Cashing in on carbon credit: An experiment in sustainable tree harvesting

On a country back road near Penobsquis, an experiment is underway that its supporters hope will point the way to a market-driven, low-carbon economic boom for New Brunswick.

A non-profit organization called Community Forests International bought more than 285 hectares of forest from a private landowner and is now harvesting it using low-impact, sustainable methods.

Since 2012, CFI has sold $300,000 in carbon credits from the land to customers and has used the sales revenue to finance its work.  

"We've offset an awful lot of carbon, held it up in this forest and prevented it from going into the climate and contributing to climate change," Dale Prest, the non-profit's ecosystem services specialist, said during a recent wintry walk through the woodlot.

Carbon credits sold to variety of buyers

The carbon credits are being sold to a variety of buyers, including Dialog Design, a Toronto-based architecture and design company with 600 employees that creates green buildings.

"It was part of what we cared about and it was part of our reputation," said founding principal Craig Applegath.

The company had reduced its own emissions as much as possible but couldn't realistically get to zero, Applegath explained.

"We said, 'OK, even if we're doing things that reduce that, what do we do with the balance of that?' We said, 'we have to find a way to offset it.'"

Applegath read a story in the Globe and Mail about CFI's work in Tanzania and contacted the organization.

"We wanted the best way to do it," he said. "At the same time, we did want to keep the money inside Canada and benefit communities in Canada."

Prest said Dialog Design told CFI that "if we would manage our forest in such a way that would store more carbon than it would otherwise, they would pay us to do it on their behalf. And that's exactly what we've done."

Dialog's initial commitment to buy five years of carbon credits helped kickstart the project and the equivalent emissions reductions has been 17,000 tonnes. The average Canadian produces 20 tonnes per year so the amount is significant, Prest said.

Project helps with sustainable forestry

One example of CFI's approach came last year when it hired a local contractor to do some thinning on the woodlot.

Because the market price for wood is low, Prest said, "it really drives a lot of forestry contractors … to cut as much wood as they can, at as low a cost as they can, as quickly as they can."

But thanks to the revenue from carbon credit sales, "we were able to pay him extra, pay him a little bit more to do a particularly careful job."

Rather than clear-cut the land, the contractor harvested about 25 to 30 per cent of the trees.

"We made less than if we'd just flattened it, but we were able to take it because we're selling another product here, and that is carbon credits," Prest said.

At the same time, the younger trees on the lot will continue to grow, making them more valuable for carbon-storage until they are cut years down the road.

And the wood that was cut generated local jobs, both through the contractor and the local mill that bought the wood.

"The value on the dollar was really significant," Applegath said.

"There was an ecological value, which is what we were trying to do, but it came along with this really smart, social community value as well."

Dialog Design looked at a lot of other carbon-credit vendors but found some of them "scammy," Applegath said. "I think [CFI] is the smartest one in the world, actually, in terms of what it's doing and how it's doing it," he said.

Project could help with N.B.'s climate change plan

The lot is a pilot project, but Prest says it could easily be increased in scale as part of New Brunswick's climate change action plan.

The Gallant government is now looking at whether to adopt a carbon tax or a cap-and-trade system as a way of putting a price on carbon that would deter higher emissions.

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While a carbon tax is simpler to administer, it would likely be more noticeable — and unpopular — among New Brunswickers.

But Prest said New Brunswick could join the carbon trading system already established by Ontario and Quebec. California is part of the same market.

Those jurisdictions, with large populations and large industrial bases, will have a harder time lowering emissions.

But "we have the opposite situation here in New Brunswick. We could actually be exporting our carbon capture potential of our forests, exporting that as carbon credits into those other regions, and creating a whole new export industry from our most rural communities."

It would also allow New Brunswick to skip some of the normal development and administrative costs associated with cap-and-trade programs, while adopting a less expensive way to reduce emissions, he said.