 Akiara taito everybody, welcome to this fifth webisode in the series of Otato and Ahere, produced by Pure Advantage and Tarnes Tree Trust. These webisodes are being hosted by our friends at the Edmund Hillary Fellowship. And in today's webinar we'll be looking at climate change, the threats and opportunities to our Ahere, and also what role forests and especially native forests can play in reaching our 2050 net zero emissions target for New Zealand. I'm joined by three experts in this area, Dr Mark Kimberley, a statistician formerly with Sion, a now an independent consultant, Dr Sean Weaver, an expert in environmental finance and indigenous forest carbon markets, and Matt Walsh, who's the founder and MD of New Zealand Carbon Farming. Before we get into our panellists, just a reminder that we're very happy to take your questions. Please use the Q&A box that you can see there in Zoom for your questions. And also check out the chat because in the chat we put references of our panellists say something that we know there's a reference to on our website or if they mention a link we'll try and include that in the chat for further reference for you. And we will be finishing at 7.30 but there's so much more content available on our website and all of the contributors tonight are featured on our website. And so there's a tonne more information there for you to look at, that's pureadvantage.org. And of course we'll be posting lots of stuff on social media. We really appreciate it if you can share on social to get the message out about this really important discussion about the role of native forests of our Nahedi in New Zealand, not just for climate change but for our future prosperity across whatever way you want to measure it, whether it's commercial, spiritual, environmental, ecological, even cultural. So to our guests, in a minute I'm going to ask our guests to introduce themselves. But I might just do an ad actually because next week the series continues and we have three amazing guests that are going to be talking to us about what role the government could play in expanding, protecting and enhancing our native Nahedi across New Zealand. And I think that's going to be a really good episode too because there is so much that we expect of government to do, but if we could be very pointed in our expectations we might actually achieve something. So to our guests, well I wonder if I could get them all to introduce themselves and we might start with you, Matt. Tell us about who you are a little bit and what interests you in forests and a native forest especially? Thanks Vince. Matt Walsh from New Zealand Carbon Farming. Our business is about growing trees to preserve the planet. So we own and manage the largest privately owned conservation estate in New Zealand and we grow those trees to contribute to climate change, not for harvest. We've been doing that for more than a decade and we have 66 million trees that we're growing to protect the climate. 66 million trees seems like a lot? It is really a lot but that's just getting started from our point of view. We've had lots more to do and when we started out we all had young kids and so we wanted to do something that would make a difference for their futures as well as for all New Zealanders. At the time climate change was already out there as a problem but really very little was being done to address it and so we established New Zealand Carbon Farming as a way of investing and doing something to make a difference for the climate and for us we saw the opportunity to establish permanent nature reserves that will continue to have a positive impact over hundreds of years and as we've grown we've attracted passionate, talented people who love the idea of getting up in the morning and going to work to help the environment which is what our business is all about. But what I'm most proud of is that myself and my co-founder Bruce Miller are just a couple of local guys who have started a business with an ambition to make a difference and over time we've been able to achieve more and that ambition has got bigger. So together we're proof that on an individual level you can make a difference to climate change provided you have the drive and ambition to do so. Yeah, good stuff. Ora, we'll come back to talking about New Zealand Carbon Farming later and really looking forward to you explaining the business model but to you, Mark Kimberley, tell us about who you are and what's your interest in native forests? So I work for many years at Scion and Rojrua researching various aspects of trees and how they grow and growth rates and things like that. Both exotic species like radiata pine and also native species. So in the last decade or so a lot of my time has spent looking at carbon sequestration by trees and how it's done and how much carbon trees can remove from the atmosphere and that sort of thing. So I retired from Scion a couple of years ago and I've been just doing things that interest me since then really including I've done quite a lot of work with Tani's Tree Trust on looking at some of their data that they have. They are an organisation concerned with growing basically the growing of native trees in New Zealand and they have quite a lot of data measurements and plots and stands of planted native trees and also regenerating native forest around the country and using some of my experience I've been able to work out the rates at which these native forests are sequestering carbon. I'm just asking you about that in a minute because we want the detail but Sean please tell us a bit about your background and again your connection to New Zealand forests. Thanks Vincent, Sean we very cost. I have a background in forest ecology and forest conservation that goes back to the 1980s and started my career trying to protect the rainforests in the Pacific Islands and learned very early on that people who own these forests need to make a living and if we're going to invite them to protect them we need to find another way for them to make a living on their own land and the same is true for New Zealand farmers who own land in order to make a living and forest conservation on that land will commonly be the type of productive activity and if we don't compensate that land owner in some way for giving up rights to perhaps a less sustainable activity on their land then they're less likely to voluntarily protect or grow or protect forests on their land so I've been involved for the last 30 years I suppose and helping to cover the opportunity cost of land owners that are giving up certain rights to logging for example and funding that through compensatory payments so when carbon markets came along there's an opportunity to fund this activity without having to ask governments or philanthropy to fund that compensatory payment and that's why I got involved in carbon markets in the mid 2000s at the time I was teaching environmental studies at Victoria University and somebody left the door open and I snuck out at Ecos. So it's essentially what it is and so we work on both sides of the carbon market at Ecos we help businesses and organisations and products go zero carbon through carbon footprint measurement that informs a carbon reduction plan and then if people want to go zero they typically have to buy offsets and then we supply offsets from native forest carbon projects in New Zealand and also in the Pacific islands so that's essentially what we do. Fantastic well that's a great depth of experience so we're looking forward to tapping into that Sean. I thought we should frame the problem so this episode is about the role that forests could play in mitigating climate change or at least playing a part in helping us meet our objectives as a nation and also looking at some of the threats but let's look at the problem and I thought Mark you're, sorry Matt you're pretty well positioned given that you've built a career out of this could you describe to us the nature of the role you know give us a sense of just how much sequestration is going to be required if we are going to meet that 2050 net emissions target. So I feel like this is the hospital past question to be honest with you know there's just so many different numbers swirling around climate change and trying to make it possible for the environment to be able to do that is quite difficult so I'm going to try and simplify that this evening if that's even possible and fortunately the Ministry for the Environment has just released the latest climate numbers so I've got some recent data to go on and that latest report goes up to 2019 when our national emissions were 83 million tonnes of carbon and that's an increase of 2% over the year before that which might not seem just single annual rise this century. So we're going backwards in terms of our targets between 1990 and 2018 our emissions rose 57% over that period one of the worst performers in the OECD and while for 2020 emissions you're likely to see a significant drop caused by COVID but that's really a one-off and so getting to our net zero target at 2050 is going to take real effort to turn around that current trend and of course it's not just the local commitments that we've got to take into account New Zealand along with every other countries that has international obligations to reduce our emissions under the Paris Agreement and the numbers on that are that by 2030 New Zealand has pledged to cut its emissions to 30% below 2005 and 11% below 1990 and if you look at that 1990 number target that's quite interesting because it's going to be really tough to move our emissions to 11% below 1990 when at 2018 we were 57% above so that's kind of illustrates the scale of the difference and the challenge that we face but gets even tougher for us this year because at the UN climate conference in December all countries are expected to set an even more ambitious target than the one we have now so that hurdle is about to get higher and in order to meet those targets the governments established the Climate Change Commission who's recently produced the report and that report shows that we're going to miss our 2050 target by 6 million tonnes so that's the gap if you like that you're talking about that's the gap and really the commission is asking a lot of us between now and 2050 and they're talking about things like reducing pure petrol and diesel cars, reducing stock numbers, pushing down emissions from power generation and air conditioning and fridges but really they're leaning pretty heavily on trees for that 2050 target and they have some very very ambitious goals for tree planting over the next 30 years and those targets will see New Zealand plant certainly more Indigenous trees than what's ever planted before with a target of 16,000 hectares of new Indigenous plantings per year by 2025 and 25,000 hectares per year for the 20 years following that. Just to clarify, even if we are reducing our growth, in fact let's not talk about growth in net just yet but even if we are reducing by these measures and reducing herd numbers and shifting cars to electrics and more cycling and walking and so on there's always going to be a component that needs to be sequestered because we're not going to be able to reduce enough to make those targets and trees the easiest form of sequestration. I think in my opinion trees are really only designed to buy us time trees buy us time to do the hard yards they buy us time to do the things which fundamentally reduce our emissions and that's the things you talk about walking, cycling, driving, electric cars those fundamental behaviour changes that you talk about that stuff is hard and it takes time to create those sorts of changes in an economy. Trees buy us time to get to our targets in the meantime while we're making those hard changes and so give us a sense of what scale of planting do you think I know this is the hospital past but just give us a sense of the scale of planting that's required for trees to do that job for us. I think the commission summed it up pretty well with those targets I mentioned earlier but honestly those targets are extremely ambitious and I'd be surprised if those targets survive into the final report because the industry is not equipped to scale up to that kind of level in the time periods they're anticipating certainly we need a lot more trees, we really need a lot more trees in order to help with this target but it's only one piece of the puzzle and it's only one bit of the picture. The hard yards are going to have to be done at some point in the economy. Thank you Matt that was incredibly succinct and even I understood it so that well done to answer that question. Mark at least one of the I suppose misnomers around natives has been as I understand it that the ministry has not been the effectiveness or the scale of sequestration that's offered by native trees, by native forests. Your work has and the work of Tane Tree Trust has really questioned the accuracy of those lookup tables that MPI produces around natives. Can you explain your work and have I described it correctly? Yeah so MPI has these lookup tables that they're used for estimating how much carbon different types of forest can sequester as a sort of default value and just roughly speaking I think radiated pine according to the lookup tables it will sequester around 25 tonnes of CO2 from the atmosphere per hectare per year roughly speaking. But according to the lookup tables natives only do around about six tonnes per hectare per year but those tables are really pretty conservative and for the natives in particular they are quite a bit lower than what we've found from our measurements of actual growth rates of trees. Natives they certainly sequester at a slow rate for a while after you plant them but eventually they can actually start sequestering quite rapidly and so we've looked at some stands of planted native trees for example a stand of totara in Northland which is around 100 years old and it's currently carrying, it's sequestered over its lifetime around 1,500 tonnes of CO2 which means that it's averaged around 15 tonnes a year and it's currently averaging close to 30 tonnes a year so it's kind of current rate which is way higher than what the native lookup table was suggesting. We don't need to go into huge detail but Mark why is this the case these numbers? Well it's kind of what they were intended to be used for. They are based largely I believe on regenerating scrubland which is probably not the best native forest that you can grow for carbon and they're probably deliberately fairly conservative anyhow for various reasons so there's a huge variation when you look at all different types of forest both native and exotic but certainly those are right at the low end of what you'd expect from natives. You can certainly do much better if you have the right sort of trees growing at the right stocking and on the good sites Yes. What are the chances of government or MPI in particular changing its stance or changing those lookup tables or are they internationally determined? No, I'm not an expert on how that was all done but they used for a specific purpose as a default value for small land owners to work out how much carbon they sequestered so they can claim carbon credits so they have fairly limited use, they're not really intended as a general idea of what trees will sequester so hopefully the research we're doing and the measurements we're taking will give a better and more accurate view of what you can expect to sequester from native forestry Sean Weaver going to your experience with both here and in the Pacific the role of indigenous forest as a carbon source is it well understood and to what extent do these new figures that Tarnes Tree Trust and Mark is talking about elevate the potential for native forest to play a bigger role in climate mitigation? Yeah firstly native forest deliver a whole lot more services than just carbon storage as many people fully understand and the benefit of native forest carbon projects and permanent forest projects like the projects that Matt's doing and the projects that we're doing is that they're delivering a broad range of ecosystem services many of which are including building climate resilient landscapes that are going to have permanent forest on them and help landscapes be more resilient to things like extreme weather events like floods and droughts and especially floods and flood damage and this is true in New Zealand but also especially in the Pacific islands which are very exposed to cyclone damage and the damage to the economies of the Pacific islands in those communities is much more severe and intense than we get in New Zealand so on the one hand there's a really important agenda to reduce emissions on the demand side but also sequester as much carbon as we can but also to build as many climate resilient landscapes as we can and this resilience is also incredibly important and Matt pointed out that the tree solution buys us time from an emissions management perspective but permanent forest do more than that as well they build resilient landscapes and those landscapes and landforms can be maintained for thousands of years and there's a permanent rehabilitation of erosion prone lands that many of them should never have been in pasture in the first place and are only profitable because they're exporting lots of sediment downstream and not having to pay the cost of that so we've got an opportunity in New Zealand at the moment to change the rural landscape for the better for resilience and also protect biodiversity New Zealand has suffered a massive biodiversity decline over the last couple hundred years with the last major landmass to be populated by humans in the world and there's been a massive decline in biodiversity wherever we see farms used to be forests most of the time and those lowland forests had very high biodiversity on them as a very unique landform and so this carbon forestry agenda gives us an opportunity to turn back that tide but do so in a way which actually makes a living for landowners and that's the key point that's true in New Zealand it's also true in the Pacific Islands because in the islands and in New Zealand landowners on relatively marginal lands often struggle to make a prosperous living on those lands anyway and asking them to go into that for the climate system without some sort of help financially is just not going to really deliver and we saw that with we tried to sort of recover the New Zealand East Cape from Cyclone Bola with some stimulation and funding support but it only really tinkered around the edges we didn't do a very large scale reforestation of what could have been done and we've got an opportunity to do that now so on the adaptation and resilient side great opportunities on the emissions management side so great opportunities but I also echo what Matt said it's so important that we don't see forests as a get out of jail free card they are part of the puzzle and in fact if we didn't use forests as part of the solution we certainly wouldn't get there that's not only for New Zealand but globally it's also partly because globally forests contribute a really significant proportion of global emissions around about 15% or so of the global total of emissions comes from the global forest sector which is probably about as big as the entire country of the United States across all sectors of emissions is that because of the emissions that come from the processing the harvesting the processing and the manufacture of timber products that's part of the puzzle but when forests are cut down and transformed into agricultural landscapes or degraded in those forests which is built out of carbon dioxide stored as carbon in those trees that decomposes and burns and gets back in the atmosphere so it's mostly emissions from the decomposition of that wood which goes back into the air and what we need to do all around the world is slow down the deforestation rates and slow down the forest degradation rates by protecting existing forests existing biodiversity habitats and master pieces as well as growing new forests which is akin to paying new and young painters to build future master pieces so it's a really important complimentary measure to the global effort to reduce emissions and to manage our global climate change aspirations. What you're saying is that the climate emergency is providing a perfect opportunity for us to reforest and discover and enjoy the full benefits of forests. All the things we've talked about previously on these episodes, the non-timber benefits of forests whether they have commercials such as tourism or honey through to the spiritual and ecological values of just being alive and well through to the mitigation factors of providing resilience. Emergency is a perfect excuse if you like for rediscovering and re-investing in forests in general. It's a great incentive for us to rediscover the value of trees and forested landscapes for a broad range of ecosystem services that they provide among which include the wellbeing we get from being wrecked less as an economy when the next cyclone hits but also benefiting the fact that spending time in forests and having forested landscapes is good for our wellbeing in so many other ways but it's really valuable to measure the financial and economic benefits of those ecosystem services as well as the non-economic or non-financial benefits because when we add up those financial benefits they add up to quite a lot. So for example if you were to have a climate resilient landscape that experienced extreme weather events like cyclones but did less damage to say the economy of Hawkes Bay then you can actually put a price on the value of that hinterland management and that price is the avoided cost of all of that damaged infrastructure, all of those damaged roads and bridges and all of those damaged farms and houses and productivity and this is very much about building a resilient economy. So this is not just a mission to look after nature, it's a mission to look after people as well. Now there are forests and forests and I suppose the emphasis of this whole series has been about growing indigenous forest, native forest and the challenge that we have in New Zealand is that at the moment we have a lot of exotic minus radiata, a terrific tree there's no denying it and has a role and so I'm really curious Matt about your business model which does see huge planting of native forest excuse me of exotics on traditional New Zealand farmland with a view as I understand it to transitioning to native forest eventually over time. I wonder if you could explain your business model and what the opportunity is both in the short term and in the long term. So as I mentioned our business is growing trees to preserve the planet and over the last decade our trees have captured more than 20 million tonnes of carbon which is the equivalent of taking every car off New Zealand roads for a whole year or to make it lit for you since you've been on this webinar our trees have stored about 160 tonnes of carbon which is like taking about 160 cars off the road since you logged on. So that's kind of the scale at which we are operating out but we're ambitious and we have set ourselves major goals to do much more. This year alone we'll plant 7 million trees on top of the 66 we currently have and it's interesting that Sean mentioned the landowner income so to make it worthwhile for landowners you have to find a way to help them live and we partner with thousands of landowners in New Zealand, iwi, farmers and individuals and over that time we've paid them 73 million in carbon income over our 10 years. So we're certainly doing our part to make it attractive for landowners to consider permanent forestry. I just ask a really quick question Matt, that 73 million is derived from issuing carbon credits? Exactly, so that's carbon income derived from the land that the forests have been planted on. Eventually as Sean says, the reward or the compensation that the landowner gets for putting that forest or putting that land into forest. And as you mentioned our focus is on planting permanent regenerating forest so I'll talk about what that is to answer your question. So there's a number of components to this but I'll try and summarise it. The approach starts with the selection of the right land for the program to be successful. For us we look for the rough country, the steep erosion prone country often isolated and hard to get to. And over 95% of our 66 million trees are planted on really marginal farmland. So we don't plant on quality farmland and that's been our operating model for 11 years long before it was topical to talk about it. So Sean mentions the opportunity to reorient the landscape and for us we're focused on that land that perhaps shouldn't have been in farmland in the first place. That's the stuff that we're after. Any better land that we come across we sell back into the community so it can continue to be farmed. Last year alone we sold nine small farms back into local communities. So we're very much about the right tree and the right place and that's what's been our operating model. You don't necessarily have to own that land, your point is you're leasing it from the existing owners. Exactly. So about half of our trees we own ourselves land and trees and the other half we partner with land owners who are interested in deriving a carbon income from those trees. So having selected that kind of marginal land we then look for land where there are existing native trees that can provide a seed stock to kick start the process of regeneration. And our estate currently includes 6,000 hectares of native forests and we look for blocks which have indigenous forest already scattered amongst the block or perhaps are around the outside of the block. That's the ideal type of land for us. That's what we look for. Once we've chosen that block we then establish what's called a nurse crop and this acts kind of like an umbrella which protects and nurtures the indigenous species underneath and then by carefully managing that nurse crop we can create the right environment for it to regenerate over time into an indigenous and biodiverse forest and along the way the annual income from the carbon provides the ongoing resources necessary to make that transition possible. So that's essentially how we operate our model and how regeneration works in a practical context and that science has been around since the 70s and for the last three years we've worked with an independent team of forest scientists to pull together all of that research and start the process of operationalising it and that process is ongoing. We're very optimistic about the progress we've made so far. Do you share any of the concerns that are in the community at the moment about the predominance of radiata forest as an alternative is a fast-growing part of the farmland and I'm thinking in particular that some of the concerns around for instance the loss of farmland you say that you're not targeting productive pasture. You look exactly and there's a lot of debate about this at the moment but for us that's always been a fundamental value of ours we're not interested in planting on land that is productive as farmland our opinion and it is only our opinion is that trees should not be planted on land that is productive farming that's just our opinion but that's our operating philosophy we sympathise with the concerns that communities express about how that land is being locked up and what that means for their communities but our model of regeneration is very labour intensive so we create jobs in the communities where we plant long-term jobs because there's a lot of work that needs to go on in these forests over many decades. I'm really curious about that management exercise because I'm assuming that by some miracle native forests don't just spring up underneath the darkened canopy of pine forests so can you tell us about that management? How do you manage a transition and maybe even give us some specific examples of areas that you see it working in? It's very, very site specific as the first point to make so every block will need a different plan and every block will need more or less management and to get it to its destination and so it's critical to be able to identify the right kind of block that has the right potential that you then have the right plan in place for making it possible and so having established the nurse crop that we've talked about the way that you encourage the indigenous to come through is by creating light wells in that canopy and so essentially it's like punching holes in the canopy of the forest and letting light in underneath that, where you do it, when you do it, how big the holes are, where they are in the forest, when exactly in the evolution of the forest that you do it, there are all critical decisions that need to be made and are very site specific. In many cases if you've got the right established indigenous either around the outside or ideally within the forest you will have momentum of seed source which will create what's called seed rain in these light wells which will start to kick start that process of natural regeneration but in reality there's also going to need to be some planting. We need to plant understory indigenous in those light wells in order to get them going and also the other critical aspect of this is pest control and I know you're going to come on and talk about that in a minute but if all you're doing is growing candy for pests to eat then you're wasting your time. You've got to get control of those animals and get them out and keep them out of those blocks for the program to be successful. It's an expensive exercise that what you're talking about it does the business model sustain that level of management and in particular does it sustain it over the long term because what timeframe matter we're talking about according to your model to for this regeneration to occur? Look the science indicates that it takes decades you know this is a long term process but a lot of the groundwork can be done early so if you choose the right block you plant the right nurse crop you have the right holes or light wells punched in the forest at the right time and you establish the right indigenous in those light wells in an environment without predators then you have set the forest on the right path. All of those actions happen in the first 30 years of the forest so really what you're talking about is investing the majority of your money in the first 30 years and of course as I mentioned earlier because of the way our model works the radiata trees produce a lot of carbon credits absorb a lot of carbon produce a lot of carbon credits over that crucial 30 years and that's not only when the planet needs it the most but that's when the money is needed the most in the project in order to do those activities. And who does that labour Matt? Is that something that you take on yourselves as carbon farming or is that an obligation of the land owner? Depends on the arrangement typically where we are planting on other people's land we take responsibility for that management but in the case particularly of iwi groups who are very interested in the creation of skills and employment opportunities in their areas we will look to have a structured plan around how we use local people on particular blocks. Sean the model sounds fantastic thank you Matt for answering those questions. The model does sound fantastic and if it was successful I guess we would be feeling quite excited about this opportunity but what confidence do you have as a scientist that the model is correct? What confidence do you have as an ecologist that this level of management can be sustained to actually deliver in the end an indigenous forest? You know it's a very good question it's a question that we get asked a lot with the work that we do so like New Zealand carbon farming we use occasionally a mixed model so just as a preface our planting model will plant native trees only when we can and sometimes the whole project can be native only but what it will do is deliver an economic performance which is nowhere near as good as when the exotics are involved but if the land owner and the investor are happy with that then it's natives only in fact there's an investment that we've just been brokering finalising today where it's 100% natives it's just that the internal rate of return is a bit more pedestrian than what might be delivered from a project with pine trees in it or any other exotics pine trees are not the only exotic of course an exotic tree is any tree that didn't come from New Zealand and there's an awful lot to choose from which aren't going to go wild and that are going to create good nursery species and going to perform well as a carbon crop but with our model if the internal rate of return or the economic performance of the native only project doesn't quite get to the magic number doesn't quite get over the line for the land owner and or the investor then we entered our model is to then introduce a hectare or another hectare or another hectare of exotics in a imagine it's a 100 hectare project and it doesn't quite get over the line so then we introduce 1 2 3 4 5 hectares of exotics until we get to that magic number because for us the exotics serve at least two purposes one is to fund the natives and the other one is to fund the natives because if you can't fund your dreams your dreams will stay dreams you won't be able to turn them into reality so financing the gig is so important and if you know there's many and I come from a kind of a pure native forest ecology background and I've realised that perfect is the enemy of the good and especially in a climate emergency and especially when there's not unlimited grant money floating around for people to just go out and cover the landscape and trees because conservation costs money and so even if you're maximising the native element commonly there will be a need to introduce some exotics to the max now the question is then how do you manage those exotics and of course that will differ depending on the model that you're using and Matt's approach is a model that essentially creates that shade and shelter to provide a microenvironment in those light wells to enable native forest to regenerate now people who understand native forest regeneration will know that native forest regenerate in light wells in the native forest so you can imagine a notion of native forest and then imagine holes in that forest whenever a big tree falls over that creates a light gap and a light environment for native forest regeneration in that forest and so forest ecologists who have understood this as Matt has said from the 70s know that you can regenerate native forest in those kind of light wells and if the starting forest is not a native forest well the natives in the light world probably don't care that much in fact they're probably quite happy that we've got an environment to live in at all because remember that environment used to be marginal pasture and had been marginal pasture for many many decades and so transitioning into this mixed model is certainly a lot better often than erosion prone pasture then as I've said the way we manage the exotics in our model is slightly different where we would let's say we plant 100 hectares of land and I don't know 30 hectares of that is exotics then those exotics we would begin creating corridors in that exotic forest after about 12 years take out 10% replace it with natives and actively plant those natives and then 5 years later do the same and then 5 years later do the same and if you carry on doing that you'll find that in 60 years you've got a pure native forest where the exotics have been in there for that early period and then they're no longer needed and they're out so another thing that's important is that if you're doing this on private land people typically don't want their land value to go to zero and if you've got no product of activity ever forecasted after 60 years then the land value is going to drop even now and so it's important to maintain that land value by having an opportunity for some sort of cash flow in the future now one way to do that is to have some sort of crop that you can harvest and replace in the future and the way that we would do it is to have a native crop of say Tautra like what Tane's trees trust has done and where you then begin harvesting that Tautra in sustainable forest management continuous canopy modalities starting in maybe year 80 and then you've got an opportunity for a cash flow from really high quality native timbers essentially in perpetuity as you've transitioned from marginal farmland into permanent forest which is maintaining that cash flow because after 100 years you're still going to have to kill possums in states and ferrets unless somebody has come up with a clever trick to eradicate them in the meantime and so there's always a need and even if it wasn't for those pests there's always a need for conservation management and so financing that through an intervention that creates a cash flow from that landscape is highly valuable and again just to reiterate the point that the perfect is the enemy of the good if we were to try and just be not touching these forests at all then the business model wouldn't work and we just wouldn't even get started so compromise is important here. A question for Mark as a scientist as someone being involved in the forestry sector for a long time do you think that we are taking a gamble by using as much pine as we are on the road? I hope really that intergenerationally we're going to be able to manage them to transition. In other words are you buying the argument that Matt and Sean are putting forward? Yeah I mean certainly the pines will grow very well for 100 years or more and sequester a lot of carbon exactly how that transition is done I think certainly would be fairly tricky to manage and it's probably a bit outside my area of expertise to really to talk too much about it but certainly not a simple thing to do to transition from an exotic forest through into a native which require quite a lot of intervention I would think. I mean under the pine trees will grow in the canopy what develops underneath unless a fair amount of light getting in is going to be pretty minimal. There will certainly be a lot of different species growing up there but not much actual carbon stored in the understory so exactly how you would encourage that to develop is I think still requires quite a lot of work and it certainly wouldn't be easy. Can I just add to that too Mark? And this is one of the reasons why we in our model actively remove the exotics and then actively plant the natives in those corridors so that we can then manage that transition. It's a more expensive model and the internal return will be lower and so I guess the risk of middle path solutions is very much dependent on the appetite for investors to take a lower than absolute maximum return on their investment because if the internal rate of return in other words is similar to the interest rate on money invested, if that is a lower number we can deliver more and more native only plantings or minimize the number of exotics that go in and also the word exotic doesn't come from the pine trees it can mean evergreen oaks for example. I mean if you walk even here in Christchurch which is kind of a very dry sun burnt landscape you go up to Victoria park and walk around under the oak trees there and understory is full of natives and so exotics include things like oaks, they include leafy trees as well as softwood species which are the pine trees and things like that but fundamentally if the economics don't work then it's going to stay marginal farmland and this is where yes we do have to take a gamble because the gamble of not acting is a bigger gamble, I think that's a key thing to take home is the cost of doing nothing, the cost of not doing this kind of work is going to be far greater than the cost of making an error here and there and what Matt's company is doing is getting the best advice available, sometimes the same scientists are involved and I've got a PhD in forestry myself so we're doing our due diligence on the forestry models to minimise these risks and use best practice and also if you've got an adaptive management regime you can adapt your management through time as you learn more, Matt will be able to do that in his projects we've designed our projects to do that as well I will leave this issue but I just want to ask one question to Matt if I may, Matt what accountability is there should part of and I'm not saying the entire model would fail but if parts of your program for instance there might be parts of the country where pests get out of control or where you've introduced a fire risk because you've got a permanent forest what accountability exists for you and for those landowners who presumably this accountability needs to be intergenerational if the model doesn't prove to be as successful as we hope I'm pleased you've asked that question because there is a very strong answer to it so legislation passed last year creates a new permanent forest category in the ETS and that permanent forest category effectively is protected in perpetuity by creating tough penalties for the people managing those forests so essentially if you register you are the forests in that permanent forest category you are exposing yourself personally not your company you personally to penalties for not managing those forests in accordance with the permanent forest regime and I'd go so far to say that no forest project exotic or Indigenous that it's trees are protected in perpetuity unless they're registered in that permanent forest category with the associated personal obligations for those involved for our part we will register all of our forests in that permanent forest category in the ETS that makes us highly motivated to resolve any of those issues that Sean talks about and any of the uncertainties that Mark mentioned we have our heads in the lion's mouth here and that's how much we believe in the potential for regeneration to benefit New Zealand and the planet thank you for answering that Matt there are so many questions and we're just not going to get time to go to them so let me just throw a couple to you and this is probably one for Sean and for Matt it's from Jackie Amers who's one of our contributors she asks, in particular she's curious to know what kind of trees are being planted, what types of trees has your company been investing in for permanent forests and a related question can you explain in more detail exactly how that transition happens once the pines reach their maturity sure I can have a quick go at that first and then pass over to Matt so for example the investment model that we looked at today and that we've been working on the last month or so a few months is native species so it's planting species that are already growing on the landscape that the project is going to be located on, it's Maori land up in Northland and so that's a native forest it's going to have a mixture of totra manaka, there's some mahoi there's a range of species one of the interesting things that when you plant native forests or plant any forest is that nature is also going to do some of the planting for you and that's going to come from the kind of seed rain that Matt mentioned where nature will through bird dispersal and also through bird dispersal will bring native seeds to the site so an element of the project will be planted by nature anyway for us when there's an exotic element let's say the farmer wants a woodlot as part of the project to lift the performance because maybe natives on their own won't compete with beef and lamb revenue that they're giving up then it's really up to the farmer to determine what their preference is and they've worked with once oaks on their land and so oaks are going in another land I know wanted eucalyps on their land and so eucalyps are going in others want a redwood forest for that woodlot others want a pine and the reasons to choose these things might relate to what kind of wood you want from it when it comes to harvest time it might relate to the costs of establishing them pine seedling is about 45 cents a eucalyps seedling might be 65 cents and a redwood might be $1.80 and seedling prices are very sensitive part of the financial model and so your choice of seedling type is going to impact a lot on the economic performance of the project so when it comes to the transition so for us imagine there's x hectares of exotic whether it's a softwood or a hardwood then that will be managed as essentially an exotic woodlot after about 12 years it depends on the species and it depends on the situation but let's imagine it's about 12 to 15 years the first corridor of that exotic forest is cut down and then replanted in natives and in those early years you're not going to get really any cost recovery on that timber because it's not really merchantable at that very young age but as that five years later do it again and as you continue that process the timber that you're taking out of the forest can fund the reforestation of that same corridor in natives so essentially we're actively using the exotics to fund the planting of the natives and ideally planting a majority of the area in natives anyway and then the minority which has exotics that minority area would be transitioned through this corridor model so that if you do 10% removal and replacement every five years then within 60 years it's a fully native forest where you started off with an exotic woodlot Matt, in the interests of time I'm going to ask you a different question it's kind of related but I'm sorry I'm not going to give you a chance to go into detail about the transition but I'm curious to know about this and we've had several questions about continuous cover forestry and does your model allow for continuous cover forestry? Will you be harvesting trees within your permanent forests and if you are can you explain the model? So we won't be harvesting, we are a no harvest model, the only cutting of trees that we do in the forest are to create light wells, other than that we do not remove timber, we do not look for timber as an income stream so we are a pure regeneration model from day one we're looking to how we can transition that forest as quickly as possible. And is that a lost opportunity and do you think it's an opportunity or a model that you think you could change over time? We are aware of Sean's model and the potential to add additional income streams always is more attractive from an investment point of view. Honestly we've got our hands full with the scale of our portfolio and affecting the operationalisation of regeneration with our scientists but that's certainly something we may look at in the future. Okay, good, thank you. There was a question here there's quite a few questions also related to soil and I'm not sure if we're going to have what time we were actually on the dot 7.30 but there's a question here from Paula Warren for instance is how is carbon sequestered into soils rather than to standing crop factored into sequestering measures and I don't know if Mark, are you interested in answering that question? Just briefly soil is certainly there's a huge amount of carbon stored in forest soils and it often basically isn't measured or not very accurately because it's very hard to actually measure it but certainly it's a big factor but most of the models that we develop aren't actually taking any account of the soil and the assumption is that the soil changes in the soil are fairly gradual anyhow. Also there's no economic instrument in the ETS to measure soil so even if you did measure soil and if the soil measurement demonstrated that there was a whole lot of beneficial soil carbon sequestration you couldn't turn that into any carbon credits so that would be a co-benefit of a project that would be a bit like a biodiversity co-benefit. Perhaps a question for next week's panel. I think it could be because next week we are looking at mechanisms and we will get into the ETS as well next week and it's deficiencies in offering solutions around all the elements of forests including soil. We are out of time and I feel like we've only just started to have all your questions answered on the chat but please do keep them coming in. I think Simon is there any way that we could continue with this online in another form? He's saying yes so we'll get on to it so you guys haven't got off yet. We're going to come back to you. Look it's been a real pleasure talking about this we do feel like we have only just scraped the surface of what the potential is for forests to provide climate resilience and sequestration so let me please thank you Mark Kimberley, Matt Walsh and Sean Weaver for joining us. Thank you to all of our audience who have joined us tonight. Good numbers, good questions and please do come back next week because we've got Dr David Hall from AUT also Annabelle Chartres from PWC who contributed to the Aotearoa Circle and to Pure Advantage thinking about biodiversity credits and other mechanisms that could be used to incentivise foresters and landowners and also Kevin Prime who is actually a living breathing example of a landowner and a family business that is doing very much the things we talked about in today's episode and native and exotic forests in a whanau run business so we look forward to that episode. Thank you very much. Thank you Simon. Thank you to the team and Noora.