A forestry consultant and ecologist recommends exclusion of exotic trees from the
forestry section of Emissions Trading Scheme should be pared back. By Joanna Grigg.

In an about-face move the New Zealand Government proposes excluding exotic forests from the planned new permanent post-1989 forest category in the Emissions Trading Scheme (ETS).

It comes after concern farmland conversion to permanent radiata pine is stripping the country of food producing areas and of jobs for rural communities. Some greet the change with relief but forestry consultant and ecologist Mark Belton, Emerging Forests Ltd, said the proposed policy is dropping a bomb into the heart of NZ’s capacity to remove carbon through afforestation.

Belton submitted to the Government on the managing exotic afforestation consultation in April, and will follow up with letters to forestry minister Stuart Nash and climate change minister James Shaw. He takes issue with relying solely on indigenous species to do the job.

Redwoods, poplars or pines are quicker and cheaper to establish than indigenous species and can help with soil erosion and flooding. They are more efficient at CO2 removal so have a critical role in global efforts to address the pending overshoot, he says.

“They should be able to earn carbon credits.”

The proposal is that only exotic forests destined for harvesting can be in the ETS. Some farms are too far from port or roading is too difficult to make harvesting economic. This cuts farmers’ options.

MPI has floated the idea of including some exotics in the proposed permanent category from January 1, 2023. The consultation suggests space-planted poplars or willows on erosion-prone land, and long-lived exotics like redwoods for amenity purposes or sustainable harvest of high-value timbers, may be included. Plantations transitioning from exotic to indigenous forests over time are also up for debate.

Belton says exotics like poplars and blackwoods have fantastic coppicing abilities, developing a large root mass quickly, so are ideal for erosion control.

Any existing ETS-registered Pinus radiata plantings are not affected, only new registrations after January 1. Existing registrations are being shifted from the Permanent Carbon Forest scheme to either the new timber averaging category or the Post-1989 permanent category (not clear-felled for a minimum of 50 years).

It’s likely most cyclical exotic forests will fit into the new timber averaging category, Belton says.

“The averaging scheme is based on good science but if your forest is on this regime, by harvesting you are releasing carbon and restricting their full-life carbon potential.”

Under the scheme only about a quarter of the carbon is captured compared to the potential sequestration of a long-lived permanent carbon forest, he says.

If there were no restrictions on exotics, MPI estimates the NZ ETS could drive upwards of 645,000 hectares of exotic afforestation in the next 10 years. The spread of pines over farmland would continue.

What’s in or out will have a big impact on NZ’s carbon removal projections. Carbon removal tonnage is estimated to be almost 40% lower if exotic forests were removed from the permanent forest category (see Table A). Not good news for climate change mitigation.

Belton suggests a halfway house is best.

To take the heat out of farmland conversions to permanent pine blocks, but still allow them in the ETS, Belton proposes some options for built-in handbrakes.

He suggests exotics should be allowed for only when integrated within farmland owned by NZ citizens. This should primarily be located on problem marginal LUC 6, 7, and 8 land types. Whole farm sales and conversions should not be allowed, without local government planning consent. All plantings should have a forest management plan to make sure best practice is achieved. This would include animal pest and weed control, fire control planning, riparian retirement, fencing and planting a diversity of species.

He floats the idea of farmers and government partnering on permanent carbon forests. This ‘Belton-scheme’ would see landowners and government taking 50% each of the carbon credits. The land-owner would still be able to sell their units in the open NZ ETS market. This would de-accelerate the carbon market price, making it rewarding but more stable.

Government would use the credits to help meet NZ’s net zero targets, without recourse to buying overseas forest offsets at great expense. Returns to the landowner would be reduced but still be very high compared to current returns on marginal land types. This could slow the land price escalation problem. The government could take over the carbon liability risk which occurs if permanent forests lose major carbon stocks due to fire or storm.

MPI also needs to consider what happens to existing exotic forests. The consultation document states there is a risk that a proportion of the 310,000ha of exotic forests registered under stock change accounting could be managed as permanent forests and continue to earn NZUs within the NZ ETS. They could be sold to new owners who convert management of the forest to a permanent exotic forest.

The Government will need to consider the likelihood that exotic forests registered under both stock change and averaging accounting will be managed as permanent and whether measures are needed to mitigate potential adverse impacts.

It’s a jungle out there but Belton says it’s a critical opportunity for NZ to get right.