Sunday, 20th December 2009
Scotland’s peat bogs could be goldmines
Owners of forests, peat bogs and moorland in Scotland could be sitting on a fortune if new schemes for carbon trading take off in Europe.
Carbon trading works by company emissions being capped at a level that is equal to or below their previous levels. These companies are then given the opportunity to buy or sell carbon credits, depending on how much CO2 they emit. These carbon credits can come from overseas. For traders, carbon dioxide is considered to be the world’s newest commodity.
Forest owners in California are planning to sell carbon credits to industrial groups and power companies in exchange for deals to preserve redwoods and other trees which can soak up large quantities of greenhouse gases.
This is a clear sign that owners of forests have woken up to the financial potential of offering carbon offsets to factories and energy companies in California where the State authorities plan to introduce a cap for emissions, allowing companies to set up a cap-and-trade system.
Investors in the US have estimated there is a significant potential for a multi-billion dollar carbon market. In 2008 the global market was worth £75 billion. The US Congress is even discussing a federal plan that would roll out the scheme across America. When this happens, Europe is sure to follow suit.
In Copenhagen, many of the participating nations have spoken about the need to plant more trees to help in the natural capture and storage of CO2. But a cap-and-trade scheme, which allows owners of major natural carbon storage systems like forests, peat bogs and moorland, to trade carbon offsets with big industrial companies, would create a revolution in Scotland's more remote rural and upland areas. If Scotland's landowners could profitably develop these historically loss-making assets, there might be a chance that the unique landscape, wildlife, river systems and tourist economy could be saved from degradation for generations.
There has been a mad dash by landowners in Scotland to dig up peat bogs and cut down trees in order to allow the construction of giant wind turbines, so that they can cash-in on the significant profits from the production of renewable energy. Scotland’s total of 1,131 wind turbines is likely to increase to 3,855, according to figures released on 7th December 2009.
However, the destruction of these natural carbon sinks is counter-productive and may actually destroy any chance of utilising these assets as part of an EU carbon trading scheme in the future.
Peatlands form a crucial part of the world’s air conditioning system. They are Europe's rain forests. Peatlands and wetland ecosystems accumulate plant material under saturated conditions to form layers of peat soil up to 20 metres thick – storing on average 10 times more carbon per hectare than other ecosystems. Peatlands occur in 180 countries and cover 400 million hectares or 3% of the world’s surface. Scotland has a unique role to play in preserving and maintaining this global resource. Over one sixth of the world’s blanket bog is located in Scotland, despite the fact that we have only one sixtieth of the world’s total landmass.
Taken together with our forestry and moorland, the contribution Scotland makes to global carbon storage is significant. Our peat bogs provide a unique resource which may shortly be recognised financially when a new carbon offset trading system is introduced. Landowners beware. If you cut down your forests or dig up your peat bogs for windfarm developments, you may be throwing away a fortune.
