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How does Maine’s forest carbon credit market work?
Forest carbon credits are gaining traction in Maine. Yet as the voluntary carbon market picks up, some in the industry are worried about access for small family forest landowners with fewer resources than corporations who manage bigger plots of land.
In order to participate in the market where carbon credits are bought and sold, a forest landowner first needs to understand exactly how much carbon their trees are capable of storing. The science behind the forest carbon market is based on the fundamental lesson taught in school: like us, trees “breathe.”
Unlike us, however, trees take in carbon dioxide and hang on to it over long periods of time in a process called carbon sequestration. When certain climate-friendly management practices are followed, the carbon stored by forests can be counted and sold as credits to companies looking to offset their emissions in a larger marketplace.
The market hinges on precise carbon sequestration calculations, which are done right down to the individual tree. That value, calculated by determining the amount of carbon a parcel of forestland will absorb and store over a period of time, often five or ten years in Maine, is then used to determine how many carbon credits a landowner can be issued by a carbon registry. Each credit is equivalent to one metric ton of carbon.
For small-scale forest landowners, who might have a 25- or 50-acre parcel of woodland, this first step can be a barrier. The ground-based surveys traditionally required for calculating carbon storage potential are expensive. Though such surveys are typically conducted and paid for by a third-party entity called a forest carbon developer, surveying plots in the thousand-acre range versus dozen-acre range often makes for a more savvy investment. That can leave small landowners without access to the market.
“When you have tens of thousands of acres to work with, then you have sort of an economy of scale to develop your own project. When you have 150 acres, the cost of developing a project would exceed the revenue you could gain from selling to carbon,” said Andrew Whitman, a climate and carbon specialist with the Maine Forest Service.
In Maine, there are a handful of forest carbon developers who work with private family woodland owners, defined as those who manage 1,000 acres of forestland or less. One of those firms, a Maine-based startup called Renoster, is using remote sensing technology in an effort to make the surveying process cheaper.
By using data collected from laser instruments on flyovers done by the state of Maine and the U.S. Geological Survey, Renoster’s team of scientists can create a detailed rendering of individual forest parcels. That rendering is called a LiDAR point cloud, named for the kind of three-dimensional laser scanner imagery created by the Light Detection and Ranging (LiDAR) technology.
“By filtering the point cloud with good statistical practices, you can actually see the shape of individual trees,” said Mary Ignatiadis, a forest economist with Renoster. “People have been doing a lot of work to make sure that [the carbon storage] calculations are really accurate, and that's the innovation that's going to allow small Maine landowners to participate.”
The state is preparing to launch a series of incentives later this year to encourage forest landowners to participate in the carbon market, according to Whitman. Maine received federal funding from the U.S. Department of Agriculture through the 2022 Inflation Reduction Act to invest in forest carbon and resilience.
There will be two incentive programs available to forest landowners with parcels under 1,000 acres and under 10,000 acres, respectively. Though Whitman said federal funding is not in a “business as usual situation,” he anticipates that the incentives will move forward.
Incentives are not the only part of Maine’s forest carbon market counting on federal funding. Forest carbon developers in the state rely on data from the U.S. Forest Service’s ongoing Forest Inventory and Analysis, or FIA. The Forest Service has seen significant budget and personnel cuts under the Trump administration. Remote sensing technology, including instruments on NASA’s satellite programs, could also be impacted by budget cuts.
“From a carbon standpoint, if the capacity of the programs to keep up with the ongoing inventory work in FIA … if that's diminished, then we'll have less capacity to have high quality data,” said Ivan Fernandez, a member of the Maine Climate Council and the Forest Carbon Task Force Gov. Janet Mills convened in 2021.
“I say that not as a criticism of what might occur by the scientists doing the work, but if you have less resources to do it, then you have less data, and you have bigger error bars.” |
