NZ Emissions Trading Scheme Statistics and Review

The summary of emission unit transactions undertaken within the NZ Emission Unit Register during 2010 makes interesting reading (see table below). For example, if we assume the nearly 4.6m NZUs transferred for entitlements were all from net increases in carbon stocks from post-1989 forest this represents 5% of potential total number of these units available through CP1 (84 million). This suggests that perhaps around 12% of the eligible NZUs have been applied for.

NZUs allocated to sectors under an allocation plan 2,883,706 Fishing, EITE and pre-1990 allocation plans
NZUs transferred for entitlements 4,597,123 Primarily to post-1989 forestry participants for net increases in carbon stocks
All unit types exported from NZ 1,266,150 Units sold to overseas buyers
All unit types imported into NZ 641,003 Primarily CER purchases, most likely by NZ compliance buyers to meet their 2010 emissions obligations due by 31 May 2011
All units types transferred internally within the NZEUR 7,469,344 Represents total volume of units sold/bought within the NZ market

Source: NZEUR Website

The much anticipated and scheduled ETS review is due to be completed by 30 June 2011. The focus of the review is design settings with reference to the international frameworks expected post-2012 and the impact on NZ competitiveness relative to possible compliance obligations by various sectors.

Interestingly, and as reported by Carbon Monitor in February, the Terms of Reference of the review do not include whether the ETS is the most appropriate response to climate change for New Zealand nor whether New Zealand should be taking action on climate change. This is further evidence that the government is committed to the ETS for the long-term and is looking at policy settings rather than whether or not we should have an ETS. This should be seen as a positive signal for forest owners who are actively investing, or contemplating investing, in forestry that has a carbon component.