Forestry, Carbon Markets and Ecosystem Services. Jim Bowyer Dovetail Partners, Inc.

Transcription

1 Forestry, Carbon Markets and Ecosystem Services Jim Bowyer Dovetail Partners, Inc.

2 Forestry, Carbon Markets and Ecosystem Services Overview of the carbon issue - Carbon cycle - Carbon is carbon, but... - Carbon markets and regulation - Strategies for managing carbon Forestry and carbon offsets - General guidelines governing payments for forest carbon storage - Managing forests to increase forest carbon storage - Carbon in harvested wood products - The California story Water management as an ecosystem service

3 The Global Carbon Cycle Source: (1996).

4 The Global Carbon Cycle 829 Source: (1996).

5 Basics The Carbon Cycle Atmosphere: 829 PgC, increasing by 4 PgC/yr. Net land use change, including deforestation 1.1 PgC/yr Net land carbon flux, excluding land use changes but including growth of existing forests 4.3 PgC/yr 7.8 PgC/yr 1.6 PgC/yr 0.8 PgC/yr Vegetation PgC Soils PgC Fossil fuel combustion and Cement production Ocean Surface Ocean 920 PgC Intermediate and Deep Ocean: Pg C Freshwater outgassing, Volcanism, and Rock weathering Source: IPCC Fifth Assessment Report (2013) Line Widths proportional to amount of flow

6 The Carbon is Carbon Debate Fossil Fuels Petroleum Coal Natural gas Limestone (CaCo 3 ) Forests Trees Litter Forest soils Other plants Shrubs, grass, ag. crops Algae Sequestered millions of years ago Fossil Carbon Sequestered, released, and re-sequestered as part of ongoing carbon cycle. Biogenic Carbon

7 Greenhouse Gases (GHG s) Carbon Dioxide (CO 2 ) Methane (CH 4 ) Nitrous Oxide (N 2 O) HFCs CFCs Sulfur hexafluoride

8 The Heat Trapping Efficiency of Various Greenhouse Gases is Not Equal Heat Trapping Compound Efficiency Compared to Carbon Dioxide Carbon dioxide (CO 2 ) 1 Methane (CH 4 ) Nitrous oxide (N 2 O) HFCs CFCs 23X 296X ,000X 5,700-11,900X Sulfur hexafluoride 22,200X

9 Contributors to Global Warming Nitrous Oxide Ozone Methane Chlorofluorocarbons Carbon Dioxide

10 Contributors to Global Warming Nitrous Oxide Ozone Methane Chlorofluorocarbons CO2e Carbon Dioxide

11 Strategies for Managing Carbon Reduce fossil fuel consumption - energy conservation - increase energy efficiency - shift to renewable energy (wind, solar, biomass) Capture and store carbon emissions - Carbon capture and storage technologies - Increase carbon storage capacity of forests Keep forests as forests Manage forests for carbon Plant new forests - Increase carbon storage in wood products

12 Forest Carbon Offsets/Markets A forest carbon offset is a metric ton of CO 2 e avoided or stored. These are purchased by GHG emitters to compensate for emissions occurring elsewhere.

13 Carbon Storage as an Ecosystem Service

14 Carbon Markets and Regulation Carbon markets today are all voluntary. Within the United States, several organizations operate carbon registries that focus on forests: California Air Resources Board (ARB) Climate Action Reserve Verified Carbon Standard American Carbon Registry

15 Carbon Offsets and Forests Forest carbon offsets can be earned through: Afforestation/reforestation Avoided conversion Improved forest management - Maintains forest carbon - Increases forest carbon stores

16 Creating a Forest Carbon Offset Project Evaluate project feasibility Conduct a carbon inventory Develop a management plan Submit project plan and documentation to carbon registry Hire third-party reviewer Submit verification to registry carbon offsets (80%) Market and sell carbon offsets Periodic monitoring, verification verified

17 Carbon Price $/metric ton CO 2 e September 16 $ Price of California Carbon Allowance Futures over time from ICE End of Day Reports.

18 Estimated Net Income for Pine and Hardwood $5/MT CO 2 e 1 Accounts for the 20% reserve pool Source: D. Mercker, Univ. of Tennessee (2012)

19 Estimated Net Income for Pine and Hdwd $20 and $1/MT CO 2 e Source: D. Mercker, Univ. of Tennessee (2012)

20 Effect of federal cap and trade program or carbon tax.

21 Effect of Federal Cap and Trade Program or Carbon Tax Emissions

22 Effect of Federal Cap and Trade Program or Carbon Tax Emissions

23 Guidelines Governing Payments for Carbon Storage

24 General Principles To receive tradable carbon offsets, carbon stored must: Be additive (beyond what would have occurred with business as usual) Be permanent Not result in leakage

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26 CARB Forestry Compliance Provisions Offset Protocol - 95% native species (based on carbon vol.) - If uneven-aged mgmt maintain at least 40% canopy cover across assessment area. - If even-aged mgmt < 40 acres in size - Harvest areas separated by minimum 300 in any direction (min. 5 yr. before rule not enforced) - Baseline carbon storage value set at 80% of highest value over previous 10 years.

27 CARB Forestry Compliance Provisions Offset Protocol - Modeling done on 100-year time line to evaluate various growth/harvest scenarios. - Contract based on commitment to conserve/ increase carbon stocks over time. - Credit given to carbon in harvested wood products. - Provisions for reducing stocks in overcrowded stands.

28 Some carbon registries require certification under one of the primary North American certification programs SFI, ATFS, CSA, and PEFC.

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30 Potlatch Corporation El Dorado, Arkansas January 7, 2014 Entered into improved forest management early action carbon offset project involving 15,809 acres. Received an initial issuance of 220,208 ARB compliance offset credits.

31 Benefits to and Obligations of Forest Landowners

32 Landowners and forest carbon offset programs: - Periodic payments - Contractual obligations - Restrictions on land use

33 Carbon in Harvested Wood Products

34 Proximate Analysis of Wood Species Ash C H O N % % % % % Douglas Fir Hickory Maple Ponderosa Pine Western Hemlock Yellow Pine White Fir White Oak BARK Douglas Fir bark Loblolly Pine bark Source: Biomass Energy Foundation (2009) (

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36 U.S. Commercial Building Stock: Total Floor Space in Buildings by Height, 2012 Millions Floor 2 Floors 3 Floors 4-9 Floors 10 Floors+ Source: US EIA (2015)

37 Building Tall Wood Buildings Requires Engineered Wood Products Cross-Laminated Timber Glue-Laminated Timber

38 Duration of Carbon Sequestration in End Uses of Wood and Paper Source: US Forest Products Laboratory (1998)

39 Managing to Increase Carbon Storage

40 Managing Forests to Increase Carbon Storage Lengthen rotation periods Harvest less volume Protect shallow and deep soil carbon

41 Other Ecosystem Services

42 Ecosystem Services Carbon sequestration Hunting Biodiversity Watershed protection and enhancement

43 Watershed Protection and Enhancement Reforestation Streamside buffers Maintenance of tree cover Less impacting harvests

44 Summary

45 Questions? Jim Bowyer