Understanding the Temporary Adverse Event Suspension for ETS-Registered Forests

If you have an ETS forest which was severely damaged or destroyed by a natural event, such as fire, wind, or landslips, then this could have significant ETS ramifications.

If your forest is registered under stock change accounting, you may have to surrender a sizeable number of carbon credits. If your forest is registered under averaging, you may also have to surrender carbon credits, plus you may lose all of your future carbon credit entitlement.

Fortunately, as of 2023 and provided certain criteria are met, you can apply for a “Temporary Adverse Event Suspension” (TAES). If the application is approved, you won’t need to pay back credits or lose future entitlement. Instead, the affected part of your forest will stop earning credits until it has been re-established (replanted or regenerated) and achieved the same level of carbon storage that it had when the adverse event occurred.

For example, in the case of 20-year-old trees that were windthrown during Cyclone Gabrielle in 2023 and replanted with the same species in 2024, the earnings pause would be 20 years plus 1 year for the replant interval = 21 years.

Criteria that must be met:
• The natural event must have occurred after 31 December 2022.
• The affected area must be contiguous and at least one hectare in size.

The ETS team at PF Olsen can help you with your TAES application. Among other things, the application will involve calculating an emissions return and obtaining drone imagery of the affected area. The cost of this work will depend on the size and location of the affected area.

There is no mandated timeframe for filing TAES applications, however, Te Uru Rākau recommends that they be lodged as soon as possible after a loss event has occurred.

Click here for further background reading on the Temporary Adverse Event Suspension