The government has backed down on a proposal not to let permanent pine and exotic forest owners earn money from the Emissions Trading Scheme.
The government had been looking to exclude exotic forests from the ETS. Photo: 123RF
It had come after alarm huge pine plantation would gobble up productive land.
The government had been looking to discourage the planting of new permanent exotic forests by excluding them from the ETS.
But the proposal incensed many Māori, who say it could cost the Māori economy billions of dollars.
Despite consultation still going on, the climate change and forestry ministers yesterday wrote to submitters telling them the change is now unlikely.
The letter said the proposals generated significant interest.
"While we consulted on options to prevent exotic forests from registering in the permanent forest category by the end of the year, we have now decided to take more time to fully consider options for the future direction of the ETS permanent forest category.
"While all decisions are ultimately for Cabinet, this means it is unlikely that we will propose closing the permanent category to exotics on 1 January 2023.
"This is particularly the case as we have been very heartened by the progress on the industry code of practice."
RNZ has approached the ministers for comment.
Only this week, the Climate Change Commission again warned the government not to rely too heavily on exotic trees to meet emission reduction obligations.
It also asked the government to clarify how the ETS would differentiate between actual emissions reductions by firms, and carbon removed by planting trees.
"Unless this is addressed, the NZ ETS is likely to deliver mostly new plantation forestry rather than gross emission reductions. This would ultimately put our economy at a competitive disadvantage relative to a decarbonised global economy and shift cost burdens on to future generations," commission chair Dr Carr said.
The ETS is a major tool to try to avoid catastrophic consequences of climate change.
It is a market managed by the government, and businesses that generate damaging gases have to buy units from it.
The number of units available shrinks over time, causing the price to go up and incentivising businesses to find ways to emit less.
Trees absorb carbon, so eligible forest owners can sell units to polluters at a price set by the ETS market.
The government last week announced it was moving to limit the allocation of free units in the scheme.
Govt had fight on its hands
The large price increase since ETS auctions started last year has seen a ramping up in planting of pines and other exotics as they grow faster than natives.
It has prompted outrage from sheep and beef farmers and rural communities that productive land will be swallowed up.
They say farms employ people who spend money in the community and put their children into local schools.
They say carbon farming means large empty plots of land quietly sequestering but also only making money for the owners, with little benefit for the community.
Poorly managed exotic forests can also harbour pests and be a fire danger - which can be a threat to our national stores of carbon held in our forests.
But the government's proposed changes have been labelled disastrous for Māori, and there are moves to take legal action.
Māori are major forest owners (about a third of plantation forestry, and it will tip over 40 percent as more Treaty settlements are completed), and make up about 40 percent of the forestry workforce.
The government's letter said it was committed to the following objectives from the permanent forest category:
- Support forests to deliver positive long-term outcomes as part of Aotearoa New Zealand's climate transition.
- Hold forest owners accountable for delivering effective forest outcomes.
- Ensure effective financial management of forests over long-term.
- Support stable NZ ETS price and market conditions in the long-term, while ensuring
- Ensure forests meet environmental and other forest management good practice.
- Manage risks to rural communities from the category are managed.
- Support whenua Māori to realise aspirations for the land.
the category can be fairly accessed.