In this month's CarbonCurious session, Nick Butcher, co-founder and CEO of CarbonCrop, joined CarbonCrop's Head of Engineering, Hannes Hille, to discuss evidence collection and why it's so important for your carbon forestry projects.
Watch the video for more information, or read the transcript below.
TRANSCRIPT
[00:00:00] Nick: Let's get started. So, thanks everybody for joining today we are going, welcome to another episode of Carbon Curious of Episodes, I think so today we're going to be talking about evidence collection and forms of evidence and why they are relevant to projects and how you can conduct evidence capture for the projects you're involved in, in the best possible way.
[00:00:26] Nick: Joining me today is Hannes Hill, who is going to be presenting about half of the stuff, especially the complicated technical stuff, and also is running the slide animation. So we're going to kind of try and Jedi mind trick each other to get the transitions on the right point. Now it'd be a great point for the next one, Hannes, so that everybody can see what you do.
[00:00:44] Nick: So Hannes is our Head of Engineering at Carbon Crop, and I'm Nick Butcher for those of you who are joining for the first time, and I'm co founder and CEO. As usual, questions, put them in the little Q&A panel. We got a storm of questions in advance of the session, so hopefully we make it through them all, I'll kind of freestyle it with which ones we prioritise based on the topics that we're covering.
[00:01:05] Nick: And we will jump right into it. So I thought I'd start off with some broader project context around landholder engagement with compliance and voluntary markets, and where, where evidence fits in. So to kind of. Thinking of it as a start to end process where the start is that you're either curious and you maybe have some land in the end is that you're sort of running an ongoing carbon project.
[00:01:26] Nick: Begins with sort of engagement and acquisition, whether that's direct or indirect Jedi, mind trick land assessment and scenario planning, like what forest do I have? What are the implications of the forest types that I have? What could I do with that land, whether it's currently forest or not? The regeneration stage of the planting and sort of modeling and selection of the, you know, which of these scenarios do I actually want to act on given the commercial and environmental and farm land management implications.
[00:01:55] Nick: Getting the evidence, which is going to be a pretty key topic today, but as you'll see, that's not the only point where evidence capture is necessarily relevant, that's, this is important both prior to the activity that you undertake, it may not just be planting, and also during the activity, and also after the activity.
[00:02:11] Nick: Next one Hannes. Actually registering the project, and then managing the process of registering the project. Once you've achieved registration looking at the performance of the project and projecting the future performance of the project, which is a key consideration in the commercial and environmental outcomes.
[00:02:28] Nick: Ongoing monitoring and reporting and compliance, the story definitely does not finish with registration, even though sometimes it feels like it's been enough of a marathon to get to that point. Registration just gets you to the point that you can start getting paid. And then, cheers Hannes Tracing and Audit and Sales, like we've had a couple of questions actually around what do I do with my units once I have them.
[00:02:46] Nick: You need to be able to, like, different, different forms of units can be monetised in different ways. And then finally Portfolio Monitoring and Forecasting. And now, if we look at those where the topic of today is particularly relevant, it's all these ones with a big green dot on them. Evidence, data, Collection and communication and management touches a lot of different points in a project's life cycle, both prior to undertaking the project activity, during the sort of initial stages of the project activity, and then on an ongoing basis over the entire term of the project.
[00:03:17] Nick: And if we sort of, like, it can potentially be quite a large pain in the neck if we jump to the next slide, the obvious question is like, why does anybody even care about this? Why can they not just take it on faith? And there's a phrase which I really love in almost all contexts is like, trust but verify.
[00:03:34] Nick: You don't want to just be skeptical of people and you can, you can assume that they have good intentions and that they're doing their best, but if you don't actually verify, their intentions and their activities, then you can create some quite perverse incentives in the system which will encourage people to do things like register forest that isn't even there, or register forest that has a completely different status to the status that you're presenting it as.
[00:03:55] Nick: That's not really good for anybody within the system except for the bad actors. You don't want to design systems that are only good for bad actors. So you need evidence to make sure that what's being Presented is actually correct. For registrars. Questions they might have is, does this forest that's been shared with me meet the requirements for registration?
[00:04:14] Nick: How, what, how big is it? How, how many trees are there? What species of trees are they, when were the trees established? How were they established? Some projects have lending to establish the forest, like, especially some forms of establishment are extremely capital intensive. The landowner might not want to finance it themselves, but the financier of the project is going to have questions like, I'm putting a lot of money into this.
[00:04:35] Nick: I may actually not have the same familiarity with the land that the landowner has and the activities that are going to be undertaken on it. Do I want to invest in this? Is this viable? Is it legitimate? Is it going to work out? Processes in the scenario where you're perhaps involved with some sort of supply chain emissions offsetting scheme.
[00:04:52] Nick: Like, what is actually happening in my supply chain according to my data? Does that actually reflect the real situation in my supply chain? Am I going to be able to demonstrate it to my downstream buyers of my products who ask questions like that? Great that you're net zero. Can you show to us how you have determined that and the evidential basis that supports it?
[00:05:11] Nick: Usually in the circumstances that I just described, it's not just the processor and the buyer. It's actually there's some assessors and some auditors involved. And similarly, they will be reviewing reports that have been prepared in connection with a collection of activities. And at some point in that process, they're going to say, Great reports.
[00:05:27] Nick: Can we do a couple of spot checks on these? We want to make sure that the assumptions that are being made here are consistent with our understanding of the frameworks that apply. And we want to make sure that the activities that are being claimed are both real and still exist. And, then they can sign off on it.
[00:05:42] Nick: Buyers who, depending on the framework, they want to know that what they're buying is actually real, that they can rely on it to the claims that they want to make and the purposes that they have. And this is an interesting one where the form of the carbon market can have a big impact. For example, under ETS, in many contexts, buyers actually don't care too much because what they're buying is an NZU.
[00:06:02] Nick: And to get your hands on an NZU, you're basically operating within a government regulated framework and the regulator, being the government, is saying, This is definitely legit, and we will definitely honour it. It's a bit like a New Zealand dollar of currency. If somebody gives you a New Zealand dollar, you don't really have to care about whether they're good for it, because it's actually, it's a promise from the government, not from the individual.
[00:06:22] Nick: In some other carbon contexts, that's less the case, and people may care a lot more about provenance, and there may be a lot more risk associated with the project. They might want to do a lot more DD due diligence, before they actually look to use the carbon units to be presented to them. And then for forest owners this is sort of almost within a project, there's still different stakeholders with different responsibilities.
[00:06:43] Nick: They may be looking at evidence for things like, I paid money to have these trees planted. Were they actually planted? Were they planted correctly? Are they surviving? Are they healthy and are they growing? And it may well be some completely different party who's doing these checks for them, and the proof that those checks were performed and that the outcomes are as they're being presented is evident.
[00:07:03] Nick: And there's many, many, many other things. This was a shortlist. Next slide Hannes. So I think we've covered a lot of these, but some examples of activities, planning a new forest, considering a land purchase for some future potential carbon related activity, registering a new forest, registering existing forest clearing vegetation.
[00:07:21] Nick: And the reason this one's an interesting thing is, let's say that you've got a bunch of gorse on your property and you clear it. There is now no evidence that there was gorse on their property, but then aside from potential historic remote sensing data that shows that there was something that looked kind of scrubby and gorse-y on your property.
[00:07:38] Nick: This probably isn't going to come up, but a situation that you very much want to avoid is some potential regulator coming and saying to you, Hey, I heard that you cleared a whole heap of healthy native bush. That's against the law. You're now in a lot of trouble. You want to be able to say I can understand why you might think that, but in reality it was actually all gorse.
[00:07:56] Nick: Here's the proof. If you haven't collected any evidence prior to the activity, and all you have is an empty paddock, you end up in a potentially awkward situation where you're like, well, I, I pinky swear that it really was gorse, and they'll say, yeah, that's what the last 15 people said, and we had concrete evidence that it was like native forest.
[00:08:12] Nick: It's a lot easier if you can just prove that in your case that this was the historical status. Weed control programs you may need evidence they've been completed correctly and you may need to provide evidence to other parties that they've been completed correctly. Pest control programs, enrichment planting for some biodiversity program, if you're filing an emissions return there's certainly circumstances in which you may need to present evidence and you may want to review evidence.
[00:08:37] Nick: An example of which might be the response to an adverse event, like some of your forest was affected by a fire or a landslide or wind throw. In summary, almost everything where it's not a case of you trusting your own eyes, you need evidence from somewhere within the system. And to, to kind of take a look at the absolute classic case, which is probably the most familiar one when people think about, I need some evidence, is this one here of, Is this thing that you've just sent to me forest and this is from the perspective of a regulator.
[00:09:04] Nick: So you're sending them in a picture. This here is some fairly standard aerial imagery. We can actually go a bit closer than this, but basically there's a boundary of land and you're saying to MPI. Hey guys, I've decided to restore forest within this polygon. Can you please register in the ETS for me?
[00:09:20] Nick: It is. Early Stage Native Regeneration, and it's about three years old. I started restoring it in 2021. They're going to quite reasonably want to say, you're saying it's forest, is it forest? And specifically, is it forest within the exact boundary that you've given me to? Because it might be forest in the middle but not near the edges.
[00:09:38] Nick: And I'm, I'm making a decision on the eligibility of each element within this polygon. Then it comes to the question of, what is forest? Forest is not just a tree. Forest is an area of nature. Woody vegetation able to achieve at least five meters tall in the current growing environment and achieve at least five, 30 percent canopy cover that covers at least one hectare in area and is at least 30 meters on average across and is mapped in accordance with the mapping standard, which I won't get into today.
[00:10:06] Nick: And in some cases, this is blindingly obvious from simple aerial imagery. And this example that I've provided here, which is just an example, I'm not saying that's necessarily true. Mature, sorry regenerating native forest. It could be hard to tell just from this imagery, and they probably want some additional supporting evidence, that The status of the vegetation on that land is consistent with the forest land definition, which requires that tree species be present sufficient to reach this criteria.
[00:10:34] Nick: It's not enough that they just might regenerate at some point in the future. They're probably going to want evidence. And another very similar one, and this is where I have to thank Charlie for saving me at the last moment it's a post 89 forest. And post 89 forest basically is forest that meets this criteria.
[00:10:52] Nick: It is either forest that was established after 1989, or that if it was present in 1989, was deforested before 2008 with the definition of deforested being cleared and then un forested for more than four years prior to that date. And, so, there's two aspects to this where the evidence that you collect is particularly important.
[00:11:15] Nick: One relates to availability of, if you go back, can't I sell that one? The historic evidence that you might have access to, that shows the historic land use, is really valuable. That's kind of a do you have it, do you not kind of thing. Can you go and find somebody who used to own the property and had photos from back in the 2000s?
[00:11:31] Nick: But where the, where the evidence that you may collect, including some of the stuff Hannes is going to present, can be particularly relevant even for today, like the 27th of August 2024, is in showing the status of the vegetation as it is now, and the implications for the historic state of vegetation.
[00:11:50] Nick: Because if, if you can, let's say that you're looking at doing a, a planting project on some land that is currently covered in scrub, And the imagery available from 1990, also blurry and somewhat old as it is, appears to be land that's now covered in scrub. If you plant the forest and then wait five years, and then take photos of a whole bunch of trees in the landscape, MPI aren't going to know whether those trees are the trees that you planted, or they're the trees that were present in 1990 and have continued to grow healthily.
[00:12:20] Nick: Except you can make a fair number of reasonable assumptions based on the maturity of those trees. If they look very young, and like they've only just been planted, probably there were no trees there in 1990. If they look very old, and like they've been there forever, better chance that the scrub that's present in 1990 was actually early stage regenerating forest.
[00:12:37] Nick: Being, putting them in a position that they can make a reasonable assessment of that, which is going to help support your application relies on providing them more than just some blurry photos from far away. In the case of significant doubt, they're likely to reject the application and you don't want that outcome if it is a legitimate forest.
[00:12:57] Nick: So in short there's a lot to it. The evidence that you collect and how you collect it matters. How you manage it once you've collected it also matters, and getting it wrong can be very painful and in some circumstances even irrecoverable. It's like the thing that you wanted to collect evidence of in terms of a land state may not even exist anymore and you can't go back in time even though you can use evidence from back in time.
[00:13:23] Nick: So that's my spiel. Hannes is going to take you through a whole bunch of what we use and how we use it to help address these scenarios and how you can. Collect the evidence potentially for your own projects to help put you in the best position for any one of these scenarios. So, over to you, Hannes.
[00:13:40] Hannes: Great, Thanks for the introduction there, Nick. Yeah, so I'm going to talk a bit about what is the evidence that we use at CarbonCrop, how do we collect it, and how can you make the most of that evidence for your projects, regardless of if you're planting a new forest or doing a biodiversity program, doing some pest control, and I want to go through a few of the different forms of evidence that we can collect.
[00:13:59] Hannes: So at CarbonCrop, and I'll go through these in a bit more detail too, we rely quite heavily on Sentinel 2 satellite imagery, LINZ aerial imagery, PlanetScope we use on occasion, LiDAR imagery we use quite often sometimes we use task aerial or drone imagery and lastly, this is behind my little screen, we use oblique photos, so photos taken on the ground.
[00:14:20] Hannes: And this is in line with MPI's recommendations as well for what they want to see as evidence when submitting new forest land into ETS to earn NZU's New Zealand Units under the New Zealand Emissions Trading Scheme. So, this all fits under this individual information category here like recent orthomosaic imagery created from drone photos, corresponds here to task aerial drone, recent drone photos or videos reasonably big ground photos is what we can take with FieldScan.
[00:14:45] Hannes: Aerial or satellite imagery from councils or commercial companies, that's these three at the top here. Sentinel 2, Lens Aerial Imagery, and PlanetScope. There's also other non visual information, like evidence of forest planting under forestry scheme, or documents like seedling orders, planting records inventory plot records.
[00:15:02] Hannes: This non visual information is also really interesting, but, I'm not going to go into it too deep here. Number one, if you've got it, you probably already know you have it, and you can just include it in your information. And number two, it's actually not that good of an evidence compared to some of these other ones.
[00:15:15] Hannes: Like, some of this stuff can be faked. So under the whole Trust but Verify, it's a lot easier to trust and verify actual visual information. rather than, I ordered some seedlings last year, but they're in the ground, believe me.
[00:15:29] Nick: I will just make a brief comment there, Hannes, on the basis of some of the presentations and discussions at the Carbon Forestry Conference last week, which highlights the fact that like, MPI aren't here to make your life difficult needlessly, they've actually indicated that they, for forest, new forest planting they will consider evidence of seedling orders or planting activities for the area that you're claiming as being substantial.
[00:15:57] Nick: Especially if it's a case of a, a registration that's being applied for very recently after the planting activities presented as having taken place. And it's just some stuff to consider there about making sure that the entity that owns the land, like, that the invoicing details align. So it's, it's by no means an instant fix.
[00:16:15] Nick: But don't just throw out the invoices that you received for the plantings and the seedlings. They are actually helpful and MPI have indicated that they're reasonably pragmatic around how they try and assess the sort of holistic application evidence bundle, rather than myopically focusing on just one bit of it.
[00:16:31] Hannes: Thanks, Alex, for informing. Let's dive into some of these visual information sources. So Sentinel 2 is a satellite by the European Space Agency, and it goes around the Earth taking photos, multiple times a day, and it's pretty decent, so it's got 10 meter resolution, I mean it ends up being the resolution of about the image that you can see in the background here.
[00:16:54] Hannes: So forests are visible, you can see this established forest here in that valley there, you can see this kind of more patchier forest here. You can maybe, if you really squint, make out individual trees as little clumps, but not really. Like, this is more for looking at a real forest. Despite the low resolution it does have 12 bands of spectral resolution, which just means that it can see some infrared bands as well that we can't see with the human eye, which is quite useful for assessing forest health.
[00:17:18] Hannes: And other vegetation indexes. The really cool thing about Sentinel 2 is that it has a two week revisit time. So every two weeks you get a photo of the same location again. And so monitoring, using it for change monitoring it's super helpful for that. However, note that it takes a photo whenever it's above that location.
[00:17:36] Hannes: Regardless if there's cloud cover or not. So if you got unlucky and there was clouds over top of it, you're going to see a big white photo. So, in practice we found that, especially over winter, you can kind of really reliably get one to two months of revisit time, and summer's usually a bit better. It's also free.
[00:17:53] Hannes: So it's made available for free by Sentinel 2. You can get it through, there's like a protocol PlanetHub that you can use to get this, access this data as well. We'd make it available from CarbonCrop too. We mostly use Sentinel 2 for forest loss detection. So, as you can see, there's forest here.
[00:18:11] Hannes: If that forest fell down because of some wind throw or there were some harvesting activities, we'd Then you would see that quite well in Sentinel 2, and reasonably recently, because it's got revisions every two weeks. It's good for that. However, if we try to zoom in on this imagery it kind of looks like this.
[00:18:25] Hannes: So the 10 meter resolution means that you can't really use it to look at individual trees. Take that in comparison to Lynn's imagery. So if I take the same spot here, This is an image taken from an aeroplane, so kind of comparing back and forwards again here. The image from LINZ is taken by a plane, it's by Land Information New Zealand a news and government organisation that tries to regularly cover the entire country with high quality aerial imagery.
[00:18:51] Hannes: We're actually quite lucky in New Zealand, from what I can tell, it's one of the best imaging programs in the world from the terms of data accessibility. It's very high resolution, so 2.5 centimetres up to 1 meter resolution you can even zoom in a lot further than I've shown in this image here, and you can definitely see individual trees, you can even make out, like, the type of species of the tree as well, so it's useful for that kind of evidence too.
[00:19:17] Hannes: It's usually only 3 band spectral resolution, but the high spatial resolution makes up for that. The revisit time, however, is a lot lower than Sentinel. So, compared to the 10 days, sorry, 14 days we see with Sentinel, we can expect 4 to 8 years of revisit time of LINZ imagery. So, if you plowed through a forest today, you might get unlucky and not see LINZ imagery evidence for that photo.
[00:19:37] Hannes: It's for another 8 years. Ah, also, it's freely available on LINZ, and we also make it available on the CarbonCrop platform. Very useful for mapping evidence of forest growth, evidence of forest species, and also maturity of a forest. Other data sets that we use is PlanetScope by PlanetLabs.
[00:19:58] Hannes: They have four meters. It's just taken by a satellite, but it's high resolution and it's 4 meter resolution, 8 bit spectral resolution, they have a very short one day revisit time, which is, like, insanely impressive however it does cost, so it costs around about 4 cents a hectare, however don't expect you can just pay 40 cents to get 10 hectares there's kind of like this minimum cost they have of about 1, 000 an hour, and then kind of 4 On top of that we find this most useful here at CarbonCrop after detecting forest loss using Sentinel to get a more in depth view of what the forest loss was and map against that.
[00:20:36] Hannes: So, but less useful for community establishment.
[00:20:39] Nick: Just a brief cost on the pricing there, like Bayonet has quite a few different cost models depending on the exact product that you're going to be using, and exactly how you're going to be using that product. I think there is like a forest metrics thing, which may be as little as 0.1 cents per hectare
[00:20:53] Nick: you know, like lots and lots of asterisks and small print to consider. I don't take that as a quote, but basically this is their whole thing. They provide all sorts of earth observation and metrics and there's a lot of different sort of pick your plan and profile options about exactly what you want to get and exactly what you want to pay.
[00:21:15] Nick: So this is sort of a ballpark general figure for some combination of that bundle rather than an exact thing for the product you want. If you really wanted to use this for some reason, the best answer is to talk to them about what they can offer. Thanks.
[00:21:29] Hannes: LiDAR is another data source we use. LiDAR stands for Light Detection and Ranging, and it's also a service provided by LINZ, and it creates these kind of 3D, or kind of volumetric images.
[00:21:41] Hannes: LiDAR, it effectively bounces a laser off the ground, and then times the time it takes to come back, and so it, and it sees both, when looking at forests, it can see both the tree canopy and the ground underneath the tree canopy. What this all means is that it's really useful for height measurement.
[00:21:59] Hannes: So LiDAR gives you kind of within about half a meter accuracy an idea of the height of the trees. So when Nick mentioned before that for something to qualify as forest land it has to be at least five meters tall, you can use LiDAR either to prove that it's really five meters tall, or that nearby trees are already five meters tall and that you can kind of create a pretty good case that.
[00:22:20] Hannes: Because there's a nearby nature forest that is, let's say, eight meters tall, your forest is also going to grow to that tall under the similar conditions. It's also free and there's a similar revisit time of four to eight years, similar to the LINZ RGB imagery.
[00:22:37] Nick: I think with that one, it's one of those kind of things that the situation now could change in the future, like LINZ is in my view excellent, as Hannes mentioned, at providing these sort of national data sets.
[00:22:49] Nick: It costs money to collect this data, they're not necessarily going to do it at fixed intervals, it may be dependent on funding, but in general collecting all of this kind of information is getting cheaper and cheaper over time. And one other brief note LINZ is one agency which commissions the collection of LiDAR information and they do it at roughly the specs that Hannes said here.
[00:23:08] Nick: There's lots of different types of LiDAR collection frameworks. You can do it from an aerial platform. You can actually do it from space platforms. You can do it from ground platforms and like, you sort of get what you pay for in terms of resolution as well. If you want a sub canopy LiDAR scan that's at like a one millimetre resolution or even higher, you know, there's people who can do that for you if you've got enough money in the bank.
[00:23:31] Nick: But there's very much a case of choosing what, like a technology that's appropriate to the purpose that you're applying it for. Here we're talking about how we use LiDAR and where we've found it's a good fit from sort of a cost and performance perspective within an overall evidence corpus. That's not to say it's the only way you can use LiDAR and depending on your use case, you may want to do something more advanced.
[00:23:52] Nick: But this is where we've found it most valuable. Thanks.
[00:23:57] Hannes: Another one that we've found useful in CarbonCrop is task aerial drone imagery. So, as Nick mentioned, so similar to LiDAR, it's the same for normal RGB imagery. There are providers out there that will go and fly a plane over your farm for you and take really high resolution photos and create a map for it.
[00:24:15] Hannes: And I'll show a quick demo of what that looks like in the context of a real project. Oh, that's if I have one. There we go.
[00:24:31] Hannes: So this imagery here was collected by Plane and this is a project here where the lens imagery available like there were these 0.3 meter, I'll just turn off the new layer as well, there was 0.3 meter imagery available from 2022, so only two years old, which is actually pretty good. But at 0.3 meters you can you can, I mean you can make out the trees it can be quite hard to make out the species, and if there's anything new that happened, or new regeneration, and you're trying to make a case about what the state is today, two years later it could be better, like in this case here, to fly your own imagery.
[00:25:07] Hannes: So that being the lens imagery, this is what the flown imagery looked like. I think this is from late last year, or the start of this year. And you can really zoom in, and yeah, as it loads, kind of get like a lot of really good detail from the imagery here.
[00:25:25] Hannes: Jump back to the presentation. So it's really quite accurate at 0.05 meter resolution, but again, it can be decided, you can pay more and get even higher resolution, and the plane just flies lower and does more zigzags. Or you can pay less and the plane flies a bit higher and takes a bit lower resolution.
[00:25:44] Hannes: It's 3 bands from the lens imagery, and it's on demand. The acquisition cost, I mean, again, this is like a really rough guideline. We wanted to put some numbers here anyway to give people an idea, like, what the rough kind of cost, but it does depend, but I hate saying just, it depends. So we thought we'd put it here anyway.
[00:26:00] Hannes: Roughly 5 per hectare is what this project costs. However, it costs a bit of money just to get the plant up in the air. So you can expect somewhere around a ballpark, a minimum, of 1,000 is like a minimum cost.
[00:26:12] Nick: That's also loosely true even if you're using somebody with a drone. Like they probably got a drive there, they've got their overheads, there's, yeah, it's definitely not in a free.
[00:26:20] Nick: One thing to note though, nothing, no problem in principle if you've got a drone, if you're using the drone to take your own images of your property, especially the harness is just about to get onto oblique images The Like, just, a lot of what's being seen until now is auto rectified geo referenced images, which are their own, they're basically, the imagery lines up exactly with a map.
[00:26:41] Nick: This is distinct from an image which is just a bleak image, which is usually just, it might have a location, in fact. It better have a location as Hannes is going to get into, but it's kind of a much lower bar in terms of capability to collect it. I was also going to say on the generally available LINZ aerial imagery versus this TAST imagery it's not like there's special planes that LINZ doesn't have.
[00:27:01] Nick: Probably the planes we used to collect some of this data, it was literally exactly the same plane that LINZ might have used to commission their data collection because they don't run planes, they just go out to the private sector and ask somebody to collect it for them. A key point though is that usually for rural imagery.
[00:27:15] Nick: You're trying to cover very large areas and you're trying to manage the costs of it and so LINZ might just collect the data at 30cm resolution, which is still entirely suitable for a well established tree, but might not be very good for sort of early, early regeneration. If you're paying the bill, As Hannah said, you can tell the pilot to fly as low and as slow as you like within the constraints of safety and kind of pay for resolution, which you're unlikely to ever get from LINZ, no matter how long you wait, because I think this property, absent sort of some massive evolution in autonomous drone technology, LINZ is never going to go out and survey the whole thing at 2.5 centimetres.
[00:27:54] Hannes: That's right. So, as Nick alluded to there's another kind of form of image resources like oblique ground photos, and I'm going to mostly talk about the ones that you can take using the thing you've got in your pocket smartphone. They are certainly high resolutions. It's almost unfair to compare these to the rest.
[00:28:10] Hannes: I kind of put a number here of one millimetre resolution because you can see blades of grass from a photo depending on which direction you pointed at. Three band spectral resolutions compared to the others, like red, green, blue images. On demand and effectively free with the asterisks that you kind of have to put your own boots on and gear out onto the land or know someone with a pair of boots and a phone that can go out onto the land and take the photo for you.
[00:28:32] Hannes: So this is kind of an interesting one that I want to dive into a bit deeper. With the other ones, it's usually that you're taking imagery from Lens, or you're paying someone else to get imagery for you. However, with the bleak ground photos, usually it's you or someone on your farm team taking the photos who might not be that experienced with evidence capture.
[00:28:49] Hannes: So I want to dive a bit deeper into like, how do I actually take some good evidence photos? To make the fun, we'll go story time. So, for some background. We've got two farms owned by two people. We've got Tom's farm and we've got Jerry's farm. And both Tom and Jerry have planted trees on their property and they're looking to get evidence for it.
[00:29:08] Hannes: Both of them are looking to register their forest for carbon credits in the ETS. They've both done their due diligence and they know that it's post 89 forest so it should be eligible. And both know that they need to provide some supporting evidence for the new trees that are growing on their land.
[00:29:22] Hannes: And I'm going to do a bit of a comparison about Tom and Jerry. One's going to do it much better than the other one, and we're going to use that as a bit of a learning. So, Tom and Jerry aren't real people, but a lot of this is based on true stories that in the last four years, us working with CarbonCrop, we have seen a lot of.
[00:29:37] Hannes: Like, we've seen the pains of collecting evidence poorly, and we've seen how easy it can be if the evidence is collected great. So it's all inspired by true stories. So Tom, so yeah, we're going to talk about how they both go about it in terms of making the plan, taking the photos, and organising the evidence.
[00:29:53] Hannes: So Tom, when it comes to making a plan, just wants to get it done, so he doesn't really make a plan, he just goes out and starts taking photos. Gerry, on the other hand, decides where to pick photos ahead of time. So I'll show what that looks like. So we've got Gerry's farm here, and we've got these areas here in the stripy lines, they're the areas that were just newly planted.
[00:30:15] Hannes: We can see, actually, interestingly, already from the lens imagery, no matter how much I zoom in there's no evidence of new planting. In fact, there's even small bits of evidence of sheep running around, which is kind of contrary. However, this is arguably old. This would be, it won't be this 10 meter imagery here.
[00:30:30] Hannes: It's probably this 2015 0.4 meter raw imagery. So nine years old, due for a re-flight soon, but you can't really rely on that. So we're going to go and take some photos. When Jerry does his planning, he uses a map and decides ahead of time and set some points on a map about where he's going to take photos.
[00:30:49] Hannes: He also looks at local topography. So using a 3D view might decide that we want to take some photos from the tops of these hills because then we can get a good oversight over into the planting area. He also sees that there's some parts like these here, these trees which exist already, that are already visible on aerial imagery, so it doesn't necessarily have to go and take photos of these already because it's just kind of double work.
[00:31:13] Hannes: And he ensures this whole plan will be covered by making some bit of a plan about covering the whole area, and he checks existing images so he sees what's already available on LINZ. And see where you actually take photos from. Now, we'll come back to Tom. And Tom's got his phone. Tom goes out and starts taking photos.
[00:31:32] Hannes: He takes a close look at this. Actually a pretty good photo on it's own. Like it's not blurry, it shows the tree seedling in the ground really well. However he didn't capture a wider landscape. So he really just showed one tree. And in terms of the trust but verify, like MPI wants to trust you, but they also need to make sure that you've actually planted out the whole area that you've said you've planted.
[00:31:50] Hannes: And he also might have took some photos of trees that were visible in Linz imagery anyway, which just created extra work for himself. And lastly, this is probably the most disastrous part, he didn't have location turned on. So he's got this photo of a seedling, however it does not have a geotag against it.
[00:32:04] Hannes: So as far as anyone external who needs to verify this. Kind of coming in. They don't even know that this photo was taken on Jerry's farm. So, sorry. Tom's farm. So Tom claims this photo was taken right here of that new planting. For all we know it could be a Google search image of a poplar ceiling.
[00:32:24] Hannes: And so without the. kind of geotagged where it is on the land, it's quite hard to use this evidence. Also not impossible, so we have used evidence in the past before where it's some photos have a geotag and some photos haven't, so don't throw them away completely just because there's no geotag, but It definitely adds a lot of validity to your claims if they've got geotags on them.
[00:32:45] Hannes: Perhaps he did actually have the location turned on, but it stopped recording the location halfway through. We're seeing this on some phones they go into a battery saving mode, I mean, even though you tried photo-tagging photos at home and their tag was turned on, As you got out into the field, you might have noticed the first five or ten photos had location, but then, you know, the other hundred that you took didn't.
[00:33:05] Hannes: And this did happen in real life as well, and it was really quite unfortunate for the landowner who had to go back out and take a big bunch of photos again. Jerry, on the other hand, taking photos. So he's got his plan, and he takes a variety of different photos. So he's got this photo here, which shows, it might be quite hard to see in the presentation, but that's a seedling on the right here, and you can see a few seedlings in the background, so it's capturing a wider view.
[00:33:28] Hannes: Over here, also might be quite hard to see, but we've got a seedling right in the front here, and you can kind of see a line of seedlings going back off into the distance. And here's another nice one, so you can see seedlings in the foreground here, and you can see the areas that have been spot sprayed.
[00:33:42] Hannes: So it shows quite a nice wide angle and shows that this entire kind of paddock here has been planted. He also ensured his phone was set up to take location tagged photos. The question we get asked often is how do you know if your phone is set to occasionally take photos? We have built an app to do that.
[00:33:58] Hannes: I, there's obviously free alternatives as well, like you can Google search ensuring GPS location metadata, and there's places you can upload photos. At CarbonCrop, we've built this app that you can use to test your GPS and make sure that photos have location. So, we can take a photo that we know has location.
[00:34:19] Hannes: This one here that Tom took should. And then it gets a big tick, it says awesome that photo has low RGPS location, you can continue on with the rest of your upload. So on iOS that works pretty well, we found that once you set it up on iOS then it seems to continue on clicking photos pretty reliably with the geotag.
[00:34:39] Hannes: On Android we always recommend using an app because of the aforementioned power saving mode. We have an app called FieldScan, and this has the added benefit of well as, if you make a plan, if you make a plan of where to take photos, You will be able to see these offline when you're out working in your field about where you plan to take photos.
[00:34:55] Hannes: And also make sure that your location services are turned on from the app itself. And as the photos are taken around your property, they'll show up on the map. And they will automatically upload into CarbonCrop and I'll show you what that looks like in a second.
[00:35:14] Hannes: And, yeah, like I said, he captured nearby settings and he captured wider angles.
[00:35:22] Hannes: So, what's the result for Tom? So, because Tom didn't have the wide angle photos, he can't really prove that the entire area was planted. He just has a few photos of individual seedlings. The photos I said here can't be, that might be a bit too strong of a word, probably in conjunction with a few other bits of evidence, probably could still be used for evidence, but it's a much harder case to make.
[00:35:39] Hannes: But because they didn't have location, It was hard. And lastly, the other benefit of any location is the organisability. So without location, it's very hard to know which photo was taken where. For Jerry, the result is something much more like this. So here's a view of the carbon crop platform, and here's Jerry's farm.
[00:36:01] Hannes: Each one of these yellow spots correspond to a set of photos being taken, and we can see, for example, if we go over here he had location turned on and all of the photos are visible here directly on the map. And it's really easy to use this evidence because they've got really good coverage across the entire area that is claimed to be planted showing photo evidence of those different areas.
[00:36:24] Hannes: And so the aforementioned FieldScan app works so you get a link and then photos are taken with the app and automatically uploaded and they appear on this map here. So if Tom was working with someone else for the ETS registration, he wouldn't have to transfer the photos. Across to him, he would just The person working with them would just see them appearing like this on the map.
[00:36:47] Hannes: So, for Jerry, the result is the GPS table, we accept your evidence the close up photos, they prove there were species that were planted, the wider angle photos prove the coverage that the entire area planted, and the photo's easy to find and reference back to. So, what can we learn from this? Make a plan, decide up front where you want to take photos, and know what other evidence exists already.
[00:37:05] Hannes: Take into account local topography. If you stand on a hill, you can capture a lot more area kind of from the high vantage point. And lastly, pay special attention to the boundary. If you take photos from the kind of boundary in, then it kind of provides a lot more credibility to the planting areas that you've defined that you're submitting, rather than just only taking photos in the middle.
[00:37:25] Hannes: Number two, set up your device. Turn your location on and test ahead of time that you're getting location. And on Android, we definitely recommend using the specific app to actually ensure that location tags exist. And number three, when you're taking photos, capture both larger areas and nearby seedlings.
[00:37:41] Hannes: Of course, if you're doing biodiversity monitoring in like a well established forest, it can be quite hard to capture larger areas. It's most likely if you're inside a forest but similar things kind of apply. You might want to find a nearby hillside so you can capture the whole thing. Although, typically, if you've got a established forest, you can see it all from aerial imagery.
[00:37:56] Hannes: And lastly, use discretion with your plan, or use discretion with the person and people who are executing your plan. We've found sometimes with bigger projects, you've got one person making the plan, and someone else going out and taking the photos. You shouldn't try to bush bash to find the exact location that you were requested to take a photo at.
[00:38:11] Hannes: Like, use discretion, and like, when you're on the ground you might want to take a photo somewhere else than where you'd originally planned.
[00:38:18] Nick: I'd say one more comment there. Like, as much as you can, try and put yourself in the shoes of somebody who's sitting behind a desk in an office somewhere looking at this and trying to make a reasonable decision around what you're claiming.
[00:38:29] Nick: Sort of, what would I think if I got sent this? What would I, because It's no good taking a photo of every single tree, because no one's going to take the time and energy to review every single tree photo that you send and say oh yeah, this was, this was clearly planted at 1, 200 stems per hectare because there's a hectare here and I got sent 1, 200 photos, each of which is of a distinct stem.
[00:38:49] Nick: So I'd say sort of attribute good faith to the assessor, but also put yourself in their shoes. and try and make what you think would be your life easy while still allowing you to make a good, well-substantiated decision.
[00:39:04] Hannes: Ah, and I wanted to make one last point about fighting fakes, which is something that's getting easier and easier. This image on the right, I asked ChattyPT to turn that into an image of a regenerating New Zealand native forest, and if you look quite closely, you can probably tell that it's AI generated, and it kind of almost looks a bit too perfect and crisp.
[00:39:19] Hannes: But this is a real threat. I haven't seen it happen myself, but I have heard of it happening. In the case of a carbon project, to say like, here's what this forest could look like. From the position like Nick mentioned, it puts itself in the position of someone who's sitting in an office trying to verify if something is real.
[00:39:33] Hannes: This job's getting harder and harder for them, and what you can do to ensure, to make their job easier, is Ensure the photo is a tag with the time and location, as I mentioned before. And also ensure that other metadata is included. This happens somewhat automatically, but like the camera type, shutter speed, the f stop if that stuff's all included, it just kind of adds to the credibility of your photo.
[00:39:51] Hannes: Of course, the stuff can be faked, but it just increases the effort and therefore increases the credibility that you haven't faked it. And having a good chain of trust from the photographer up to where you've archived the photos. And it helps a lot. So this is one of the reasons why we built FieldScan, the app is that we verify who took the photo and there's a kind of chain of trust from the person taking the photo up to the platform to help find this stuff.
[00:40:18] Nick: Awesome. Thank you, Hannes. So let's say you do all of this. Now you're successfully registered. As I mentioned before, that's not the end of the story. Almost quite the opposite most of the time you're involved with a project is going to be after the registration stage and there's still a whole heap more work to do, including carbon stock measurements health and survival monitoring and loss detection, to name just a couple of them.
[00:40:38] nick: So, like, keeping good ongoing records and evidence over the duration of a project. is likely to be valuable to you at some point during the project and it's something that you need to have good organisational systems for, otherwise you're just going to have like this giant Google Photos folder of that time I went for a wander in the paddock.
[00:40:55] Nick: For the most part, especially with sort of long term permanent native forests, you don't actually need to do a lot in terms of data collection, but you may want to, especially if you're trying to sort of actively manage the health and the biodiversity of the forest, because it's very easy to end up with sort of a What's technically forest, but it's certainly not healthy forest and we want healthy forest that stores more carbon and provides better habitat.
[00:41:16] Nick: It's more resilient to disease and to environmental change. And so the some of the other stuff that you might be interested in capturing data on beyond just the carbon in the forest is a sort of differentiation by species within the the vegetated area, the health of the sub canopy, which can be very difficult to determine from remote sensing data sources, which are usually looking down from above monitoring your pest control program, where we're doing some work with a partner who's interested in using our field scan data capture abilities to look not at the trees, but at the trap lines around the trees and kind of show, capture some evidence that they've been checked, that they're being maintained, that they're working effectively.
[00:41:52] Nick: And then there's various biodiversity supporting metrics, which biodiversity is such a sort of nebulous thing at the moment that in many cases people aren't quite sure exactly what data they should capture and what it should. demonstrate, but it's, it's still a lot easier if you've got some data that shows, like, because the, an interesting thing about especially local evidence is that you can kind of decide later on the metric that you want to generate from it.
[00:42:12] Nick: It could be like stem count, it could be species diversity, it could be canopy coverage just having the evidence allows you to kind of make the decision later on what you want to use the evidence for, but if you don't have the evidence then you're sort of stuck guessing about what might have been in the past. And finally on future tech,
[00:42:30] Hannes: Yeah, so I wanted to show something. So going beyond photos. So photos are great and all, but we can do kind of even better than that. So if you look at this kind of image of a tree here it's actually not just an image. This is a 3D model that was created from a short video.
[00:42:47] Hannes: So this is about a minute long video that was converted into a 3D model. And this is kind of the extra advantage if you can kind of like zoom around and pan around, you can get some idea for the size of these trees, which can give you an idea for how much carbon is in them. But also if you're kind of trying to do some biodiversity proof or monitoring, then you can look at what this sub canopy looks like and get like a really good picture.
[00:43:08] Hannes: And so if you're trying to take that person who's sitting behind the desk and kind of really bring them into the world this kind of 3D model can help a lot. So if I zoom out this is kind of what it looks like. This was taken with a smartphone camera just by kind of like taking this video and then turning it into a 3D model.
[00:43:22] Hannes: So this is kind of what we believe the future for evidence could look like as well alongside satellite imagery, aerial imagery, and these oblique ground photos. as well.
[00:43:32] Nick: Yep, really awesome point. I think the potential commodification of the data capture for this stuff is one of the key things, like, in the same way that getting aerial imagery from a drone used to be like, you know, are you a major military?
[00:43:46] Nick: If not, then don't even bother trying, and now you can go and buy something that can do it for about 500 bucks, and now you own a drone that can capture aerial imagery, in the same way that getting this sort of thing from a drone until recently required sort of access to extremely serious computing resources and maybe some sort of ultra high resolution LiDAR sub canopy scanner and now you can do it with a commodity phone just by going for a short wander through the forest and it's better than the LiDAR data, like you don't get this sort of spectral information in general from LiDAR.
[00:44:16] Nick: I mean, I won't say it's universally better. The volumetric precision, well, for damage will be better with LIDAR, but you can sort of see where the whole thing is likely going in terms of the future of these technologies. And it's pretty exciting. And it also uses a hell of a lot less power than the LIDAR scanner.
[00:44:33] Nick: Right. That's us for the main topic. We will now jump into questions. I see we've had one come in, which I have added to the list to answer. But before we get into the general questions, we had quite a few questions around the carbon price and there were some major shifts in the carbon price last week following some updates on control settings from the government.
[00:44:52] Nick: So, to go through a little bit of the history. Back in around, I think this is around March ish, memory fails me a little bit there was a significant drop in the carbon price. The overall curve here looks back over the last two years or so and that March drop was when the auction failed to clear fully in the March auction, which is what I'm pretty sure of the date.
[00:45:13] Nick: And, and at that point, the market basically lost confidence that there was going to be sufficient demand for units at the 64 clearing price. Which was partly due to various sort of ongoing policy questions around future of supply and future of price controls. Subsequent to that, there was a price consultation released and there are a couple of things in that which were sort of open questions and open guidance.
[00:45:38] Nick: The top one I think was, had at least the potential to be interpreted. And that's borne out in what happened in the last week, but it was basically a proposed revision to the auction volumes. So, the blue bars on the left are what the units made available by auction excluding the cost containment reserve for going to be for each of these years.
[00:46:00] Nick: And that the sort of teal colour is what they would propose to be revised downwards to. So, basically the proposal was to significantly reduce the number of units available through auction to help improve the probability of meeting the emissions budgets over the next decade or so and in part by using up some of the surplus of units that's sort of accumulated in what's usually referred to as the stockpile.
[00:46:23] Nick: So these are New Zealand emission units that can be used to fulfil surrender obligations and are owned by some private entity that's got some units that they might want to do something with in the future. I think the, you'll see shortly that the market still didn't like this consultation in terms of the implications, because there was, and I think it mostly came down to this other little line that was sort of buried about halfway through it, which was, we've included two options for price control settings, an extension to the status quo is the first option, and this is consistent with the Commission's recommendation, so that the Climate Change Commission recommended maintaining the status quo for price controls.
[00:47:02] Nick: The second option is to lower the price corridor trigger prices, i. e. lower the trigger prices for both the auction floor and the CCR. This was, I think many people interpreted this as a very weird thing to include in the consultation. I mean, yes, Some people might argue, well, I was just saying it's an option, but, you know, anything is an option, by highlighting certain options, you suggest that they are going beyond merely hypothetical options to distinct possibilities under serious consideration, and when you looked at the Proposed price curve for future emissions that the Climate Change Commission were advocating in order to achieve sufficient decarbonisation.
[00:47:41] Nick: Basically, they're saying carbon needs to cost more than it does today. If we're going to see the level of incentives to reduce emissions that we'd like to see combine that with stockpile of units that are already available sitting there to be used to meet surrender obligations, the suggestion that someone's considering making more units available at a lower price through the government auction mechanism came across as a very odd thing to suggest, and you'll see in the next slide how the market reacted to that consultation.
[00:48:11] Nick: Another sharp however, last week on Tuesday morning, the results of that price control consultation came out. And if you jump to the next slide, Hannes. You'll see that it was very positively interpreted. In short, they agreed to stick with the status quo for the price control settings within, within, near as dammit, like there's a couple of very minor revisions to account for changes in inflation rates and such like.
[00:48:37] Nick: And they also agreed to basically adopt, for the most part, the Commission's guidance on the reduced auction volumes, which means a massive reduction in the quantity of units to be made available through auction over the next five to six years under the current. settings. So basically these two things both contribute to a reduced supply of units or potential supply of units at low prices which meant that the market went back up and last time I checked, it was about 61 ish, 61 to 62, which is, If you sort of look at that graph, last time we saw that was back in about March, part of the auction failure.
[00:49:15] Nick: There is another auction coming up in a week or so, I think and the big question there is like, is it going to clear its, which requires a price of 64 or above? So, stay tuned, and coming to the next question, I think, the first question on the list, where do I see the NZU price trending in the future?
[00:49:32] Nick: I've basically given about as much information as I can, I don't know draw your own conclusions on everything that I just presented, this is definitely not trading advice, but I can give some guidance on where NZUs can be traded EMS TradePoint is available for trading, Jardin slash Comtrade, often available for trading, and there's also CarbonMatch.
[00:49:54] Nick: There's a couple of different platforms in New Zealand, which work on different frameworks and have different cost profiles and different functionality. We do there's a question a little bit further down on, our services for customers who have their forest registered with us. We do support trading your units on your behalf, as your agent, on your instructions.
[00:50:13] Nick: We don't give you access to any special prices. We don't give you any other benefits along those lines. It's more just a convenience thing. If you, if you're only going to trade rarely. And you can't be bothered setting up an account, then we can help. But in many cases if you want to be actively involved, then we've had a lot of customers set themselves up with an EMS Tradepoint account.
[00:50:32] Nick: Which amongst other things, allows you to trade even very small volumes. Whereas some of the other larger platforms won't allow you to trade through the digital platforms for less than 5, 000 units. Which is about 300, 000 worth at current prices. Next slide Hannes. So yeah, I basically answered this question before.
[00:50:52] Nick: If you want to sell via CarbonCrop, the price will be the MS TradePoint price. We generally, or whichever platform we choose to trade through price, but we generally, we sign an agreement with you, where you specify how many of your units you want us to sell, and the minimum price you're willing to sell them at.
[00:51:09] Nick: and the duration that you're willing to, for us to leave the order open at. We then basically just post an order on your behalf through our systems at that price, having done various anti money laundering checks with you. And then we give you whatever the proceeds are. We don't charge a commission. If you're a customer registered with us, if you're not a customer registered with us, we don't offer this service at all.
[00:51:28] Nick: It's not really our goal to be a general trading platform operator. But yeah, basically it's, it's a convenient service for people who really don't want to set up an account. If you're happy to set up an account, that can often be the more convenient approach. We are looking in the future at providing deeper integration of trading through our platform but it will be generally through other exchanges. We're definitely not looking to become an exchange.
[00:51:49] Nick:This is an interesting comment. I've kept it in, in full just because it, it sort of is representative of many of the different views that you'll get around the potential drivers of future carbon prices. It could well be that the Economic downturn is having some impact on carbon prices because there's a million different things which drive the prices of any commodity, including sentiment around the potential future price, availability of cash at the current price, cost of capital at current price, blah blah blah.
[00:52:15] Nick: It could well go up. It could stay the same, it could go down. I think the market price is giving you the market's best guess of what is likely to happen in the future, appropriately discounted. I won't speculate further, there's a lot of different drivers that will influence the future price, but one of those is certainly, like this is a highly regulated market the cost control mechanisms are a key one, as will be the future market access for different carbon removal sources.
[00:52:43] Nick: How do I see how many credits you have? Well, if you're with us, get in touch with us and we'll tell you. If you're not with us, get in touch with either, if you're managing your own account in the Emissions Trading Registry, log in, or if you're not, then ask whoever does manage it on your behalf.
[00:52:57] Nick: Somebody should have access to your ETR account for you. We do have some work coming in the fairly near future to display the number of units that you have available in your ETR account within your Carbon Crop Platform account for those of you who are carbon cropped. registered customers. which will make it a little bit easier.
[00:53:14] Nick: Linking with international markets, so I'm not going to go into a great deal of detail on this. I'd say there is work going on. A key topic is New Zealand's national liabilities under the Paris Agreement and how we're going to meet those liabilities, especially sourcing carbon emissions mitigation units from overseas.
[00:53:34] Nick: Something that I'm constantly ranting on about is how I think we should be making more of an effort to position ourselves as a potential future supplier. Internationally of carbon removal units. I always find it interesting that there's reference to It being a future problem that New Zealand might have too many carbon removals because we planted too much forest.
[00:53:54] Nick: And that's a very New Zealand problem to have. The issue of there being too much capacity to remove carbon isn't top on the priority list of many people at an international level because, you know, Like, we need to remove an enormous amount of carbon from the atmosphere. We have way too much of it in the atmosphere at the moment, and we're still going in the wrong direction.
[00:54:13] Nick: I think in the long term, like in the short term, we need to get our own ship in order. We haven't reduced our net emissions enough as a country by any means yet, and we won't have within the next five years. But looking sort of 10 years out to 15 years out, which is not far away, when you talk about forestry investment, we potentially want to be looking to planting those forests now.
[00:54:32] Nick: It could well be that New Zealand's in a position to be a supplier of high integrity carbon removal units to the international market. Although, there's obviously market risk associated with this.
[00:54:45] Nick: bit of a tangent and ties in very neatly with the evidence topic that we've been talking about. So yes, it is expensive. It is arguably inefficient. There's always the question of compared to what, but a lot of remote sensing based carbon models are informed by on the ground measurement data. So I think going out and measuring trees is a very valuable thing to do and I don't see any evidence that we're going to get away from it completely in the future.
[00:55:09] Nick: The way we think of it is that measuring the trees. allows you to calibrate your models, which allow you to predict the attributes of other trees without going and measuring them. And yes, there is a lot of progress and a lot of work in that space. We do it particularly using high resolution aerial imagery and some of the other data sources Hannes has just mentioned.
[00:55:28] Nick: There is work also ongoing around using LiDAR. I'd say it's an area of active interest across the space. And yeah, expect to see more about it over time. We, we, We're already doing this for some of our customers outside of the ETS to basically estimate the level of carbon removals and the rate of carbon removals in non ETS eligible forest for various agricultural supply chain in particular emissions and removals related claims.
[00:55:56] Nick: And in general, we're seeing far, in our view, much more accurate results than you would achieve for the same area of forest under the default tables within the ETS.
[00:56:07] Nick: Ah, this is just a representative one. I've finished planting another area on natives. What do I need to do to register these areas in the ETS? Either do it yourself or find something to help register it for you. But if you're one of our customers or you'd like to be, then just get in touch with us and ask us about it.
[00:56:19] Nick: The next question is a really important one. And the answer is sometimes. It depends on the size of the area and the age of the forest and various other factors like that. But we can, you can use our platform to do this cost modelling, go out to registration to kind of answer the question of is this going to be worth it commercially and given my other goals?
[00:56:38] Nick: That is interesting to note that we've, we've got some customers who are registering their regenerating native forest in the ETS primarily to put an additional layer of commercial protection on that forest, so that if somebody else owns the land in the future, it's going to be very difficult for them to,
[00:56:55] Nick: because they want to protect it, so it's almost like a different form of covenant. This one here, I'm getting well into the speculation category, but I will speculate to some degree because we certainly saw the opposite happen a few years back. Sheep and beef land. is also known as land that you could plant trees on potentially.
[00:57:14] Nick: And for a while Keith Woodward was doing a lot of commentary on this space, basically saying that the most profitable use of much sheep and beef land in New Zealand was as forest, carbon forestry. So, and, and that was driving the land price. Like, I think for a while that it was sort of prices up around the high, high single digit thousands of dollars, even low double digit thousands of dollars per hectare.
[00:57:37] Nick: It was very difficult to create a net present value of the land that was that high for sheep and beef farming purposes, and it was being driven by forestry. I think that the uncertainty around the, some of the uncertainty around the future limitations on especially exotic forestry within the ETS are probably acting to suppress the price, but I'm no expert beyond that.
[00:57:59] Nick: Here it's, it's too broad a question for me to answer in just a short session, so this one I really, I know Hannah said before that we don't want to say it depends, but here it really does just depend to an enormous degree. There's like, what's the environment? What's the slope? What's your intended future land use?
[00:58:14] Nick: Are you looking to be able to continue to graze it in some sort of agroforestry mode? Is it for erosion control purposes? What's the weed spread risk? Like This is why we built the Carbon Crop Platform and we are working on making it even more broadly available to help you just sign in and answer these questions yourself quickly and easily and project both the costs and the potential returns for whichever activity you're looking at doing.
[00:58:36] Nick: So we had two questions on soil carbon: What is the role of trees and soil on current farm sequestration? And most of the, sorry, I'll give, I'll give an in a nutshell answer. At the moment, the New Zealand ETS doesn't give you any recognition for soil carbon sequestration and it doesn't penalise you for soil carbon loss.
[00:58:54] Nick: It has been fairly widely discussed within New Zealand whether to provide further incentives for soil carbon sequestration. My view is that it's a good idea to explore it and it may be a good idea to implement a system for it. But we need to make sure that it's robust and that we are, in particular, recognising and rewarding soil carbon sequestration that is real and that is durable.
[00:59:17] Nick: A big issue in New Zealand is that, as I understand it, a lot of our soil is relatively close to saturation in terms of the soil organic carbon stocks, so it's difficult to significantly increase the soil carbon content, and there's also a very high risk with soil carbon of basically sequestration reversal in the case of a drought.
[00:59:38] Nick: You can lose several years worth of soil carbon sequestration in a single drought event. I saw a farming processor in Australia, it may have been a farmer in Australia, expressing extreme skepticism. So, Australia has a soil carbon scheme that's recognised with ACCUs under their ETS. This farming entity was basically saying that it no longer engaged with it and thought, was extremely sceptical about it, largely because of concerns with both measurement and durability.
[01:00:05] Nick: So, I think it's worth, soil health is extremely important. It is possible to increase soil organic carbon stocks. It's beneficial if you can increase soil organic carbon stocks. And the big question for me is, is there a robust way to do it? And to make sure that there are appropriate durability mechanisms and we don't just kind of.
[01:00:23] Nick: Basically have the soil equivalent of your forest growing for a few years and then all burning down.
[01:00:28] Nick: Riparian planting and shelter belts do fit into the ETS, but they still have to meet the ETS definition that we talked about before, both as a forest land and as a post 1989 forest land. The good news is that when they're not, Meeting the ETS definition of forest land, the typical agricultural supply chain definitions for removals are a lot more permissive, and they're essentially, if it's sequestering carbon, and there's a durability guarantee mechanism in place, then it's admissible.
[01:00:53] Nick: A key thing to note, though, is that especially for riparian planting at small scales, The volumes of carbon you're talking about are usually very small. So our position is that it is important that it's recognised for the sake of fairness, but it's not going to be the thing that significantly moves the dial on overall carbon sequestration across New Zealand.
[01:01:13] Nick: How do carbon units work and can you show an example of the calculations? In a nutshell, you get recognised for carbon sequestration in your forest. Per ton of CO2 sequestered, you get one unit that equals an NZU under the ETS. I won't give any examples of the calculations, but our platform does provide broad calculation capabilities for all different forest types and areas and planting plans.
[01:01:33] Nick: So if you're really interested, get in touch with us about using the CarbonCrop platform, we can show you some more. We did just have one more comment about the suitability of biochar for increasing soil carbon and soil carbon durability is certainly a good option. It is also not recognised under the ETS at the moment and potentially should be.
[01:01:50] Nick: A key question there is really the economics of it, from what I understand, but if there's significant co benefits, for example, for soil health, and that can provide a sort of an economic boost in like, my view is that at least in principle, BioShare should be recognised under the ETS as a carbon store.
[01:02:07] Nick: It just should also have appropriate durability control mechanisms as in any other circumstance. All right, thanks so much everybody for joining and for listening. I realise we ran a bit over. Thanks Hannes for all of the coverage of all the cool evidence stuff. To those of you who do use FieldScan in the future for collecting your own evidence, we're really keen to hear feedback on what works well and what you'd like improved.
[01:02:29] Nick: So once you're giving it a crack get in touch with us and enjoy the rest of your afternoon. Cheers all.
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