Ask the Conservationist

The Carbon Market of the Future

A reader from Connecticut wants to know if owners of small, wooded plots of land — 50 to 1,000 acres — can participate in the carbon market of the future. The answer? Find out from Nature Conservancy experts!
Evan Griswold of Old Lyme, CT writes:

“I would like to know if the owners of small (50 to 1,000 acre) woodlots will be able to participate in the carbon market in the future. If so, how? Private forest owners control 59 percent of the forestland in the United States and provide the bulk of the sequestration and storage of carbon in wood. How will climate legislation take this into account?"

Jeff Fiedler and Dylan Jenkins:

This is an excellent question to ask, and though challenging, one that The Nature Conservancy and several regional forestry organizations are working to address.

While there is nothing in federal climate bills (or current voluntary carbon markets) that prohibits small landowners from participating, transaction costs and other barriers are likely to make it harder and less cost-competitive for them to participate in a carbon market.

The Conservancy is trying to improve climate legislation working its way through Congress to support participation by smaller, private forest owners in carbon sequestration efforts and to improve their access to markets.

There are several ways to encourage participation of small forest landowner in carbon markets:

  • Small landowners could be allowed to pool their lands together into one larger "project" that would sequester greater amounts of carbon;
  • Streamlined or simplified methodologies could be adopted for small landowners, thus reducing transaction costs;
  • Forestry groups can embark on outreach and education efforts to get small landowners up to speed on laws governing carbon markets.

An alternative, non-market approach is to create a new incentive program targeted at landowners unable to participate in the carbon market. This program would be funded by a small portion of the allowances created under a cap-and-trade program. The Conservancy has worked successfully to incorporate such an approach into federal legislation.

A "Working Woodlands" Model in Pennsylvania

In Pennsylvania, where nearly 70 percent of forests are privately owned, the Conservancy has launched a market-based forest carbon program called Working Woodlands that is now aggregating private woodlands of at least 250 acres and streamlining inventory, planning and forest certification methods to make it easier for woodland owners to participate in carbon markets.

The Conservancy will work with individual forest owners who enroll in the program to inventory their woodlands and develop sustainable forest management plans certified by the Forest Stewardship Council (FSC), a non-profit organization that promotes high economic, ecological and social standards for forestry.

The Conservancy will then work with Blue Source, one of North America's leading carbon project developers, to sell the landowners' forest carbon credits on the voluntary market, using a rigorous set of standards for evaluating the carbon sequestration benefits of the forests enrolled in the program.

After paying the trader and covering expenses, the bulk of the revenue from the sale of the credits will return to the landowner, providing a strong incentive for them to continue sustainably managing their forests.

Here are some more forestry resources in your region that may be of interest:

Originally posted in February 2010.

About the Conservationists

When this was originally posted, Jeff Fiedler was the Nature Conservancy's senior policy advisor for climate and forests.
When this was originally posted, Dylan Jenkins was the director of forest conservation for the Nature Conservancy in Pennsylvania.


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