Before human settlement 1000 years ago New Zealand was almost entirely covered with primeval forest up to the mountain timberline with an estimated 80% total forest cover.
Polynesian and European settlers have removed two thirds of the original forest, converting large areas to grassland causing major environmental damage. Today forests cover about 25% of the country.
New Zealand has extremely high levels of soil loss due to erosion. At least 10% of the 12 million hectares currently in pasture is farmed unsustainably due to erosion.
New Zealand Emission Trading Scheme (NZ ETS) became law in November 2008 and includes forestry. New Zealand leads the world in developing domestic legislation that specifically provides for forests to be grown for carbon sequestration and storage, notably the Permanent Forest Sink Initiative scheme (PFSI).
Arguably ETS forests are not ‘permanent’ or ‘additional’ because no changes are implemented in forestry management and forests will be harvested. ETS forests are issued the domestic NZU carbon unit. These can be converted into an AAU for international trading
Permanent Forest Sink Initiative (PFSI)
The PFSI is a carbon forestry mechanism designed and regulated by the New Zealand Government to promote the establishment of permanent forests for carbon sequestration on previously unforested land.
To be eligible the projects must comply with Kyoto Protocol forestry rules.
The mechanism enables land owners to earn Kyoto compliant emission units for carbon sequestered (absorbed) in these forests during the Kyoto first commitment period from 01 January 2008 to 31 December 2012. PFSI forests are required to be maintained as continuous canopy cover forests for a minimum of 99 years, and if any harvesting occurs it is only permitted on the basis of low intensity individual tree or small coupe removals. Clear cutting is not allowed.
These restrictions and other obligations are recorded in a covenant between the Crown and the landowner and registered against the land title. The landowner is liable to the Crown for any decreases in the forests post-2007 carbon pool which means the landowner is required to surrender Kyoto compliant emission units to the Crown if forest biomass loss occurs e.g. because of illegal harvesting, or natural causes such as fire or windthrow etc.
The key distinction of PFSI forests is they are managed under a sustainable forest management regime principally for the purpose of carbon sequestration and long term carbon storage unlike NZ ETS registered post-1989 forests which are ‘business as usual’ commercial timber forests that can be clearfelled at anytime.
The Permanent Forest Sink Initiative has been specifically designed to address concerns about permanence and additionality and meet other attributes required of gold standard carbon offset projects.
Although ERA is not working directly in New Zealand, we do promote PFSI carbon tonnes and occaisionally use them in our business dealings.
