Commission’s ETS change risks forest planting targets

Friday 11 Jun 2021

New Zealand’s forestry industry says the Climate Change Commission is risking forest planting rates by stating that the current Emissions Trading Scheme ‘will incentivise more production forestry than needed.’ The final recommendations from the Commission were tabled in parliament on Tuesday. The government will be producing an Emissions’ Reduction Plan later this year.

Farm Forestry Association President, Graham West, says he acknowledges the Commission still expects an additional 380,000 hectares of plantation forests to be planted in the next 15 years as a major means of offsetting greenhouse gas emissions from the rest of the economy. But he says owners of farmland who are considering planting exotic woodlots may have second thoughts.

“Decision making about the value of carbon when planting trees is already complex enough as it is. Cashflow is a critical factor. Now farmers and forest investors will be looking at even more uncertainty, if carbon credits are under review and may be reduced. The government needs to note that the Commission itself says there is the risk of a perverse outcome of discouraging forest investment through changing the ETS.”

The Forest Owners Association President, Phil Taylor, says the 380,000-hectare projection of exotic forests, to meet the Commission’s gas budget, was always going to be problematic to achieve, but even more so now. “The net stocked area of New Zealand’s plantation forestry has fallen by 40,000 hectares in the past two years. That reduction isn’t a good basis to put the brakes on plantation planting within the next ten years.”

“After more than a decade, the ETS has only just begun to work the way it’s meant to. That is to incentivise emissions’ reduction. It’s a strange time to pull it back.” Phil Taylor says if the Commission doesn’t get the net emissions reduction it expects from forests over the next 30 years, then the government will have to force tougher and bigger cuts out of transport and agriculture.

Phil Taylor says though, that he’s waiting to see how the government develops policies to implement the recommendations from the Commission. “We are pleased the government already seems to have abandoned its ideas of trying to restrict planting forests on the better classes of land where a quarter of the current national estate is already growing.”

“And it’s important to realise that the forest contribution to fighting climate change is not confined to the trees themselves, but the downstream use of timber and wood products. The Commission’s reference to forests’ role in ‘a thriving, low emissions bioeconomy’ is hugely important for environmental and economic reasons,’ Phil Taylor says.

“The Forestry Minister, Stuart Nash, has also made it clear that the government’s Wood First construction policy really means using timber construction wherever possible.” Phil Taylor says the Commission’s expressed wish for better pest control in forests is largely confined to indigenous planting, but would also benefit exotic forest landowners as well.

Graham West also says there are strongly positive features in the Commission’s report. “The government has been asked to encourage ‘additional carbon storage in smaller blocks of trees on farms’. We hope to see that implemented with some sort of grants scheme.” “We have long advocated for policies which assist ‘mosaic’ landscapes of smaller forest blocks interspersed with other land use. This has been acknowledged.”

Source: Forest Owners Association, Farm Forestry Association

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