Does money really grow on trees?

Arise in the value of carbon credits and a looming deadline to be able to stake a claim to the NZ Emissions Trading Scheme's current Commitment Period has farmers studying the trees on their land more closely.

Beef + Lamb NZ is conducting a series of workshops throughout New Zealand as farmers seek more information about the scheme.

A workshop at the Marua Hall in Northland featured consultant Phil Orme, from Orme & Associates. Orme travels the country helping farmers understand and tackle the daunting process of preparing their claims for the Ministry for Primary Industries, which administers the scheme.

If they are registered before January 1, 2023, their claim will be backdated to cover a five-year time span (2018-22). After that date a new three-year slot (2023-25) begins to bring New Zealand into line with the Paris Accord five-yearly time slots.

And with carbon credits trading at about $77 per unit, up from about $20, farmers are paying attention.

While New Zealand's Emissions Trading Scheme has existed since 2008, many farmers have been hesitant to become involved due to a perception of complicated processes.

Orme & Associates' mission is to allay those fears, and for farmers to claim credits where credit is due.

"Farmers are time poor and setting up in the system is quite daunting," says Orme. "I can clearly remember my hand shaking as I pressed the button the first time. It had taken 40 hours of gathering all the information for the submission. Now I can put it together in a few hours."

He has six team members helping farmers with their submissions.

"It is actually quite straightforward and possible for farmers to go through the process themselves. Once set up, a return must be submitted each five-year Commitment Period."

He said many farmers did not realise which existing trees on their land might qualify, sometimes with a bit of infill tree planting.

Forest land is deemed to be "a tree species capable of reaching 5m, over one hectare in size in one location, more than 30 metres' average width and capable of a minimum of 30 per cent canopy coverage".

"There are a whole lot of tree species that qualify for that criteria." Trees existing before 1990 did not qualify for the scheme.

"Any trees planted after that date can qualify, not just pine trees. Reverting native bush, poplars planted for erosion or totara in paddocks can count if they are planted or exist in sufficient numbers to give the required canopy coverage for an area.

"Totara trees are slower-growing than pine trees but cattle can still graze under them so they can be a good option to grow. Suddenly farmers might not think of totara trees as weeds any more," he said.

Trees included in Queen Elizabeth Trust covenants tended to be older trees so they did not qualify but Orme said sometimes regenerating edges did, as long as they were planted/reverted since 1990 and meet the forestland definition.

"Often farmers have planted a lot of native trees on the edges to fill out the space to fences and these areas can count."

At the Marua workshop, he gave examples to help farmers learn from the mistakes of others.

"Be really careful about legal boundaries as only trees growing within these areas can be counted."

There were many examples where legal boundaries shown on titles did not correspond to the lay of the land.

"What is drawn on a map can often be impractical for fence lines so there are many examples where neighbours allow give and take rather than follow the exact lines drawn on a map. However, trees might end up being planted right up to the fence line over the legal boundary, which means those trees are actually only able to be claimed by the neighbour."

Another example he showed was where a paper road ran right through an area of planting, making a huge dent in the area that could be legally claimed for carbon credits.

Orme said farmers had to consider what was the best use of the land.

"Not all farmland is suitable for trees, but most farmers would have some areas that have always been a bit of a pain to manage. Where extra fencing is needed but it's difficult to get to and the area would need an extra trough, or where a steep gully always needs spraying and the animals never go down there.

"It might make good business sense to look at planting trees for carbon credits," he said.

Areas under 100ha could be estimated using MPI's default tables "regardless of how the trees look", making the process more straightforward. Larger registrations with areas over 100ha had to have the tree volume measured. However, most farmers would fall under the MPI default tables, he said.

Historic aerial farm photos could provide vital proof of land use before and after the 1990s and an online repository of old photos called Retrolens could be consulted as well as family photos.

"You need to be able to say, ‘I've got some trees here on land I own and here is the proof they were planted after 1990'," Orme said.

"If it is the right use for the land, and it meets the requirements, why not consider registering in the ETS?" he said.

Farmers looking at the potential of trees to tap carbon credits