On September 24 the Government tabled legislation to amend the Emissions Trading Scheme (ETS).
The proposed changes for the forestry sector are outlined below. The current legislation still applies until these changes are passed into law by Parliament.
The public can make submissions on these changes until October 13. To find out about submitting, visit: www.parliament.nz/en-NZ/PB/SC/MakeSub/.
Note that all the changes below are subject to change as the Bill goes through its various stages.
Forestry – proposed changes
- The forestry sector entry date of 1 January 2008 is unchanged.
- Although there will be a “progressive obligation” (the ability to surrender 1 unit for every 2 tonnes of emissions from 1 July 2010 until 31 December 2012) applying to stationary energy, liquid fossil fuels and industrial emissions, this will not apply to forestry emissions.
- There will be a NZ$25 price cap on units for all sectors including forestry from 1 January 2008 to 31 December 2012. Forest land owners can access units for emissions from deforestation or harvesting during this period at a maximum price of NZ$25, and can sell units for a maximum price of $25 on the domestic market.
- Forestry units allocated as part of the allocation plan for pre-1990 forests, or earned from post-1989 forests, can be exported subject - to New Zealand not breaching its commitment period reserve. Units allocated to other sectors can only be traded domestically during the price cap period.
- All sectors are allowed to bank their units.
- Subject to New Zealand securing offsetting rules internationally, offsetting will be introduced in the ETS after 2012.
- The higher level of allocation, to eligible landowners who purchased their forest before 1 November 2002, is fixed at 60 units per ha.
- Those who have undertaken tree weed tree weed eradication will now be able to apply for a retrospective exemption for deforestation undertaken since 2008. The timeframe for deforesting under a pre-1990 tree weed exemption has been extended to the end of the relevant commitment period. There will be periodic opportunities to apply for this exemption.
- Applicants for post-1989 forest land to join the ETS have to declare compliance with the Biosecurity Act (including regional pest management strategies).
For more information visit: http://www.mfe.govt.nz/publications/climate/emissions-trading-bulletin-11
For information on the effects of the changes to the ETS on Agriculture, Stationary Energy and Industrial Processes and Liquid Fossil Fuels, visit: http://www.beehive.govt.nz/sites/all/files/1_Summary_of_ETS_Changes.pdf
Review of the Afforestation Grant Scheme
The Afforestation Grant Scheme (AGS) has been in place since the beginning of 2008. MAF recently conducted a review of the operation of the AGS, and as a result, the Afforestation Grant Scheme Guidelines (the Guide), the grant agreement template, and application form have been revised. New versions are available at: www.maf.govt.nz/sustainable-forestry.
For those already familiar with the AGS, the key changes to the scheme as a result of the review include:
- specification of the standard to which grant forests must be maintained;
- permitting stockings down 500 stems per hectare (however stockings of 500-749 stems per hectare will be disadvantaged in the scoring for the erosion co-benefit);
- requirement for indigenous forest to achieve the minimum establishment standard establishment prior to the grant payment being made;
- the exclusion of self-sown tree weeds (i.e. wildings); and
- clarification on:
- the circumstances in which a grantee would be required to replant a forest;
- landowner options after the end of the term of the grant agreement;
- land eligibility; and
- the minimum requirements for an application to be eligible for a grant.
For more information call 0800 CLIMATE or visit www.maf.govt.nz/sustainable-forestry.