Photo: RNZ / Kate Newton
A group representing Māori forest owners say Māori could be billions of dollars out of pocket under proposals to review the Emissions Trading Scheme released today.
Māori are major forest owners but holdings are often on marginal land and can be difficult to make money from. Some Māori see selling units on the ETS - carbon farming - as a major opportunity.
The government today released reviews into the ETS and permanent forestry asking for the public to weigh in.
Te Taumata chairperson Chris Insley represents a group of Māori foresters and said the reforms could be incredibly prejudicial to Māori, jeopardising huge amounts of possible ETS revenue.
"[It] will eliminate $10 billion development opportunity for Māori off marginal land," Insley said.
"Who's the loser in all this? It will be Māori."
Climate Minister James Shaw said the review would try to ensure that Māori had options for how to use their land.
Insley took unsuccessful legal action to stop the release of the review, with more to play out in the courts. He has also filed an application with the Waitangi Tribunal, and intends to take a complaint to the UN body on indigenous peoples.
Forestry Minister Peeni Henare said this projected loss was based on the previously hot prices of carbon units, which has since dropped.
However, many analysts lay the blame for the drop on the government.
Not wanting to add to the cost-of-living crisis, Cabinet late last year chose to ignore advice from the Climate Change Commission that would allow the carbon price to rise. Since then the price has fallen steeply.
Changes to the ETS are crucial - it is the single largest tool to get the country to meet its climate obligations. Its current settings make it cheaper for emitters to buy credits from planting trees than investing to cut emissions.
It has prompted an uptick in pine being planted.
Shaw said if changes were not made it could cause a flood of credits from new forests in future years and a corresponding price crash.
"A collapse in the carbon price would also be catastrophic for land owners, in particular Māori land, who have invested heavily in forestry on the assumption of rising, or at least stable, carbon prices."
The government today released four ideas to reform the ETS. Options include restricting the amount of units available in the scheme; and allowing the government or foreigners to buy credits.
The biggest change, assessed by officials as being the most likely to achieve what was wanted, was the idea to establish a whole new additional ETS market. There would be one scheme for emissions reductions, and one for things that remove emissions from the atmosphere, like tree planting.
Dr Christina Hood from climate consultancy Compass Climate said it would not be overly complicated to set up.
"We need to be thinking about emission reductions and support for forestry as two independent issues, and trying to solve both of those rather than continuing to trade them off against one another."
The increase in pine planting has prompted an outcry in the rural sector over fears productive land will be swallowed up and communities hollowed out.
Beef + Lamb chief executive Sam McIvor said his organisation had been pointing out major flaws in the ETS for years.
"The government's acknowledgement today that [the scheme] isn't working and requires change is encouraging," he said.
"There is a lot of detail to work through, but on the face of it there looks like there are some practical options here that will make a difference."
After public consultation the final advice will go to whoever wins October's general election.
