If you are a forest owner who wants to achieve the maximum income from your forest, you need to register in the Emissions Trading Scheme (ETS) before the end of 2022.
The Emission Trading Scheme is New Zealand’s main tool to reduce the country’s net emission and meet international targets. (Click here to see our ETS Q&A).
Most forests planted after 1989 are eligible to earn carbon credits (NZU) and be part of the ETS. One NZU equates to one tonne of carbon. NZU’s are currently worth approximately $35 a unit when traded. Being in the Emission Trading Scheme gives you access to additional income from your forest.
There have been some recent changes to the ETS and the way carbon is allocated to forest owners, the main change being the introduction of ‘averaging’.
Averaging will have very little benefit for second rotation or older forests and there are some very strong arguments why a forest owner should register their forest under the current ‘sawtooth’ accounting model while they still can. The 2022 deadline for registering under sawtooth is looming and we are encouraging any forest owners to register as soon as possible.
If you are unsure on whether this will effect your potential carbon revenue, we are here to help.