Initiative: Carbon-credit dollars for timber

A new initiative provides a market for carbon credits in which forest owners would receive money from health care companies looking to reduce the size of their carbon footprint.


Associated Press

Published on December 16, 2013 9:29AM

RAINIER, Ore. (AP) — For most of Oregon’s history, the forests like the ones near Paul Nys’ house were places where a landowner could get wealthy. Cultivated from seed, rows of trees were grown to a healthy middle age and then chopped down, buzzed into lumber at sawmills and shipped out.

Over the years, the retired schoolteacher has had many offers to buy his property, like many other landowners in the state’s timber region, from both timber companies and developers. And each time, he would say no thanks.

Now 74, Nys and his wife have an unusual offer: Instead of getting money so someone could chop his trees down, he might get paid to leave them up. It’s part of a program to preserve the forest land so that the trees can help absorb greenhouse gases.

And why not, he said. He worries about their health when they can longer care for themselves. The money could be used to help pay medical bills. For those with fewer than 500 acres, like Nys, the arrangement could net participants more than $1,000 per year.

“My father, who lived to be 100 years old, always said we just rented the land,” Nys said. “It’s a trust, and we’re happy to take the money from it.”

Dotting the forestland, along the spines of two mountain ranges, are small tracts of timber lots that date back to the earliest days of Oregon homesteaders, family forests inherited by people who use the land as their retirement plans, stocks and savings accounts.

Nys doesn’t have to look far for examples of the forces that have shaped Oregon’s landscape. At the south rim of his property there’s a bare, brown patch of hillside, cleared of trees and their stumps by the timber company that owns the land.

The new initiative is based on the opposite of that concept. Trees act as “carbon sinks,” each one a great big straw that sucks carbon dioxide out of the air and into the tree and its root system. In a voluntary carbon market, companies that pollute or use lots of power, especially in the health care industry, seek to offset their carbon emissions by buying up the carbon-absorbing capacity of farms like Nys’.

Through a system established by the initiative, the carbon would be bundled and sold to health care companies, and Nys will pocket dollars based on the 20-year carbon-absorbing capacity of his trees. That could start at more than $5,000 as an up-front payment for the first five years of the deal, and continue to generate about $1,000 to Nys for the rest of the life of the contract.

The transaction is a delicate balance. Stories abound of carbon-credit scams, from nonexistent forests in the Philippines to schemes to defraud tribes in the Amazon, so the project’s leaders are cautious when introducing timber owners to the concept.

But in the Oregon initiative, proponents say, everyone benefits. Corporations lower their carbon footprint, landowners get money for health care and the environment benefits from healthy trees.

“Everybody tells us they’re doing a social good,” said Catherine Mater, who conceived of the initiative, called Forest Health-Human Health. “Everybody makes the claim, but no one’s able to show us the social value. We can.”

Mater is a senior fellow at the Pinchot Institute in Corvallis, Ore., where researchers identified the chief reason landowners wanted to sell: their health care bills.

“Their biggest fear wasn’t taxes, it wasn’t development,” said the institute’s Brian Kittler. “It was their fear of not being able to afford their health care costs.”

Left with bills to pay, these aging lot owners have few options. They can cut down the trees and turn them around for straight cash, or sell the land entirely, usually to developers looking to build residential or industrial lots.

So the initiative sought to avoid the forest land sell-off while paying the owners’ hospital bills, with 10 percent of the money going to a community health care fund.

Their solution begins on land like Nys’ tract.

The initiative calculates the carbon absorbed by Nys’ forest land and bundles it with the carbon absorbed by the forest land of his neighbors. That bundle is then verified by an independent auditor that makes sure the trees exist and are indeed drawing the amount of carbon promised.

If it passes muster, the bundle is presented at a virtual international carbon marketplace, like a stock market for carbon credits, to companies looking to offset their carbon emissions. The Oregon forestry bundles will be targeted at companies in the health care sector.

Mater said she envisions similar projects on farms in places like Iowa, where the young are leaving home and farmers are looking for ways to make money off their land.

The idea of linking carbon credits to social welfare has taken off elsewhere, including a project that generates carbon credits from reforestation of the Mississippi Delta. One of its investors is a railway that runs routes through the delta.

American Carbon Registry spokeswoman Mary Grady said the connection between social good and improving the environmental makes sense for a buyer who wants to show it is investing in a local community.

“They (carbon-credit sellers) are targeting a certain buyer audience that’s going to want to relate to that story,” Grady said.

To Nys, the carbon credits represent the possibility of financial freedom. His children and grandchildren wouldn’t be burdened by the bills for his health care, while the forest he’s cultivated for a quarter-century is ensured to stand for decades, if not longer.

“It’s a trust and an investment,” Nys said. “It’s what I’m leaving to everyone who comes after.”


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