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Carbon Offsets and Financial Opportunities

Carbon Offsets and Financial Opportunities. Coastal Fertilization Program Meeting Kevin Astridge – Forest Practices Branch February 4 th , 2008. Fertilization and Carbon Sequestration. Projected increase of 30 m 3 /ha of stemwood in Coastal Douglas Fir Weight of Wood 0.5 tonnes

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Carbon Offsets and Financial Opportunities

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  1. Carbon Offsets and Financial Opportunities Coastal Fertilization Program Meeting Kevin Astridge – Forest Practices Branch February 4th, 2008

  2. Fertilization and Carbon Sequestration • Projected increase of 30 m3/ha of stemwood in Coastal Douglas Fir • Weight of Wood 0.5 tonnes • Wood is 50% Carbon • Tonnes of Carbon/ha = 30x0.5x0.5 = 7.5 Tonnes C/ha • Tonne of C02/Tonne of C = 16+16+12/12 = 3.67 • Tonnes of C02/ha = 3.67 x 7.5 = 27.5

  3. Fertilization and Green House Gas Emissions • Fertilizer manufacture – 0.8 tonnes CO2e/ha • Transport – 0.014 tonnes CO2e/ha • Application – 0.016 tonnes CO2e/ha • Applied Nitrogen conversion to GHG = 0.95 tonnes CO2e/ha • Total CO2e/ha = 1.79 tonnes CO2e/ha (Scott, Perry, Winter – BC Forest Professional January-February 2009)

  4. Value of Carbon Offsets • Chicago Climate Exchange • North America’s first cap and trade system • Offers futures and options on emission allowances • Current price $2.15 US/tonne • European Climate Exchange • Current price 15.70 Euros/tonne • Montreal Climate Exchange • Current price $9.00/tonne

  5. Greenhouse Gas Reduction Targets Act • Brought into force January 1st, 2008 • Legislates Greenhouse Gas reduction targets for British Columbia • Commits to a Carbon neutral public sector by 2010

  6. Pacific Carbon Trust • Provincial Crown corporation set up to acquire credible greenhouse gas offsets • Offsets used to meet government carbon-neutral public sector by 2010 • Acquire offsets from projects that meet eligibility criteria as defined by the Emission Offsets Regulation

  7. Emissions Offset Regulation • Order In Council approved December 8th, 2008 • Sets out requirements for greenhouse gas reduction or removal project to be recognized as offsets • Additionality • Monitoring and validation • Risk mitigation and contingency plan for reversals • Ensure greenhouse gas removals endure for a period of 100 years

  8. Challenges • Fertilizing results in additional carbon sequestration • Harvesting prior to 100 years creates reversal • Offsets would have to be replaced

  9. Carbon Accounting • Half-life of wood products is the time it takes half of a type of wood product to be removed from service • Construction lumber: 67-100 years • Other lumber: 6-30 years • Paper products: 1-6 years • Residues • Landfill (Ter-Mikaelian et al. Forestry Chronicle 2008; Chen et al CJFR 2008)

  10. Carbon Accounting • Increased volume allows the possibility of: • Substitution of wood for more energy intensive building materials • Substitution of woody biofuels to substitute for fossil fuels • These types of offsets accumulate annually – cascading carbon pools

  11. The Below Ground Pool • After harvest cut blocks are initially sources of CO2 • Studies in Prince George sub-boreal spruce forests indicate that plantations become sinks at around 8-10 years of age • How does fertilization affect the below ground Carbon pool and when a stand achieves “carbon green-up”? (Fredeen et al. For. Ecol. and Man. 2007)

  12. Summary • Fertilization results in additional carbon sequestration • A portion of the carbon fixed may be long lived enough to claim offsets • 27.5 tonnes/ha x $20 = $550/ha • How much of the above can we legitimately claim? • We need an understanding of the time dynamics of forest carbon pools in order to dependably account for offsets and how forests can be managed to optimize both wood yield and carbon storage

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