• NZ needs to plant around 1.3 million new hectares of forestry to help the country's environment and economy, a new report finds today
• A better, workable Emissions Trading Scheme is also urgently needed
• Pure Advantage's new paper, "Our Forest Future", has been welcomed by the Government and the forestry industry

New Zealand urgently needs to plant swathes of new trees - more than a million hectares of them - to help combat climate change and boost a green economy, a major business think-tank says.

Pure Advantage today launches its new report, Our Forest Future, as the Government signs a landmark UN agreement to rein in global warming.

The group calls for a new national forest strategy that would halt deforestation and ultimately create 1.3 million hectares of new forest.

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It argues that planting huge new blocks of permanent native forest and fresh high-carbon commercial forests could avoid large areas of land being lost to erosion, help off-set agricultural emissions and put the country on course for a net-zero greenhouse gas future.

Along with erosion-prone land, new forest should also be planted along waterway margins and urban forest, where the environmental benefits of trees, such as protecting river ecosystems, would be much greater.

New Zealand needed to expand its forest cover, prioritise forest that would remain permanent, allow for diversity in forest stocks and bolster measures to protect them, the report's author, Dr David Hall, said.

It pointed to a shortage of capital as the biggest obstacle to new forest planting, but suggested ways that tree-planting could pay off - particularly by strengthening relations of responsibility between polluters and "anti-polluters".

Further, it recommended options to fix the Government's under-review Emissions Trading Scheme (ETS), which has been criticised for failing to incentivise planting trees through carbon pricing.

This week, the Government was slammed by a Morgan Foundation report that pointed out how its emissions reductions goals had been partly met through buying dodgy foreign carbon credits.

A key motivation for the Pure Advantage report was to help "re-frame" the way the public thought about tackling climate change in New Zealand, where sea level rise would likely exceed the global average, Dr Hall said.

Just like pushing for more renewable energy, planting more forestry was a "tangible target" that delivered other environmental pay-offs and made good economic sense, he said.

According to the Ministry for the Environment, forest removal was averaging around 8,500 hectares per year, while Global Forest Watch put our net loss of tree cover between 2001 and 2014 at 139,793ha - an area most of the size of Stewart Island.

The growing of new forests has meanwhile declined from a peak of 98,200 hectares in 1994 to just 2500 in 2014.

"But if we were to replicate what we were planting in the mid-1990s, when we were averaging around 70,000ha of new forest each year, we could have that extra 1.3 million hectares planted within 19 years."

Most of the 1.3 million hectare area the report proposed planting new native trees was upon the 1.1 million hectares of land identified by the Government as erosion-prone land.

The Government has targeted these vulnerable areas through its Afforestation Grant Scheme, which provides public money to landowners with the aim of acheiving 15,000 hectares of new forest by the end of the decade.

But Dr Hall said that, even if that goal was reached, it would solve just 1.3 per cent of the problem.

Getting the whole picture right, reduces the need for a forestry ETS. It will make forestry a much more attractive investment on its own.

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Covering the entire amount in native trees would avoid hundreds of millions of dollars of lost value, while sucking nine million tonnes of carbon dioxide from the atmosphere every year.

"That would get us about two thirds of the way back to 1990 levels if our gross emissions remain at their current level," Dr Hall said.

"Alternatively, if we planted those 1.1 million hectares in Pinus radiata, we could sequester carbon at around three times that rate."

To better incentivise planting, he suggested that landowners should have a "smorgasbord" of funding options to pick from depending on their circumstances.

Beyond the Afforestation Grant Scheme and other Government mechanisms like the Permanent Forest Sink Initiative and Erosion Control Funding Programme, he suggested bigger and bolder measures.

These included creating a meaningful carbon price, greater support for community conservation through voluntary offsetting and donations, slashing the actual capital required for planting, state-guaranteed "climate bonds" for forestry investors, funding more QEII covenants and exploring a polluter-pays "environmental consumption tax" independent of the existing Emissions Trading Scheme.

As for the ETS itself, he argued that its lack of credibility could be solved by making either ministers or an independent body, similar to the Reserve Bank, accountable for its outcomes.

New Zealand Institute of Forestry president James Treadwell welcomed the report, but believed there needed to be more emphasis on the uses, benefits and trade agreements around forest products.

Mr Treadwell felt a new strategy also needed to look at removing bias from the regulatory environment, where subsidies that some land uses get affected land values and encouraged deforestation.

The report presents a very good analysis of the benefits that arise from forests, not only for the forest owner but on surrounding communities and future generations.

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"Getting the whole picture right, reduces the need for a forestry ETS. It will make forestry a much more attractive investment on its own."

But improving the economics of forestry by attending to regulations, encouraging use of forest products, improving trading, providing research and education would require funding, Mr Treadwell said.

"So government funding for that can be regarded as a way of - at least partly - recognising the public benefits of forests."

NZ Forest Owners Association technical manager Glen Mackie felt the report presented "an ambitious, but very achievable proposal that would transform forestry in New Zealand".

"The report presents a very good analysis of the benefits that arise from forests, not only for the forest owner but on surrounding communities and future generations," he said.

"The proposed strategy to increase NZ's plantings by 1.3 million hectares would not only be hugely beneficial for our carbon position, but would position New Zealand to reap the other associated benefits with forestry, [such as] employment, economic advantage, clean water, reduction on runoff, and siltation."

Associate Minister of Primary of Industries, Jo Goodhew, pointed to the range of policies already in place, along with those still in development, to increase forestry.

"The Government recognises the importance of increasing afforestation to boost our wood products sector, and also as part of the wider work programme around climate change," she said.

"We are developing a National Environmental Standard for Plantation Forestry that will increase efficiency and provide long-term certainty for landowners as they manage plantation forestry activities under the Resource Management Act, while also boosting the environmental benefits from forestry."

Further, she expected an increase in forestry planting due to the recent rise of the NZU carbon price from around $5 in 2014, to its current price of $13.45.

DOLLARS AND SENSE: 10 figures that make the case for millions of more trees

• $95 per household: Our willingness to pay for improved provision of habitat for native species in public forests.
• $34-67 per visit (in 2012 dollars): Our willingness to pay for recreational opportunities in planted/native forests.
• $184 per year per person: Our willingness to pay to avoid a 20 per cent loss of urban trees.
• $19.2 million: Health benefits from reduced exposure to PM10 particulates in Christchurch air.
• $1.8-$4 million: Value of improved air quality from planting for Project Twins Streams in Waitakere.
• $1000 per hectare: Per hectare benefit of trees from avoided erosion in the Gisborne region.
• $250 million per year: Total avoided erosion value for 2.9 million hectares of future forest.
• 3.9-5.5 million and $600 and 850 million (depending on carbon price): Annual carbon sequestration by planted forests since 1990.
• $0.2-$25 billion in total, at $148-$22,749 per hectare: Carbon stock in non-soil pools from planted forests.
• $4.682 billion: New Zealand's forestry export revenue in 2014/15.