Climate Forestry Body Accuses NZ Gov of ‘Vandalism’ Over ETS

Changes to the Emission Trading Scheme will cost New Zealanders billions of dollars and will not move the dial on climate commitments.

Mon 10 Jul 23


The Climate Forestry Association has accused the New Zealand Government of “economic vandalism” as the proposed reforms to the country’s ETS have led to a slowdown in tree planting.

As reported in the NZ Herald, the Climate Forestry Association is concerned about the regulatory uncertainty around the future of an industry, which according to the President of the New Zealand Institute of Foresters, James Treadwell, “is the only effective measure currently in place to address climate change commitments, offering a ray of hope in meeting our targets.” 

The Climate Forestry Association is a joint initiative between iwi groups, the NZ Farm Forestry Association and other carbon forest groups, including NZ Carbon Farming.

The association was established last year following Iwi’s concern over the Government’s leaning towards greater native plantings is growing. It has a natural alliance with farm foresters, who see value in planting exotics for carbon income.

Andrew Cushen, CEO of the Climate Forestry Association, spoke to Mike Hosking of Newstalk ZB.

“The only part of the system (ETS) working is the forestry component.”

According to Cushen, forestry levels are lower than in 1990, when the ETS was proposed.

“It will cost the economy billions of dollars without moving the dial on our climate commitments.”

“We are stuck looking at forestry levels and not the economic implications,” he said.

“Right now, treasury estimates that we could be up for $25 billion to meet our climate commitments; forestry is the only thing contributing to that at the scale that we need to offset future costs.”

“Instead of doing that, we are looking at billions of dollars of extra costs…that’s why I call it economic vandalism.”

According to Cushen, the NZ Climate Commission is driving the changes and is concerned that the recommendations are “light-on” for detail. 

“We find this incredibly costly with such poor analysis,” Mr Cushem said.

The proposed changes to the ETS market

On Monday, the New Zealand government released four options for reforming the future ETS market. These include:

  • Use existing levers to strengthen incentives for net emissions reductions, for example, reducing the number of NZUs sold through auction.
  • Increase the demand for emissions units by allowing the Government and / or overseas buyers to purchase them.
  • Strengthen the incentives for gross emission reductions by changing the incentives for removals.
  • Create separate incentives for gross emission reductions and removals.

Wood Central reports that the most likely outcome will be splitting the ETS market into two – with a market for emissions reductions and another for removing emissions from the atmosphere like tree planting.

The consultation will run until 11 August 2023; changes could be implemented by early 2025.


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