The benefits of tree planting in the UK are significant, but what can be done to make it a viable and attractive investment for businesses?

Building Commitment to Forest Creation in the UK

Stephen Prior, Co-Founder Forest Carbon. Stephen Prior is the former head of an independent secondary school in Zimbabwe who discovered a second vocation through his Durham University MBA dissertation. During his research into the potential for a domestic forest carbon market Stephen met James Hepburne Scott, who had submitted the original research idea to Durham, and the pair co-founded Forest Carbon in 2006. The company has gone on to plant 4 million trees in the UK as part of its corporate partners carbon management programmes, and leads the way in Woodland Carbon Code certification. Forest Carbon is also using its experience in supporting Defra in the development of further domestic ecosystem services markets and is the carbon project partner for the Grown In Britain campaign. 

Despite the many benefits UK woodlands bring to the UK – including flood amelioration, carbon dioxide sequestration, improvements in health and well-being, wildlife habitat, and river quality improvement - one thing stands in the way of much more substantial private sector carbon investment in the green infrastructure of our country: the non-offset status of Woodland Carbon Code credits.

This is brought about by the inclusion of forestry carbon sequestration in the UK’s Kyoto commitments and accounting, which creates the ‘double-counting’ scenario of emissions reductions being used by both the government and the carbon investor.  It forces companies making a valuable contribution to the nation’s fabric to use nuanced and convoluted language which doesn’t appropriately demonstrate the impact of their commitments.

A 2009 Forestry Commission report, endorsed by the government of the day, recognised that an effective tripling of the rate of planting of all types of woodland across the UK could lead to emissions abatement of around 10% of the national footprint by the 2050s. Unfortunately we are nowhere near achieving that aspiration – an increase from around 8,000 ha per annum to 23,000 ha per annum – but access to the voluntary carbon market could provide much needed extra funding. 

Making it a win – win – win – win…

With carbon emission reduction targets now hard-wired into UK law and government policy for business, and assuming we all accept that woods are good for us, it could make sense to make it possible for businesses to invest unequivocally in UK woodland creation – without the contorted language.  We suggest a means to do this:

Thanks to the rigour of the Woodland Carbon Code (WCC) it would be possible for the UK government to cancel its own Kyoto units against certified new woodlands – safe in the knowledge that they were genuinely additional and the carbon estimates were sound and conservative. At a stroke this measure would allow UK business to report woodland creation as a full grade carbon offset – conferring carbon neutrality and meeting UK government environmental reporting guidance. 

Sounds simple, but why would the government cancel Kyoto units when there could be a call for them in meeting future targets, and a financial burden if it were short of them? The answer is that the cancellation would actually lead to a net increase in emissions reductions, with the added (and not inconsiderable) bonuses of economic benefit, employment creation, flood mitigation, quality of life improvement, habitat creation, river protection and timber supply chain security. 

If we did hit the target, to increase planting from around 8,000 ha per annum to 23,000 ha per annum, what would the sums look like? 

Carbon benefit

Under this proposal the creation of an extra 15,000 ha per annum would lead to, on average, the issuance of 4.5mt Woodland Carbon Code ‘forward’ credits per annum, which in turn would lead to the cancellation of 4.5mt Kyoto units (AAUs) – about 0.6% of the UK total. Because the Woodland Carbon Code measurement methodology is conservative this amount of woodland creation would lead to an actual carbon sequestration figure of between 5.6mt and 7.5mt – all deposited in the UK government Land Use Land Use Change and Forestry (LULUCF) pot. 

These figures don’t include harvested wood products however, which also generate an emissions reductions pool for the carbon balance sheet of the nation that grew the timber. This could amount to a further 3.0mt per annum of carbon gain (though this has a shelf life, it’s still an important part of deferring emissions). 

Economic benefit

Our crude estimates suggest that 15,000 ha of new planting per annum would be responsible for creating over 8,000 jobs in the rural economy, as well as protecting a further 16,000 jobs and maintaining necessary investor confidence in the long term health of the timber harvesting, haulage and processing sectors. 

UK carbon offset projects could also offer a possibility for export – meaning a (small) positive contribution to the balance of trade.

Finally – an increase in UK planting offers improved supply chain security for a material that will become increasingly important. In 2011 the UK was the third largest net importer of timber globally, behind China and Japan, and in 2012 around 80% of all timber consumed in the UK was imported. 

Environmental and social benefits

The estimation of environmental benefits resulting from new woodlands is currently a key theme in much UK government thinking. We suggest a few of the benefits below. 

Riverbank planting

The 2010 UK National Ecosystem Assessment (NEA) estimates that climate change could double the number of households at serious risk of flooding by 2060, and that without mitigation the costs of damage to households will increase from £1.4 billion in 2000 to at least £20.2 billion in 2080. With mitigation it is estimated that this figure would be reduced significantly to something in the range £2.2 billion to £6.7 billion. These figures do not include flooding losses incurred by agriculture. 

The NEA also reports that the pollution remediation effects of woodlands are likely to be substantial, and studies show that riparian woodlands achieve almost complete prevention of diffuse pollution into rivers.  

At the time of writing, 63 new woodlands covering 2,377 net planted hectares have been validated under the WCC. These have resulted in 115 miles of river and stream bank protection which will deliver flood alleviation, diffuse pollution mitigation, erosion prevention and improvements to aquatic life in general. There is no doubt that woodlands planted in the right locations are a cost-effective tool for long term flood amelioration. 

Habitat creation

To date WCC validated projects have created 23 miles of new adjoining woodland boundary for the benefit of wildlife mobility, and initiated 1,649 net ha of UK Biodiversity Action Plan Priority Woodland Habitats.  

Social benefit

We believe the greatest social benefit is the creation of rural jobs. However all new woods created under the Woodland Carbon Code offer public access and many provide opportunities for education and community involvement.

In addition 2010 and 2012 reports by the Forestry Commission highlight several studies that demonstrate the health benefits of green space, particularly woodlands, including reduced health inequality, improvements in levels of physical activity, improved mental well-being, and increases in life expectancy, all consequent on proximity to green spaces. 

Is there demand?

Finally, of course, what evidence do we have of the demand for this investment? Feedback we receive tells us that the need to use nuanced language and the non-offset status of UK woodland projects are a significant barrier to participation. Despite these limitations, and as an example of the potential, Forest Carbon Ltd and corporate partners have been integral to 9.7% of all new woodland planting in Scotland in the past five years. 

In the UK’s commitment to the EU’s emissions reductions targets and the fine print of the Climate Change Act there is clearly a desire to reach our goals and deliver scalable solutions.  Our aim is to work out how can we remove barriers that stop businesses making an investment they want to make in something that’s so obviously good for our country.