What Is “Safe Carbon”?

This blog is based on information from our March 2025 CarbonCurious webinar.

If you're earning carbon credits through the Emissions Trading Scheme (ETS), chances are you’ve heard the term safe carbon. But what does it actually mean, and why does it matter now more than ever?

In simple terms, safe carbon is the portion of your carbon credits - known as NZUs (New Zealand Units) - that you can sell now without risking a future financial liability.

That means you can offload them with confidence, knowing you’ll still have enough units to meet your obligations later (like when you harvest your forest or deregister from the ETS).

So, how do you know what’s “safe”?

That depends on a few key things:

• How your forest is registered (Stock Change, Averaging, or Permanent)

• The age and growth stage of your forest

• Whether you plan to harvest or leave it standing

• When and how you joined the ETS

Your safe carbon isn’t fixed. It changes over time and with your intentions. That’s why selling without understanding your position can be risky. It could leave you exposed down the track.

How much carbon is “safe”?

Here’s how safe carbon can look depending on how your forest is managed:

1. Stock Change + Harvest

You’re growing a forest with the intention to harvest. It’s registered under the Stock Change method. This is where things get risky. You earn units as the trees grow, but you’ll need to surrender most or all of them once you harvest. That means your safe carbon could be zero. Selling now means you’ll have to buy units back later - potentially at a much higher price.

2. Averaging + Replanting

Let’s say you’re planning multiple rotations and replanting after harvest. Under Averaging, you’re issued credits up to the long-term average carbon stock. That could leave you with around 350 NZUs* per hectare that are considered safe to sell, provided you follow through with your replanting plan.

3. No Harvest (Permanent Forest)

Now imagine you decide not to harvest at all. Maybe the land is hard to access, or carbon income is more appealing than log returns. If you convert to a Permanent Forest, your safe carbon can leap to 600+ NZUs* per hectare - a difference that could be worth over $20,000 per hectare at current prices (as at March 2025).

*NOTE: this will vary by tree species, region, and registration history.

Is anyone selling “unsafe” carbon?

Possibly.

With NZU prices dropping, some forest owners might be tempted to sell more units than they should - either because they’re under financial pressure, betting on future rule changes, or simply not sure what’s actually safe.

This creates more supply in the market and keeps prices down. But it’s also risky. Selling “unsafe” carbon means gambling with your future ETS obligations - and as we’ve seen, the scheme doesn’t always move in expected ways.

Safe carbon isn’t just about rules. It’s about intentions.

One of the biggest shifts in the market could come not from regulation, but from behaviour. Analysis suggests around 67 million tonnes of NZUs from post-1989 forests may currently be “unsafe”, held back to cover future harvest liabilities.

But if landowners change their minds and decide not to harvest, those same units could suddenly become safe, and eligible for sale. That kind of shift could quietly unlock a wave of new supply, adding further pressure on already-soft carbon prices.

The bottom line?

Safe carbon is personal. It depends on your land, your forest, and your plans. It can’t be eyeballed, and a wrong move could come with significant cost.

We help landowners model their carbon profile and understand what’s genuinely safe to sell. That means fewer surprises down the track, and more confidence in your decisions. To learn more about the ETS, and safe carbon, check out our March CarbonCurious session.

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Disclaimer: This blog is for general information only. It is not advice, a forecast, or a prediction. While we aim to provide accurate insights, there may be errors in fact or analysis - so treat this as a prompt to look closer, do your own research, and consult official sources wherever possible. Carbon markets are complex, and future prices or policy changes are inherently uncertain. You should always seek independent advice before making any trading or investment decisions.