New Zealand's annual emissions of greenhouse gases also vary but they are equivalent to roughly 80 million tons of CO2 at the moment. During the 2020s our plantations will become net emission sources as large areas of trees planted during the 1990s are harvested.
Q. What have been the main drivers of deforestation in New Zealand, and how does forest removal contribute the opposite effect of carbon absorption?
The main driver of deforestation in New Zealand historically has been felling and burning of native forest for agriculture, and prior to that burning for hunting by Maori. Before people arrived our land was approximately 80 per cent forest.
By the time Captain Cook sailed around the coast this had been reduced to 50 per cent, and colonial settlers "breaking in the land" for agriculture further reduced our forest cover to about 25 per cent of our land area.
Destruction of forest reduces carbon storage in the landscape, and this carbon mostly gets emitted into the atmosphere as CO2.
Q. Can you give a brief overview of how New Zealand has attempted to establish incentives to grow forestry, such as the Permanent Forest Sinks Initiative and the Emissions Trading Scheme (ETS)?
In short, the idea of emissions trading is that targets are set for people to reduce greenhouse gas emissions, but if they prefer not to reduce emissions then they can pay people to extract their emissions from the atmosphere.
The most common way of removing greenhouse gasses from the atmosphere is by planting trees on land that had formerly been in low vegetation such as grass, thereby increasing carbon storage in the landscape.
Q. What have been the key shortcomings in these schemes to date, and what has made joining them unattractive, both for domestic and international reasons, such as exclusion from the European ETS? Why have less than 50 per cent of post-1989 forests been registered with the ETS?
Our carbon credit "currency" has been subject to massive inflation as a consequence of government policies.
These policies include allowing imports of super-cheap "hot air" credits from eastern Europe that represent no environmental gain, free gifting of New Zealand credits to particular sectors (such as "trade exposed" industries and owners of forest planted prior to 1990 who are not allowed to earn for credits from carbon sequestration but who have to submit credits if deforestation occurs), and gifts of credits to those who reduce their credit requirement by reducing emissions (effectively paying them twice for reducing emissions).
The extremely low credit prices within our ETS that resulted from these policies are too low to stimulate much new forest planting.In addition, someone who established a forest, say during the 1990s, and who chooses to use their forest to earn credits for sale now will have to repay some credits at time of harvest, and this long-term liability cannot be justified with today's very low credit prices.
The international Kyoto process has similarly been subject to flawed policies, allowing many people to make money without really doing anything to help the environment.Unfortunately we adopted many of the Kyoto trading scheme's flaws in our domestic ETS.
The good thing about the Kyoto protocol is that countries at least got together and agreed that we have a problem.
Q. What impacts have failures of these schemes had on the amount of forest actually planted today?
New forest planting is extremely low, and there is plenty of deforestation for the creation of dairy farms or housing developments.
Q. What effects have the inclusion of forestry in our Intended Nationally Determined Contribution (INDC) had on the issue?
Forests planted during the 1990s saved us, allowing us to meet our initial target to get 2008-2012 net greenhouse gas emissions to the level of our gross emissions in 1990. However, anticipated harvest of those forests during the 2020s represents a major problem for New Zealand, making it very difficult, with current policies, for us to meet our INDC in 2030.
Our national 2020 commitment will be primarily met by our Government using "hot air" credits that were imported from Eastern Europe and then submitted by ETS participants to meet their ETS commitments at very low cost.
This way of meeting commitments is unlikely to be available in 2030 because it is not morally defensible, as it does nothing to help solve the problem of climate change.
As a consequence of meeting our commitments in immoral ways, our actual emissions have continued to rise at a rate that is one of the fastest in the world, and unless we see changes in ETS policies, we are unlikely to make our INDC, small as it is compared to other countries. With appropriate policy changes planting forest on eroding land could contribute to meeting our INDC target.
Q. You've argued that to avoid a blowout of our carbon account in the next decade as trees planted during the 1990s are harvested, the price of our domestic carbon credit - the New Zealand Unit (NZU) needs to be much higher to encourage new planting. What per-credit price would be attractive and how could we get there?
A price of $15/credit would begin to attract interest from potential forest planters, and a consistent price of $25/credit is likely to see a large rate of afforestation, mainly on small land holdings.
For instance, many hill country farmers could plant carbon forests on erosion-prone portions of their land and benefit financially while they help us meet our targets.Other New Zealanders who emit greenhouse gasses would pay them for sequestering CO2.
"Plant and leave" plans generally become economically viable at about $35/credit.To get to an effective credit price, we should:
• Stop grandfathering credits (gifts of "thin air" credits that represent allowed levels of emissions)
• Not auction "thin air" credits (the current plan from our Government is to replace "hot air" credits with domestic "thin air" ones that similarly represent no environmental gain)
• Stop random gifting of "thin air" credits from Government to people or industries whose behaviours they wish to influence
• Apply the ETS equally to all sectors
• Allow trading only between sequesterers and emitters to reduce gaming and speculation by traders who make no real contribution to solving the problem
• Manage our domestic credits as a currency
• Set reduction targets each year that stabilise our domestic carbon credit price (similar to the way the Reserve Bank sets interest rates to avoid inflation of the kiwi dollar)
• Require surrenders only for "over target" GHG emissions.
Q. The Green Party has suggested afforestation could be encouraged through payments or tax credits for certified sequestration, and in a wider sense, introducing a new carbon tax or levy. Could their proposals address the sticking points around forestry and carbon?
A carbon tax could be made to work, but a fixed ETS could also be made to work. We just have to stop treating credits as a commodity and instead treat them as a currency.
Q. Do our forest assets - and the potential to better use it to get us closer to carbon-neutrality - set us apart from other countries or make us unique in a global context?
Not really.Many countries have areas that were deforested over the last few thousand years that they could re-forest. We are lucky, though, that radiata pine grows so rapidly here, it is intolerant of shade, and that it is only rarely a wilding problem.
Over much of New Zealand it will not regenerate itself unless we nurture it, unlike lodgepole pine, Douglas fir, Ponderosa pine and other species that create serious wilding problems despite their rarity in our plantations.
On reasonably warm, moist, erosion-prone sites, if we planted and left radiata pine then we would get rapid CO2 sequestration to meet our targets and the forest would act as a nurse crop for much slower growing native forest so long as a native seed sources were available.
We could make a policy that required people to establish native forest seed sources close to their carbon forests.Ultimately, if planted and left, these plantations would revert to native forest over 100-200 years, which in my view is a great outcome.
Q. In New Zealand's forestry space, what do you expect will change once the commitments made in Paris kick in?
This is a political question.
• Jamie Morton travelled to Paris with support of the NZ Science Media Centre and the Morgan Foundation.
