Wednesday, December 6, 2023

Voluntary carbon options open up

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Other positive aspects of forestation on farms should also be recognised, say those in field.
Professor Shaun Hendy of Toha says ultimately one carbon credit could rule them all, with a voluntary market providing an innovative proving ground for new technology.
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Like the monocultural forest profile that backs them, New Zealand Units have focused industry, landowners, and the government most intently on carbon, putting the other positive aspects of forestation on farms in the shade.

Professor Shaun Hendy is chief scientist at environmental data company Toha, one of several carbon credit companies operating in NZ’s commercial voluntary carbon market, separate to the Emissions Trading Scheme.

The NZ commercial carbon market is dominated by several large players, including Toha, Toitū and Ekos, all governed under regulations Hendy describes as relatively light in a rapidly evolving sector. 

He sees the carbon credit market as likely to broaden in what those credits represent in coming years and being the catalyst for engaging more farmers seeking values, and value, over and above carbon alone.

Hendy acknowledges the issue of “additionality” in carbon sequestration is a complex one for farmers to grasp when assessing their farm’s carbon absorbing capacity.

It requires a change from a “business as usual” approach in forest/vegetation management, to proof of some action that gains them extra carbon credits to offset against emissions. 

His company plays a role in assessing a farmer’s efforts to protect native bush and determine the value of the carbon that improvement generates.

For example, a farmer wanting to claim carbon credits from an unfenced block of bush on their farm would have to fence it off to add valid carbon credit gains to it.

“Then you could confidently go into the carbon market and sell it as an offset.”

It’s a point farmers often pull up on, believing that a block of vegetation represents a block of carbon, which it does – but it is the effort to improve that block’s carbon capture that counts for credits.

Hendy said there are data modelling tools, including look-up tables, that can help determine the additionality of moves like fencing unfenced blocks. 

Toha partners with external science organisations to develop these tools.

Pest control is another area where additional carbon may be captured by embarking on a control scheme.
“Ultimately we would like to link up biodiversity, erosion and water quality with carbon capture, but we are not quite there yet,”  Hendy said.

Soil carbon is another area demanding more work to determine how much any improvement in it would count as a credit. 

Meanwhile NZ’s understanding of native trees’ ability to capture carbon is also requiring some catch-up work to be done.

Overseas, the European Union has recently moved to clamp down on companies’ ability to make carbon neutral claims, requiring them to distinguish between their own emissions reduction efforts and the use of carbon-offsetting schemes that plant trees.

Hendy’s company offers landowners, iwi and catchment groups the opportunity to have their kaitiaki work recognised,  to claim carbon credits for that work, and move towards gaining credits for biodiversity benefits in the future. 

Hendy said this will help meet a growing demand for “carbon-plus” from investors and consumers seeking improved biodiversity and water quality alongside improved carbon from plantings.

As He Waka Eke Noa (HWEN) continues to be formulated, he said, interest is growing from landowners and farmer groups increasingly recognising the value of native plantings.

Toha has recently launched the East Coast Exchange to help nurture that interest in Te Tairāwhiti. 

The exchange is a post-Gabrielle creation including a growing portfolio of Te Tairāwhiti-focused initiatives helping build resilience on the East Coast. It  includes land improvement efforts planting natives, and protecting erodible areas that may not fit into the ETS. 

The exchange is touted as a precursor to where “carbon-plus” credits may evolve in the future, to include water quality, biodiversity, and erosion control values.

Hendy said he likes Climate Change Minister James Shaw’s belief that ultimately one carbon credit should rule them all.

“I like his thinking, that we should move proven credits into the ETS, once we know how they fit with our national inventory of emissions. 

“The voluntary market could remain, though, almost as a proving ground for innovative and new approaches to carbon sequestration and reduction.”

Such a move would also eliminate the risk of credit holders double dipping between private and national schemes.

Hendy is confident his company can adapt to HWEN as it is finalised, and he hopes its rules are nailed down sooner than later, so he and others can play a role in helping landowners determine their carbon storage capabilities on farm.

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