INTRODUCTION:

Forests are being recognized in financial markets for the ecosystem services that they provide, such as biomass for renewable energy, clean water, clean air, habitat for wildlife (especially threatened & endangered species) and now carbon sequestration. Carbon storage is one method used to offset carbon emissions in the form of carbon dioxide (CO2), which increases global warming.

The advantage of forests providing these new ecosystem services versus other systems, such as algae farms for energy, or underground storage tanks for carbon dioxide, is that our forests provide other amenities that alternative carbon storage systems do not provide, such as clean air and water, wildlife habitat (especially for threatened and endangered species), protection from soil erosion, wood products, and recreation for humans. Finally, these new ecosystem services will reward forest landowners with increased revenue opportunities for their forestland and keep local economies strong.

EMERGING MARKETS:

New market trading platforms, government regulations, and financial incentives are emerging with the goal to reduce CO2 emitted to the atmosphere. Entities that emit CO2 are required in some situations to turn around and sequester CO2 out of the atmosphere in order to remain carbon neutral, or pay for this sequestered service from another entity. Currently, there is no overreaching transfer mechanism in place to trade CO2 credits from storers to emitters. Until these markets are developed and standardized the Alabama Forestry Commission recommends that forest landowners and emitters be very careful in making any long term contractual commitments. While there are great opportunities for increased incomes from forestry operations, there are also substantial risks that every entity must evaluate.

DEFINITION OF CARBON AND CARBON DIOXIDE (CO2) UNITS:

Most trading platforms sell and buy units of carbon dioxide equivalent in metric tonnes (MTCO2e). An equivalent metric tonne of CO2 is abbreviated MTCO2e.

A molecule of carbon dioxide includes the weight of the gas, which is more than the weight of the carbon alone because the gas also includes two oxygen atoms. A simple multiplication factor, 3.67, can be used to convert carbon to carbon dioxide equivalent. (The multiplication factor of 3.67 is derived by comparing the molecular weight of carbon with the molecular weight of oxygen (CO2 = 12+16+16=44. C = 12.) As carbon combines with oxygen to form CO2 the total molecular weight increases at a consistent ratio of 44/12 or 3.67)

FOREST MANAGEMENT ACTIVITIES:

Forestry management activities, such as reforestation or harvesting, can be significant sources or sinks for carbon. Site preparation burning, fertilizing, thinning, salvage cuts, hardwood control, livestock grazing, and many other management activities influence carbon storage in a forest stand, and are also important for the health and vitality of a growing forest. Forest landowners must consider the ability to continue these management activities before entering long-term contracts (i.e. greater than 15 years in length) to sequester carbon. A result of entering into a contract agreement which limits these management activities could result in forest stagnation, creating significant forest health issues (such as increased risks of southern pine beetle infestations or destructive wildfires). Additionally, stagnate forests create closed canopies which limit use by wildlife.

Next 

Additional Resources:

- How much carbon have your trees stored?
- Carbon Sequestration Publications
- Carbon Sequestration Website
- Carbon Sequestration FAQs

The Alabama Forestry Commission is currently updating information on the Carbon Sequestration Webpage as new developments occur. Please periodically check this website for new updates.

For more information contact:
Alabama Forestry Commission