Land use change for carbon sequestration: assessing the influence of carbon trading

16 March 2022

Dr Richard Kipling: IBERS, Aberystwyth University.

• The potential to earn income from carbon trading is increasingly a factor of interest to land managers
• However, numerous factors can influence the potential for carbon sequestration, and accurately assessing the potential of a landscape can be challenging
• Understanding the influence of these factors is essential, as inappropriate actions can result in sub-optimal or adverse outcomes

A recent report by the Green Alliance suggests that, in the UK, carbon sequestration could have a value of up to £1.7 billion per year. The authors predict that efforts to sequester carbon are likely to focus on land considered ‘less favoured’ for farming (because the returns to farming are low) and on highly productive lowland peat (because the amount of carbon emissions and the potential to store carbon is so high). The buying of farmland for carbon sequestration is already a hot topic in Wales. Should such schemes be welcomed, as an important part of our attempts to control global warming (as well as an opportunity to make money for some) or are they potentially damaging for both the environment and rural communities?

This article focuses on just one aspect of land use change for carbon sequestration – the types of carbon cost associated with any scheme, which must be weighed against its benefits when judging its net carbon value. The wider (negative or positive) environmental or social impacts of such schemes, which may be substantial, are not considered here, nor are problems with carbon credit scheme design and governance. All of these impacts should be taken into account alongside the issues discussed. 

1. What do carbon credits need to take into account?

1.1 Carbon removal credits

The chart below gives an overview of the carbon impacts that need to be accounted for when calculating the expected net carbon value of a scheme, to give its true impact on global greenhouse gas emissions. In terms of reducing global warming, only this global impact matters. The following sub-sections discuss each of these carbon impacts in turn.

Fig 1. The carbon costs that must be taken into account when evaluating schemes for carbon removal (and the value of credits created from them), in order to give an accurate picture of their net effect on greenhouse gas emissions.

Carbon footprint of schemes: To understand the net carbon impact of a particular scheme, it needs to be considered over its whole lifetime, including the creation, use and disposal of products arising from activities such as tree planting. This section will use illustrative figures from the literature, to give an idea of the types of emissions considerations, costs and benefits associated with plantations and the use of their products. For any particular afforestation scheme, these figures will vary with tree species, growing conditions, nursery growing and harvesting methods, transportation distances and methods, how long the scheme is in place for, and the post-harvest use of the timber. However, the same aspects and issues will need to be accounted for whatever the characteristics of any given scheme. The focus here is on afforestation, but many of the same issues apply to sequestration in wetlands – and certainly, the logic of considering both the carbon benefits and costs of schemes remains the same.

Ingram et al (2019) estimated that for a Red Maple tree grown in a nursery and transported to a site for planting, the total expenditure of carbon for the lowest impact option considered would be around 20.228 kgCO²e (kilograms of greenhouse gases converted into equivalent amounts of carbon dioxide, according to their global warming effect over 100 years). However, over a 60 year lifespan the tree would sequester a total of 905.93 kgCO²e. That is, the emissions costs of production would reduce the overall emissions benefits of growing the tree by less than 2%.

This is not the end of the story though. At the end of the tree’s life, the 905.93 kgCO²e which the authors calculate would be sequestered by the tree, will return to the atmosphere as it decomposes, balancing out the emissions uptake. EC JRC (2010) recommend that, as a result, the emissions benefit from growing trees should be considered to be their value in temporarily storing carbon, estimated as 0.01 x the amount of carbon stored per year. Using Ingram et al’s (2019) estimates, their Red Maple would sequester on average 15.099 kgCO²e per year (in fact, this is likely to be a large over-estimate, as trees sequester much less carbon per annum earlier in their lifecycles, with more sequestered later – and therefore, stored for a shorter time overall). This gives a carbon value of 276.31 kgCO²e from the storage of carbon through the lifetime of the tree – much less of a benefit than suggested by the total amount of carbon sequestered while the tree is alive. At the scale of a whole scheme, one also needs to take into account that many of the trees planted will be removed as the woodland is thinned, and others will die young. On the other hand, if the woodland is naturally regenerating or is re-planted, the next generation of trees will take up carbon, balancing that lost as trees are cut, burnt or die in other ways – until such time as the trees are removed from the site. These issues show that the longevity of the forest – the permanence of the scheme (Elliott et al 2022) – is vital to its carbon value, given that individual trees will eventually return their carbon to the atmosphere.

If trees are burned for biomass energy production, this may be assumed to replace fossil fuel-based energy production, and the benefit of this reduction in fossil fuel use could be counted as a positive impact of the plantation. In this case, it would be important to ensure that the carbon value included in the carbon credits from the woodland was not double counted via its effects on emissions from the energy sector – which would increase the risk of negative overall consequences for global emissions. Calculations of impacts on fossil fuel energy use would also have to take into account wider ripple-out effects, such as the potential for widespread carbon sequestration schemes to alter energy prices and, as a result, overall energy consumption, affecting the net carbon benefits expected.

Another option is that the wood from the tree is harvested and used in products. Kutnar and Hill (2014) listed estimated emissions associated with 14 wood products, finding a range of values from a low of 57 kgCO²e for sawn, air-dried hardwood and a high of 643 kgCO²e for outdoor use ply-board. However, the product, while in use, would still have the carbon storage benefits of the live tree (without further accumulation). Using the ILCD method described above (EC JRC 2010) over a 50 year lifespan, for the sawn timber this would represent an additional 452.97 kgCO²e sequestered, and an overall emissions saving from tree planting to end of life of 652.05 kgCO²e. For the ply-board, the net saving would be just 66.0537 kgCO²e.

Summarising, the net emissions savings from any plantation may be substantially lower than indicated by the estimated amount of carbon stored over the lifetime of a tree, depending on specific context and scheme longevity.

Carbon storage potential of a more effective scheme: Recent research by Hou et al (2020) has suggested that, correcting for factors such as precipitation, initial soil organic carbon stock, temperature, stand age, and previous land use, deciduous broadleaf (0.42 Mg ha−1 yr−1), evergreen conifer (0.48 Mg ha−1 yr−1) and evergreen broadleaf woodlands (0.73 Mg ha−1 yr−1) will sequester different levels of organic carbon in the soil. The differences related to the nature, pattern of accumulation, amount and decomposition of leaf litter and roots, but were limited to younger stands of trees with an average age of less than 20 years, and did not take into account other factors such as soil pH and clay content. In relation to above ground carbon storage, Förster et al (2020) found that native beech forests in Germany sequestered twice the carbon of Scots Pine plantations, and had 25% higher primary productivity. The differences between the carbon sequestration rates of different tree species found in these studies requires further investigation, but demonstrate that what trees are planted and where is vital in relation to how much carbon they will sequester. Benton et al (2022) note that, as conifer plantations are viewed as more profitable in the UK, private investors are likely to maximise the area of this type of woodland. However, if such trees are planted in conditions where other tree species and/or management regimes (including, vitally, the age at which harvesting will take place) would be likely to sequester more carbon, this carbon opportunity cost should be taken away from the calculation of the carbon benefits of the scheme. Given the scale of potential differences in carbon sequestration found by the studies above, this could have a huge impact on the net carbon benefits of any scheme.

Carbon footprint of previous activity now taking place elsewhere: Land earmarked for carbon sequestration through afforestation is likely to have been farmland previously. On the face of it, a carbon benefit is likely from stopping that activity. However, assuming no change in the market for the crops or livestock produced, ceasing production in one place will lead to its increase in another. The shift may lead to production in more emissions efficient ways elsewhere but, it may also lead to less efficient production elsewhere, and ultimately in either case the loss of pristine natural habitats to provide the additional agricultural land required at the global level.  As such, it is reasonable to assume that the reduction in emissions from ceasing farming on the land to be planted (or restored to peatbog or fen), will be nullified by the emissions caused by that activity subsequently taking place elsewhere.

As national greenhouse gas inventories do not take into account the carbon leakage described above, there is a policy incentive for national governments to ignore it. To do so is to risk real net increases in global greenhouse gas emissions, as schemes produce carbon credits which are used to off-set emissions, while not actually leading to any more carbon being stored globally. Note that this carbon leakage is in addition to the carbon leakage which might arise if governments count credits produced in their own jurisdiction towards their own climate targets, in addition to the same credits being used to off-set emissions in other countries (Benton et al 2022) – if both these issues arise, there may be ‘double carbon leakage’.

In reality, the impacts of displacing farming to accommodate a carbon sequestration scheme could have many other ripple out impacts, some carbon positive, some carbon negative – the timber produced on the land could reduce demand for timber elsewhere, for example. Untangling these different impacts is extremely complex, requiring in-depth consequential life cycle assessment approaches, which cannot themselves provide certainty (Ekvall, 2012).   

Carbon storage under previous use: Carbon sequestration in the soil on farmed land is not zero. It is lower under arable land than permanent grassland. Estimates vary with location (in particular, soil type, environmental conditions and management) but, for the UK Prout et al (2020) found mean soil organic carbon content (g kg^-1) of 25 for arable (based on 1661 studies), 42 for permanent grassland (based on 1277 studies) and 40 for woodlands (based on 269 studies). They also highlighted a relationship between soil type and soil organic carbon, with higher clay content increasing the potential to hold carbon – in terms of clay content (g kg^-1) the mean figures for arable (262) grassland (281) and woodland (251), may in part explain why the mean soil organic carbon figures were actually higher for grassland than woodland. However, these data show that soil organic carbon levels may not be dramatically higher under woodland than permanent grassland. Rees et al (2018) identified research suggesting that a conversion from arable to deciduous woodland could increase soil carbon concentration by around 400%, versus 23% under conversion from grassland to woodland.

Although marginal agricultural grassland used for livestock production might be more economically attractive for carbon sequestration than arable (due to the lower market value of farmed products) (Benton et al 2022), such land may also have the smallest net benefit in terms of additional carbon sequestered.

The take home messages are that i) the level of carbon storage when the land was farmed needs to be deducted from expected levels when the land is afforested, to give the net benefit of afforestation and, ii) this net benefit is likely to be much lower (and may in some cases even represent a net loss of soil carbon) when permanent grassland is converted to woodland, than when arable land is. 

Carbon footprint of wild herbivores: A final factor, is that wild ruminants populate the forest habitat of the UK, and it is reasonable to assume that species such as deer would return to re-forested land. Let’s assume the return of deer (0.4 livestock units) at a conservation grazing level of 0.03-0.15 livestock units per hectare per year (following SAC (2007) stocking guidelines for conservation management of woodlands). Based on estimated emissions per adult deer of 10.4kgCH⁴ per head per year, a 100 hectare site could be responsible for annual emissions of 2184 – 10920 kgCO²e in enteric methane – not accounting for emissions from manure. For context, a study by Edwards-Jones et al (2008) of the carbon footprints of two Welsh sheep farms, found emissions of 5,278 kgCO²e per hectare per year from one, and 4,216 kgCO²e per hectare per year from the other – although these figures take into account all farm emissions, not only methane emissions from the animals. To give a broader idea of the likely ‘natural’ level of methane emissions from wild ruminants versus current methane emissions from farming, Manzano and White (2019) estimated that in the USA, the natural population of elk, deer and bison (before their depletion by humans), could have produced around 86% of the level of methane currently emitted by all farmed livestock in the country.

In summary, new plantations are highly unlikely to have zero methane emissions, and the emissions they produce (and/or the carbon costs of removing wild herbivores) should be deducted from the predicted carbon value of the project. As Benton et al (2022) highlight, other greenhouse gas emissions (for example, relating to adding fertiliser to the land to promote tree growth) should also be taken into account.

1. Carbon emissions reduction credits

Green Alliance (Benton et al 2022) highlight that carbon credits produced by changes in practice (for example, using less artificial fertiliser) cannot be simply valued in terms of the level of reduction they represent, as regulations are likely to force such reductions over time in any case. As a result, such changes can only be valued in terms of the increased pace of change driven by the funding provided by selling carbon credits. Clearly, it would be hard to know with certainty what a ‘no carbon credits’ rate of change would be, as in their absence the re-focussing of governments on other policies could well drive change faster. Consequently, the positive impact of such schemes versus emissions reductions without them – the concept of additionality (Elliott et al 2022) – is difficult to ascertain, and cannot be assumed.

2. General principles

The issues and complexities described above can be brought together as general principles for assessing the net carbon benefits of any carbon sequestration or emissions reduction scheme. Life Cycle Assessment (LCA) has become one of the most widely recognised and respected ways of measuring the environmental impacts of products and initiatives, and adheres to international standards and guidelines (EC JRC 2010). Decades of LCA research teaches important lessons about assessing environmental impacts. Two of the most important are relevant to assessing the greenhouse gas emissions benefits of carbon storage or emissions reductions schemes: 1) A holistic view needs to be taken, over the whole lifetime of the activity – including end of life and waste, 2) Attributional studies (adding up all the impacts of an activity) can tell you the impacts of that activity. However, they cannot tell you what the consequences of changing it in any particular way would be and, therefore, should not be used to judge between the merits of potential changes. Understanding the consequences of choices requires consequential assessments, which take into account the wider and knock-on effects of any change (Ekvall 2012).

The concepts of permanence (including legal provision to ensure schemes last long enough to deliver their promised carbon storage or emissions reductions benefits), additionality (that schemes must provide benefits in excess of what would otherwise have been delivered) and avoiding carbon leakage (in this case, described in their report as double counting of carbon credits by the selling country) are emphasized by Green Alliance as important standards for agri-carbon trading, alongside proper measurement and verification (Elliott et al 2022). However, although these standards are vital, the lessons from LCA go further – to permanence, the idea of considering the whole life / duration of a product or activity adds the imperative of understanding how forest products are used and dealt with at the end of their lives. The concepts of additionality and carbon leakage are equally vital but must be explored fully and along with the other potential consequences of undertaking a particular scheme, within a comprehensive and structured consequential assessment.

Lesson 1 from LCA highlights that the net benefit of carbon sequestration schemes must take account of costs and benefits from the planting of seeds through to the final disposal of wood products. Lesson 2 emphasizes that the wider impacts of such schemes must be incorporated into assessments of their value, including the shifting of agricultural production elsewhere, the relative value of a given scheme versus alternatives (including the carbon sequestration value of previous uses), and impacts on wild ruminant populations. These lessons are widely recognised and understood within the field of environmental assessment, and they should be fully applied to the evaluation of carbon sequestration schemes to avoid unintended consequences from their implementation.

3. Final thoughts

This report has focussed solely on the likely global greenhouse gas emissions benefits of changing land use from agricultural production to sequester carbon, particularly by planting woodlands. It has not looked at the risks of schemes failing to deliver what they promise, nor addressed wider issues associated with the trading of carbon credits themselves, or with other environmental and social risks and costs of such schemes. Neither has it looked at the many other important ecosystem services and roles that woodlands play. Instead, it provides a focussed critique of the efficacy of using afforestation of farmland to offset global greenhouse gas emissions, showing what factors must be included in the equation when assessing the emissions value of any particular scheme. If these factors are not taken into account, the use of agricultural land for carbon sequestration, is likely to lead to suboptimal and potentially damaging consequences for efforts to battle global warming. Considering these factors together, it is currently far from clear that the displacement of agricultural production by afforestation can be justified in terms of global carbon storage or emissions reduction.

What is required instead, are solutions which:

• maximise carbon storage and emissions reduction in productive landscapes (for example via agroforestry and silvopasture systems) in addition to
• moving farming practices to become more regenerative (safeguarding and improving natural resources and ecosystem services alongside producing high quality, nutritious food within planetary boundaries) including
• increasing hedgerows and trees and improving their management, while enhancing the management of and safeguarding existing wetlands and semi-natural habitats, protecting them from development as well as agricultural encroachment.

Such solutions must of course, be held up to scrutiny in the terms covered in this report. Climate change is a physical crisis, which only physical changes in the levels of atmospheric greenhouse gases can mitigate – the framing of the issue financially, as a moneymaking opportunity, distracts us from the only important outcome, which is reducing the amount of CO² and other greenhouse gases in the atmosphere in order to maintain our global life support systems. Any scheme that, on the balance of evidence cannot achieve that is not a solution to the problem. If reduction in greenhouse gases in the atmosphere can be achieved and money made too, all to the good – but efficacy in tackling the problem should be what determines whether any scheme goes ahead. All else being equal, carbon sequestration and emissions reduction in productive, regenerative agricultural systems in the UK can be expected, in comparison to schemes which displace agriculture, to

• reduce carbon leakage (avoid shifting of production elsewhere)
• enhance permanence of solutions (giving landowners and local communities an active and continued stake in sustainably managed productive land)
• achieve additionality by expanding and improving innovative and regenerative agroforestry practices which cannot develop without long term support for farmers to build the skills, access the resources and train the workers needed.
• still provide timber, which (if the governance of the life cycle of such products is improved) might sustainably replace alternative building products with higher environmental impacts.
• support diverse, innovative and lively rural communities

If you would like a PDF version of the article, please contact heledd.george@menterabusnes.co.uk