Carbon offsets from a permanent forest sink project – keep it real

Project Rameka sequester and ride
Project Rameka sequester and ride

In which I guest-post as myself and describe a carbon forest sink project I am involved in and our debate about whether we should provide carbon offsets to anyone as part of the project. I originally wrote this for the Greens Frogblog

Simon Johnson is a conservationist, tramper, accountant, former DOC worker and resource management consultant. Simon also blogs periodically at Hot-Topic.co.nz. In this guest post he writes about carbon offsetting from the point of view of a carbon forest.

I am one of the trustees of a small 47-hectare carbon forest sink and native re-vegetation project and mountain bike park; “Project Rameka” in the east Takaka hills in Golden Bay.

It’s really a response to climate change made by two of my old friends, Bronwen Wall and Jonathan Kennett, who bought the land in 2008. Bronwen and Jonathan decided to apply their experience organising native planting projects in Wellington to climate change after reading the 2007 fourth report of the International Panel on Climate Change (IPCC).

It’s been embraced enthusiastically by the Golden Bay community who do the planting, pest control and track work through Project Rameka Inc.

The land is owned by a trust and I am one of the trustees. I did the early accounting for the trust and prepared the application to get the land into the Permanent Forest Sinks Iniative (PFSI).

In return for a 50-year covenant restricting the land use to forest, we receive about 800 carbon credits (specifically assigned amount units) per year for Project Rameka. These units started life as part of New Zealand’s 1990 baseline amount of ‘Kyoto’ units under the Kyoto Protocol.

How many units we get is based on the amount of carbon withdrawn from the atmosphere by the trees. Thanks to the Golden Bay weather, plants grow really quickly. So we really are storing carbon. We have seen 3cm annual growth rings in the few pines we have removed.

For a couple of years we didn’t do anything with the units. They sat in our account at the NZ Emissions Unit Register (the ‘bank’ for carbon credits and emission units). We initially thought the units could be a revenue stream to fund more traps or native seedlings. However the many donations to the project have always kept ahead of the costs.

We also thought that if we owned these units then we would be keeping them out of the hands of emitters so possibly we might even be reducing New Zealand’s emissions as well as sequestering carbon.

As we began to understand the New Zealand emissions trading scheme (NZETS), we realised that the good done by the Permanent Forest Sink Initiative couldn’t make up for the design flaws in the NZETS, as they are joined at the hip. Both schemes create and use carbon credits that are bought, sold and have prices. We could say that the PFSI and the NZETS are both limbs connected by the blood flow of carbon credits to the body, the international carbon trading market.

So when we were approached by Green Party MP Kevin Hague, to offset his greenhouse gas emissions, we didn’t say yes straight away. We had a bit of a discussion about it. Trying of course to avoid MEGO; “My Eyes Glaze Over”, as we would rather be talking about this winter’s planting plan than carbon trading. After much discussion we had two options.

One option was to say no we don’t want a bar of carbon offsetting.

We were aware that the Tyndall Centre’s Kevin Anderson has said that “offsets are worse than doing nothing”.

Selling our units as “offsets” could imply that we accept that
international Kyoto-style emissions trading and offsetting and schemes
like the NZETS are sufficient responses to climate change. That clearly isn’t the case. We would agree with James Hansen that the UNFCCC and Kyoto processes have not and will not achieve the magnitude of emissions reductions the science tells us is necessary.

We think the NZETS is a joke as it has no cap on the number of units given free to emitters and it allows unlimited use of cheap units from the much larger international carbon market.

The other option was acknowledge the problems with the NZETS, and come up with our own version of offsetting in negotiation with Kevin Hague. And that’s what we did.

Why did we do this? Well, we know that Kevin’s flying is not for a weekend of shopping in Melbourne, but part of the essential price of putting the Green message to the public. We support the Greens as the only party with good policy on climate change. The fact that the Green MPs offset their flying emissions does have real political value.

This struck home to me back in June this year when I went to a talk about the ‘Rio+20’ conference. Kennedy Graham described the conference’s failure to address climate change as a double crisis, an environmental crisis and a crisis of international governance.

Neophyte Minister of the Environment Amy Adams defended business-as-usual and patronised Kennedy, saying he was too idealistic. Some one asked Adams if she offset her flying and what she did personally to reduce her emissions. She completely fluffed her answer. Moral victory to Kennedy who we know had offset his air travel to Rio.

What does this offsetting look like?

We cancel, not sell, our assigned amount units, in return for payment from Kevin Hague. A sale would mean the unit could be resold many times before being used by an emitter in the NZETS to allow their emissions. ‘Cancelling’ means the unit legally ceases to exist. It can never be used by an emitter. Also, we could insist on a higher price per tonne of GHGs than the current NZ market price which has recently been less than the price of a cup of coffee. With Kevin Hague we settled on $25 per tonne, which was the price discussed when the NZETS was being amended in 2009.

We also let our Golden Bay network know we are getting money for
offsetting from Kevin Hague. The Project Rameka team had no problem and immediately came up with new trapping and planting projects for the money. As ever they exceeded expectations. They went out and bought the traps and installed them before any money had changed hands!

So far we have not agreed to provide any offsetting service to anyone but Kevin Hague. We have been asked a few times to offset discretionary personal overseas travel and we have said ‘No’. Flying that doesn’t seem that essential doesn’t tick all the boxes the same as our arrangement with Kevin Hague.

Since we started our offsetting arrangement with Kevin, the price of carbon has continued to decline and the NZETS has been made even more ineffective. The Government has permanently excluded agriculture from the NZETS and has extended the two-tonne-for-one-unit discount for emitters. Tim Groser remains welded to the idea of “lowest international cost”.

As far as commercial carbon foresters are concerned, the NZETS has gone pear-shaped because of the price collapse.

Carbon foresters have seen the value of their forests decline by 90%. Pine seedling planting in nurseries has declined by millions and forest clearance for dairy conversions in the North Island looks like starting all over again.

Brian Fallow the Herald economics editor describes the NZETS and National’s climate change policies as a shambles and a disgrace.

It appears the only people trading forest carbon in New Zealand that are happy at the moment are the Rameka Trustees and Kevin Hague.

We are happy as we are supporting the Greens, getting a realistic carbon price for our units and recycling the proceeds into more carbon-sequestering re-vegetation.

Kevin Hague has said to us that he appreciates being able to go for a bike ride at Rameka where his flying is offset, and he also appreciates that we let him know what his money was spent on. He said to us “It felt real”.

If only we could get the rest of New Zealand’s climate change and emissions trading policies just as real in terms of being the right incentive at the right price to really reduce greenhouse gas emissions.

23 thoughts on “Carbon offsets from a permanent forest sink project – keep it real”

  1. It must be disappointing that your rent seeking business has not panned out.

    I guess you could try to find inc.ome streams from more traditional schemes, like creating value added products and services

        1. Hang on; that’s one of the wettest parts of the state! I mean, c’mon; there are ferns in some of those gullies!… Annual rainfall probably pushing 800mm. Are you telling me you get more rain than that in NZ? 😉 *

          It’s a great little MTB park though, Eagle on the Hill.

          *in a weekend?

    2. Andy is always good for another record low on the scale of cynical and risible troll comments. As usual the mud sticks once again squarely on his own face.

        1. Very few, primarily because the ETS was nobbled by the current National government. There would be many more if the ETS made it financially viable to create native forest to sequester carbon.

        2. Seriously, andy, you’re doing the usual denier thing of assuming that the people who actually do things for a living don’t have sufficient brains to work any of this stuff out. There’s no reason why a well-designed scheme implemented in good faith should not achieve important ecological outcomes as well.

          “Forests with high carbon storage capacities are those in relatively cool, moist climates that have fast growth coupled with low decomposition rates, and older, complex, multi-aged and layered forests with minimal human disturbance…

          Although a fast growing, mono-culture plantation forest may have a rapid rate of carbon uptake for the years of vigorous growth, it will store less carbon in the long term than an old growth forest.”

          See also the ACF.

          Everyone I know in landcare is specifically concerned that carbon offsetting not become an endless expanse of even-age monoculture.

          Here’s a question for you – when commercial forestry operations do this very thing, do you object?

  4. I just bought a block of land, which I suspect was once pristine native forest. Having been all logged, pines were put in which have also been logged. Now it is a barren landscape with gobs of thistle and barley grass and the odd rabbit. In other words having exploited it for all its worth it is now a desolate landscape with nothing but weeds. A triumph of human endeavour.

    I plan to restore the native tree species that were once there (all out of my own pocket), but it is going to be a monumental task. Just getting rid of thistle, which are everywhere, is staggeringly hard work. Question is will I allow anyone to offset their emissions or gain carbon credits from the property? Not on your nellie! We are well beyond the point of offsetting emissions, we now need to start thinking zero emissions and sequestration.

  5. I can appreciate that carbon offsetting as currently implemented has fundamental issues. However, this notion that private exchange of carbon offsets is wrong because it’s akin to “absolving sins”, and that we should instead return to a true Amish lifestyle or whatever, is counter–productive. It’s “emotionally sensitive Greenie” rather than “informed and rational Greenie”. The environment has no concept of original sin: a ton of carbon sequestered really does absolve a ton released.

  6. “It’s “emotionally sensitive Greenie” rather than “informed and rational Greenie”

    I would agree with your patronising comment if all our emissions were just from deforestation and were then returned by afforestation. Trouble is for every unit of carbon emitted by deforestation 1.4 units of carbon from fossil fuels has been emitted over the last 200 years which no matter if you are sensitive or rational greenie amounts to a severe imbalance in atmospheric carbon.

    At the end of the day the question is can we withstand the coming climatic onslaught even if we stopped emissions at 393ppm. My suspicion is that we have already let the genie out of the bottle, and have dug a big hole for ourselves that will be tough to get out of but not impossible if there is a collective will. It certainly doesn’t help to dismiss out of hand the notion of sequestration with zero emissions.
    The technologies are mostly there, we just need some incentives to implement them.

  7. Tony,
    that’s brilliant that you have bought that land in order to re-vegetate it. From our experience I would encourage you to involve as many people as possible. Both from a biodiversity and climate change point of view. I totally hear what you are saying when you say you fear ‘that the genie is out of the bottle’, and ‘We are well beyond the point of offsetting emissions’. I think it’s completely valid for you to decide that you won’t offset any one else’s emissions from your project.
    In our project, we started as three friends having a discussion while driving back from a 40th birthday. We started with about 4 questions.
    1. Could we buy some marginal hill country farm land and restore and re-vegetate it and sequester carbon it?
    2. Could we get a local community involved in doing much of the hard work?
    3. Could we get some benefit from any Government schemes (Permanent Forest Sink, ETS forestry, EBEX21) ?
    4. Could we set up a project that showed you could wrap up the answers to questions 1, 2 and 3 into a successful package?

    Looking back after 5 years,I would say we have achieved our goals and that we do have a successful template. #2 (community involvement) has been the most important thing in achieving #1 (re-vegetation and sequestration). The answer for #3 is ‘yes we have got some small but important benefit’ as we have received some units from being in the Permanent Forest Sink Initiative. The real importance of the PFSI is gaining credibility for the project. Being in the PFSI says ‘yes it’s really a carbon sink project’ and not just a MTB trails park. We have a covenant over the land requiring active long-term management to promote afforestation. We would like to, at some stage, get a Queen Elizabeth II permanent covenant.
    An important aspect of getting Project Rameka into the PFSI was to learn by doing about the carbon credits (and offsets) side of these sorts of schemes. And I certainly have learnt lots about the PFSI, carbon credits, emission units and the ETS etc (some of which I foist on Hot-Topic readers in the form of posts!).

    I completely agree that offsets will not solve global warming. I would also say that not just most but the vast majority of carbon credit ‘offsets’ such as the Clean Development Mechanism are invalid (e.g. about 2/3 of CDM units come from dodgy flourocarbon destruction projects in China and India). As my friend Tom says, in a developed western society like NZ, even driving down to the supermarket, is an ‘offset’ – as the action assumes we can keep borrowing from the future.
    However, I would not say that there can be never ever be a valid offsetting arrangement.
    In the big picture of the whole project, the issue of using our units as offsets has been pretty much a second or third or fourth-order issue. For several years, we just focused on sale and purchase agreements, GST on land sales, and planting and trapping schedules. The boring but compulsory details.
    Much later we were approached by an adventure tourism business that wanted to ‘green’ themselves and use Project Rameka in their marketing. They wanted access to our MTB tracks and for us to declare them ‘carbon neutral’ in return for a $$ donation. Their business was driving tourists around in vans. A bit fossil-fuel based. They were very pushy and wanted their cake and to eat it too. So we politely told them to get stuffed. Again this was just a small matter of business in a meeting of the trustees.
    We had many discussions about cancelling units for Kevin Hague before we agreed to do it – precisely because it’s a complex, “MEGO” inducing, jargon-rich, and value-laden set of issues.
    The post I wrote with contributions from the other trustees is really an attempt to say ‘most emissions trading with offsets is a crock and is not part of a solution but we have an arrangement with Kevin Hague that seems to work for us’. Part of the arrangement was for Kevin to host our post on Frogblog to highlight these sort of issues to Frogblog readers. Unfortunately, the first commenter copied and pasted in Watts up with That science denial material that derailed any useful discussion.
    So please accept this as perhaps an addendum to the original post.

    1. I was much taken with your consideration of carbon offsets , the answer you found, applying it to a person who would encourage and prefer a carbon zero solution to air travel if it could be found, that is someone who is genuine about reducing carbon emissions.

      Alas I have also been thinking that Greenland and the PIG are going to go right on melting regardless of what we do and other things too unless we can find a way of pulling back the carbon we have emitted. It is not only a matter of ceasing to emit carbon but of sequestering it as well with long term carbon sinks the only way we can really apply that for now as Hansen has pointed out.

    2. If someone goes out and makes counterfeit currency, does the whole money system collapse? No. Private exchange of carbon credits is simply not vulnerable to the problems of carbon markets. They have their own set of problems instead, that they are not monitored and maintained in perpetuity by society. You have to assume that whatever you set up is going to be maintained by this society, right?

      If you buy carbon credits from a project that is actually sequestering carbon, then you are supporting that project. Assuming that project is legit then it can use this money to grow, expand and hopefully sequester more carbon. The person investing isn’t expecting anything more than that out of it. They are not demanding a dividend. This can plug into commerce nicely and experience exponential growth.

      What you’re saying is that you are denying outright any form of investment, just because the person investing believes that through these actions they are doing their part to help solve the problem.

      What? How does that make any sense?

      You are undermining this possibility of it growing into a useful project right from the start. Instead of being a useful act to save civilization it will remain a narcissistic token of self–hatred. Guess what? We have advanced civilization, and it took deforestation and oil to get here.

      But please, if your group does take donations which can be converted into rough carbon units, please let me know as I am in the habit of privately supporting useful projects. Try as I might, my life has an inevitable carbon footprint and I am in the practice of buying carbon credits voluntarily. I don’t much like the apparent suggestion that I should either a) feel bad about myself, and perhaps just stop living, or b) come into the light, try to set up some eco–friendly paradise and hope to ride out the collapse of civilization.

      But look, if you don’t want to do this or can’t because you’re sort of in “startup” mode and not yet ready to take investment yet: no worries. There are plenty of other projects to invest in, I spread widely and buy more than I need.

      1. (note: “narcissistic token of self–hate” is probably a little cruel. There are more benefits to this project than a few carbon credits. I blame the broken “edit” facility :->)

  8. Samv,
    so after you ‘accidentally’ tapped out ” Instead of being a useful act to save civilization it [your carbon forest] will remain a narcissistic token of self–hatred” – with your keyboard, you ask me to facilitate some carbon offsetting for you.
    Don’t call us, we will call you.

    1. Don’t take this the wrong way: I’m just trying to encourage you to stop thinking of offsetting as something rich people do to feel better about themselves but won’t really help anything. And yes, I did this by pointing out that a single valiant project alone could be seen as something some rich people are doing to feel better about themselves. Depending on the perspective and idea of how the solutions will work, you can reach an entirely different conclusion. The perspective I reach is almost diametrically opposed here: I believe in investment in carbon projects and you see people looking to promote themselves as “carbon neutral” without making a substantial change. You want them to make a bigger change. That tourism operator who wanted to offset, what should they do? Stop running their business and tell people to stop flying here? Convert some food crops to biofuels and run the tank on that?

      What you don’t seem to accept is that investment is change. There is some crazy anti–investment sentiment out there and it is serving only to discourage the very positive change that investment could bring about. Commander–in–chief of this craziness is of course James Hansen. Great climatologist, absolutely nutballs when it comes to solutions. His “Tax and Dividend” idea? Someone please take away his copy of The Communist Manifesto. Put more money in consumer’s pockets and they’ll spend it on gasoline and ipads. Nutballs. Cap and Trade or Tax and RFP for sequestering projects is the only likely paths for solution IMHO.

      I think there are some great points you make about borrowing from the future: or, to put things back in economics terms, we can’t run a deficit carbon credit economy. I can’t offset emissions today with carbon to be sequestered tomorrow. There are some good concerns to be raised about this sort of trading and I’m glad that you’re raising them, and glad that you’re sharing lessons learned from your project. If you can figure out how to turn that into a template for expansion and relevance to the global project, great. If not, well someone else will—we hope.

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