Potential Scrub Changes and Its Spatial Allocation under the New Zealand Emission Trading System

Under the New Zealand Emission Trading System (NZETS), post-1989 forestry land (the exotic or indigenous forest land that was not used for plantation on 31 December 1989) in New Zealand is eligible for reward for each tonne of CO2-eqv sequestrated by reverting from pasture to indigenous scrub. We use the Land Use in Rural New Zealand (LURNZ) model to conduct 2 simulations assuming that one tonne of CO2-eqv costs $25; The reference case is that no one has entered the NZETS, the other scenario is that the whole agriculture sector and indigenous forest (but not plantation) have entered the ETS. Each simulation estimates the amount of land use changes in dairy, sheep-beef and scrub from 2008 to 2015. By comparing these simulations, we identify the current use and the area of land that may revert to indigenous scrub. The results suggest that 224,000 more hectares of post- 1989 forestry land will be protected into scrub under NZETS than without the system. After applying a land use allocation algorithm, the most likely reversion may take place on marginal sheep-beef land.