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If you're thinking about applying to register land in the ETS, you'll need to work out if your forest is eligible. You may earn or have to pay (surrender) New Zealand Units (NZUs or units) if you register with eligible forest land.
If you're planning to deforest your land, you'll need to find out if any of the rules in the ETS apply to you. You may be liable to pay units after deforesting certain kinds of forest.
Some kinds of forest are not covered by the rules for the ETS. They are not eligible to enter the ETS.
We’ll explain how to identify the different kinds of forest land in the ETS below on this web page.
When working out how the ETS and its rules apply to your forest, there are 2 aspects to consider.
- Requirements that define "forest land" in the ETS based on the species present, and for forest size and crown cover
- Rules that decide what sort of ETS forest land it is, based on when it was planted or established and what was on the land before
If you can't work out if the ETS rules apply to your land, consider hiring and asking a consultant for advice. They can also help you with other ETS tasks, such as registering.
To qualify as forest land in the ETS, the forest must:
- cover at least 1 hectare in area
- contain species that can reach at least 5 metres in height when mature in that location
- have (or be expected to reach) crown cover of more than 30% in each hectare
- be at least (or expected to reach) 30 metres across on average.
You can register in the ETS if your forest is not yet mature. The forest must be likely to reach these size requirements in future.
Forest land that is harvested is still considered forest land if:
- it will be replanted or seeded naturally with forest species within 4 years of harvesting
- it will meet certain stocking requirements when replanted, and
- the land isn't converted to another use, such as pasture.
There are 2 main kinds of forest land in the Emissions Trading Scheme (ETS):
- pre-1990 forest land and
- post-1989 forest land.
Pre-1990 forest land includes certain kinds of older forest established before 1 January 1990. If you have pre-1990 forest land you cannot register this in the ETS to earn units. If you deforest this land you may have to pay units for this deforestation.
Post-1989 forest land includes forestry established after 31 December 1989. If you have post-1989 forest land, you can choose to register in the ETS with this land. You’ll have options for how this land enters the ETS when you register this land in the ETS. How you register determines:
- when and if you can earn units for this land
- whether you need to pay (surrender) units if you harvest the land.
If your post-1989 forest land is not registered in the ETS, you will not:
- earn units for this land
- have to pay units for harvesting or deforesting.
You may be wondering why the ETS defines forest land in this way. This is because the ETS is aligned to an international climate change agreement, the Kyoto Protocol. In the Kyoto Protocol, there is a difference between:
- forest established before 1 January 1990 (pre-1990 forest land)
- those established after 31 December 1989 (post-1989 forest land).
The spread of exotic tree weeds is an issue for many parts of New Zealand. Tree weed species include wilding pines and other wilding conifers.
If tree weeds meet the requirements to be considered pre-1990 forest land, you could be liable to pay units if you deforest the land. However, you can apply to be exempt from the ETS liabilities for deforestation of tree weeds.
The ETS excludes other types of trees that aren't considered forest species under ETS rules, such as:
- fruit and nut trees that are managed as food crops
- shelter belts (less than 30 metres wide on average, unless they join onto other forest land)
- small areas of trees (less than 1 hectare) more than 15 metres from adjacent forest.