Effective 12 January 2023, new ETS fees will come into effect which increase prices considerably unless you have a permanent forest.
Photo credit: Awaroa Inlet by Nick Burns, CarbonCrop employee
Effective 12 January 2023, new ETS fees will come into effect which increase prices considerably unless you have a permanent forest.
After a consultation period, MPI has amended their ETS fee changes to remove the disproportionate impact on native forests and the smallest landholders. The new fees reduce almost all fees for permanent forests to zero, and keep fees for smaller landholders the same. This reduces the financial barriers to ETS participation for our native forests and will help forest restoration and biodiversity.
From 1st January, new registrants for the ETS will be either “standard forestry” or “permanent forestry”. Standard forestry covers Stock Change and Averaging.
What are the New Prices?
Here is a snapshot of the key fees:
For a full look at the fee changes, read here.
How have the prices changed?
Prices for almost everything under the permanent category have now dropped to zero.
For standard forestry blocks over 10ha, new registrations are 3-7x more expensive than previous, depending on the size of your forest.
The biggest change comes with adding new blocks (CAAs) to your existing registration. For blocks over 10ha, adding new CAAs are are 18 - 40x more expensive.
Filing an emissions return has increased slightly in price also.
What does this mean for you?
1 For those with permanent forestry this is a big win, as pricing for almost all ETS services drops to zero. For smaller forestry block holders, pricing changes for the main ETS services of registering or adding extra forest blocks haven’t changed so pricing changes don’t impact you too much unless you want to transfer ownership.
2 The large change in cost to add new CAAs means you may want to think carefully about when the right time to add these to your registration is, and group several together. Fortunately, no matter when you add your new CAA, your carbon credits return will still be back-dated to the start of the current emissions return period, so you don’t miss out on carbon credits if you choose to do this.
3 Your annual carbon cash flow may be at risk if you are smaller. Although costs for emissions returns for existing customers are still relatively small - $165 vs $100 - it may no longer be financially worthwhile to file a return every year. This means that you may only file once at the end of the emissions return period, and so will have to wait longer until they are issued credits.
When the pricing proposal was opened up for feedback, CarbonCrop advocated for a fairer deal for smaller and native landholders in the ETS, and will continue to do so.
If you're not yet registered for the ETS, we can help you make an informed decision. Find out what you've got, and what it's worth. For free.