Home Forest Carbon Pool Maximising Income and Managing Risk

 

Post 1989 :: Maximising Income and Minimising Risk via Pooling of Credits

International Markets and International buyers have large often multi million tonne appetites for credits. They are not interested in a few thousand hectares here and there. And they are definitely not interested in smaller parcels.

Small isolated parcels of forest credits represent huge risks to buyers. These risks need to be managed or the price will reflect a significant reduction for risk.

Penalties are crippling – up to 10 times the credit value. Miss managed can create a nightmare for the smaller or inexperienced forest owner. Simple mistakes can occur such as the incorrect mapping of the forest. EITG recommends that you seek and receive assistance from an NZIF registered forest consultant.

Unexpected losses can occur from fire or other in rotation risks that require credits to be surrendered bacCarbon Stock Changesk to the Government.

At harvest credits must be surrendered to the amount deemed to be emitted, some 60% of the total carbon stocks on site. The balance 40% of the total carbon is deemed to be emitted over

a 10 year period. The above graph shows where the forest is replanted at 2020 to offset the losses due to the decay after removal of the harvested timber.

Aggregation allows the creation of a large scale forest credit asset. Integrating this with other EITG sources of credits from other projects all over the world reduces risk, allows for the harvest liability and means we can access international markets.