The Kyoto Forestry Association (KFA) welcomes the passing of the Emissions Trading Scheme (ETS) legislation and will continue to work with officials and all political parties to ensure any future amendments to the scheme do not undermine the value of the carbon credits it delivers to post-1989 forest owners.
KFA spokesman Roger Dickie today congratulated Climate Change Minister David Parker, Forestry Minister Jim Anderton and the Labour/Progressive Government for progressing the ETS into law.
“For post-1989 forest owners, the passage of the ETS represents the end of a long political battle for the credits that were always rightfully ours and the beginning of getting down to the business of planting trees, developing New Zealand’s forestry export potential and joining the fight against climate change,” Mr Dickie said. “Forestry was always going to be New Zealand’s least-cost answer to reducing our Kyoto liability and genuinely fighting climate change, at least until new low-carbon and methane-reduction technologies are developed, and the passage of the legislation will kick-start new planting from 2009 onwards.”
Mr Dickie also congratulated Opposition Climate Change Spokesman Nick Smith for pushing successfully for the exclusion of “Dirty Russian Hot Air” from the ETS and Green Party co-Leader Jeanette Fitzsimons for ensuring that only “Greened AAUs” are admissible under the new law.
“These were important changes that have protected the environmental integrity of the ETS and will maintain the value of our clean, green forestry carbon credits which, in turn, will provide a greater incentive to get planting again,” he said. “The changes also help compensate for the Government’s unfortunate decision to delay bringing transport into the ETS, which will have the effect of making our carbon credits worth less than they would otherwise have been.”
Mr Dickie said KFA believed that all gases and all sectors, particularly agriculture, should be brought into the ETS sooner than planned, in order to deliver a far more liquid carbon market than would otherwise be the case. “The sooner that the agribusiness sector accepts that it will soon face a carbon price, the sooner it will begin adapting to that price and the sooner land values will adjust accordingly to encourage afforestation,” he said.
MAF also had a responsibility to ensure that it minimised compliance costs for those wanting to trade in carbon credits while some details of the scheme also had to be ironed out, Mr Dickie said.
In particular, KFA would want to see the option of land owners being able to elect to join the scheme on an average-carbon basis, to minimise annual carbon measuring costs. Another problem it would want to see fixed was that the current rules provided a greater incentive to replant on new land rather than replant an existing forest upon maturity. KFA would want the two situations treated the same, Mr Dickie said. He said this would also reduce any incentives for land owners to participate in less robust voluntary market products, which would provide greater order to the official market.