Is my forest eligible for carbon credits under the ETS?
Learn about the definition of forest land under New Zealand's Emissions Trading Scheme (ETS) and six factors which affect eligibility for carbon credits.
To be eligible for carbon credits under the ETS your trees must meet the definition of forest land laid out by Te Uru Rākau - The New Zealand Forest Service. Some landholders tell us they find these requirements a bit complicated, so in this post we’ll outline the key factors which determine whether your forest is eligible.
We’ll also share some of the tips and tricks we use at CarbonCrop to help landholders maximise the number of carbon credits they can claim.
Based on our experience, here are the top 6 factors for eligible forest:
Forest area: Your forest must be at least one hectare in size
Forest width: Your forest must measure at least 30 metres in width
Forest height: Your forest must reach 5 metres in height
Canopy cover: Your forest must reach 30% average canopy cover
Tree species: Your forest must contain eligible tree species
Post-1989 status: Your forest must be established after 1990
Now let's go through each of these in turn.
If you’d like us to assess your land for carbon credit eligibility, we offer a Land Assessment service via our website. It’s completely free of charge and uses aerial imagery and artificial intelligence to analyse your forest remotely. Over 1000 kiwi landholders have applied for an assessment within the last six months.
1. Forest area: Your forest must be at least one hectare in size
While many people register huge areas for carbon credits, owners of small lifestyle blocks will be excited to learn that they can earn carbon credits for a single hectare of forest.
Large farms can also take advantage of the low minimum requirement by registering a series of one hectare plots across their site, such as erosion planting in gullies, or hillsides which are already regenerating and less suitable for grazing.
Each area registered in the ETS must be a minimum of one hectare in its own right and the area must be contiguous. This means that if you have lots of sub-hectare pockets of trees dotted across your site, you can’t simply add up to meet the one hectare requirement.
Tip: If you’re close to the one hectare mark, consider planting trees to extend existing forests or link together pockets of trees to meet the minimum requirement.
During assessment stage we can advise on the rules for connecting existing trees together and calculate your additional planting requirements.
2. Forest width: Your forest must measure at least 30 metres in width
Besides measuring one hectare in size, you need to prove that your area of forest measures an average of at least 30m in width.
This isn’t always easy to calculate, especially if you’re registering native regeneration, long, narrow plots of planted trees or other irregularly-shaped plots. Shelter belts aren’t typically eligible for carbon credits, but in some cases they can be wide enough to register.
At CarbonCrop we use precision mapping to reliably calculate the average width and provide these measurements to MPI. Our tools also help landholders to evaluate different scenarios for what to register and which areas to retain as farmland.
Tip: Not all forest is densely-packed and easy to draw a boundary around. If your forest areas are sprawling, be aware of the spacing between your trees, as this will affect the forest width - and the number of credits you can earn.
Understanding the rules around width and spacing enables us to maximise the registered area and number of carbon credits earned. You’re allowed to have gaps of up to 15 metres between trees, and in some unusual cases even 30 metres, provided you can still meet the canopy cover requirement explained below.
3. Forest height: Your forest must reach 5 metres in height
The important thing to point out here is that your trees don’t need to be this tall at the time you register them for carbon credits. Even seedlings can be eligible. However they must be able to reach an average of 5m in height within a reasonable timeframe.
Carbon credits are awarded for carbon sequestration, so it isn’t a question of whether a certain tree species can grow to 5 metres in height, you need confidence that they will grow to 5 metres on your particular plot of land.
Here are some of the factors which influence growth:
Tree species - not only must they be eligible, but they must be able to thrive in your particular site
Land management practices - for example, overgrazing or pests may suppress forest growth
Soil type and quality
Climatic conditions - wind, rainfall, temperature, sunlight etc.
At CarbonCrop, when registering land for the ETS we use different forms of evidence to give MPI confidence that your particular trees will be able to reach 5 metres within 20 years.
4. Canopy cover: Your forest must reach 30% average canopy cover
Similar to the height requirement, your forest is not required to have 30% canopy cover at the time of registration, however you need to ensure it will achieve this within a reasonable timescale.
If planting trees, the density of planting should reflect the span of your chosen tree species. In the case of poplars, for instance, the number of stems can be surprisingly low, especially if your land is suitable for poplars species with larger spans. With native planting, many landholders choose to include a mix of different species.
Tip: Allow for windfall and tree loss when calculating how many trees to plant within a particular area. Your forest needs to maintain at least 30% canopy cover over time, so you would be wise to factor this in, especially if planting exotic trees which do not easily regenerate.
If you are considering planting, CarbonCrop can provide more information about different tree species and the number of stems needed to achieve your desired canopy cover.
5. Tree species: Your forest must contain eligible tree species
We receive lots of questions about tree species and their different rates of carbon sequestration. But before forecasting your carbon forecast returns, we need to ensure your tree species are eligible in the first place.
Here are some of the main species which are eligible for carbon credits under the ETS in New Zealand.
Eligible native trees include:
Manuka and kanuka (provided the site supports their growth)
Podocarp trees such as rimu, kahikatea, miro, mataī and tōtara
Rātā, beech, ponga, pōhutukawa and tī kōuka (cabbage trees)
Eligible exotic trees include:
Pinus radiata, douglas fir, poplar and larch
Softwoods such as cedars and redwoods
Hardwoods such as eucalyptus (gums), oaks and willows
Which species aren’t eligible? Under the current regulations, sadly you cannot register orchard species, vines and crops for carbon credits. This puts all kinds of delicious trees out of the running, including kiwifruit, olives and avocados.
Tip: Most trees that grow to 5m are eligible, provided they’re woody. Flexible friends like harakeke (flax), toetoe, rushes and sedges don’t qualify. Gorse and matagouri are also ineligible, despite growing pretty tall and acting as a nursery crop for native regeneration.
6. Post-89 status: Your forest must be established after 1990
When did your forest become forest? The date your land became forested is a key determinant of carbon credit eligibility, because the ETS only recognises forests established after 1989.
While there are some important exceptional circumstances, if your forest was planted or started regenerating before 1990, you are unlikely to be eligible for carbon credits.
Forest establishment date can be a bit harder to grasp than the rest of our top six, so we’ve dedicated another post to this important topic.
Find it here: What is pre-1990 vs post-1989 forest land?
Okay, that concludes our top six factors for eligible forest under the ETS. How did you get on?
Do you think you might have some eligible forest? Or perhaps you’re considering planting out trees in the future?
Get our free Land Assessment
Whatever your situation, if you own land in New Zealand and want to learn more about your options, we recommend applying for a free Carbon Land Assessment.
You’ll receive a detailed report outlining different areas of your land, plus a carbon forecast showing what your carbon credits could be worth if these areas were successfully registered.
Over 1000 kiwi landholders have requested an assessment within the past six months, from Te Tai Tokerau to Rakiura.
We’re a tech-enabled forestry company that helps Kiwi landholders to access carbon credits. Our cutting-edge technology is backed-up by a friendly team of carbon advisors who can tailor your assessment and talk you through the wonderful world of carbon credits. If you decide to sign up with CarbonCrop we take care of your land registration and ongoing carbon management, in exchange for a small percentage of the credits.
Our initial assessment is completely free of charge and while we hope you’ll love our service, there’s no obligation to proceed to registration.
Where to start? Find your land