Forest conservation projects hit a financial wall amid provincial mandates, rigid laws<\/p>\n
This is the second part of a two-part series. Part one can be found here:\u00a0New carbon pricing fuels 600% revenue surge for B.C. community forest<\/a><\/p>\n Turn over a fir needle and you\u2019ll find two silver streaks that, under a microscope, reveal thousands of stomata\u2014the tiny, porous mouths of a tree.<\/p>\n On a sunny day, the pores open, allowing the tree to absorb carbon dioxide in a chemical process that transforms invisible gas into trunks, limbs and bark.<\/p>\n Plants first started inhaling carbon in this way more than 400 million years ago<\/a>. In the years since, forests have colonized land and today absorb roughly 7.6 billion metric tonnes<\/a> of carbon dioxide every year\u2014double what they emit.<\/p>\n That number hides some worrying trends. In Canada, logging and wildfires flipped Canadian forests from a net carbon reservoir to a net source about 25 years ago, according to the federal government<\/a>.<\/p>\n British Columbia responded by launching one of the world\u2019s first large-scale projects designed to generate revenue for local communities by not logging old-growth forests.<\/p>\n The model, which began in the Great Bear Rainforest in 2009 and has since been exported to the Amazon and Africa, created market value by putting a price on carbon locked in and absorbed by trees.<\/p>\n On the surface, the premise appears simple: a company or government pays to protect forests at risk of logging, and in exchange, they receive tradeable carbon credits\u2014known as forest carbon offsets\u2014used to cancel out their own emissions.<\/p>\n After years of operating as a voluntary system often financed by governments, B.C.\u2019s carbon landscape shifted overnight on April 1, 2024. The province’s new mandatory industrial policy now forces big emitters to either offset their pollution or pay a steep price.<\/p>\n After a short delay, the move led to a 2025 windfall for a community forest co-managed by the Resort Municipality of Whistler and the Lil\u2019wat and Squamish nations.<\/p>\n Cheakamus Community Forest forest raised $600,000 in forest carbon offsets in a single sale to a mining company\u2014a six-fold year-over-year increase that would have never been possible without B.C\u2019s new industrial carbon policy, said executive director Heather Beresford.<\/p>\n But while Cheakamus celebrates rising demand and higher prices, Gary Bull, a professor emeritus of forestry at the University of British Columbia, said B.C.\u2019s decision to regulate the carbon market has made it nearly impossible for others to take part.<\/p>\n \u201cWe\u2019ve seen very limited carbon income coming into B.C.,\u201d Bull said. \u201cGovernment trying to control a market is just a mistake.\u201d<\/p>\n B.C.’s voluntary carbon market sees limited uptake<\/p>\n Despite their potential, only a handful of forest carbon offset projects have succeeded in B.C. Some of those projects have sought validation through a global voluntary carbon market\u2014private, unregulated systems where corporations like Walt Disney Co. (NYSE:DIS) and Shell plc purchase credits verified by independent third-party firms.<\/p>\n In 2008, the Nature Conservancy of Canada bought and later launched the 54,000-hectare Darkwoods Forest Carbon Project<\/a> near Creston, B.C. The project sold millions of credits to private companies, but also to the B.C. government.<\/p>\n In 2013, the province\u2019s then-auditor general John Doyle investigated Darkwoods alongside a gas flaring carbon credit project near Fort Nelson. In both cases, he found<\/a> the projects failed to demonstrate that the sale of carbon credits was needed for the projects to go forward.<\/p>\n \u201cIn industry terms, these projects would be known as \u2018free riders\u2019,\u201d said Doyle at the time. \u201cTogether, they received $6 million in revenue for something that would have happened anyway.\u201d<\/p>\n More recent third-party audits show the 100-year Darkwoods project is now largely meeting its goals, issuing millions of carbon credits, and storing enough carbon to offset emissions from about 6,700 British Columbians per year.<\/p>\n \u200bOn Vancouver Island, Mosaic Forest Management Corp. said in 2022 it would defer logging on 44,000 hectares of land in a project known as the BigCoast Forest Climate Initiative.<\/p>\n A subsequent audit<\/a> from the U.S.-based company Renoster Systems Inc. found the project suffered from a lack of transparency and accounting problems\u2014including a failure to consider fire risk\u2014that rendered its carbon credits \u201chighly dubious.\u201d<\/p>\n “Most critically, the project\u2019s area appears to us to be gerrymandered,” Renoster concluded.<\/p>\n Mosaic strongly disputed those claims, though in 2024, it temporarily suspended the program to assess what it described as accounting errors.<\/p>\n A spokesperson for the BigCoast initiative confirmed the program is still \u201con hold\u201d as it worked to \u201calign the project design to the latest best practices and standards.\u201d<\/p>\n Outside of B.C., forest carbon offset schemes have faced intense scrutiny in several U.S. states and multiple countries that make up the Amazon Rainforest.<\/p>\n High-profile investigations have documented a number of programs purporting to protect forest carbon stocks\u2014only later finding they never preserved forest carbon<\/a>, were used as cover to launder illegal logging<\/a>, or sold millions of credits to avoid cutting trees when the threat never existed<\/a>.<\/p>\n Even some of the industry\u2019s biggest auditors have faced controversy. A 2023 investigation<\/a> by The Guardian newspaper found a significant percentage of rainforest carbon offsets provided by the Washington, D.C.-based auditor Verra were \u201clargely worthless.\u201d<\/p>\n Verra\u2014which audits Darkwoods and BigCoast\u2014later contested the findings, stating the reporting was based on research that \u201cmassively miscalculate\u201d its certified projects.<\/p>\n Other community forests face carbon credit ‘dead end’<\/p>\n The B.C. government\u2019s efforts to finance forest management through carbon offsets has faced mixed success, experts say.<\/p>\n Advocates often hold up the Great Bear Rainforest as a poster child for how to successfully run long-term carbon credit programs backed by government. Spanning five million hectares along the northwest coast and Haida Gwaii, the project has protected about 85 per cent of the rainforest from industrial logging. The forest carbon offsets have generated over $85 million<\/a> for its Indigenous shareholders\u2014largely fuelled by the B.C. government acting as its biggest buyer.<\/p>\n But according to the latest records available through B.C.\u2019s Carbon Registry, only two other locations in B.C.\u2014the Cheakamus Community Forest and a much smaller project on Quadra Island\u2014have sold carbon credits under the government-run market.<\/p>\n After years of researching the sector, UBC\u2019s Bull said the province\u2019s restrictive carbon offset protocols have failed to keep pace with the higher value and standards found in other private markets.<\/p>\n One of the province’s mistakes, according to Bull, was a decision not to harmonize standards with Quebec, California and a number of other western U.S. states when it had a chance to do so in 2008. In the years since, he said private carbon markets have become \u201cas sophisticated as the Toronto Stock Exchange.\u201d<\/p>\n \u201cThere might be a spurt of interest now,\u201d said the economist of Cheakamus’s recent surge in revenue. \u201cBut I\u2019d say it\u2019s still tokenism with what they are getting.\u201d<\/p>\n For Susan Mulkey, a senior manager at the BC Community Forest Association, Cheakamus’s unique success was driven by Doug Konkin\u2014a former deputy minister of forests who lived in Whistler and is widely credited with facilitating its entrance into B.C.\u2019s carbon market.<\/p>\n \u201cI don\u2019t know what he did. All I know is [Whistler] was the first and the last community forest that qualified,\u201d said Mulkey, whose group represents the province\u2019s 62 community forests. \u201cWe have invested resources in it at numerous increments over time. And we\u2019ve been slammed every time.\u201d<\/p>\n \u201cIt\u2019s just such a dead end for us. It\u2019s so frustrating. It does not make sense.\u201d<\/p>\n