Conservation finance: It's time to revisit carbon markets

"First you measure the diameter and height of the tree and, depending on the species and wood density, then apply an equation to convert the field measurements into a biomass figure. You can then begin to quantify how much carbon it has sequestered, is storing and how much it will sequester in the future.” 

Alessandro Baccini, research professor at Boston University and senior scientist at Woods Hole Research Centre, is perhaps the world’s leading expert on measuring forest carbon. Between 2008 and 2012, Baccini and his team visited 17 countries, going into the field to collect measurements that would allow them to calculate biomass density. Combining the measurements with satellite observations, he and his team were able to generate maps of biomass. 

“We now have data that allows us to estimate the above-ground biomass stored in woody vegetation anywhere there is a satellite observation,” he says. 

Thanks to the work of Baccini and his team, you can now use a computer to tell you how much carbon the trees are sequestering in a forest on the other side of the world.

As carbon emissions trend upwards, despite conventions, international commitments and increases in renewable energy, it is clear that the focus on reducing emissions needs to be coupled with a focus on increasing carbon capture. Last year an estimated 50 billion tonnes of greenhouse gases (GHGs) were emitted into the atmosphere, 37 billion tonnes of which were CO2 – 3% more than in 2017. 

In order to limit global warming to no higher than 1.5 degrees in the next 10 years, scientists estimate that 10 billion tonnes of carbon need to be removed annually in the short term. But negative emissions technologies that remove CO2 or other gases from the atmosphere are nowhere near developed enough to meet that target. 

Fortunately, says Baccini: “We already have the best technology that can remove carbon at scale in a cost effective way, and it’s thousands of years old with a very long and positive track record: the tree.” 

Indeed, a study headed by scientist Bronson Griscom in 2017 estimated reforestation, avoided forest conversion and the management of trees and forests could remove as much as seven billion tonnes of CO2 and GHG equivalents a year. Other natural climate solutions such as regenerative agriculture practices, grazing, agroforestry and coastal, wetland and peat restoration could raise that to 11 billion tonnes a year, tapering down after 2050. Until then, nature is our likeliest hero in the bid to store carbon. 

“It’s fair to say nature has a branding problem,” says Griscom. “We think it’s fragile and we think man-made technology is stronger, more interesting. But nature is incredibly resilient and incredibly capable.”

What is particularly special about natural climate solutions, like forests, is that they have far more wide-reaching benefits for the environment than carbon capture alone. Nearly all of the natural climate tools at our disposal improve air quality, water quality, soil quality and – the jewel in their crown – they increase biodiversity. Natural climate solutions are essentially a win-win.

So the question becomes: what is the fastest way to increase the use of natural climate solutions? The answer could well be developing the carbon offsets markets. 

In northern California adjacent to the Redwoods National Forest, 15,000 acres has been proposed to be set aside to develop a fish and wildlife sanctuary, transitioning the forest to one imbued with old-growth characteristics: canopy openings, intact soils, large diameter and older trees, down wood and a healthy fungal ecosystem. 

Research, such as that from the University of Vermont in July, has uncovered the complex and deep relationships of forests. We now know that old-growth forests are more stable environments, being more resilient to projected increases in temperature and precipitation. They also provide a safe haven for endangered species. 

Since 1945, however, it’s estimated that old-growth forest in California, Oregon and Washington State has declined by two thirds, to just 18% of total forest area, which has also declined by some three million acres. With their decline have come a fall in the numbers of key species: the northern spotted owl, the northern flying squirrel, the red tree vole, along with the warner, the shortnose, two different types of trout and many plants. 

The 50-year restoration project at Redwoods is being undertaken by the Yurok Tribe, California’s largest native American group, which, through the support of grants and the sale of carbon offsets, has been able to buy back 55,000 acres of land that once belonged to them. Some 44,714 acres of that current total (including part of the 15,000 being restored) are now registered as forest carbon projects for the California Air Resources Board’s Emissions Trading System, the world’s second largest carbon trading market. 

It’s a positive story that those in the carbon-offsets and emissions-trading sector welcome. 

“It’s been really difficult to convince people of the positive results of carbon offsets. And the backlash has been overwhelming sometimes,” says Rajinder Sahota, chief of the California Cap-and-Trade Program at the California Air Resources Board (Carb), with a note of exhaustion in her voice. 

In 2012 and 2013 the Carb was sued over its offsets. 

“We won that case,” Sahota says. “And we won the appeal and the Supreme Court kicked it out. But that still doesn’t assuage the critics.”

Carbon markets, and offsets in particular, have had a troubled history since they were established by the Kyoto Protocol that came into effect in 2005. 

Like the Paris Agreement that proceeded it, countries signed up to commitments and it was the first time in history industrialized countries accepted legally binding targets for emissions of a range of GHGs. Article 17 of the Protocol envisaged so-called ‘international emissions trading’ with ‘assigned amount units (AAUs)’ as the currency, but cracks in the design quickly appeared. The US under president George W Bush pulled out and AAUs never took off, but other units prevailed – the most common being Certified Emission Reductions (CERs)

Developed nations that were larger emitters could meet emissions reduction targets by funding projects, such as wind farms or solar panels in developing countries, through the so-called Clean Development Mechanism (CDM). It awarded such projects carbon credits, which could be traded on the international carbon markets – and offsets were born.

Given the US’s absence, the EU ended up leading the way in creating the first and largest emissions trading system, which accepted CERs and emission reduction units so that its members could meet their allowance targets. But the high hopes of Kyoto continued to fade. 

“There was growing disappointment around the rules being set for the emissions units and their oversight,” says Peter Zapfel at the directorate-general for climate action at the European Commission. 

For example, projects were supposed to qualify for credits only if they could prove they would not have occurred without the credits. But stories of fraud were frequent, like that of a Chinese hydroelectric dam that received credits despite having been planned before the Kyoto Protocol. 

Some credits, it was discovered, were being sold twice – once on the compliance market and then as voluntary offsets. In some instances, developers sought to pollute simply to then reduce pollution, qualify for credits and make money from the cost differential, as happened in the refrigerant industry with its industrial gas credits. 

Indeed, the Stockholm Environment Institute in 2015 found that the credits may have increased emissions by as much as 600 million tonnes of carbon dioxide – with Russia and the Ukraine the biggest offenders in the ‘polluting to make a profit’ loophole. 

The massive issuance of dubious credits also contributed to the collapse of carbon credit prices, which discouraged genuine offset projects. 

Zapfel says there were many discussions at UN level around tightening the rules, but several developing countries (being suppliers of credits and therefore benefiting from looser rules) pushed back. In a case of bad timing for compliance market offsets, the global financial crisis also hit. 

“We were facing a severe economic crisis and an internal euro crisis, and the price of carbon dropped substantially,” says Zapfel. “The intention of allowing carbon offsets to lower compliance costs for regulated companies in order to meet their emissions targets was now redundant. 

“In fact, to allow carbon offsets would have deterred them from reducing their emissions,” he says – the so-called ‘get of jail free card’ that many critics of offsets highlight. The EU stopped allowing offsets altogether.

Alongside the compliance market, a voluntary carbon offset market sprang up. Corporations in industries that did not need to buy allowances decided to reduce their own emissions voluntarily and offset those they could not by seeking projects that would be a match. 

This was another laudable idea, but again stories of credits being sold twice and exaggerated claims about carbon sequestration grabbed headlines. Worse still, there were high-profile cases of fraud and mismanagement. In a short time, the voluntary offset market became as controversial as the compliance market. 

“I’ll never forget the headline in the Financial Times that talked about ‘Carbon cowboys’,” says David Antonioli, chief executive of Verra, a non-profit organization that manages the Verified Carbon Standard (VCS), the world’s largest voluntary GHG offset programme. 

The Wild West image has been hard to shake. When Baccini was conducting his research on carbon sequestration, he says locals would ask him and his team if they were the carbon cowboys they had heard so much about.

But it’s time for those stories to be put on a shelf, because the carbon offsets market has dramatically cleaned up its act. 

Outside California's state building, small groups of environmentalists are regular protesters, chanting “No cap-and-trade”.

One of their gripes is that offsets allow companies to carry on emitting, a second being that offset programmes are still fraught with double counting, a lack of additionality, and questionable carbon accounting. 

It’s worth noting that carbon offsets are a small portion of overall allowances – limited to 8% of California’s capped emissions. That limit drops to 4% after 2020, returning to 6% in 2026.

The evidence to support the claims of protesters doesn’t quite stack up – at least not enough to abolish a programme that is succeeding in reducing emissions. In the last 10 years, California has reduced its GHG emissions by more than 60 million metric tonnes of CO2 equivalent, says Antonioli. 

“The notion that companies are offsetting instead of reducing emissions is false. In fact, typically what we see is that companies that are interested in offsets have already made substantial efforts to reduce their carbon footprint. Beyond that, they now know how to look for – and find – high-quality offsets that are effectively reducing emissions.”

What the protesters seem to be concerned about is not offset programmes, or even cap-and-trade, but simply the lack of pressure being put on fossil fuel companies across the state. But even here it’s hard to argue that California isn’t trying. 

In 2017, zero-GHG sources surpassed fossil fuel sources for electricity generation for the first time since California started tracking its GHGs in 2000. California was also the first state in the US to set auto emissions standards to try and reduce GHGs – a programme that president Donald Trump is now trying to roll back. 

“I understand the urgency of reducing emissions to zero,” says Sahota, “but we can’t get to that perfect solution right now. What we do have here [with the cap-and-trade] is a politically and economically viable solution.”

Critics’ concerns over the standards of offset projects may be understandable, but they are also not entirely justified. The process of selecting projects goes through independent specialist verifiers before review by Carb. 

Verra’s VCS, the American Carbon Registry or Climate Action Reserve must also demonstrate no conflict of interest before they help review project information for Carb to consider schemes as offset programmes. Furthermore, projects have to be domestic and are therefore visible. 

“California and other US states pursued a very different model to that which was introduced under the Kyoto Protocol,” says Zapfel. “They’ve taken the lessons learned, and it’s much more selective. Under the CDM all types of offsets were allowed, but California has strict categories and benchmarks.” 

Offsets do not include clean energy, for example, but forestry, livestock, rice cultivation, coal mine methane and ozone-depleting substances projects – they are more geared towards natural climate solutions. 

While the CDM may not hold offset projects to as high a standard as some would like (it ends this year), the new gatekeeper of the offset world does.

The International Carbon Reduction and Offset Alliance (Icroa) was set up in 2008 and promotes best practice in the voluntary carbon market. It has a code that several actors in the carbon offsets market have signed up to. There are also more standards and verification and registry bodies now.

Beyond Verra’s VCS, the American Carbon Registry and Climate Action Reserve there is the Gold Standard, the Plan Vivo Standard, as well as several domestic verifiers and standards, such as the UK’s Woodland Carbon Code. 

The VCS has the largest global market share of offset programmes registered with it and straddles the voluntary and compliance markets.

Antonioli says there were lessons that needed to be learned in what was an entirely new market. Verra has strengthened its standards over time and regularly revisits its requirements. That means taking feedback from critics too. 

“Several years’ back,” he says, “one organization approached us and asked us to stop allowing refrigerant destruction projects because the generation of offsets from such projects was undermining efforts to regulate emissions of refrigerants with a high global warming potential. We agreed and removed them.” 

He gives another, more recent example: “Renewable energy facilities were once included within the carbon offsets projects for Verra, but we decided to exclude these in developed countries and some developing countries because the costs of producing renewable energy have fallen and we don’t deem them appropriate for carbon finance anymore.”

There is still fraud, Antonioli admits. 

“Only the other day, I saw a project in Honduras that claimed to be verified by us – and I know it wasn’t. It’s on my radar. These things will happen as they do in any market, but what is reassuring about the offset market today is the level of oversight, commitment and transparency of projects, and of verification standards. That transparency is only going to increase.” 

In the case of Verra’s VCS, all projects can be searched for in its online database, with details of the projects’ aims and as well as their monitoring reports. And satellite imagery technology, underpinned by years of research by the likes of Baccini, means that verifiers and buyers of credits will be able to know in real time how their projects are progressing in terms of sequestration. 

“It’s not a perfect solution,” says Baccini. “Carbon sequestration accounting is incredibly complex and rates can vary year to year, but we don’t want to wait 20 years to have all the information to do this properly. 

“We can always do it better, but right now we can measure carbon sequestration with a rate of uncertainty that is fine for markets – plus or minus 10% to 20% – and the good thing is we can quantify that level of uncertainty in our estimates.”

The reassurance that carbon offset programmes are legitimate is a message that must reach a wider audience because, other than project finance for permanence, offset programmes that include forests, farming conversions and peat, coastal and wetlands restoration are probably the sole tool for reducing emissions while simultaneously improving conservation at scale. In the case of the Yurok Tribe, the co-benefits of the carbon-offset programme through reforestation and afforestation are manifold. 

The Yurok Tribe study the forest wildlife

Edward Mann, Yurok Tribe member and director of the forestry programme, says: “Through our land management, we hope to see the forest regenerate, the land become more resilient, with fewer catastrophic disturbances and the water quality improve as sediment run-off is reduced. Species like the California condor and the Humboldt marten, northern spotted owl, marbled murrelet will hopefully return and thrive, and the rivers will support greater numbers of Chinook salmon and coho salmon, steelhead and green sturgeon”.

There are carbon offset projects that are helping support orangutans in Indonesia and wildlife populations in Africa, points out Antonioli. And farming conversion offset projects are boosting insect and pollinator populations. 

Moreover, carbon offsets can also be a means to tackle more of the UN’s Sustainable Development Goals than those that deal with nature and climate. 

The solutions suggested by Griscom’s research sequester carbon, improve biodiversity, soil, air and water quality, and have the ability to provide social benefits. The Yurok Tribe’s project offers a good example – it has, without doubt, brought about social justice. 

“We lost our ancestral land base, and now that is changing,” says Tim Hayden, the Yurok Tribe’s natural resource division director. “It’s hard to convey how meaningful that is.” 

Without carbon offsets, the only way the Yurok would have afforded to buy the land would have been to pay a loan back by logging the entire forest. 

The project has had cultural benefits for the Yurok in addition to the work opportunities – seven new positions in forestry are supported by the carbon offsets. They now own and manage the land and its resources according to their traditions. 

Mann says that on the reclaimed land, hundreds of miles of commercial roads for timber will be decommissioned. There will be no clear-cutting or large-scale commercial forestry taking place, and prairies and other sensitive habitats will be restored. 

The landscape will also be opened up and kept resilient by using prescribed burning – a traditional means of managing forests that tribal peoples have been engaged in for hundreds of years to lower the intensity of fires. It means that when fires happen, older growth trees can better withstand them. 

“You can still see the burn scars on the trunks of old growth redwoods that survived fires from decades ago,” says Mann. 

It is a long-term project – one, Mann says he won’t live to see come to full fruition: “But this is how we must think about sustainability.”

There are offset forest projects in northeastern Australia run by aboriginal communities and peatland restoration projects run by indigenous groups in Finland. Indeed, carbon offset projects can not only empower communities but they can also increase gender equality as many of the farms and forest offset projects in developing countries tend to be run by women. 

So what needs to be done to increase the use of offsets?

Voluntary offset programmes have seen a marked increase since the Paris Agreement was signed in 2016. According to data from Forest Trends, both issuance and retirement of carbon offsets projects by CO2 emissions and GHG equivalents reached a record high in 2017 (the last year data was released). 

The good news is that natural climate solutions are becoming the preferred choice. Energy efficiency and fuel switching, and renewable energy are by far the largest projects in the voluntary carbon markets, accounting for more than half of the 2,008 projects that have issued offsets since the Kyoto Protocol took effect. 

But according to a report from Forest Trends, in the first quarter of 2018, forestry and land use projects dwarfed those in renewable energy and energy efficiency (again the latest data available).

The report suggests that compliance markets not only start to include offsets (only a handful do, such as California, Quebec, New Zealand and South Africa), but that they also consider transitioning voluntary offset programmes into both domestic and international decentralized compliance markets. 

Such moves will put even more emphasis on the issue of pricing. The voluntary offset market has the flexibility to allow for higher pricing of credits from projects that have more or a broader impact, such as enhancing old-growth forests rather than planting monoculture forests, or for projects like that of the Yurok Tribe that have social benefits. 

Project developers say the inflexibility of the system can be one of their biggest hurdles: that prices of their offsets are being dragged down because of cheaper, less impactful projects. 

Jeff Swartz is the director of climate policy and carbon markets at South Pole, which helps climate protection projects come to fruition. 

“You can’t really compare the impact of a wind-farm credit to a credit that supports forests and creates livelihoods,” he says. “What this means is that we need to be able to put a price or value on those co-benefits in some way.” 

Swartz points to a study by Icroa and Imperial College of London from 2013. When voluntary carbon offset buyers were asked what factors drive their preferences for certain offset types, relevance to business and co-benefits were the two most cited factors. 

However, 82% of respondents said they would like to see more quantification and valuation of co-benefits. 

“Significantly,” the report noted, “buyers also indicated a willingness to pay up to 33% more per tonne of CO2 for projects with verified social, economic and environmental co-benefits.” 

Another crucial element for the scaling up of offsets is that the cost of carbon credit verification is currently too high. Take the case of the Worldview International Foundation (WIF) that has been planting millions of mangrove trees in Myanmar. 

Two academics from the Lee Kong Chian School of Business at Singapore Management University – Ryan Merrill and Simon Schillebeeckx – spent time on the ground documenting the struggle of WIF’s founder to raise funds to plant the mangroves, which make communities resilient to weather events. 

One route of funding was to become verified for carbon credits, yet two cost estimates for the verification process in 2016 from the Gold Standard in Switzerland and the American Carbon Registry came in at around $400,000. WIF would have needed to plant over 500 hectares with 2.5 million mangroves to recover the registration costs alone, leaving nothing for employment, planting or livelihoods, says the case study. 

Other verifiers charged less but required the employment of an independent project consultant. According to Merrill and Schillebeeckx, one consultant approached by WIF required $18,000 for helping secure funds, due diligence and a site visit, $60,000 plus expenses for developing the project note and project document, $5,000 for travel, $35,000 to pay the independent certifier, and a $60,000 bonus from the first carbon credit sales. Thereafter, the consultant would assume brokerage of the Worldview credits in exchange for 35% of all carbon credit sale revenue. 

The result of the costs, says Merrill, is that small players with small parcels of land or that are working in a local language have “zero chance to get through the gatekeepers” in order to become registered as carbon offset projects. “The sellers are the weakest group in the whole chain, and that needs rethinking as they are the ones making the impact.” 

“The verification system has good intentions, but those kinds of sums are hard to swallow,” adds Schillebeeckx. “It means between 40% to 80% of money paid by a corporation that wants to fund an offset project does not go to reforestation but to intermediaries, verifiers, resellers and other actors in the space, which dramatically reduces the impact the money could have. These actors add value, but it means if you are spending $10 per tonne of CO2 sequestered, probably only about $2 to $6 goes to those planting trees. That’s only going to deter corporations from using offsets. If you want to scale the impact, we need to find ways to reduce the cost.”

It’s been an issue that South Pole has been trying to solve. 

“It’s a minority of cases that generate carbon credits on a large scale,” says Swartz. “We work with small landowners to be a carbon partner. We can group communities together like a land trust and then make assessments for collective credits.”

He is bullish about the future of voluntary carbon offsets as more companies choose to create their own emissions targets and as it seems likely they will be adopted in compliance markets. 

Carbon taxes or carbon pricing will be the driver, and it’s clearly coming. The US government is under pressure from both Democrats and Republicans to introduce a tax. Canada, South Africa, Colombia, Chile, Argentina, the EU, Mexico, Australia and New Zealand, as well as several regions in China, are among those that already have a tax or price on carbon. 

Some of those countries have included offsets, while others are considering the idea as we exchange the Kyoto Protocol for the Paris Accord. In addition, industries are creating their own cap-and-trade systems. 

The International Civil Aviation Organization is planning to launch the first-ever sector-wide cap-and-trade programme, Corsia. Given the challenge of reducing aviation emissions, it could rely heavily on carbon offset programmes, says Forest Trends. 

“We’re not going to offset our way into solving the climate change crisis,” says Antonioli. “We need strong climate change regulations that put a price on a carbon, such as cap-and-trade programmes or a carbon tax.” 

It’s true that offsets are not a silver bullet. Bill Moomaw is a world-renowned scientist lauded for his work on climate change, carbon sequestration and biodiversity loss. He was involved in the world’s first carbon-offset programme for the building of a new, cleaner power plant in Connecticut. 

“The question was: how many trees could the business plant to offset that power plant?” says Moomaw. 

After deliberation, the project chosen was a 30-year reforestation programme with CARE Guatemala. 

“ But those were the days when our aims were to be carbon neutral,” he says. “They have long gone. Now we need to be carbon negative. We have to emit less than nature can take out. 

“So our efforts must be twofold: we need to sequester more carbon at the same time as we reduce emissions. And protecting intact forests populated with large trees and allowing more forests to continue growing to their ecological potential size and complexity will sequester more additional carbon in the near term than any other option.”

Whether offsets increase or not, it seems carbon markets are back in the race. 

Prices on the EU Emissions Trading System (EU ETS) have ticked up this year – fluctuating in a band between €18 and €25 in the first quarter, and between €20 and €27 in the second. The price as of September 26 was €25.21.

As prices have shifted upwards, the financial community has shown more interest. 

“Trading was dominated by the compliance sector like utilities and heavy industry, but now we’re seeing transactions increasingly done by hedge funds and banks,” says Anders Nordeng, carbon market analyst at Refinitiv. 

He says US banks are clearly back in the game because trading starts to tick up around 2pm in Europe when the US markets open. Morgan Stanley, Goldman Sachs and JPMorgan have reportedly recommitted to carbon trading. 

“The EU ETS showed that European policymakers had the will and the capacity to tighten the system, and that has convinced non-compliance buyers to start investing,” says Nordeng. 

The EU ETS was set up with different trading periods that allowed for rule adjustments as the market developed. 

“We are in the third trading period that will run through 2020, and then we’ll enter 2021 to 2030 when we will see the ceiling of allowed emissions annually start to decrease more rapidly,” he says. 

According to first-half 2019 data from Refinitiv, the price increase in carbon is global. 

New Zealand’s carbon units reached record high prices in April and May on expectations that the country’s main ETS feature, the fixed price option or de facto price ceiling of NZ$25 ($16), might be increased. And both traded volume and the carbon value of China’s eight regional ETSs were up on the same period in 2018. 

Prices in North America (Quebec and California) also rose over the period. 

Uniquely able to breathe and survive in brackish water, filtering out salt through their leaves, and able to migrate when necessary, mangroves are one of the most resilient types of tree on Earth. So resilient, in fact, that they survived the world’s last mass extinction. 

Having weathered 80-odd million years of planetary events, when the tsunami of 2004 ripped through Sri Lanka and Indonesia, it was the mangroves that acted as a shield to coastal areas. And when cyclone Nargis ravaged Myanmar in 2008 claiming more than 138,000 lives, areas where mangroves thrived experienced a lower loss of human and aquatic life.

The mangroves have not been resilient, however, to the intense deforestation that has occurred as shorelines across the tropics and sub-tropics have been cleared to make way for shrimp farms, industry, hotels and beachfront properties. Nor have they been able to withstand the chemical run-offs of farming. From 2001 to 2012, between 35 and 97 square miles of mangrove forest were lost each year – a higher rate of loss than that experienced by tropical rainforests. 

Yet mangroves are incredibly effective at sequestering carbon. One mangrove tree can capture a full tonne of carbon in only 20 years. Indeed, weight for weight, some studies indicate mangroves can sequester four times more carbon than rainforests. 

In Myanmar, the NGO Worldview International Foundation (WIF) has been planting mangrove trees for seven years – it has now planted almost six million of them. By 2023 it hopes to have planted 300 million, capturing and storing over 150 million tonnes of CO₂.

Now two academic entrepreneurs from Singapore Management University who are involved in WIF’s mangrove project have set up the Global Mangrove Trust (GMT) as a means of getting international payments to WIF for tree planting and to sell offsets. They are hoping to use blockchain and bitcoins to do it, working with a bank and Zilliqa in Singapore to develop the technology. 

In return for making a digital payment, a buyer will receive a digital coin that marks a stake in the forest. 

“It allows projects to say: ‘We want to plant 200,000 trees. Our planting and caring costs are $3 per tree for 25 years, and we want to sell ‘Gro’ coins to fund our project,’” says GMT co-founder Simon Schillebeeckx. 

GMT’s plan is to automate the carbon-offset verification process using satellite imagery and machine learning.

When Euromoney pulls into the Dundreggan Conservation Estate, where Trees for Life’s main operations are based, in the Highlands of Scotland just a few miles from Loch Ness, a red-faced middle-aged man in shorts, T-shirt and backpack is sitting at the entrance waving. 

“I’ve just walked 144 miles to be here from Glasgow,” he says, adding he is on “a sort of pilgrimage.” He has heard about the mission to plant millions of trees and wanted to help out for a few days. Such is the reputation of Trees for Life. 

The 25-year-old non-profit has now planted over 1.6 million trees across the north of Scotland, mainly thanks to volunteers, who travel from all over the world to see the ancient woodland of Glen Affric and the Highlands and to make their own contribution. 

TfL’s founder, Alan Watson Featherstone, came from the spiritual community of Findhorn an hour’s drive north in Moray, and TfL was built largely by spiritual seekers, backpackers and bohemians. In the last four years it has sought to establish corporate partnerships and commercial ventures in a bid to become self-sustaining. 

“About five years ago it became clear that volunteers alone were not going to get us to this aim of restoring the Caledonian forest on a large scale,” says Alan McDonnell, a Belfast-raised ecologist who has worked in conservation in various government settings and is now a conservation manager for TfL. 

Alan McDonnell, conservation manager for TfL

Along with McDonnell, a new chief executive was put in place, as well as a corporate responsibility head. 

A Tesla pulls up into Dundreggan’s driveway with Edinburgh plates – it’s bankers on a corporate retreat. While here, they will plant trees, help out in the tree nurseries and learn why the ancient woodlands are important. Such visits are educational and offer a financial boost for TfL – Dundreggan is running at a loss of £50,000 a year. 

But one arm of TfL is financially sound, and it is a sign that carbon offsets can help forward-thinking conservation charities continue their missions. TfL has an arms-length consultancy business that advises landowners in Scotland who want to restore land to native forests – assisted by the ability to sell carbon credits. One year in and that part of the charity is already close to breaking even.

It can charge more than some of its local competitors by using its own experience certifying TfL’s projects through the Woodland Carbon Code. 

“We are sincere in our aim to rewild the Scottish Highlands,” adds McDonnell, “so we know that our forest creation is delivering important action for biodiversity as well as carbon sequestration.” 

It’s a win all round. Carbon credits rewild Scotland’s landscapes quickly by providing landowners with a source of revenue from trees, while TfL can show investors that it is a business-savvy charity. 

That will help it as it seeks to raise £3 million for a rewilding centre on Dundreggan.