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Archive for Friday, June 26, 2009

Tree owners could reap climate bill windfall

June 26, 2009

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— For years, landowners have gotten paid for not farming. Now they may get paid for not cutting down trees.

While U.S. families could see their annual energy bills rise hundreds of dollars under a climate bill that President Barack Obama and congressional Democrats are trying to push through the House, owners of large swaths of forestland — timber companies, large farms, foreign countries — could reap billions of dollars.

The bill is aimed at curbing the gases, largely carbon dioxide from power plants and vehicles, blamed for global warming.

But it would allow polluters to buy credits from owners of forestland as an alternative to switching to fuels other than coal and gas or installing expensive equipment to capture the greenhouse gases. The land owners would get the credits because trees suck up greenhouse gases, preventing them from reaching the atmosphere and acting like a blanket to warm the Earth.

The premise is that at some point, the sources of greenhouse gases will find it cheaper to switch to other fuels or install pollution controls than to keep paying for the credits.

“In effect, the public is going to pay polluters to plant trees,” says Frank O’Donnell of the advocacy group Clean Air Watch. “Does that really lead to a major improvement in global warming? I don’t know and I’m not sure anybody knows.”

Here’s how it works, hypothetically. Say an acre of forestland sucks up two additional metric tons of carbon after a landowner plants more trees on his land or promises to rotate the way he cuts them down so more are standing at once. If the pollution market created by the legislation is currently trading at $20 a ton, then the landowner could stand to make $40 per acre if he qualifies for the program — a potentially good investment for owners of large tracts of forest, such as timber companies or large corporate farms.

The legislation would also extend to international forests, promising to pay some countries that agree to slow their harvesting of trees.

The Agriculture Department, which includes the U.S. Forest Service, will oversee the domestic program and develop regulations for verifying whether a forest owner’s particular tract of land is capturing carbon.

Critics say the program is ripe for abuse and that landowners could reap new rewards for things they’re already doing.

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