New Zealand’s regenerating native forests are chronically underfunded and critically important. By providing access to carbon credit revenue to forests that have previously been left out, Native CCUs create an incentive for landholders to keep doing more to increase forest growth, improve biodiversity and build a collective action response to climate change.
A critical principle for carbon credits from regenerating forests is additionality. This means:
the carbon credit is issued for sequestration that would not have happened without the financial incentive of carbon credits.
If the credit wasn’t there, it would be ‘business as usual’.
How do Native CCUs cause this change from ‘business-as-usual’?
It comes down to two key things:
Without the money from carbon credits, the land is unproductive
The financial incentive motivates landholders to invest more back into restoring their forests, thus capturing even more carbon.
1 The regenerating native forests are on otherwise unproductive land
+99% of the land registered under Native CCUs is seen as having ‘low productivity’ and not suitable for arable cropping. As these areas are regenerating forests, they’re unlikely to be earning revenue.
"Native CarbonCrop Units have led to a tangible financial outcome, now all reinvested in restoration and showing us that the station can generate new, conservation-related income streams alongside traditional farming."
- Landowner, Glen Dene Station
2 The financial incentive created motivates reinvestment back into restoration efforts which sequester more (and thus earn more)
Of the landholders registered in the launch of Native CCUs, 100% of the funds have been reinvested into restoring the native regenerating forests. In each case, the landowner has invested more into restoration than they earned through Native CCUs.
100% of the funds have been reinvested into restoring the native regenerating forests
A breakdown from one of the landholders is:
Doing nothing may mean a landholder’s neglected forest goes backwards - they are then liable to make up for the lost carbon.
Paying for performance, not promises
Importantly, credits are only generated from recent regeneration growth. This means credits are issued for growth that has actually happened, for carbon that has actually been removed from the atmosphere, rather than paying for the promise of something to happen in the future. This is a key principle in international guidelines. ‘Ex-ante’ (future promises) recognition is unacceptable for voluntary carbon offsets such as Native CCUs.
We could be boosting the carbon-sucking potential of our regenerating native forests right now. We’re not - or at least, not anywhere near enough. And funding is a critical constraint. The status quo wastes the potential of our regenerating native forests, and that’s hurting everyone - landholders, businesses looking for better offsets, and the climate and country at large.