Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Profit-rich foresters might quit ETS

Profit-rich foresters might quit ETS

January 18, 2013. Media release

Forest owners who have made a tidy profit by selling carbon high and buying low are now looking to quit the Emissions Trading Scheme, Carbon News reports today.

In 2008, the forestry sector became the first to enter the scheme.

The idea was that giving the owners of post-1989 forests tradable credits for the carbon stored in their trees would encourage planting.


And, at first, it worked. Influential forestry companies such as PF Olsen and Ernslaw One entered the market, and carbon forestry projects sprang up.


But that was when spot NZUs (the units issued to New Zealand forest owners) were worth between $18 and $24 a tonne. In 2010, they started falling on the back of cheap international prices, and today spot NZUs are worth around $2.50.

Figures from the New Zealand Emissions Unit Register show that New Zealand emitters are now using four times as many international units as foreign units to meet their carbon obligations, according to Carbon News, the country's specialist information service on carbon markets.

In September, the heads of eight forestry companies, who between them control about 70 per cent of the country’s plantation forests, wrote to Prime Minister John Key asking him to intervene directly to stop the flow of cheap carbon credits into the country.

Carbon News understands that companies that sold credits in the $20 range in the first few years of the scheme are now buying European carbon at around 40 cents a tonne in order to meet their own looming carbon liabilities from harvesting their forests.

As one source said, that leaves them with a huge profit and little incentive to stay in the scheme.


Forest Owners’ Association chief executive David Rhodes has now confirmed to Carbon News that several forestry companies are looking at quitting the scheme.

“I wouldn’t be surprised if they do,” he said, “I expect some will.”

Rhodes said that at $2.50 a tonne, it wasn’t worth the work involved in monitoring and measuring the carbon stored by forests and meeting the compliance requirements of the ETS.

ENDS


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Royal Society: Review Finds Community Water Fluoridation Safe And Effective

A review of the scientific evidence for and against the efficacy and safety of fluoridation of public water supplies has found that the levels of fluoridation used in New Zealand create no health risks and provide protection against tooth decay. More>>

ALSO:

Scoop Business: Croxley Calls Time On NZ Production In Face Of Cheap Imports

Croxley Stationery, whose stationery brands include Olympic, Warwick and Collins, plans to cease manufacturing in New Zealand because it has struggled to compete with lower-cost imports in a market where the printed word is giving way to electronic communications. More>>

ALSO:

Prefu Roundup: Forecasts Revised, Surplus Intact

The National government heads into the election with its Budget surplus target broadly intact, delivering a set of economic and fiscal forecasts marginally revised from May to reflect weaker commodity prices and a lower tax take. More>>

ALSO:

Convention Centre: Major New SkyCity Hotel And Laneway For Auckland

Today SKYCITY Entertainment Group Limited revealed plans to build a new hotel and pedestrian laneway of bars, restaurants and boutique shopping on land it owns in the Nelson and Hobson Streets block, expanding the SKYCITY Entertainment Precinct. More>>

ALSO:

Igniting The Spark: Bringing The Digital Enabler To Life

Changing a name is, relatively speaking, the easy part of a re-invention. Changing a culture, getting all the ducks in a row, turning yourself inside-out to become customer-inspired is a much bigger challenge. More>>

ALSO:

Ebola And NZ: Targeted Screening At Airport But Risk Low

The risk of any cases of Ebola in New Zealand remains very low, but health and border authorities are well prepared... anyone arriving in New Zealand who in the last three weeks has visited countries affected will be screened for symptoms of the disease. More>>

ALSO:

Scoop Business: Brewer Seeking Crowd-Funding Cancels Shareholders’ Dividends

Shareholders in Renaissance Brewing company, the first business to seek equity through crowd-funding in New Zealand, have cancelled their claim on $147,000 of accumulated earnings “to make Renaissance a more attractive investment opportunity.” More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news