Money Growing on Trees? Vermont Forest First In State For California Carbon Market
A chunk of northern Vermont forest will soon help reduce greenhouse gas pollution in California.
The idea is that companies will pay to reduce their carbon footprint by buying the carbon sequestered in a forest on the other side of the country. But determining how much carbon is being stored, and then enrolling in that expanding carbon market, is far from simple. It involves a lot of time, money and long hours walking the woods.
Forester Charlie Stabolsepszy turned off a logging road and tramped uphill on a mountainside in northern Franklin County. He was headed for a point marked on his GPS, where he'd begin a carbon inventory.
He was at the base of Burnt Mountain, where the air was cool, the breeze was light, and the songbirds seemed to be celebrating their first glimpse of sunshine in days. The 5,400 acre parcel has been owned for years by the Vermont chapter of The Nature Conservancy.
The woods were once logged but are now being managed as forever wild – eventually even the logging road will grow over to trees. All those trees are now part of an emerging system designed to reduce greenhouse gas pollution. The Burnt Mountain tract will be the first in Vermont to be enrolled in the regulated California carbon market.
"We saw it as an opportunity to hang on to the property, and to think about how we might manage the property as a core area, in an unmanaged condition," said Heather Furman, director of the Vermont chapter of The Nature Conservancy.
"We saw it as an opportunity to hang on to the property and to think about how we might manage the property as a core area." — Heather Furman, director of the Vermont chapter of The Nature Conservancy
Furman said as conservancy staff thought through the options and talked to scientists, they figured the land could still generate some revenue by selling carbon instead of trees.
"As they looked at it, they said, 'This is really a special place,'" she said. "If we decide to hang on to it and own the property and no longer do timber management but manage it for carbon, it could be a really unique pilot project for doing carbon in Vermont."
To understand how this works, remember your Biology 101. Thanks to the miracle of photosynthesis, trees absorb and store carbon dioxide and release oxygen. They do this by reaping energy from the sun and producing wood, bark and leaves.
In California, companies facing mandates to reduce CO2 emissions can buy 8 percent of what they're required to cut as "offsets." That is, they can pay someone else to store carbon for them to offset what they're producing.
But for the market to work, you need to know precisely how much carbon is in the trees, and what will be held there in the future.
That's where people like Charlie Stabolsepszy come in.
The forester carries a collection of low-tech and high-tech instruments, including a laser range finder. His task is to measure tree height, diameter, estimate crown size and inventory every woody species on the site, not just those that would be commercially valuable. That's one reason why determining carbon storage potential is a much more sophisticated operation than what he does to measure potential board feet for a logging job.
"Here I'm going to use the $2,500 dollar range finder on every single tree, and I’m going to shoot everything twice," he said. "On a regular timber cruise for a commercial sale, a lot of times, I'm just going to use ocular estimates, meaning I'm just basing it on my experience because it is good enough. There is no 'good enough' here."
The reason for this expensive, time-consuming work is simple: the carbon market works on the principle of trust-but-verify. The Burnt Mountain inventory will be checked by a third party and then re-checked by California regulators for accuracy.
"Here I'm going to use the $2,500 dollar range finder on every single tree, and I'm going to shoot everything twice... There is no 'good enough' here." — Forester Charlie Stabolepszy
Cakey Worthington is director of implementation at Bluesource, a California company that's carving a niche in the emerging carbon market.
"We are a carbon offset development firm," Worthington said.
Bluesource will actually market the carbon credits. Worthington explained that the company will review the Vermont inventory to make sure it's exact before helping The Nature Conservancy find a buyer.
The whole process can take 18 months or more. On this project, one goal is to determine how much more carbon will be stored in the un-harvested Burnt Mountain trees, versus what would be removed in a comparable commercial woodland.
"It's the difference between what the property is doing in terms of their carbon stocking, and comparing it to regional averages of what industrial, maximum revenue-generating harvests would be over that timeline," Worthington said.
On Burnt Mountain, the photosynthesis and growing trees is expected to earn The Nature Conservancy about $2 million over 10 years – money the organization hopes to use for more conservation projects.
But the hurdles to enter the California regulated carbon market may be too much for most Vermont forest landowners.
University of Vermont forestry professor Bill Keeton has done detailed research on the issue. He told Vermont Edition last summer that the bigger opportunity here is in the voluntary market, where companies that want to offset their CO2 pollution voluntarily buy carbon credits.
"After taking a really hard look at this, we've concluded that the potential is high here, really high," Keeton said. "There's a lot of opportunities that would directly benefit landowners. But it's primarily going to be through those voluntary markets, and it's going to require something called 'aggregation.'"
"Aggregation" refers to small parcels of woods being lumped together, which is a way to accumulate acreage in a place like Vermont, which may not have the thousands of acres in a single parcel generally considered feasible for California. While the voluntary market has forest inventory requirements that are just as strict as California’s regulated system, landowners must commit to keeping the carbon stored for 40 years, rather than the century required for the California market.
Right nearby Burnt Mountain is a project that will soon be part of this voluntary carbon offset system. The Cold Hollow to Canada partnership involves about a dozen Franklin County landowners whose property provides crucial wildlife corridors to habitat north of the border. The landowners are also looking to reap some financial reward from all those trees storing carbon.
Consulting forester Charlie Hancock chairs the Cold Hollow to Canada board. Depending on how much land is aggregated, he said about 6,000 to 8,000 acres could be involved in the carbon project. Hancock said the landowners can still work the woods while their property is enrolled in the voluntary market.
"Whether the landowners' objectives are timber investment or sugaring or wildlife habitat or recreation, they can all be achieved within this framework," he said.
Back on Burnt Mountain, a hawk circled overhead as Charlie Stabolsepszy continued his painstaking measurements. The entire inventory will take three foresters on the ground working long days for several weeks.
"After taking a really hard look at this, we've concluded that the potential is high here, really high." — Bill Keeton, UVM forestry professor
Jim Shallow, The Nature Conservancy's Vermont director of strategic conservation initiatives, acknowledged a project like Burnt Mountain is expensive and out of reach for most private landowners. On Burnt Mountain, the inventory and other up-front costs alone will amount to at least $200,000.
Shallow said the Vermont chapter of the Conservancy's first foray into the complexity of the carbon markets will help other landowners think about their options for storing carbon.
"So we're actively trying to think about, how do we take this experience that The Nature Conservancy here at Burnt Mountain is learning, and transfer that over to thinking about, how do we work with private landowners to maybe aggregate several landowners together to get enough carbon together to make the cost of the doing the inventory feasible?” Shallow said.
Although The Nature Conservancy has chosen not to log the property, Shallow said some timber harvesting is allowed under the California carbon market rules.