The Forest Design
Our model relies on periodic thinnings in order to optimize the sequestration capacity of a hectare of forest. Without thinnings, the trees crowd one another and overall productivity declines. The timber that is extracted from the forest belongs to the landowner – to either sell or to use on the farm. We select species for our forest designs with this in mind. Certain species tend to grow very rapidly and are great carbon accumulators, however the market value of the wood is insufficient for sustainable forestry. Others species grow more methodically, however the wood is more valuable. We use a mixed species model that balances these concerns. Some species excel at long-term carbon accumulation, while the fastest growing tree species are included to provide the farmer with significant early income.
The Contractual Relationship
We enter into an initial 25-year contract for each project. These contracts are easy to follow and are discussed in depth with the farmer in order to set reasonable expectations. Although we intend that each forest plantation last indefinitely, the 25-year period is a reasonable legal agreement for a landowner. Fortunately, we believe that the model will work, and we are confident that the landowner will maintain the land as forest indefinitely due to its ability to satisfy his or her needs for income.
Payments for Ecological Services (PES)
Since most landowners do not have the resources to wait 15-20 years to realize profits from their forest, our model incentivizes and motivates landowners to establish and manage the forest through two PES mechanisms. The first is a US$2,000 establishment contribution per each hectare of new forest plantation. The $2,000 is spread out over a period of three years, which helps cover planting and management costs over that period. We conduct our forest measurements annually in order to ascertain the productivity of the plantation. For each metric ton that is captured in the forest, we then pay the farmer US$5. Typical annual forest productivity would yield approximately $200 each year in carbon capture payments. These payments allow the farmer to remain invested in the project until profits from forest thinnings arrive.
The Interpersonal Relationship
We guide the landowner every step of the way (after all, we have obligations to the forest sponsors that we must meet!), however, we attempt to empower the landowner to take over responsibility. Our team regularly visits each project to train the farmer and farm employees on management techniques and general land management. It is rare that a week goes by without some interaction between us and a landowner. In some cases, we have even reinforced the link between the farmer and the forest donor through visits to the project sites by the sponsor.