By Christine Yankel, The Climate Trust
As published by GreenBiz and Sustainable Business Oregon – July 23, 2014

Portland’s nickname “Stumptown” reflects the central but conflicted role of trees in Oregon’s physical, cultural, and economic landscape. Forests cover nearly half of Oregon’s 62 million acres, and while wood product markets have faced challenges in recent years, the forest sector employs more than 76,000 people in Oregon and accounts for nearly 7% of Oregon’s economic base. In some rural counties, the forest sector accounts for up to 30% of the local economy.

Forest ecosystem services—clean water, habitat for fisheries, recreational use, and carbon sequestration—also provide important, but sometimes hard to value sustenance to economies and society. Carbon markets, and especially the success of improved forest management projects in California’s cap-and-trade system, provide a path for sustainable forest management that bridges what is sometimes portrayed as conflict between timber harvest and conservation, supporting both economic and ecosystem goals.

In June, California Air Resources Board (ARB) issued 2.43 million offsets to two new improved forest management projects (2.16 million offsets to Blue Source and Heartwood Forestland Fund’s Bishop Improved Forest Management Project; 270,000 offsets to the Miller Forest Improved Forest Management Project), and forestry projects officially became the largest source of offsets for California’s Cap-and-Trade program, surpassing offsets produced by Ozone Depleting Substances (ODS) projects. Though only eight forestry projects have been issued ARB offset credits—compared to 34 ODS projects and 15 Livestock projects—the 5,890,103 offsets issued in total to these forestry projects now make up over 52% of the 11.2 million offsets issued to date by the system.

Notably, improved forest management projects can include sustainable timber harvest, so that forest owners can benefit from multiple revenue streams, and forest systems can benefit from management that develops strong, resilient forests. Some of these projects incorporate working conservation easements that protect working forests, preserving these lands with the aim of sustaining timber and other forest products in perpetuity together with forest conservation values. With more projects working their way through the carbon market process, it is encouraging to see forestry rewarded through this market-based mechanism for the climate benefits of improved management of these vital resources.

Markets are working, but challenges remain for making carbon markets work to support forest owners and businesses in Oregon and beyond. In Oregon, 60% of forest land is owned by the federal government and so is ineligible for participation in the California cap-and-trade offset market. Projects on other public lands can also be a challenge under California compliance market standards. Voluntary markets provide more diverse approaches for forest owners, but a recent report by Ecosystem Marketplace showed that average offset prices in voluntary markets dropped slightly in 2013. EPA’s Clean Power Plan, while admirable, does not provide a clear path for support of forest carbon offset projects at national scale. Given the tremendous range of products and services we enjoy from healthy, functional forest systems, ensuring that these benefits to climate, water, and life are supported means available benefits for us all.

If we want to support counties, cities, and businesses in Oregon that aim for healthy forests instead of Stumptowns, we need to foster innovations in carbon and other markets that help forests and businesses grow together.