Forestry in the New Zealand emissions trading scheme: design and prospects for success

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The New Zealand Emissions Trading Scheme is globally unique in that it will include all gases covered by the Kyoto Protocol and all sectors of the New Zealand economy. This includes the land-use sectors of agriculture and forestry, with forestry being the first sector to enter the scheme from 1 January 2008. This article provides an overview of how the forestry aspects of the scheme are designed, including a discussion of how the challenges associated with forestry have been overcome. It concludes by suggesting that New Zealand’s experience and insights from the development of the New Zealand Emissions Trading Scheme provide important lessons for how other countries can design emission trading schemes that incorporate the land-use sectors, while maintaining environmental integrity.

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