Farm Forestry New Zealand

Handling the heat of climate change

Howard Moore, New Zealand Tree Grower May 2021.

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Recent submissions to the Climate Change Commission on its Draft Advice and to Te Uru Rakau on the Emissions Trading Scheme

Submission on Emissions Trading Scheme regulations

This submission dealt with the effects of averaging, which is being introduced as an improvement to the Emissions Trading Scheme to encourage new planting. Under averaging, participants receive New Zealand Units as their forest grows in its first rotation, up to the average level of long-term carbon which it would store assuming further, similar rotations. Owners face no harvest liabilities, but they must replant after each harvest and cannot earn further New Zealand Units unless they change to a much longer rotation period or replant with different species. With me?

Regulations will determine what the ‘average levels of long-term carbon storage’ are, and Te Uru Rakau has options around how these averages might be set up and managed. The public was invited to make submissions on these options.

What we said was −

• Do not make things more difficult for owners of small forests than they already are. Some of the options look more complex than the present Emissions Trading Scheme
• Keep things simple and flexible We want each small-scale forest owner to be allowed to nominate their own target rotation length, from which Te Uru Rakau would generate the appropriate average. This would accommodate our use of alternative species for which Te Uru Rakau has no standard rotation lengths. Of course, the approach would require accounting for any harvesting before or after the nominated year, but after that, later rotations would be assumed to be the same and there would be no further reporting.
• We want Te Uru Rakau to allow growers to transfer to the Permanent Forest scheme should anyone find, for example, that not harvesting at all made more sense than sticking to the nominated rotation, or if events arose outside their control that locked up the forest and prevented harvesting − force majeure.
• Should such an event actually prove to be temporary, we also want provision for a grower to switch back again and restore the forest’s averaging status. As above, this would require a carbon reconciliation.
• We welcome any simplification in accounting for sub-areas and we like the idea of a one-hectare minimum because if there is an adverse event, one measurement will be better than coarse measurement when determining the financial effect It would also really help if Te Uru Rakau gave us a method to map sub-areas inside a carbon accounting area.

Still with me? Try the next one.

Submission on Draft Advice from the Climate Change Commission

The Draft Advice ran to 189 pages, setting out recommendations for land use change and reducing gross greenhouse gas emissions across all sectors of the economy. In terms of new planting, the Climate Change Commission said ‘…exotic afforestation would continue

the trajectory expected under current policies up until 2030, averaging around 25,000 hectares per year. From 2030 onwards, the rate of afforestation for carbon removals would reduce. In total, around 380,000 hectares of new exotic forestry would be established by 2035.’ It asked for ‘…at least 16,000 hectares of new native forests per year by 2025, and 25,000 hectares per year by 2030 until at least 2050.’ The native forests would come from planting and from natural reversion. What we said is below.

• Overall, we agree with the Draft Advice and main findings − endorse an integrated strategy that includes water and biodiversity and support moving to a circular economy and eliminating the use of fossil fuels − motherhood and apple pie.
• However, we believed the Climate Change Commission was −
  • Over-estimating the role of native forests and the area which may be planted by 2035
  • Over-estimating the area of exotic forests which may be planted by 2035
  • Offering no practical contingencies should either of these failures occur
  • Emphasising carbon and wood waste over the major role forestry can play in the bio-economy and a move to renewable resources
  • Failing to recognise the implications of the success or failure of measuring carbon on farms, the He Waka Eke Noa initiative
  • Providing little direction to the government agencies which are charged with developing the policies aimed at the required forestry contributions.

The submission in more detail

New Zealand has no track record in successfully establishing large areas of native forest in emergent species. The infrastructure does not exist and the costs are likely to be much higher than the Climate Change Commission’s estimate. Responses under the 1 Billion Tree programme are not a good long-term indicator of capacity, willingness or skill.

The area of our production forests has been declining since 2005. The best that current policies have achieved in new planting, with higher carbon prices and the 1 Billion Tree programme and ignoring failure to replant, is 19,000 hectares last year. Rising land prices and continuing deforestation mean the ‘trajectory expected under current policies’ is unlikely to produce the 25,000 hectares a year of production forestry which the Climate Change Commission wants every year from now until 2035.

The Climate Change Commission has no contingencies for failing to achieve either the indigenous or the exotic planting rates. To the extent that they are relying on new forests for timber, fuel and biomaterials as well as carbon storage, any shortfall could seriously affect their long-term forecasts. We would like them to be more imaginative and aggressive in building a carbon buffer by encouraging, for example, permanent forests of long-lived exotic species, or the use of exotic species as a nurse crop for transition to indigenous trees.

The Draft Advice emphasises exotic forests for carbon storage and as a source of wood waste. There is only passing reference to the role of wood products and paper packaging in the wider economy to reduce embedded carbon and the use of petrochemicals. This downplays a substantial contribution of the forestry sector.

The Climate Change Commission expects He Waka Eke Noa to be successful in measuring and encouraging reductions in agricultural emissions but has offered no contingency should it fail. It ignores any connection between He Waka Eke Noa and the Emissions Trading Scheme, even though the former is trying to emulate the latter with all of the necessary mechanisms for control, measurement and compliance. If He Waka Eke Noa is successful, then the present Emissions Trading Scheme for forestry will be redundant because all of the methods and controls needed for measuring ‘the additional carbon from small areas of permanent vegetation’ should work equally well with large areas of permanent vegetation, such as in commercial forests including pre-1990 forests. That implication is ignored. In addition, unless the schemes were combined, a farm forester might have to choose between them or comply with both. The mind boggles.

Of course, if He Waka Eke Noa does fail to reduce agricultural emissions, someone is likely to scream for more exotic forestry to make up the shortfall. We might say ‘I told you so’ but by then we will have lost another five years, land prices will be up and the job will be so much harder. This implication is missed as well.

After the submission went in at the end of March, Rod Carr, the chairman of the Climate Change Commission observed that ‘their portrayal of forestry as being a binary choice between native permanent and short-term exotic may not be helpful.’ Well, really? It sounds like a gracious apology for not knowing much about the sector. Let us hope the submission process helps ill in the knowledge gaps.

Howard Moore is a member of the Wellington branch, Forest Investors action Group, the Executive and the levy board Small and Medium Enterprise Committee.