The Baker City Herald reports (with my commentary included within):
Carbon: The new forest product?
Following a record-setting decade for catastrophic forest fires, a new era may be on the horizon focusing on sequestering carbon dioxide in trees instead of letting them burn and pollute the atmosphere.
Mike Gaudern, executive director of the Oregon Small Woodlands Association, delivered that message to members of the Baker County Private Woodlands Association during a swing through Eastern Oregon last week.
“Oregon has been picked as one of three pilot project states in the nation” where cap and trade carbon credit trading will be made available to woodland owners through the Chicago Climate Exchange program, which was formed in 2002 and began trading carbon credits in 2003.
Me: I‘ll going to go out on a limb here and predict that land prices for Oregon private woodlands are going to be headed for the roof.
“I don’t care if you believe what Al Gore and others are saying about carbon emissions causing global warming or not. My interest is making you money,” Gaudern said. “We grow trees that suck carbon out of the air, and people want to pay us money for it — a lot of money.”
Me: This quote says it all. Period.
Gaudern said U.S. cities, states and industries are under a voluntary carbon credit cap-and-trade program, with a reduction goal of 6 percent by 2010. However, there’s a threat of required emission reduction standards if they fail to meet that voluntary goal.
Under the voluntary cap-and-trade system, polluting companies, municipalities and others have the option of offsetting their net carbon emissions by trading for carbon credits, which can be purchased on the Chicago Climate Exchange from carbon sequesterers, such as the owners of private woodlands.
Companies that reduce carbon emissions below the target cap earn carbon credits that can also be sold to firms exceeding the emissions cap, Gaudern said.
“Trees are carbon-storing machines,” Gaudern said, adding that woodland owners can make money on the amount of carbon currently stored in their trees, and on the amount of tree growth, which translates into additional carbon stored.
Me: The carbon goes in, the cash comes out – while the trees just stand there.
The carbon trading opportunity provides a source of income that can help small woodland owners pay for logging to reduce overcrowding and create a healthier forest with faster-growing trees.
When trees are harvested, the wood continues to have value for retained carbon credits as long as it is used in products ranging from home construction to furniture manufacturing and other products that retain the carbon in the wood.
Me: So they’ll have to have carbon cops to follow the trees that are cut. More beauracracy.
When trees or lumber are burned they lose their carbon credit value, as the carbon is released into the atmosphere, Gaudern said.
Me: Then your carbon cash goes up in smoke. The carbon cops will be out looking for smoke on the horizon to find the renegades enjoying their fireplaces while still trying to pocket the cash.
He said this is not the first time a cap and trade system has been used successfully in the United States to reduce emissions. A similar system was used in the 1970s to reduce factory sulfur emissions responsible for acid rain.
Me: Never mind that acid rain was a myth, as is AGW. Who cares about the facts when there’s money to be made?
Gaudern said he is stepping down from his position as OSWA executive director on Nov. 1 to run the new Woodland Carbons Co., which is owned by OSWA.
Me: You can’t blame the guy for being an opportunist. If Gore et al. is dumb enough to promote this scheme, thousands of men like Mr. Gaudern will be smart enough to make a fortune off of it.
He said Woodland Carbons Co. will function as a pool for small woodland owners to sell carbon credits as a group through the Chicago Climate Exchange.
“I am staking the next three years of my life that we can make this thing work,” Gaudern said.
Me: Said like a capitalist who probably doesn’t really give a damn about the environment – just like Al Gore. Gaudern is smart enough to know that President McCain or President Obama will likely help him realize his dream.
The initial plan for Woodland Carbons Co. is to sell 5,000 acres of carbon credits through a pool process. Gaudern said growers interested in participating will have to be certified by a regional auditor with the Chicago Climate Exchange, who will verify the trees are growing and document growth over the 15-year contract period covered by carbon credit trading.
OSWA received funding from the American Forest Foundation to develop a “Working Certified Tree Farm Forester” carbon aggregation system in Oregon.
Me: The government will need “regional auditors” to document tree growth. More beauracracy. Forestry will suddenly become a very popular major in colleges all across the fruited plain.
“If a landowner chooses to join a pool, their commitment is to be a certified tree farm for 15 years,” Gaudern said. “The reward is that they would receive a check for carbon they store on their parcel.”
Me: Who said money doesn’t grow on trees?
In the United States, where the emission reductions are currently voluntary, carbon credit prices have been volatile, ranging from $7 a ton in March to the current $1.13 per ton of carbon sequestered, Gaudern said.
In Europe where carbon emissions are mandatory rather than voluntary, Gaudern said the carbon credits are trading as high as $38 per ton.
Me: But of course. Businesses that need to exceed the caps will have no choice. Government mandated demand, will shrink supply, and the price will sky-rocket.
…
In preparation for the carbon trading era, Gaudern said the Woodland Carbons Co., has received funding to complete a forest growth computer model, which will help determine how much carbon Oregon woodland owners have on the ground.
Me: Computer models? Don’t get me started.
…
Details about how the carbon credits will be calculated and paid through the Woodland Carbons Co. include a 20 percent reserve to protect against fire losses and other factors. However, Gaudern said at an average price of $1.85 per ton, Oregon woodland owners would received approximately $2.05 per acre for growing their trees for 15 years under a carbon credit contract.
However, if the United States goes to a mandatory carbon emissions reduction program like Europe after the upcoming presidential election, Oregon woodland owners could receive closer to $65 per acre if carbon credits were to rise to the $38 per ton currently found in Europe, Gaudern said.
Me: So we’re not talking about a goldmine for most landowners (unless you’re Ted Turner), but for folks like Gaudern who want to pool together scads of landowners and just get a “piece of the action” – this will be a gold mine.
….
Hat tip to Tom Nelson
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