Forest offsets and the California compliance market: Bringing an abstract ecosystem good to market

Marissa Bongiovanni Schmitz,Erin Clover Kelly

doi:10.1016/j.geoforum.2016.06.021

Abstract

Improved Forest Management (IFM) projects under the California cap-and-trade market allow production of new, non-traditional commodities: forest carbon offsets. Earlier analyses have considered forest offsets generated through tree planting in the Global South, as vehicles for sustainable development. However, the California IFM program is testing offset production in new geographic and forest management contexts: with offsets produced and consumed within the US on working (timber producing) forests. With data drawn from California IFM project design documents and in-depth interviews with carbon project developers, this study traces the development, sale, and maintenance of forest offsets, in order to map access to benefits along the commodity chain. Results reveal that the cost and complexity of rendering biological services ‘real’ for market legitimacy are reducing benefits to marginal landowners, who lack needed capital, knowledge, and technology to bring offsets to market. An important insight of this study is that the state has maintained power over program participation and offset supply through control of the forest offset methodology, creating a production process largely mediated by the state, adding risk and uncertainty to market participation. Findings provide an empirical example of neoliberal nature and offer broader lessons on governance and benefit distribution for ecosystem service commodity chains.

Highlights

Atmospheric greenhouse gas (GHG) reduction markets are generating production of new and unusual goods called forest carbon offsets
The 2012 launch of a regulatory cap-and-trade market in California expands their production into untested geographic and forest management contexts. This is done through an improved forest management (IFM) protocol, which incentivizes offset production on forests that are generally subject to commercial timber harvest
One challenge was that participants at times withheld sensitive information, related to project developer contract terms and fees. We address this by comparing our findings to those of Kercher and Keeton, who previously reported on cost and revenue data for the California regulatory forest offset market (2015)

Summary

Introduction

Atmospheric greenhouse gas (GHG) reduction markets are generating production of new and unusual goods called forest carbon offsets. The 2012 launch of a regulatory cap-and-trade market in California expands their production into untested geographic and forest management contexts. This is done through an improved forest management (IFM) protocol, which incentivizes offset production on forests that are generally subject to commercial timber harvest. Three years into cap-and-trade market operation, it is possible to assess California regulatory IFM market participation. We employ both a commodity chain analytic framework and Ribot and Peluso’s ‘theory of access’ to trace the development, sale, and maintenance of forest offsets, to test who benefits and how from

Methods

Findings

Discussion

Conclusion