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Deforestation in the ETS

If you deforest pre-1990 forest land that hasn't been granted an exemption or offset, you must tell us and pay for any emissions you create through deforesting the land. To do this, you must submit an emissions return between 1 January and 31 March in the year following deforestation. Follow our step-by-step process to make sure you meet your obligations.

Deforestation has a specific meaning in the Emissions Trading Scheme (ETS). There are two situations when land is considered deforested after forest is cleared.

  • The forest is removed and the land is converted or used for something else. For example, the land is developed for pasture, housing, or another non-forestry use.
  • The land is not replanted or regenerated with forest species that meet certain criteria within set timeframes.

How to meet stocking and growth thresholds to avoid deforestation

Removing pre-1990 forest is not deforestation in some circumstances, if:

  • you replant the forest or allow forest to regenerate, and this new forest meets the criteria below for stocking and growth thresholds, or
  • you are only deforesting small areas of land up to 2 hectares in any mandatory emissions return period (the current period is 1 January 2018 to 31 December 2022, the next is 1 January 2023 to 31 December 2025), or
  • you are clearing land for best practice forest management (see section 179A(1)(a) of the Climate Change Response Act), or
  • you have an exemption that allows you to remove your forest without any obligations, or
  • we have approved your application for planting an equivalent forest elsewhere (offsetting forest land).

See the definition of pre-1990 forest land in the ETS

Check when deforestation obligations don't apply

How to offset deforestation of pre-1990 forest

Who has obligations when deforesting pre-1990 forest land

When pre-1990 land is deforested, usually the person(s) who owned the land at the time must notify us and submit an emissions return.

In some circumstances, a person who didn’t own the land may be responsible. This happens if

  • the landowner made a formal arrangement to give the right to decide to deforest to someone else, and
  • the landowner also had no control over the decision to deforest.

You are responsible even if you did not voluntarily register your forest into the ETS.

If the land was sold recently

If pre-1990 forest land is deforested before it is transferred to new ownership, the former land owner must meet the obligations for deforestation. They must notify us about the deforestation and submit an emissions return.

If pre-1990 forest land is transferred while it is temporarily cleared, the new owner is responsible for the deforestation obligations if:

  • they do not replant, or
  • they replant but the forest will not meet the required stocking and growth thresholds in time, or
  • the land does not regenerate naturally as forest to the required stocking and growth thresholds within set timeframes.

Steps for meeting your obligations for deforesting pre-1990 forest land 

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How to meet stocking and growth thresholds to avoid deforestation

Forest land that has been cleared will be classified as deforested if it doesn't meet specific stocking and growth thresholds 4, 10, and 20 years after clearance.

Four years after clearing

Four years after clearing, the land must have either:

  • at least 500 stems a hectare of exotic forest species growing, or
  • been replanted with at least 100 stems a hectare of willow or poplar species (used to manage soil erosion), or
  • predominantly regenerated indigenous forest species, growing at a rate that suggests the land is likely to be forest within 10 years.

Ten years after clearing

Ten years after clearing, the land must have:

  • predominantly exotic species growing, with a tree cover of at least 30% from trees that have reached at least 5 metres high, or
  • predominantly indigenous forest species growing that meet the definition of forest land under the ETS.

See the definition of ETS forest land

20 years after clearing

20 years after clearing, the land must have predominantly indigenous forest species growing and at least 30% of trees 5 metres high.

Determine the date of deforestation

The date of deforestation is needed because you must notify us within 20 working days of deforestation occurring and submit an emissions return the following year between 1 January and 31 March.

If the forest was cleared and converted to another land use, the date of deforestation is the date in which conversion begins.

When forest land is deforested by not being replanted or regenerated to the required stocking and growth thresholds, the date of deforestation is the date it fails to meet these thresholds, i.e. 4, 10 or 20 years after clearing.

How to request an emissions ruling

Emissions rulings provide an official determination on matters relating to the Emissions Trading Scheme (ETS). They are often used to check if land would be eligible for registration as post-1989 forest land if it was planted. This means that you can check eligibility before making the investment.

They can also be used to determine:

  • if pre-1990 deforestation would occur if an area of forest was cleared
  • how ETS regulations would apply in specific circumstances.

Emissions ruling application form and guide [PDF, 338 KB]

Emissions ruling fees

You need to pay a fee to apply for an emissions ruling. The amount of the fee is on the application form. The fee covers up to 4 hours of work on the application. If more time is needed to make a ruling, you will be charged more.

Processing time for emissions rulings

There is no set timeframe for Te Uru Rākau – New Zealand Forest Service to issue an emissions ruling outcome. It usually takes us between 4 and 8 months.

Penalties and offences

You may face a penalty, fine, or conviction if you:

  • don't file a mandatory emission return by the due date
  • have calculated emissions or removals incorrectly in your emissions return
  • are late paying units that you owe.

Read more about penalties and the Emissions Trading Scheme

Emissions Trading Scheme operational policy: Assessing penalties for failing to correctly report emissions and removals [PDF, 260 KB]

Guidance on penalties under the Climate Change Response Act 2002 – EPA   [PDF, 742 KB]

Who to contact

If you have questions about deforestation:

MPI business units