The first reading of the Climate Change Response (Emissions Trading Scheme—Forestry Conversions) Amendment Bill received strong support in Parliament late last month.
“This Bill is about protecting our most valuable land that grows food for export and sustains rural communities,” says Forestry Minister, Todd McClay.
“For too long, ETS incentives have driven the wrong outcomes for our rural sector.
“Once farms are planted in trees as a result of carbon credits we lose the ability to produce the high-quality safe food that consumers demand – and we lose rural jobs, export earnings, and the families that go with them. Today we are putting a stop to the harm that this has done to rural New Zealand.”
The Bill will:
- Prevent exotic forests from entering the ETS on LUC 1–5 land (New Zealand’s most productive soil);
- Limit new ETS registrations on LUC 6 land to 15,000 hectares per year, allocated by ballot;
- Allow up to 25% of a farm to go into the ETS, preserving landowner choice while ending full-farm conversions;
- Protect eligible Māori-owned land, and provide time-limited exemptions for pre-announced investments.
The Bill includes temporary exemptions where an investor can provide evidence of a qualifying forestry investment between 1 January 2021 and 4 December 2024. For instance, the purchase of land and ordering of trees prior to 4 December 2024 would be an example of proof of a qualifying investment, whilst each of these actions alone would not.
“The last Government sat back while 300,000 hectares of farmland were sold off for carbon credits. That short-sighted policy puts ideology ahead of long-term food security. We’re reversing that damage,” says Mr McClay.
The new settings will take effect from 4 December 2024, with the law coming fully into force in October 2025.
See the July 2025 edition of NZ Logger for details.
