Sep 01, 2006. /Lesprom Network/. The Forest Owners Association has welcomed the government’s decision to go ahead with a revamped Permanent Forest Sinks Initiative. “This is a step in the right direction. Both the minister of forestry and the minister of climate change have listened to feedback about the original proposals and have made some important changes,” says NZFOA chief executive David Rhodes. “Assuming the final conditions of participation are acceptable, the relaxation of the harvesting restrictions will make some land owners more likely to participate. It will help them derive an income from storing carbon from the atmosphere – an environmental service which is very important to society.” The Kyoto Protocol created a market value for carbon storage from 1990. Mr. Rhodes says this is something the government has recognized by granting PFSI emission credits for indigenous forests from this date. “No rationale has been provided for the later qualifying date for non-indigenous forestry, and this is of concern,” he says. “However a very important principle has been established. Forest owners are deriving a market-based income for the environmental services they provide.” He says forest owners expect to see this reflected in the government’s Kyoto policies as they apply to conventional plantation forests, where wood fibre production is the main economic driver. Unlike the so-called permanent sinks, these forests are planted and harvested by clear-felling on a regular cycle. “Policies need to provide an appropriate level of recognition and encouragement for plantation forests which have been planted since 1989, as they qualify for credits under the Kyoto Protocol. However we remain concerned that the notion of a deforestation cap, whereby forest owners will be taxed for the loss of carbon if they fail to replant harvested forests, still appears to be on the table. So long as there is sufficient market-based recognition of the carbon storage service provided by plantation forests, there will be no need for an arbitrary cap. We can then start to rectify the rate of new planting which has stalled in the last two years.” The Permanent Forest Sink Initiative (PFSI) provides an opportunity for landowners to establish permanent forest sinks and obtain tradable Kyoto Protocol compliant emission units in proportion to the carbon sequestered in their forests. To be eligible for this initiative the land must not have been covered in forest as at 31 December 1989 and the forest must be "direct human induced .... through planting, seeding and/or the human-induced promotion of natural seed sources." This means some form of active management will be required in establishing the forest. Limited harvesting of the forests established under this initiative is allowed after a period of 35 years. However, harvesting must leave a continuous canopy cover. Therefore, clear-fell plantation forests are not included in this Initiative. Landowners will be expected to meet all the costs and risks associated with the PFSI. Agreements between landowners and the Crown will be registered against land titles. The New Zealand Forest Owners Association (NZFOA) was set up in 1926 as an advocacy group for commercial plantation forest owners, and is now one of the country's most active and influential resource sector organizations. Its members' forests comprise more than 80% of the country's plantation forests.