Denny Gallaudet of Cumberland walks through the woodlot behind his house where he's lived for 40 years on Tuesday, Dec. 29, 2020. Credit: Troy R. Bennett / BDN

Denis Gallaudet is a retired banker, so he knows the value of things. Take, for example, his trees. There is value in the carbon that his 25-acre woodlot in the town of Cumberland sucks out of the atmosphere and converts into lengthening branches and thickening trunks. That’s because large companies, including Amazon and Disney, are willing to pay landowners for tree growth in order to offset their own carbon emissions.

But Gallaudet, a member of Sierra Club Maine, can’t sell his carbon because it’s not financially feasible. The markets where sequestered carbon are bought and sold, including California’s “cap and trade” market, are only available to forest landowners with tens of thousands of acres, due to the high costs of quantifying and verifying projected carbon sequestration in trees.

That could soon change. A variety of groups are ramping up efforts to open up the multi-billion dollar carbon offset market to small forest landowners. They want their efforts to financially boost small landowners while also enlisting more corporate polluters to mitigate the harmful effects of climate change on the nation’s most forested state.

In December, the Maine Climate Council, a panel convened by Gov. Janet Mills to create a plan to achieve carbon neutrality by 2045, called for the formation of a group to develop a voluntary forest carbon program. The program would provide financial incentives for the state’s 86,000 woodland owners with between 10 and 10,000 acres to “increase carbon storage in Maine’s forests” while “maintaining current timber harvest levels.” On Wednesday, Mills signed an executive order to form a 15-member task force to address issues facing small landowners on this matter.

Separately, at least two private organizations, one of which was bought by oil giant BP in December, are planning to launch programs in 2021 that will combine smaller forest landowners’ property into large offset projects.

One of the programs will use satellites and other technology to measure tree growth and carbon capture, steps needed to sell carbon. Another will pay small landowners to implement forest practices that will increase tree growth and carbon sequestration on their land.

Counterintuitively, one of those practices involves thinning forests, so the remaining trees can grow larger and capture more carbon.

Getting small landowners involved is essential to the state’s climate goals, said Patty Cormier, Maine state forester.

“These are the folks we really want to get to and get them to the table and get them jazzed and develop a program that benefits them,” Cormier said.

But for now, as a growing number of companies have pledged to shrink their carbon footprints, Gallaudet and others remain locked out of a growing market. Companies including Chevron, Nestle and Koch Industries have bought more than 8 million tons of carbon from Maine forest offset projects owned by groups such as The Nature Conservancy, The Passamaquoddy Tribe, and The Downeast Lakes Land Trust, among others, since 2013, according to the two main carbon offset project registries. Those 8 million tons of carbon — sold in units called carbon credits, each of which represents a ton of carbon — are equivalent to the total annual emissions of about 1.7 million cars.

However, critics have questioned whether many of those carbon credits represent a true reduction in the amount of carbon in the atmosphere. Some experts have also argued that carbon markets delay meaningful climate action by allowing companies to avoid tackling the challenge of getting off fossil fuels.

Regardless, small Maine landowners are looking for ways to sell their carbon.

“I get a lot of calls from members asking, ‘How do I play in the carbon market?’” said Tom Doak, executive director of Maine Woodland Owners, a group representing Maine’s family forest landowners. “My answer is that it’s not practicable, not feasible at this point.”

But new efforts could change that.

David Montague, president and CEO of the Downeast Lakes Land Trust, discusses the group’s carbon sales. The sale of carbon credits allows the Downeast Lakes Land Trust to conserve additional land, which is open to the public. Credit: Linda Coan O'Kresik / BDN

“It’s the only way that this works,” said David Montague, president and CEO of the Downeast Lakes Land Trust, one of the largest and earliest sellers of carbon offsets in the state. “In my mind, that has been the goal of carbon markets from the beginning, to make it accessible to much smaller landowners.”

‘An economy of scale challenge’

Selling carbon requires establishing a baseline of how much carbon is in the property to begin with. That’s because buyers aren’t just looking to pay for trees that are already standing. They are paying for trees to grow and capture more carbon — in other words, carbon above a baseline established at the beginning of a project.

It can be cost prohibitive to establish a carbon baseline and measure continued carbon capture since doing so requires paying specialists to develop models and verify the work. But the carbon can’t be sold, and the landowner paid, until the trees have grown and captured carbon above and beyond the baseline.

To complicate matters further, some markets do pay for carbon upfront. In those markets, the surrounding forestlands can be used to calculate a carbon baseline. Those markets will pay a forest owner upfront if they have more carbon on their property than nearby woodlands and commit to preserving it for many decades.

Denny Gallaudet of Cumberland walks through his woodlot. Credit: Troy R. Bennett / BDN

In 2017, Gallaudet hired a forester to study the amount of carbon that his 25-acre woodlot of 120- and 150-year-old oaks and pines captured from the atmosphere each year. The answer surprised him: 150 tons, he said. With sequestered carbon going for about $15 a ton on the energy credit market, he realized he could be making a few extra thousand dollars off his property. He could get almost the same amount of money to leave his trees standing than to cut them down and sell them for timber, he said.

He prepared an application to California’s regulatory carbon market, which required following a 140-page set of protocols used to measure and model tree growth. It also required him to commit to keeping his trees standing for 100 years. But after realizing it would cost between $10,000 to $15,000 to bring in the third-party specialists needed to verify the projected carbon capture, he decided selling his carbon “didn’t make sense,” he said.

Without thousands and thousands of acres, the sale of carbon credits doesn’t justify the cost of setting up a project for small landowners like Gallaudet.

“It’s really an economy of scale challenge,” said John Ringer of the American Forest Foundation. The group has teamed up with The Nature Conservancy to pilot the Family Forest Carbon Program in Pennsylvania, which the groups hope to expand to other parts of the country this year. (The Family Forest Carbon Program said it hadn’t yet determined when it would open the program to Maine forest owners). 

The program will cut down on upfront costs by aggregating small landowners into a single large forest carbon offset project. It will then pay them to implement forest practices that will increase tree growth and carbon capture on their land, instead of measuring and verifying the carbon associated with each individual landowner. Ringer said the concept works because of a new verification methodology developed by the partnership, which uses a U.S. Forest Service dataset of 100 forest plots around the country to establish baselines.

Another company, Finite Carbon, is planning to launch a national offset program for small landowners this year called CORE Carbon that will take a different approach. The program will use satellites to measure and model tree growth on participating woodlots, and bypass the expensive boots-on-the-ground operations that are currently needed to verify carbon sequestration.

“You’re not paying people to do what they’re already doing, you’re paying for long-term change,” said Sean Carney, president of Finite Carbon, a carbon offset project development firm which has launched several projects in Maine. The company sold a controlling stake to oil giant BP in December.

A giant yellow birch tree towers into the sky in Denny Gallaudet’s woodlot. Credit: Troy R. Bennett / BDN

While some programs will pay landowners to store more carbon, experts said owners can’t simply cut down fewer trees if they want to successfully reduce atmospheric carbon.

That’s because if people simply stopped cutting down trees in Maine, for example, harvesters would cut more in other places to meet the global demand for forest products. In that scenario, the total amount of carbon in the earth’s atmosphere would not change.

Instead, experts said the way to increase carbon in forests is through active forest management. Somewhat paradoxically, landowners can actually grow larger trees — and sequester more carbon — by removing small trees and plants that compete for resources.

“By thinning out the stand, you can increase the stock of the stand in terms of overall biomass and in terms of carbon,” said Adam Daigneault, an assistant professor of Forest, Conservation and Recreation Policy at the University of Maine in Orono.

This kind of active forest management takes time and money, which carbon markets can provide, Daigneault said.

Correction: A previous version of this story misspelled Adam Daigneault’s name.