Climate Change Legislation and Forest Landowners
4/28/2008
Climate change legislation was introduced to Parliament in December 2007. Bills are usually altered during the Parliamentary process but the following are the key relevant aspects for Forest Landowners.
MAF has a detailed publication available at www.maf.govt.nz “Forestry in A New Zealand Emissions Trading Scheme”.
Forest Landowners will be classified as having one of three kinds of forest
1. Pre-1990 forests
2. Post 1989 forests and
3. New forest established post 2008
Pre-1990 forests
Owners of forest land planted pre-1990 who have not been granted an exemption will be subject to emission liabilities if their lands are deforested. This will not apply if forest owners harvest and replant their forests or allow them to regenerate. Pre-1990 forests do not earn emission units. However, the Government plan on giving free emission units to owners of pre-1990 forest land. The number of units allocated per hectare cannot be predicted with accuracy at this stage.
To convert this land to a non-forestry use (deforestation) will incur a significant penalty.
Deforestation of less than two hectares of forest is exempt from the scheme.
If your total forest area is between 2 and 50 hectares, it is possible to apply for an exemption and have no liability.
Post-1989 forests:
Owners of forests established on eligible land post-1989 and those intending to establish new forests on eligible land can participate in the ETS (Emmissions Trading Scheme). Participation in the scheme is voluntary.
If forest landowners are not in the ETS there is no liability for harvesting or deforestation.
If participants do enter the ETS then harvest or deforest, or if there is any decline in carbon stock (for instance, as a result of fire), the owner has to surrender emission units to cover the amount of carbon released (that is, the reduced carbon stock). However liability will not exceed New Zealand Emission Units (NZUs) earned.
Only forests established on non-forest land (for instance, agricultural land) since 1989 can be counted for NZU’s, and only in relation to the carbon they absorb after 2008.
New forest established post 2008
If you establish forest from now (2008) on you can apply for the Afforestation Grant Scheme (AGS) as an alternative to the ETS. This is a government grant to establish new forests whilst retaining responsibility for credits and liabilities. There are no harvesting restrictions but the forest must be a minimum of 5 hectares and be maintained for at least 10 years.
What forest landowners have to do and when.
Under the proposed legislation, 1 January 2008 is the date from which obligations will apply. However, no action is required of forest landowners until the legislation has become law, which is expected to be on 30 June 2008.
Owners of pre-1990 forest lands will have until 30 June 2009 to apply for an exemption from the ETS (for example, if they own 50 hectares of forest or less as at 1 September 2007)
Owners of post-1989 forest lands who wish to participate in the ETS will have until 1 January 2010 to apply. Those who join will have to report to the administering agency, at least by the end of the period 2008–12, any carbon stock changes in the relevant post-1989 forest areas.
Requirements for those wanting to deforest pre-1990 forest.
The core obligations for people deforesting Pre-1990 forest land will be to report on the area deforested to the administering agency; calculate (using a formulae to be provided) the emissions associated with this deforestation; and surrender a number of New Zealand Emission Units (NZUs) or other acceptable units equal to the calculated emissions.