Submission on managing exotic afforestation incentives

On 22 April 2022, Lawyers for Climate Action NZ Inc (LCANZI) made a submission responding to the Government’s discussion document Managing Exotic Afforestation Incentives - A discussion on proposals to change forestry settings in the New Zealand Emissions Trading Scheme (Discussion Document).

The submission addresses overarching issues about the proposed changes to the Emissions Trading Scheme (ETS) to exclude permanent exotic forestry.

Our primary submission is that, whatever approach is adopted for permanent forestry under the ETS, the likely emissions impact of adopting such a policy, and the flow-on effect on the amount of overseas carbon credits that Aotearoa New Zealand will need to purchase to meet its Paris Agreement commitment, need to be carefully considered.

Secondly, irrespective of whether any of the options for forestry proposed in the Discussion Document is adopted, this will not resolve the underlying design flaws within the ETS, in particular:

  • the lack of a meaningful limit on gross emissions (due to limited coverage and the stockpile);

  • the inability to incentivise gross emissions reductions over removals; and

  • the inability to incentivise mitigation measures/removals with the greatest co-benefits/least negative impacts.

In light of these issues, LCANZI supports a more fundamental review of the ETS, including consideration of whether it should be supplemented or replaced with a tax on gross emissions and a separate incentive framework for removals.

You can read the full submission here.

LCANZI