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New Zealand's private sector will not plant more trees under planned changes to the Emissions Trading Scheme (ETS), a forestry group says.

The Government plans to set an emissions target for 2020 early next month so that Trade Minister Tim Groser can take the figure to negotiations at a United Nations climate change meeting in Germany on August 10.

Climate Change Minister Nick Smith said at the weekend that while decisions were yet to be made, targets of a 40 per cent reduction on 1990 emissions -- the figure international scientists say is necessary to keep global warming to around 2degC -- would have too great an economic impact, which he estimated would cost $15 billion a year by 2015.

Kyoto Forestry Association (KFA) spokesman Roger Dickie said Dr Smith was "incorrect if he thinks the Government's plans to water down the ETS are going to encourage new planting".

Plans to delay the entry of polluting sectors into the ETS and to exclude agriculture meant the forestry sector would have no one to sell carbon credits to domestically.

"So, the domestic price for carbon will remain low, which will not encourage investors to plant new trees."

The Government was also expected to cap the carbon price which would prevent the international trading of New Zealand credits, Mr Dickie said.

"No private sector investor will risk their capital to plant new forests under these circumstances."

The KFA represents more than 30,000 New Zealanders and forestry companies.

Academics said New Zealanders would need to plant new forests, boost the use of existing forests and increase the use of wood in construction to cut the nation's greenhouse gas emissions.

"In order to avoid a serious problem in our future national greenhouse gas accounts, we need to increase the rate of new planting right now," said two specialists at Canterbury University's forestry school, Associate Professor Euan Mason and senior lecturer David Evison.

Ministry of Economic Development figures released last week showed the nation's total greenhouse gas -- primarily carbondioxide, methane and nitrous oxide -- jumped nearly 24 per cent between 1990 and 2008.

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