following frequently asked questions cover general issues related to the ETS (Forestry).

This factsheet is intended to provide a summary only. We recommend referring to A Guide to Forestry in the Emissions Trading Scheme for more detailed information - available at www.maf.govt.nz/sustainable-forestry or call 0800 CLIMATE (254 628). The Climate Change (Emissions Trading) Act 2002 and associated forestry sector regulations are available from www.maf.govt.nz/climatechange/legislation/.

When and how do I register to join the scheme?

Owners of post-1989 forest land may voluntarily apply to be registered in the ETS at any time. Owners of more than 2 hectares of pre-1990 forest land that is deforested during 2008 or 2009 must register for the ETS by 31 January 2010. Registration information is available at www.maf.govt.nz/sustainableforestry.

What guidance material is available to help me understand how to register and calculate carbon emissions and removals?

MAF is progressively making available a series of guides and standards. These documents provide detailed information about the administration, rules and procedures that must be followed. The following guides and standards are available at Forms and ETS Transactions :

A Guide to Forestry in the Emissions Trading Scheme provides an overview of the ETS in general, including: how carbon is stored in a forest; how the stored carbon may be calculated; the entitlements and obligations of ETS Participants who own pre-1990 or post-1989 forests; and taxation implications for forestry ETS Participants.
A Guide to Classifying Forest Land for the Emissions Trading Scheme gives practical guidance on how to determine whether an area of forest is pre-1990 or post-1989 forest land under the Act (available soon).
A Guide to Mapping Forest Land for the Emissions Trading Scheme describes how to define an area of forest using either the online mapping tool or by submitting existing data in electronic form, for example, shapefiles.
A Guide to Look-Up Tables for the Emissions Trading Scheme describes how to use tables to determine the amount of carbon (the "carbon stocks") within a Participant's forests.
The Geospatial Mapping Information Standard prescribes the format and content of the geospatial mapping information that a person must provide to comply with the requirements of the Act and the Regulations.

Do forest land owners have to pay to MAF any fees or charges for participating in the ETS?

There are no fees or charges payable in relation to pre-1990 forest land. This is in recognition of the mandatory inclusion of this land within the ETS if it is deforested.

There are some fees and charges payable in relation to post-1989 forest land to recover some of MAF’s ETS administration costs. This is in recognition of the voluntary inclusion of this land within the ETS and the benefit gained by the landowners from receiving carbon credits from the Government. Fees and charges must be made in New Zealand Dollars.

Further information is set out in A Guide to Forestry in the Emissions Trading Scheme and in the legislation (www.maf.govt.nz/climatechange/legislation).

What is the compliance regime associated with the ETS?

Participants will be expected to monitor changes in carbon stocks on forest land and file emissions returns at set periods and MAF will encourage and monitor compliance of this. There are both civil penalties and criminal offences associated with non-compliance of obligations under the ETS. In general penalties are set at $30 per outstanding unit for failure to surrender emissions units by the due date.

What changes have been made to deadlines for Forestry in the ETS?

On 30 June 2009 Parliament passed amendments to the Climate Change Response Act 2002 (CCRA), affecting some of the deadlines relating to pre-1990 forest land.

For pre-1990 forest land:

the notification deadline for deforestation of pre-1990 forest land that occurred during 2008 and 2009 has been deferred from 31 January 2009 to 31 January 2010;
participants will not be penalized for failing to notify deforestation of pre-1990 forests by the old deadline (31 January, 2009), provided the participant notifies MAF on or before 31 January 2010;
participants who deforested pre-1990 forest land during 2008 or 2009 are still obliged to file an emissions return quantifying their deforestation liability, between 1 January and 31 March 2010 (there has been no change to these dates);
the deadline for surrendering emissions units to meet deforestation liabilities reported in an emissions return has been deferred from 30 April 2010 to 30 April 2011. No changes were made affecting post-1989 forest land. Applications may still be made at any time to voluntarily register post-1989 forest land in the ETS. Registered ETS participants remain entitled to receive New Zealand Units (NZUs) for increases in net carbon stocks in post-1989 forests from 1 January 2008.

No changes were made affecting post-1989 forest land. Applications may still be made at any time to voluntarily register post-1989 forest land in the ETS. Registered ETS participants remain entitled to receive New Zealand Units (NZUs) for increases in net carbon stocks in post-1989 forests from 1 January 2008.

More detailed information about key dates, deforestation notifications and emissions returns can be found at www.maf.govt.nz/sustainable-forestry.

What new changes are proposed for the forestry in the ETS?

On September 24 the Government tabled legislation to amend the Emissions Trading Scheme (ETS). The Climate Change Response (Moderated Emissions Trading) Amendment Bill includes proposed changes affecting all sectors, including forestry. A summary of the changes proposed for forestry is available in Issue 8 of the Sustainable Forestry Bulletin.

Note that current legislation and regulations still apply until changes are passed into law by Parliament.

When will the Forestry Allocation Plan be issued?

A new consultation draft of the pre-1990 forest land allocation has been issued because of the changes proposed in the Amendment Bill (see above). The Pre-1990 Forest Land Allocation Plan (Consultation Draft) supersedes the Draft Forestry Allocation Plan released in October 2008.

Following the public submission period (closing 22 November 2009), a report on the submissions will be prepared. Subject to the Amendment Bill being enacted, the Minister will then recommend to the Governor-General that a finalised Pre-1990 Forest Land Allocation Plan be issued.

Once the Allocation Plan is issued, a public notice will invite people to apply for an allocation. MAF is planning to run public meetings for landowners on the forestry allocation plan and exemptions from the ETS (see below) in the 1st half of 2010. The Government expects most, if not all, eligible landowners will apply for either an allocation or an exemption.

Can I apply for an exemption for my pre-1990 forest land?

Yes, in some circumstances. Two types of exemption are available for pre-1990 forest land:

a one off exemption for owners whose total forest holdings are less than 50 hectares;
An exemption for deforestation of tree weeds which will be open periodically.

Pre-1990 forest land exemptions from the ETS are not automatic and must be applied for by the current forest landowner. Before applying for an exemption, landowners should carefully consider whether or not they wish to forgo any entitlement they may have to a free allocation of NZUs.

The deadline for applying for a ‘less than 50 hectare’ exemption will be advised by public notice. This must be before 1 July 2010. Further information about the eligibility rules for exemptions can be found at Pre-1990 Exemptions.

What is the position with offsetting (that is, deforesting and then replanting in another area)?

Under the Kyoto Protocol there is no provision currently for offsetting. However, the international rules may change in the second Kyoto commitment period, which starts in 2013. Therefore, the legislation includes provisions that if the international rules do change this will be reflected in the ETS.

Why have indigenous trees not been included in the pre-1990 scheme?

The ETS excludes indigenous forests established before 1 January 1990 as deforestation rates are currently very low and there are already controls in place to avoid increased rates of deforestation in the future.