1. Carbon Offsets and Financial Opportunities Coastal Fertilization Program Meeting Kevin Astridge – Forest Practices Branch February 4 th, 2008

2. Fertilization and Carbon Sequestration Projected increase of 30 m 3 /ha of stemwood in Coastal Douglas Fir Projected increase of 30 m 3 /ha of stemwood in Coastal Douglas Fir Weight of Wood 0.5 tonnes Weight of Wood 0.5 tonnes Wood is 50% Carbon Wood is 50% Carbon Tonnes of Carbon/ha = 30x0.5x0.5 = Tonnes of Carbon/ha = 30x0.5x0.5 = 7.5 Tonnes C/ha Tonne of C0 2 /Tonne of C = 16+16+12/12 Tonne of C0 2 /Tonne of C = 16+16+12/12 = 3.67 Tonnes of C0 2 /ha = 3.67 x 7.5 = 27.5 Tonnes of C0 2 /ha = 3.67 x 7.5 = 27.5

3. Fertilization and Green House Gas Emissions Fertilizer manufacture – 0.8 tonnes CO 2e /ha Fertilizer manufacture – 0.8 tonnes CO 2e /ha Transport – 0.014 tonnes CO 2e /ha Transport – 0.014 tonnes CO 2e /ha Application – 0.016 tonnes CO 2e /ha Application – 0.016 tonnes CO 2e /ha Applied Nitrogen conversion to GHG = 0.95 tonnes CO 2e /ha Applied Nitrogen conversion to GHG = 0.95 tonnes CO 2e /ha Total CO 2e /ha = 1.79 tonnes CO 2e /ha Total CO 2e /ha = 1.79 tonnes CO 2e /ha (Scott, Perry, Winter – BC Forest Professional January-February 2009)

4. Value of Carbon Offsets Chicago Climate Exchange Chicago Climate Exchange North America’s first cap and trade system North America’s first cap and trade system Offers futures and options on emission allowances Offers futures and options on emission allowances Current price $2.15 US/tonne Current price $2.15 US/tonne European Climate Exchange European Climate Exchange Current price 15.70 Euros/tonne Current price 15.70 Euros/tonne Montreal Climate Exchange Montreal Climate Exchange Current price $9.00/tonne Current price $9.00/tonne

5. Greenhouse Gas Reduction Targets Act Brought into force January 1 st, 2008 Brought into force January 1 st, 2008 Legislates Greenhouse Gas reduction targets for British Columbia Legislates Greenhouse Gas reduction targets for British Columbia Commits to a Carbon neutral public sector by 2010 Commits to a Carbon neutral public sector by 2010

6. Pacific Carbon Trust Provincial Crown corporation set up to acquire credible greenhouse gas offsets Provincial Crown corporation set up to acquire credible greenhouse gas offsets Offsets used to meet government carbon- neutral public sector by 2010 Offsets used to meet government carbon- neutral public sector by 2010 Acquire offsets from projects that meet eligibility criteria as defined by the Emission Offsets Regulation Acquire offsets from projects that meet eligibility criteria as defined by the Emission Offsets Regulation

7. Emissions Offset Regulation Order In Council approved December 8 th, 2008 Order In Council approved December 8 th, 2008 Sets out requirements for greenhouse gas reduction or removal project to be recognized as offsets Sets out requirements for greenhouse gas reduction or removal project to be recognized as offsets Additionality Additionality Monitoring and validation Monitoring and validation Risk mitigation and contingency plan for reversals Risk mitigation and contingency plan for reversals Ensure greenhouse gas removals endure for a period of 100 years Ensure greenhouse gas removals endure for a period of 100 years

8. Challenges Fertilizing results in additional carbon sequestration Fertilizing results in additional carbon sequestration Harvesting prior to 100 years creates reversal Harvesting prior to 100 years creates reversal Offsets would have to be replaced Offsets would have to be replaced

9. Carbon Accounting Half-life of wood products is the time it takes half of a type of wood product to be removed from service Half-life of wood products is the time it takes half of a type of wood product to be removed from service Construction lumber: 67-100 years Construction lumber: 67-100 years Other lumber: 6-30 years Other lumber: 6-30 years Paper products: 1-6 years Paper products: 1-6 years Residues Residues Landfill Landfill (Ter-Mikaelian et al. Forestry Chronicle 2008; Chen et al CJFR 2008)

10. Carbon Accounting Increased volume allows the possibility of: Increased volume allows the possibility of: Substitution of wood for more energy intensive building materials Substitution of wood for more energy intensive building materials Substitution of woody biofuels to substitute for fossil fuels Substitution of woody biofuels to substitute for fossil fuels These types of offsets accumulate annually – cascading carbon pools These types of offsets accumulate annually – cascading carbon pools

11. The Below Ground Pool After harvest cut blocks are initially sources of CO 2 After harvest cut blocks are initially sources of CO 2 Studies in Prince George sub-boreal spruce forests indicate that plantations become sinks at around 8-10 years of age Studies in Prince George sub-boreal spruce forests indicate that plantations become sinks at around 8-10 years of age How does fertilization affect the below ground Carbon pool and when a stand achieves “carbon green-up”? How does fertilization affect the below ground Carbon pool and when a stand achieves “carbon green-up”? (Fredeen et al. For. Ecol. and Man. 2007)

12. Summary Fertilization results in additional carbon sequestration Fertilization results in additional carbon sequestration A portion of the carbon fixed may be long lived enough to claim offsets A portion of the carbon fixed may be long lived enough to claim offsets 27.5 tonnes/ha x $20 = $550/ha 27.5 tonnes/ha x $20 = $550/ha How much of the above can we legitimately claim? How much of the above can we legitimately claim? We need an understanding of the time dynamics of forest carbon pools in order to dependably account for offsets and how forests can be managed to optimize both wood yield and carbon storage We need an understanding of the time dynamics of forest carbon pools in order to dependably account for offsets and how forests can be managed to optimize both wood yield and carbon storage