Forests play a key role in meeting carbon emission reduction goals by capturing and storing carbon immediately, rapidly, in great quantity, and for long periods of time. A carbon offset is a reduction in greenhouse gases, or an increase in carbon sequestration, used to neutralize or cancel out an equivalent amount of emissions. Carbon sequestration refers to the process of capturing carbon from the atmosphere and storing it in some way—usually in trees or other plants. Carbon sequestration is among the most well-known ecosystem service provided by forests, and is one way to generate a carbon credit.
A carbon credit is a certificate or permit representing a reduction, removal, or avoidance of one metric ton of carbon dioxide or its equivalent in the atmosphere. Essentially, these credits are financial instruments that can be traded in carbon credit markets.
As a large-scale forest landowner, carbon credit markets represent an emerging opportunity for school trust lands, especially for forested trust lands with the potential for carbon sequestration. Forest carbon credits have the potential to provide supplemental annual income in addition to timber revenue based on the forests’ ability to capture carbon dioxide from the atmosphere and permanently store (sequester) it in within their growing biomass (trunk, branches, leaves and root systems) as well as in long-lived wood products like lumber in buildings. Credits for this storage could be sold to power companies and others who are required or wish to reduce their emissions of greenhouse gases like carbon dioxide. With proper design, forest carbon projects can fit with other land management objectives and will not unduly impair the future use or value of the property any more than other forest activities.
Although developing forest carbon projects is a complex and often daunting endeavor, payments for carbon sequestration present an opportunity to gain a new revenue stream from school trust forestlands while reducing the impacts of climate change. Successful project development requires complying with rigorous standards of analyzing and documenting carbon benefits, working through an array of legal and business issues, and actually carrying out the challenging work of forest management activities that go beyond business as usual. But this should not dampen interest in entering the carbon market, for even a small new revenue stream which generates a reasonable return would be consistent with the trust responsibility, so economic returns that may only be modest per acre are appropriate for consideration and exploration.