How the ETS defines deforestation

What is meant by deforestation in the ETS

Deforestation has a specific meaning in the ETS. There are 2 situations when land can be considered deforested after forest is cleared.

• The land is converted or used for something else. For example, the land is developed for pasture or housing.
• The land doesn't meet certain criteria within set time frames. In particular, if the land doesn't meet ETS criteria for re-establishing forest on the land (stocking rates per hectare and the growth rates of the trees on the land). These criteria are explained on this web page.

Meeting ETS stocking and forest growth thresholds after clearing forest so that land is not considered deforested

If your forest land is cleared and re-established, you must meet ETS stocking and forest growth thresholds so that the land is not considered deforested. Your land will be treated as deforested if it does not meet these stocking and growth thresholds 4, 10, and 20 years after clearance.

Threshold to meet 4 years after clearing

Four years after clearing, each hectare of the land must have:

• at least 500 stems of exotic forest species growing, or
• been replanted with at least 100 stems of willow or poplar species for managing soil erosion, where the local authority has determined the risk of soil erosion is at least moderate, or
• mostly indigenous forest species, growing in a manner so that the land is likely to be forest within 10 years after clearance.

Threshold to meet 10 years after clearing

Ten years after clearing, each hectare of land must have:

• mostly exotic species growing, with a tree crown cover of more than 30% from trees that are at least 5 metres high, or
• mostly indigenous forest species growing that meet the definition of forest land in the ETS.

More about size and cover requirements to meet the definition of "forest land" in the ETS

Threshold to meet 20 years after clearing

Twenty years after clearing, if the land contains mostly indigenous forest species, each hectare of forest must have more than 30% crown cover from trees that are at least 5 metres high.

Your obligations if deforesting pre-1990 forest land

If you deforest pre-1990 forest land, you are liable to pay (surrender) units for the resulting greenhouse gas emissions, unless the land is exempt.

Find out what to do when deforesting, or planning to deforest pre-1990 forest land

Find out when you don’t have to pay units for deforesting pre-1990 forest land

Apply to plant forest land to offset emissions from deforesting pre-1990 forest land

Your obligations if deforesting post-1989 forest land

If you deforest post-1989 forest land (standard or permanent forestry), it is not eligible to be in the ETS any more.

If the land was registered as standard forestry, you must:

• remove the land from the ETS, and
• pay (surrender) the net balance of units that were received previously for the land.

If you deforested and are removing a part of a carbon accounting area, you will also have to submit an emissions return.

The same applies to permanent forestry – with additional penalties if the deforestation occurs while the land is still registered as permanent forestry.

Find out more about removing ineligible land from the ETS

Penalties for clearing permanent forestry

From 1 January 2023, you can apply to plant forest land elsewhere to offset the emissions from deforesting post-1989 forest land.

Applying to plant forest to offset emissions when removing post-1989 forest land from the ETS

When ETS deforestation liabilities do not apply

The rules for the ETS do not treat cleared land as deforested in certain cases. You won’t have to pay (surrender) units for deforestation in these circumstances.

We provide guidance about this for pre-1990 forest land elsewhere on our website.

Find out more about deforesting pre-1990 forest land without having to pay units

For post-1989 forest land, cleared land won’t be treated as deforested if:

• the land is on the edge of post-1989 forest land that was established before you registered the cleared land into the ETS, and
• the cleared area is less than 1 hectare or less than 30 metres at its widest point, and
• you are only clearing to meet New Zealand's best practice forest management, and
• the land will be used after clearing only for best practice forest management purposes.

Permanent damage to forest land

You are generally not liable if an area of your post-1989 forest land is permanently damaged by a natural event outside your control, such as after a landslide or if a river changes course. If it isn’t possible to re-establish forest in the area, this land would not be considered deforested. You wouldn’t have to pay (surrender) units.

If your land becomes permanently damaged, contact us.