Frequently Asked Questions

Quick answers to questions we hear regularly. For deeper coverage, follow the links to our detailed articles.

Eligibility

How much land do I need?

Minimum 1 hectare of eligible forest, with an average width of at least 30 metres.

→ Small Landowners & Lifestyle Blocks

Can my shelterbelt earn carbon credits?

Usually no. Most shelterbelts are narrower than the 30-metre minimum width requirement.

Can I get credits for regenerating scrub/bush?

Yes, if it:

→ Native Forestry & Regeneration

Can I earn carbon credits from pasture (soil carbon)?

No. The NZ ETS only recognises carbon stored in forests, not pasture or soil. This is because soil carbon measurement isn’t yet reliable enough for trading schemes.

My forest existed before 1990. Can I earn credits?

No. Pre-1990 forests cannot earn credits — but they have deforestation liability if cleared.

→ Eligibility: Post-1989 Forest Land

I have a second rotation forest. Can I earn credits?

Very limited. Under averaging accounting (the only option since 2023), you earn units until the forest reaches its average carbon stock. Second rotation forests are already at the average — there’s nothing more to earn.

This is a significant trap for buyers expecting carbon income from mature or second rotation plantations.

→ Averaging vs Stock Change Accounting

Getting Started

How do I prove my forest is post-1989?

Use historical aerial imagery (Retrolens, LINZ) to show the land wasn’t forest on 31 December 1989. Personal photos, planting records, and seedling receipts also help.

→ Mapping & Carbon Measurement

Do I need a consultant?

Not required, but recommended for:

Simple situations can be done DIY.

→ Working with Carbon Consultants

How much does registration cost?

Typical costs:

→ The ETS Registration Process

Earning & Selling

When can I start earning credits?

After your forest is registered and you file your first emissions return. You can earn credits back to the date of registration.

How much will I earn?

Depends on species and age. Indicative figures per hectare:

At $65/NZU, radiata might earn $1,300-2,000/ha/year at peak growth.

→ Carbon Look-up Tables Explained

When should I sell my credits?

There’s no perfect answer. Consider:

Some landowners sell as they earn; others bank units and sell periodically.

→ Trading NZUs

Do NZUs expire?

No. You can hold them indefinitely.

Obligations

What if my forest is destroyed by fire or storm?

The Temporary Adverse Event Suspension (TAES) can pause your obligations while you re-establish the forest. You won’t have to surrender units if you replant within the timeframes.

→ Insurance & Risk Management

Do I have to surrender credits when I harvest?

Under averaging accounting (from 2023): No, if you replant within 4 years.

Under stock change accounting: Yes, you surrender units for carbon lost at harvest.

→ Averaging vs Stock Change Accounting

What happens if I don’t file my emissions return?

You may receive infringement notices and penalties. Late is better than never, but on-time is best.

→ Penalties & Enforcement

Common Concerns

What if carbon prices crash?

You can hold units indefinitely — you don’t have to sell at low prices. But if you’ve over-sold and need to surrender units, low prices when buying would actually help.

→ Market Trends & Price History

Can I exit if I change my mind?

Yes, for post-1989 standard forestry — but you must surrender all units you’ve received.

Restricted for permanent forestry — early exit is very expensive.

→ Exiting the ETS

What about the new LUC restrictions?

From October 2025, exotic forestry on LUC class 1-6 land is restricted. Native forestry has no restrictions.

→ 2025 Legislative Changes

Is carbon farming bad for rural communities?

This is debated. Large-scale conversions have caused concern. The 2025 restrictions aim to address this. Native forestry and integrated approaches are less controversial.

Specific Situations

I have Māori land. What’s different?

Māori land has explicit exemptions from the 2025 LUC restrictions. There are also additional governance considerations through Te Ture Whenua structures.

→ Māori Land & Carbon Farming

I’m buying land with ETS registration. What should I check?

→ Due Diligence for Land Buyers

What happens to my carbon when I die?

ETS registration transfers with the land to your heirs. NZUs in your account are personal property and pass through your estate.

→ Estate Planning & Succession

I have over 100 hectares. What’s different?

You must use the Field Measurement Approach (FMA) — actual forest measurements rather than lookup tables. This requires professional forest inventory services.

→ Field Measurement Approach

Money & Tax

Is carbon income taxable?

Yes. NZUs are trading stock. Income from selling is taxable; you may get deductions for units purchased or surrendered.

→ Tax Treatment of Carbon Income

Is GST charged on NZU sales?

No. NZU sales are zero-rated for GST.

Can I get funding to establish forest?

Various programmes have existed (One Billion Trees, regional grants). Check current availability — programmes change frequently.

→ Financing Carbon Forestry

International

Can I sell NZUs overseas?

No. NZUs are domestic only — they can only be used for NZ ETS compliance.

Are NZ credits accepted for corporate carbon neutrality claims?

Increasingly not. Major certification bodies like Toitū have moved away from accepting NZ forestry credits for international voluntary market standards.

→ Voluntary Carbon Markets

Still Have Questions?

If your question isn’t answered here:

Next Steps

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