It will stop accepting the Government-issued credits from early 2024.
Forest offsets have been under scrutiny here and overseas, with some projects shown to have overstated how much extra carbon they were truly removing.
Companies can use them to say they are counteracting emissions from their operations and sometimes brand their products as carbon neutral or even carbon positive.
Toitū rules require their clients to cut their own emissions first, before resorting to offsets.
Companies certified as carbon neutral by Toitū include Westpac, BNZ, ANZ, Canon, Deadly Ponies, KPMG, Kathmandu, Lotto, Simpson Grierson and many others.
Toitū Envirocare chief science adviser Belinda Mathers said it was a difficult call to stop accepting New Zealand forests as carbon offsets under its certification scheme, but clients had been understanding.
Market expectations were changing, after scrutiny of forest projects overseas, and Toitū had signed up to only use credits that had been certified by a new body, the Integrity Council for the Voluntary Carbon Market, she said.
“The indication we have been given by the New Zealand Government ... is that they are not intending on applying for approval under those international standards at this time.
“So, until some New Zealand credits become available, we have made that really difficult decision.”
Toitū said about 90 per cent of its offset customers use overseas offsets and it hoped New Zealand forests would be able to qualify in the future.
Owners of ETS-registered native forests can still sell them to polluters who need to buy credits to meet their obligations under New Zealand law, for example, companies selling coal, petrol and natural gas within New Zealand.
They can also sell them to other companies wanting to buy voluntary offsets that are not certified by Toitū.
Toitū's clients include government agencies such as ACC and the Waka Kotahi NZ Transport Agency, but often these use the organisation only to certify that they are cutting their own emissions, not to certify offsets.
There are no voluntary forestry schemes (schemes outside the Emissions Trading Scheme) that meet Toitū's standards, so this decision leaves its customers without a New Zealand-based option.
But Mathers said there were excellent native forest schemes in New Zealand, and she hoped New Zealand forests would get certified by the International Integrity Council.
Among other things, forests have to prove they are truly taking additional carbon from the atmosphere beyond the normal run of events, and that the climate benefits would not have happened without the financial investment from selling the carbon credit.
That is to avoid criticisms that some forest owners were benefitting from “business as usual” and not truly helping the climate as much as claimed.
New Zealand’s Ministry for the Environment, the ministry responsible for ETS rules, has been approached by RNZ for comment.
- RNZ
