Mississippians with timberland in production are looking at carbon as a new source of income, and they are learning to manage their land for the most profit while participating in efforts to lower greenhouse gas levels.
Carbon dioxide, or CO2, often called simply carbon, is one of several chemical compounds known today as greenhouse gases, or GHG. These gases occur both naturally and as byproducts of fossil fuel use in various transportation and industrial processes.
Randy Rousseau, a Mississippi State University forestry professor and specialist with the MSU Extension Service, said that while other gases are more noxious, carbon dioxide makes up the greatest proportion of greenhouse gases in the atmosphere—about 80 percent.
"CO2 comes from many different sources," Rousseau said. "It can be natural, such as volcanic, but it also comes from fossil fuels being used to create energy for our cars or to power our electricity-generating plants."
Many scientists link the buildup of greenhouse gases in the atmosphere to global warming.
International efforts have been under way for several years to reduce or offset the amount of carbon that is emitted into the atmosphere. Industries are retooling operations to release less carbon dioxide, and some are purchasing carbon credits to offset some of the carbon dioxide production that they have not been able to effectively and economically eliminate.
Trees take in carbon dioxide from the atmosphere and store it. Most carbon is stored, or sequestered, in the wood and accounts for one-half of the dry weight. Carbon remains in the wood throughout the life of the forest product.
Newly planted trees and some existing stands have qualified under the Voluntary Carbon Market as sequestered carbon. This allows forest landowners to sell these carbon credits to others who need to offset some of the carbon they are producing through industrial processes.
Rousseau said selling carbon credits is a growing, non-traditional way that forest landowners may gain additional revenue.
MSU’s Forest and Wildlife Research Center held a carbon short course in July to help raise awareness and educate landowners and foresters on the latest in national carbon legislation and market situations. The United States has not participated in the international carbon market, but recent legislation shifts may change that and could drive up the price of carbon.
Jeffrey O’Hara, a senior economist with the Chicago Climate Exchange, said at the carbon short course that forestry carbon can play a role in markets.
"The carbon industry is expected to be worth $60 billion in the United States in 2012. That puts the carbon market on par with wheat and corn," O’Hara said. "It will drive up the cost of carbon and probably make forestry more important."
Christopher Galik, a research coordinator with the Climate Change Policy Partnership at Duke University, told those assembled for the carbon short course that the purpose of offsets is cost containment.
"The amount of carbon you can claim compares to the amount of money you get for carbon offsets," Galik said. "How you do your (carbon) accounting has a very big impact on how much profit you can have. Forestry offsets can be a very big contributor to reaching the cost of compliance with greenhouse gas reductions."
Lawmakers are debating the entire issue of the Cap and Trade Carbon Market, including what offsets will qualify for carbon credits, how to standardize the way carbon credits are calculated and the industries that may be exempt. Part of the equation lies in determining how long carbon remains sequestered in various forest products.
For example, carbon sequestered in trees that are made into paper products does not have much permanence because paper’s lifespan is short. However, carbon sequestered into trees that are made into furniture has a much longer anticipated permanence. The value of carbon varies in these instances.
The United States currently has a voluntary system of carbon trading, with most of it operating through the Chicago Carbon Exchange. A number of countries use a cap and trade system, which limits, or caps, the amount of carbon an industry can emit and sets restrictions on how carbon credits can be traded. Many experts in this field expect it will be instituted in this country, possibly even this year.
The House Energy and Security Bill was passed by a narrow margin earlier this year and now faces challenges in the Senate.
"This climate change legislation, if passed and signed into law by the president, will have direct implications to all taxpayers, as well as forest landowners," Rousseau said. "It is not certain that forestry offsets will be included, but if they are, Mississippi’s vast ownership of forestland should be poised to take advantage of a new market."