Course:FRST370/2022/ The North Cowichan Municipal Forest Reserve, British Columbia: forestry-centric management regimes and current possibilities of carbon offset

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Summary of Case Study

Carbon offset projects are a relatively new source of income for community and corporate ventures. The North Cowichan Municipal Forest Reserve (MFR) is presently considering options for implementing a Carbon offset scheme to generate revenue from the forest with reduced harvest levels. The land ownership and governance structure gives the MFR Unique flexibility in its ability to determine management options for the forest. This case study examines how carbon offsets may be incorporated into the (forest) management regime of a community with a long history of timber harvesting and evolving community values and perceptions.

Keywords

Carbon Offsets, Community forestry, Conservation, Timber, Recreation

Introduction

The presence of a changing climate and public values regarding forest management, managers have had to look to new methods for capturing economic benefits from forest lands beyond traditional timber harvesting. Carbon offsetting is a method in which forest landowners can receive payment for the carbon sequestered by forests and for improving ecosystem function and integrity. For communities, this presents a potential opportunity to benefit financially from forests while decreasing harvesting intensity. This case study focuses on the North Cowichan Municipal Forest Reserve on southeastern Vancouver Island in British Columbia, Canada, and the proposed transition from traditional harvesting to carbon offset production. The aim of this case study is to assess the implications of this transition against those of the current management regime and provide recommendations for future management within this region.

Description and Background

The North Cowichan Municipal Forest Reserve (MFR) is the name used for the private forest lands owned by and located within the municipality of North Cowichan on southeastern Vancouver Island. The MFR was established in 1946 by the municipal council [1]. The initial landbase for the forest was acquired through land reposition from individuals with outstanding property taxes [1]. The area encompassed by the MFR at the time of establishment included six primary regions. These included Mount Prevost, Mount Tzouhalem, Maple Mountain, Mount Sicker, Mount Richards and Stoney hill[1]. All these areas are currently managed for multiple values and are used extensively by members of the community [2]. Since the establishment of the MFR, the municipality has acquired 2 additional parcels of forest land with revenue generated from activities within the MFR [1]. The area of the MFR is approximately 5000 hectares which equals 25 percent of the land area of the municipality of North Cowichan [2]. Following the initial establishment of the MFR, the first management regime was implemented by a consulting forester in 1960 [1]. The initial management consisted of a diameter limit method which allowed the harvest of trees over a specific diameter [2]. This management strategy prevailed until 1981 when the first managing forester was hired by the municipality and a forest management plan was developed for the sustainable management of the landbase [1]. An interactive map of the area is available online at: https://northcowichan.maps.arcgis.com/+apps/webappviewer/index.html?id=2346f9fa5669451cad56966546c06239

Tenure arrangements

The MFR is different than most of the community forests in British Columbia due to the type of land holding. Most community forests in BC are situated on Crown land and operate under harvesting concessions awarded by the provincial government of British Columbia [3]. The MFR landbase is private land that is owned by the municipality of North Cowichan[4]. Community forests operating on crown land are required to adhere to forest management legislation outlined by the provincial government including regulations relating to land use, harvesting systems, ecological integrity, and annual allowable harvest levels [3]. This limits the ways in which many community forests operating on crown land can utilize their landbases for the benefit of their communities. The MFR is not constrained by regulations for crown land forestry but does adhere to the Privately Managed Forest Land Act[5]. This act allows for more creative management and silvicultural strategies due to fewer regulations than those imposed on crown land forestry activities [5]. The privately owned status of the MFR also allows the municipality to lease the land to outside firms and secure revenue from industries outside of forestry. A substantial portion of the annual revenue for the MFR comes from a land lease to a telecommunication company which has installed cellular towers on mountain tops within the MFR [6].

Administrative arrangements

From the inception of the MFR until 1981, there were minimal adjustments made to management practices and harvesting since the original management plan that was developed in 1960[1]. Until 1981 the operations within the MFR were solely undertaken by the municipal forestry department[1]. Following concerns from the public, the municipal council created the forestry advisory committee (FAC) to increase oversight for activities occurring in the MFR and provide guidance to the forestry department [2].

FAC Structure

The FAC is made up of 8 individuals from the community. The current structure includes two registered professional foresters, one registered professional biologist, a member of the municipal council to act as the chair of the committee, a representative from the Cowichan Tribes, a representative from the Halalt First Nation, a member at large from the community and a representative from the Cowichan Trails Stewardship Society[7]. The purpose of the FAC is to ensure the management occurring within the MFR is ecologically and financially sound while also aligning with the values of the community. The primary role of the committee is to review and audit forestry operations within the MFR[8]. The committee also advises the municipal council on activities within the MFR and general forestry issues [8].

Forestry Department

The forestry department is responsible for the day-to-day management of all forestry activities that occur within the MFR. Responsibilities include forest planning, harvesting, road maintenance, silviculture, fire mitigation, timber marketing and preparation of annual forestry reports [4]. The municipality of North Cowichan employs a registered professional forester to undertake these responsibilities[4].

Stakeholders and Rightsholders

Affected stakeholders

Residents of North Cowichan and owners/operators of recreation and tourism-based businesses are directly affected stakeholders. North Cowichan Municipal Forest Reserve is fully contained within the municipal boundaries, and occupies approximately 25% of municipal land, which includes most of the publicly accessible forest[2]. In addition to recreational access, residents of North Cowichan are affected by the financial state of the MFR. Revenues generated from logging are used to cover management costs first, and surpluses used to fund scholarships and community legacy projects. Logging waste supplied source of wood for the firewood program, which is not presently operating[6] .

Interested stakeholders

Local mills are not exclusively reliant on timber from any one source, nonetheless they have an interest in MFR’s harvesting levels, Under a status quo scenario logging in the MFR is estimated to yield 17500 m3 of harvested timber annually, under a full transition to carbon offsets there would be a negligible harvest volume[9].

Conservation organizations also have an interest in the proposed harvest level changes, MFR has a high percentage of the rare Coastal Douglas Fir BEC zone, and some areas of the endangered Gary Oak Ecosystem[10].

Companies seeking to buy or sell carbon credits benefit from the public perception that programs have good governance and transparency. The ecological benefits of MFR’s carbon offset plan can be bundled in to the carbon offset product, improving perceived validity and market prices.[11]

Indigenous rights and collaboration

Municipal Forest Reserve is located on the traditional and unceded lands of Cowichan Tribes, Halalt First Nation, Stz’uminus First Nation, Penelakut Tribe, and Lyackson First Nation. Government to Government negotiations between the Municipality and Quw’utsun Nation established that First Nation’s interest in the MFR management plans would be included in management planning by representation on the Forestry Advisory Committee, and in the MFR working group[12].

Current management regime

The formation of the FAC in 1981 allowed for a paradigm shift in forest management within the MFR. New management recommendations were developed with a focus on sustainability, forest health and community benefit [1]. Since 1981, the management objectives within the MFR have remained somewhat similar to those originally outlined by the FAC, but a transition to the production of carbon offsets may present another substantial shift[1]. The values currently managed within the MFR can be categorized as operational forestry, recreation and education, and ecological integrity.

Operational Forestry

The current forest harvesting strategy within the MFR can be described as market logging [4]. Under this strategy, managers schedule most harvesting to occur while log prices are high [4]. This method allows the MFR to capture the greatest value from the timber harvested from the MFR landbase. The private land status of the MFR is beneficial when using this harvest scheduling method as there is no requirement to harvest timber during periods with poor market conditions. The MFR currently employs patch cuts with green tree retention as their primary harvesting system to ensure forest cover is maintained throughout the landbase [1]. The harvesting strategy described is currently under review as the feasibility of transitioning to carbon offset production is assessed [6]. Additional timber harvesting has been postponed since 2018 while this process occurs [6].

Recreation and Education

Recreation and education are integral parts of the MFR. Hiking and mountain biking trails are prevalent throughout most of the MFR and are frequented by members of the community[2]. To support these values, portions of revenue generated by timber harvesting are directed back into capital works projects supporting recreation values [4]. These include parking expansion and washroom construction at popular trailheads[4].  Educational programs are also facilitated by the managers of the MFR for elementary, secondary, and post-secondary students [6]. This has included programs such as student-mentorship for those pursuing forestry education at Vancouver Island University [6].

Ecological Integrity

Multiple strategies have been implemented in the MFR to maintain ecological integrity. These include endangered species and ecosystem management strategies and wildfire mitigation. The MFR voluntarily participates in assessments and mapping of sensitive Coastal Douglas Fir ecosystems through the Coastal Douglas Fir Conservation Partnership [6]. Additionally, collaboration with Environment and Climate Change Canada has allowed for increased documentation and research relating to rare plant species within the MFR [6]. Fuels mitigation for wildfire mitigation continues to be an important part of management with salvage harvests of blown down trees and burning of accumulated fuels occurring annually [6]. The fuels mitigation operations are conducted by Khowutzun Forest Services, which is owned and operated by the Cowichan Tribes [6].

Transition to Carbon Offsetting

Introduction to Carbon Offsets

Forest carbon offsetting is where a forestry project prevents or reduces greenhouse gas (GHG) emission and in turn generates "carbon credits" which can be sold to another entity to offset its own GHG emissions[11]. This provides an economic incentive for a forestry company to manage in a way that sequesters carbon or prevents release of carbon in the form of carbon dioxide (CO2). As CO2 makes up a majority of the greenhouse gases that contribute to global warming and consequent climate change, carbon sequestration is a leading climate mitigation strategy. For a company to be able to sell carbon credits in BC, there is a verification and validation process one must go through. Projects must be reported to the provincial government throughout their implementation process under the Greenhouse Gas Industrial Reporting and Control Act and then verified or validated by an accredited verification or validation body[13]. The verified carbon standard program (VCS), which the feasibility assessment discusses as being the best standard for MFR [10], requires re-validation to occur every 5 years. BCs verification regulation and guidelines are in compliance with the International Organization for Standardization ISO 14064-3[13].

There are two broad categories to carbon offset projects that were considered for the MFR under VCS; Improved Forest Management (IFM) and Reducing Emissions from Deforestation and Degradation (REDD)[10]. The goals of MFR align best with IFM where carbon is sequestered through sustainable management practices. Forest Degradation as described per REDD is where loss of carbon occurs inadvertently due to poor management or illegal logging which is not an issue that needs to be resolved in the MFR[10]. Some examples of improved forest management practices are reducing harvest levels and improving the growth of trees. In a coastal forest, reducing harvest to minimal acceptable levels can increase CO2 storage by upwards of 30 percent over 100 years[14]. Improving growth of trees through silvicultural practices like fertilization or planting genetically improved stock can also increase carbon storage but to a smaller extent of 0.4-5 percent[14].

Pros and Cons

Carbon offsets can be an effective way to prevent deforestation while providing companies with economic compensation for the trees that aren’t harvested or for investments into conservation practices that increase stored carbon. A successful example can be seen in a collaboration between Mosaic Forest Management and nearby First Nation communities where both parties’ management and economic objectives were met[15]. The transition to carbon credits has been used by other communities to generate revenue to replace harvesting revenue while pursuing conservation objectives[16]. Coastal First Nations Great Bear Initiative[16], shows community, management and conservation values have changed since the last major shift in management planning for the forest. Despite these successful case studies, carbon offsets often face negative criticism and as a relatively new market there are still many governance issues in their development[11][17]. Carbon offset sales may face negative public opinion because it can be perceived as the right for large companies to continue emitting[11]. There are uncertainties about the morality of selling carbon, the actuality of GHG emission reductions, and buyers who may care only about commercial value of carbon credits and not the physical validity of the carbon offset[11][17].

Options for the Municipal Forest Reserve

In a joint consultation project between the Municipality of North Cowichan and a University of British Columbia (UBC) partner group which includes 3Green Tree ecosystem services ltd., a Municipal Forest Reserve Review in underway. A feasibility assessment for the transition of MFR to carbon offsets was completed in 2020. Currently, the public is being consulted in an effort to decide the best management plan for the community of North Cowichan[9][12]. Four options are currently in the process of being presented to the community. The first is a Business as Usual (BAU) or baseline option where harvesting is continued as per pre 2019 levels. This produces approximately 17500 cubic meters of wood annually and would result in no carbon credits. The second option is where harvesting is reduced by 50% and the retention can be used to generate carbon credits. The third scenario, called active conservation, limits logging to targeted projects with objectives to restore and enhance ecosystem conditions. The final option, passive conservation, would cease all logging except where harvesting for safety reasons is necessary. This would allow the forest to progress “naturally” and would generate the most carbon credits[12]. Figure 1 from the carbon project feasibility assessment produced by 3Green Tree[10] provides a good Visual comparison of these options.

Discussion

There is precedent for using carbon credits to finance conservation-oriented management. The promise of a revenue path which escapes the ecological and social costs associated with logging has made offset sales increasingly attractive to communities and organizations pursuing conservation objectives[16] [18]. The commitment to selling carbon credits would extend for 20 years from the time of sale[10], and may prevent the MFR from taking advantage of high log prices. Carbon markets are subject to supply and demand pressures[11] and as such are likely to fluctuate in price. 3GreenTree Ecosystem Services Ltd estimated the price at which carbon offset profits would exceed timber harvesting to be $10/credit or greater[10].

Beyond the volatility of prices in general, offset buyers tend to select credits from exciting new projects, rather than long term support for established projects (Petersen) which may be a limiting factor to the long term viability of offsets as a revenue stream. Public perception of the validity of carbon credits also influences the marketability. While credit schemes with strong governance and accountability such as the MFR are more marketable[17] the scheme that the MFR would be pursuing is based on reducing deforestation/degradation; one of the more controversial with regards to the validity of carbon sequestration claims[17][11]. The desire to reduce global CO2 emissions is a growing social value[14] and may be a motivating factor for North Cowichan residents to pursue the more conservation-oriented management paths, to reduce climate change related impacts. Carbon offset schemes however, may not be the best pathway to net emissions reductions. They are sometimes criticized as being a license to pollute, purchased by entities who care more about their business viability than actual effectiveness of the offset scheme, and that voluntary carbon offset purchases reduce the urgency of enacting CO2 emissions at effective government scales.[17]

A crucial difference between revenue from carbon credits and revenue from logging is the potential for additional value capture such as wood processing ventures. Generating revenue from carbon credits also requires a different skillset than traditional timber-based operations, therefore, even if the number of jobs available locally may be the same across scenarios, they are not necessarily interchangeable. Depending on which scenario is selected, the MFR may find itself with a mismatch between available and required skillsets in the local labour force. Entering into an agreement to steward the forests for carbon sequestration objectives would shift the accountability of the MFR from the community to the purchasers of carbon credits. This may also limit the options available to the community for wildfire fuels mitigation treatments, recreational use and revenue generation. This shift in decision-making power may result in a reduction in the social license of and adaptive capacity of the MFR within the community of North Cowichan, key factors in the building of social resilience.[19]

Recommendations

We believe that mixed management options will be the most beneficial to the MFR. There are many benefits to human stewardship and management of forest land that option 4, passive conservation, would be failing to recognize. However, we also recognize that as a private owned company, MFR has a unique ability to be able to stop logging and store carbon because they are not under the provincial obligation to meet a certain annual cut. That being said, there are risks and consequences associated with selling carbon credits as discussed previously in this case study. This is why we recommend option 2, reduced harvesting, or 3, active conservation.

The economic and community benefits of the timber industry are important to remember. There are jobs associated with logging, milling, and silviculture as well has revenue from harvesting that has returns to the community[6]. Though social opinion on logging and forestry may be negative, education and outreach can provide community members with important information regarding the benefits. The reduced harvesting scenario will still provide forestry jobs while simultaneously gaining income from carbon credits. This duality can act as a buffer when either timber or carbon markets fluctuate.

The active conservation option is also recommended because though the economic score might be lower than reduced harvest option, 4.0 versus 4.7 respectively[12], there are still employment opportunities involved in management. This option is superior to passive conservation because active conservation is described as “targeted harvesting with goal to restore and enhance ecosystem conditions”[12]. This should account for traditional management that integrates Traditional Ecological Knowledge of the Cowichan Tribes of the area. Practices like sustenance harvesting and prescribed burning have thousands of years of history and need to be considered when discussing ecological benefits. Regardless of what option is decided upon, integrating Indigenous perspectives needs to be consciously done for the benefit of the forest and for Truth and Reconciliation. There are also community benefits associated with active management in the form of wildfire mitigation. As most of the MFR is located close to the community, wildfire risk is high. Management practices like thinning, fuel load reduction and prescribed burning can reduce the risk to the community. In the passive conservation scenario with “minimal human intervention”, we assume these risk reduction practices will not be considered and therefore believe option 3, active conservation, to be superior.

References

  1. ↑ 1.00 1.01 1.02 1.03 1.04 1.05 1.06 1.07 1.08 1.09 1.10 Municipality of North Cowichan. (2022). History of the Municipal Forest Reserve. northcowichan.ca: https://www.northcowichan.ca/EN/main/departments/parks-recreation/forestry/History.html
  2. ↑ 2.0 2.1 2.2 2.3 2.4 2.5 Municipality of North Cowichan. (2018). Municipal Forest Reserve Overview. Municipality of North Cowichan. https://www.northcowichan.ca/assets/Departments/Parks~and~Recreation/docs/FINAL_Municipal%20Forest%20Reserve%20Overview%20Council%20Feb%202019.pdf
  3. ↑ 3.0 3.1 Furness, E., Howard, H., & Nelson, H. (2015). Community forestry in British Columbia: Policy progression and public participation. Forest Policy and Economics, 85-91.
  4. ↑ 4.0 4.1 4.2 4.3 4.4 4.5 4.6 Municipality of North Cowichan. (2022). Forestry. northcowichan.ca: https://www.northcowichan.ca/EN/main/departments/parks-recreation/forestry.html
  5. ↑ 5.0 5.1 Province of British Columbia. (2003). Private Managed Forest Land Act [SBC 2003] Chapter 80. https://www.bclaws.gov.bc.ca/civix/document/id/complete/statreg/03080_01
  6. ↑ 6.00 6.01 6.02 6.03 6.04 6.05 6.06 6.07 6.08 6.09 6.10 Municipality of North Cowichan. (2022). 2021 Annual Forestry Report. Department of Forestry. https://www.northcowichan.ca/assets/Departments/Forestry/docs/2021%20Annual%20Forestry%20Report.pdf
  7. ↑ Municipality of North Cowichan. (2022). Forestry Advisory Committee Membership. Municipality of North Cowichan.  https://www.northcowichan.ca/assets/Departments/Administration/Docs/FAC%20Membership%20List%20for%20Website%202020-05-06.pdf
  8. ↑ 8.0 8.1 Municipality of North Cowichan. (2022). Forestry Advisory Select Committee. Municipality of North Cowichan.  https://www.northcowichan.ca/assets/Departments/Administration/Docs/FAC%20Terms%20of%20Reference.pdf
  9. ↑ 9.0 9.1 Barron, Robert (October 20, 2022). "4 options for future of North Cowichan forest reserve". Chemainus Valley Courrier. Retrieved Dec 11, 2022.
  10. ↑ 10.0 10.1 10.2 10.3 10.4 10.5 10.6 3GreenTree Ecosystem Services Ltd. (2020). Municipality of North Cowichan (MNC) carbon project feasibility assessment. https://www.northcowichan.ca/assets/Departments/Forestry/docs/UBC_Carbon_Feasibility_Assessment_July2020.pdf
  11. ↑ 11.0 11.1 11.2 11.3 11.4 11.5 11.6 Peterson St-Laurent, G., Hagerman, S., & Hoberg, G. (2017). Barriers to the development of forest carbon offsetting: Insights from British Columbia, Canada. Journal of Environmental Management, 203, 208–217. https://doi.org/10.1016/j.jenvman.2017.07.051
  12. ↑ 12.0 12.1 12.2 12.3 12.4 Municipality of North Cowichan. (2022b). North Cowichan Municipal Forest Reserve: Discussion Guide. https://www.northcowichan.ca/assets/Departments/Forestry/docs/2021-11-22_MFR_DiscussionGuide_FINAL.pdf
  13. ↑ 13.0 13.1 Province of British Columbia. (2021). British Columbia greenhouse gas industrial reporting and control act: Validation & verification guidance document. https://www2.gov.bc.ca/assets/gov/environment/climate-change/offsets/guidance/vvb_guidance_2021.pdf
  14. ↑ 14.0 14.1 14.2 Man, C. D., Lyons, K. C., Nelson, J. D., & Bull, G. Q. (2013). Potential of alternate forest management practices to sequester and store Carbon in two forest estates in British Columbia, Canada. Forest Ecology and Management, 305, 239–247. https://doi.org/10.1016/j.foreco.2013.05.059
  15. ↑ Paterson, Alana (July, 28, 2022). "Indigenous Peoples and Loggers Win Cash, and a Truce, From Coveted Carbon Credits; Better legal protections for indigenous communities and a hot market for carbon finance spur lucrative deals to preserve forests". The Wall Street Journal. Check date values in: |date= (help)
  16. ↑ 16.0 16.1 16.2 Coastal First Nations (2022). "Coastal First Nations Great Bear Initiative".
  17. ↑ 17.0 17.1 17.2 17.3 17.4 van Kooten, G. C. (2017). Forest carbon offsets and carbon emissions trading: Problems of contracting. Forest Policy and Economics, 75, 83–88.https://doi.org/10.1016/j.forpol.2016.12.006
  18. ↑ Nature Conservancy Canada. (n.d.). Darkwoods. Retrieved November 5, 2022, from Nature Conservancy Canada: https://www.natureconservancy.ca/en/where-we-work/british-columbia/featured-projects/west-kootenay/darkwoods/
  19. ↑ Devisscher, T., Spies, J., & Griess, V. C. (2021). Time for change: Learning from community forests to enhance the resilience of multi-value forestry in British Columbia, Canada. Land Use Policy, 103, 105317. https://doi.org/10.1016/j.landusepol.2021.105317



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