Re-establishing native Hawaii forests destroyed by logging or animal grazing is expensive work. However, the state agency tasked with this mission believes there’s now a way for reforestation to pay for itself.
The state Department of Land and Natural Resources recently announced that it will attempt to sell credits that recognize a major environmental benefit from new trees that sprout from seeds.
Selling these credits would generate income that pays for reforestation work.
And the envisioned buyers for such credits could include you.
“If you drive a car, fly in a plane, use air-conditioning to cool your home, or engage in other activity powered by fossil fuels that emit greenhouse gas, you may soon have new ways to offset your emissions locally, by supporting Hawaiian forest restoration,” the agency announced in a news release last month.
DLNR intends to earn and sell what are known as “carbon offset” credits.
Such credits have been created and used mainly in Europe but also in California. A credit represents a certain amount of carbon dioxide, a greenhouse gas, either kept from entering or removed from the environment.
Almost anything that reduces CO2 emissions — windmills, electric cars, solar panels, landfill methane recovery and energy-efficient building designs — potentially can qualify for carbon credits. Trees also do the job because they absorb CO2 through their leaves and convert it to carbon stored in bark, wood and roots.
David Smith, administrator of DLNR’s Division of Forestry and Wildlife, said individuals and organizations that contribute to greenhouse gas pollution can remove CO2 from the atmosphere by purchasing carbon credits that finance tree planting.
“Ultimately this will give individuals, organizations and companies the opportunity to purchase credits directly from the state to offset their greenhouse gas emissions, which cause global warming,” he said in a statement.
DLNR intends to initially sell such credits for ongoing work on the upper slopes of Haleakala on Maui, where the agency — with public and private partners — has planted 71,000 trees and 45,500 native plant seedlings over the last three years after installing seven miles of fencing and removing 700 invasive animals.
This area, which includes 43,000 acres of grasslands within the Kahikinui State Forest Reserve and Nakula Natural Area Reserve, was once a forest dominated by koa and ohia trees later devastated by animal grazing.
Getting into the carbon credit market is an ambitious plan by DLNR, which first must have forestry projects certified for credits.
The agency is seeking $120,000 from the Legislature for certification, and estimates that it would be at least two years before credits could be sold if funding is approved.
In another twist on the carbon credit idea, DLNR issued a request for proposals last week that seeks to find a nonprofit willing to establish a forest on about 4,700 acres of already fenced land within the Mauna Kea Forest Reserve on Hawaii island.
This proposal, which can be found at dlnr.hawaii.gov, would have the nonprofit front an estimated $5.3 million expense to reforest and maintain the area, and potentially recover as much or more by selling credits. The deadline to apply is March 1.
Suzanne Case, DLNR’s director, called the two-prong effort a “win-win” for the public and foresters as well as the environment, given that reforestation helps recharge watersheds, reduce erosion, restore endangered species habitat and dampen wildfire threats.
The agency’s effort stems in part from a 2009 state task force report that researched the potential for establishing and selling carbon credits tied to forestry.
This 46-page report, titled “The Emission-Reduction Potential of Native Forest Restoration in Hawaii,” concluded that the cost to produce credits can be competitive with global credit purchase prices, under certain circumstances.
Some of the circumstances include having land that is already fenced, and re-establishing koa forests in places where they previously existed so that buried dormant seeds can be germinated by breaking up the ground surface instead of planting seeds in a nursery and then replanting seedlings.
“Forests play an important role in regulating atmospheric levels of greenhouse gases, and through appropriate management and policy frameworks, payments for carbon sequestration and storage in native forests could be an integral tool to help the state reach its policy targets,” the report said.
The targets mentioned in the report refer to a goal for the state to reduce its greenhouse gas emissions to 1990 levels by 2020. The report noted that reforestation can contribute to this goal, and that re-establishing a forest on 30,000 acres of land would represent 5 percent of the goal by removing the equivalent of 150,000 metric tons of CO2.
One metric ton equivalent of CO2 is comparable to greenhouse gas emissions from driving a car 2,434 miles, according to the state Department of Health.
Typically, one carbon credit is for one metric ton equivalent of CO2.
Gauging the market for such credits can be difficult. The task force report cited a 2009 Carbon Catalog where prices ranged from $2.50 to $65. These prices were for credits sold to both voluntary and compulsory buyers. Compulsory buyers are typically companies mainly in other countries that are required to either stay within established greenhouse gas emission caps or acquire extra cap space through credits.
Compulsory credits are largely traded on a European emissions exchange and at times have been worth almost nothing because of gluts.
In the voluntary market the average credit price fell from a $7.30 peak in 2008 to $3.80 in 2014 partly because of a growing supply and less new demand, according to a 2015 report by Washington, D.C.-based nonprofit Forest Trends.
DLNR said the international average price on the voluntary carbon market was about $5 last year and was about $13.50 in the compulsory market in California.
California’s environmental protection agency approved its first forest carbon credits in 2013 under a regulatory program that imposes caps on major greenhouse gas producers. The regulation allows these producers to partially offset their emissions by purchasing credits.
California has certified about 30 forest projects for carbon credits, according to its Air Resources Board.
In Hawaii there have been private efforts to obtain and sell credits for forestry projects, though two early ones by Big Island ranch McCandless Land & Cattle Co. and Kauai tree plantation Hawaiian Mahogany Inc. weren’t realized.
A third company, Hawaiian Legacy Hardwoods, announced in 2015 that it obtained certified carbon credits tied to roughly 300,000 trees planted over five years on part of a former cattle ranch north of Hilo. The company estimated that it could earn more than $5 million selling the credits at $40 apiece to voluntary buyers for sequestering 125,000 metric tons of CO2. Company officials did not respond to a request for sales numbers.
Case, the head of DLNR, said the state’s Haleakala reforestation project could sequester 94,000 metric tons of carbon, according to testimony she presented on bills that seek the $120,000 to establish a carbon credit certification system. She added that the agency has enough suitable land to sequester another 4 million metric tons of CO2 if it were reforested.
“Programs providing the opportunity for private entities to take on environmental responsibility through voluntary payments are almost nonexistent in Hawaii,” she said. “Such payments could considerably increase the department’s capacity to restore and maintain the critical ecosystem functions provided by the land and water areas under its jurisdiction.”