What stock change accounting is
Stock change accounting is a method of accounting for the amount of carbon in your forest land. If you have post-1989 forest land in the ETS, you must regularly calculate and report on changes to this amount. Until 2023, stock change accounting was the only method available.
The carbon accounting method you use determines how and when you earn New Zealand Units (NZUs or units). It also determines how and when you need to pay units to the government. This is known as “surrendering” units.
Learn more about post-1989 forest land
Find out more about carbon accounting and which method to use
With stock change accounting, you account for short-term changes in carbon storage. Using this method, you earn units as your forest grows and need to pay units when it’s cleared.
You’ll use stock change accounting if you register post-1989 forest land as permanent forestry.
Find out more about permanent forestry
Earning units under stock change accounting
The carbon in your forest increases as it grows and decreases when it is cleared.
With stock change accounting, you must account for the carbon in your forest at specific times. This is done by submitting an emissions return to us. There are specific times when you must do this.
Find out more about emissions returns and when you must submit them
With stock change accounting, every time you submit an emissions return you will either:
- earn units if the amount of carbon in the forest has increased, or
- need to pay units if the amount of carbon in the forest has decreased.
Your units are held in a holding account in the New Zealand Emissions Trading Register (NZETR).
Register or login to the NZETR
Accounting for carbon left on the land after clearing
When a forest is cleared, not all the carbon is removed straight away. Some of it remains on the forest land, in the form of woody debris. This decays over 10 years and continues to emit carbon during that time. This is known as "residual carbon".
With stock change accounting, you must account for residual carbon after clearing forest. In any emissions return that you submit within 10 years following clearance, you must include this in your calculations. After you harvest and replant, the emissions from residual carbon may be more than the carbon increase from the new growth. You won’t earn units for the new growth until it overtakes the residual carbon emissions.