“How will ballot measure 1 (Initiative Petition 17FSH2) impact the State of Alaska? What will be required of departments to implement this new policy and how would this impact the state budget?”
1:30PM July 20, 2018: Alaska State Senate – Committee on State Affairs Holds Hearing on 17FSH2 – Ballot Measure 1: Stand for Salmon
The Who, What, Where, Why and How of Alaskan Forest Carbon Offsets
By Denise Farrell and Debbie Atuk
Who can earn carbon offsets?
Alaskan landowners, regional and village corporations, tribes, and private landowners, located in a specific region of the State (see map below), who actively preserve forest lands and improve forest management practices are eligible to participate in the California cap and trade program. The generation of carbon offsets and the subsequent sale in the cap and trade market can generate substantial profits for landowners. Undertaking a forest carbon offset project preserves culturally important lands, in pristine condition, for future generations.
What is a carbon offset?
Forests are potent tools in mitigating climate change due to their capacity to sequester and store carbon. The stored carbon can then be sold as offsets in carbon markets which seek to incentivize forest carbon sequestration by putting a price on carbon emissions. One such market, the California carbon market, came into existence in 2013 after Governor Schwarzenegger signed the Global Warming Solution Act of 2006. Under state law in California, carbon-emitting entities must either pay the State of California for allowances to cover their emissions or buy carbon offsets from forest owners to meet compliance obligations. A carbon offset is a reduction in emissions of carbon dioxide or greenhouse gases made to compensate for an emission made elsewhere.
Where does the project have to be located?
In designing the cap and trade program the California Air Resources Board (“ARB”) designated certain areas in Alaska as eligible for forestry projects. ARB primarily selected the assessment area in regions where there was accurate US Forest Service inventory data. Accurate inventory data is a prerequisite for determining the “baseline,” for the geographic region. Only carbon sequestration above such baseline can generate carbon offsets. Currently, to be eligible for the ARB cap and trade program, forest projects must be located in the highlighted regions on the map below.
Why are landowners provided the financial incentive to preserve forests?
A carbon offset is designed to provide incentive to take actions that are “additional,” to business as usual or above a baseline of activities. In undertaking a forest carbon project in the assessment area, landowners are making a 100-year commitment to continuing to maintain the carbon sequestered in the project area above the baseline. By sequestering the additional carbon they are reducing greenhouse gas emissions. The goal of the cap and trade program is to have emitters purchase allowances or offsets (for only a small portion of their requirement). The offsets can only be generated by projects or activities that CARB want to encourage, such as forest preservation. The financial return for generating these offsets intends to provide the financial encouragement as well as the moral imperative, to do such desired actions.
How does the California Cap and Trade Program work?
Depending on the local topography and tree species composition, certain parcels of land could be developed as a carbon project which generates offsets. The development team of Environmental Attribute Advisors and Encourage Capital works with forest owners to evaluate and then if feasible, develop forest carbon projects. Our development team can undertake a desktop assessment of the lands at no cost, if certain information is provided. If the assessment yields a positive finding, then our team will propose terms to develop the project. The project development is expected to take 18-24 months and could generate a windfall of cash, potentially worth millions, for the landowner at the end of the development period. Our team will hire inventory crews, biometricians, carbon quantification experts, and verifiers to develop this project ensuring that the project meets all the requirements of the California forest carbon protocol. Our team will typically invest all up-front capital in the project to cover any related carbon development expenses in return for a minority portion of the carbon offsets generated by the project.
How to get started?
In order for our development team to assess project feasibility, propose terms and estimate the potential revenue generated from a carbon project for the landowner, we will request the following information:
- Latest forest inventory; and the inventory methodology which was used to collect the inventory
- Location of inventory plots, GPS coordinates and shapefiles
- Maps of the property
- Harvesting plan (if any)
- Ownership documents, and record of easement (if any)
- If inventory data does not exist, then any other related information such as a recent property appraisal
- Profits realized from the carbon project will be taxed as any other commercial activity. The landowner should review tax considerations with a tax advisor as they may vary for individuals and may differ from one state to another.
Major Considerations in Developing a Forest Carbon Project
- No risk or upfront costs for landowner, our team will cover all costs and develop the project
- If carbon project is successful, then a minimum 100-year stewardship commitment to monitor the project
- Windfall of cash in the next 18-24 months, potentially worth millions along with the potential for annual accretion of carbon offsets
- Penalties in case of intentional reduction in carbon stocks (no penalties in case of unintentional reversals e.g. forest fires)
- Annual recurring expenses to sustain forestry management, maintain the carbon project and hire foresters
- After initial project set up, foresters must enter the property and verify the project once every 6 years which will entail expenses to be paid by the landowner
- An opportunity to be a pioneer in the fight against climate change and global warming
- Culturally important lands are preserved for future generation in pristine condition
For Additional Information Contact
I moved to Canada from Alaska about a year and a half ago. One of the first things I noticed in my visits to Canada as a college student and now in my everyday life is that Indigenous peoples and issues enjoy far greater visibility within Canadian media and society than Alaska Native/American Indian peoples and issues do across the border. Indigenous peoples and issues are practically invisible in the U.S. at almost every level of government and society, save perhaps those western states with significant Indigenous populations such as Alaska and New Mexico. In Canada, Indigenous peoples and issues are regularly featured in mainstream news media and there is as a result a running public discourse about issues that impact Indigenous peoples such as cultural appropriation, identity, and social inequities between Indigenous communities and most other parts of Canada that simply doesn’t exist in the U.S.
This post provides a partial explanation for why Indigenous peoples and issues are more visible in Canada than in the U.S. However it is notable that greater visibility of Indigenous peoples in Canada is not necessarily translating into more positive health and wellness outcomes for Indigenous peoples compared to American Indians/Alaska Natives.
Perhaps the most obvious difference accounting for differences in visibility between Indigenous peoples in Canada and the U.S. is the stark difference in population size. Indigenous people in Canada account for about 4.3 percent of Canada’s population of 36 million. By contrast, about 2.9 million people identify as American Indian or Alaska Native in the U.S., or less than one percent of the total U.S. population of 309 million. American Indians and Alaska Natives therefore account for a tiny sliver of the overall U.S. population compared to First Nations, Inuit, and Metis in Canada.
Canada has a population that is smaller than the state of California’s that is spread across a landmass that is slightly larger than the entire U.S. Most of the population in Canada is concentrated along the U.S.-Canada border.
Most of the 10 provinces and three territories have significant Indigenous populations and rural fly-in communities in their jurisdictions. Two of the territories (Nunavut and the Northwest Territories) have majority Indigenous populations.
The provinces along the Canada-U.S. border (British Columbia, Saskatchewan, Manitoba, Alberta, Ontario, and Quebec) all have First Nations reserves within their jurisdictions, most of which are in remote regions of the provinces, and some which can only be reached year round by plane.
In addition, Inuit Nunangat (the Inuit homeland) accounts for a whopping 36 percent of Canada’s landmass and 50 percent of its coastline. Inuit are the majority population in the four regions that make up Inuit Nunangat.
American Indian reservations in the U.S. are by contrast concentrated in western states.
Very few states except for those in the West have rural American Indian communities, and only Alaska has communities in it that are only accessible year round by plane.
3. The Constitution
Section 35 of Canada’s Constitution affirms the treaty rights of First Nations, Inuit, and Metis, including modern land claims agreements. Indigenous peoples’ rights occupy their own section (Part II) of the Constitution, even though the full text of that section is short:
35. (1) The existing aboriginal and treaty rights of the aboriginal peoples of Canada are hereby recognized and affirmed.
(2) In this Act, “aboriginal peoples of Canada” includes the Indian, Inuit and Métis peoples of Canada.
Section 35 represents a hard-fought victory for Indigenous peoples who negotiated this language into the Constitution when it was being drafted in 1982.
The Constitution’s clear recognition of Indigenous treaty rights in Canada contrasts with the comparatively murky references to “Indians” within the U.S. Constitution (the reference to Indians in Article I, sec. 8 as being equivalent to foreign nations for the purposes of commerce is foundational to American Indian law).
4. Mainstream media
The mainstream media coverage of Indigenous peoples and issues in Canada dwarfs that received by American Indians and Alaska Natives in both amount and quality. Mainstream media coverage of Indigenous peoples and issues in Canada has a positive impact on the public’s understanding of Indigenous peoples and issues and enhances the political capital of Indigenous political entities. In the U.S. by contrast, American Indians and Alaska Natives are completely absent from mainstream media unless there is a newsworthy crisis that warrants coverage.
I hear or see Indigenous peoples on the news or radio in Canada at least once a week, mainly on federally-funded CBC programming. Indigenous peoples and issues are the focus of mainstream news reports almost everyday.
Rosanna Deerchild (Cree) hosts her radio show Unreserved every week, broadcast nationally from Winnepeg. The show features a broad range of Indigenous peoples and issues.
Provincial media such as the public TV Ontario often integrates Indigenous peoples and content into its programming as well.
Greater visibility of Indigenous peoples and issues in Canada translates into federal lawmakers nearly all having a rudimentary grasp of who Indigenous peoples are (at least First Nations, who have the largest population of the three main Indigenous cultural groups in Canada). However it is unclear to what degree this understanding translates into policy action that enhances the health and wellness of Indigenous peoples.
At the political level in the U.S., the relative invisibility of American Indians and Alaska Natives in American society translates into reduced political capital that in turn makes it exceedingly difficult to leverage support for policy change from either the broader society or the federal government. However American Indians/Alaska Natives have managed to leverage broad public support for causes that in turn translated into policy action, such as the long-term, mass protest at Standing Rock that led to the Obama administration’s intervention in the completion of the Dakota Access Pipeline.