Summer 2007 ACF Newsletter - Association of Consulting Foresters ...

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ACF NEWSLETTER
Focus is on Renewable Energy and Carbon Protocols
Doug Williams, ACF Legislative Consultant
Forest industry stakeholders, including ACF, have joined together in a new coalition to promote energy production
from woody biomass. The coalition was successful in broadening the definitions of renewable energy to include
woody biomass and cellulosic ethanol in the CLEAN Energy Act of 2007.
The U.S. House of Representatives passed their proposed 2007 Farm Bill on July 27. ACF worked with a broad
coalition of partners on three titles within the bill – Conservation, Forestry, and Energy. Provisions of interest include:
expanding the Secretary of Agriculture’s advisory Forest Resources Coordinating Committee to include a
seat for a private forestry consultant; establishing national priorities for the Forest Service State and Private Forestry
program to conserve and manage working forest landscapes; providing 5% of cooperative forestry assistance
directly to providers and not through State Foresters; broadening agricultural energy initiatives to include
woody biomass from all sources and placing cellulosic ethanol on equal footing with other forms of renewable energy;
and creating new markets through establishment of an Environmental Services Standards Board and other
measures to facilitate emerging markets such as carbon sequestration.
In discussions with the Chairmen of both the House and Senate Agricultural Committees last week, they advised
constituents not to be too concerned if the Farm Bill is not completed by September 30 when some programs are
due to expire. Senator Harkin and Congressman Peterson said temporary measures can be provided where
needed, but what is more important is for proper policy to be developed. Indications are that a completed farm bill
may still be six months away. ACF is reviewing early draft language for the Senate’s Farm Bill.
ACF is part of a small group of forestry advocates meeting to discuss carbon protocols being developed that will
dictate the rules for participation. California and Georgia are developing protocols that represent two completely
different approaches – California with over 350 pages of overly-complex and cost-prohibitive requirements, and
Georgia with only 19-pages of ‘understandable and practical’ guidelines. With the potential release of draft protocols
in August for a 34 multi-state registry, the group is working together to explore how we might collectively engage
or influence the process to insure the thoughtful and economic inclusion of forests.
Marketing Forest Carbon Credits
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will often run somewhat higher, particularly after the first few years. New rules for counting harvested wood products
should be available soon, and these will make forest management projects much more attractive. In many
cases, these may add another 0.5 to 1 ton CO2 per acre per year to the calculation.
Market prices on the exchange have been ranging between $3 and $4 per ton.
Those are gross sale prices, and landowners must pay for project planning, verification
and CCX registration, as well as aggregation and marketing costs. These
can run around $2 a ton, depending on the size and extent of the project.
Clearly, at current prices, these transaction costs greatly reduce the incentive to
participate. If prices were to move into the $10-$12 range, the transaction costs
would be a smaller proportion of the total revenue. Most landowners participating
today are hoping that their experience will position them to take advantage
of better prices in the future, should those become available. There are no guarantees,
though, and little basis upon which to estimate the future in this new
and untested venture.