Potential for Carbon Credits from Conservation Management: Price and Potential for Multi-Habitat Nature-Based Carbon Sequestration in Dorset, UK

Potential for Carbon Credits from Conservation Management: Price and Potential for Multi-Habitat Nature-Based Carbon Sequestration in Dorset, UK

1. Introduction

Despite considerable issues on the effectiveness and implementation of carbon offsetting, and its potential to weaken the focus on carbon emission reduction, carbon offsetting schemes are becoming increasingly popular [1]. Carbon offsetting schemes are designed to either remove CO2 straight from the atmosphere or provide infrastructure that bring emission reductions over time to offset actions that produce emissions [2]. As a result, an activity that has been offset is no longer considered to contribute to atmospheric greenhouse gas concentrations [2]. Carbon credits are therefore a financial mechanism to allow offsetting. Polluters can purchase credits, which allow them to emit a certain volume of carbon which has been pre-offset [3]. Carbon offsetting is therefore an important aspect of several organisations’ sustainability plans to reduce their carbon footprints, with several countries setting net-zero targets for the coming years, typically aiming to reduce emissions, but offset the remaining emissions somewhere between the years of 2030 and 2050 [4].
Despite the rise in anthropogenically produced carbon, nature still provides by far the dominant fluxes of carbon into and out of the atmosphere and oceans [5]. Ultimately, enhancing and restoring nature can benefit atmospheric carbon levels by sequestering carbon as well as increasing biodiversity, while addressing societal challenges. This is sometimes referred to as a nature-based solutions (NbS) approach [6,7].
Sequestration varies between habitats; woodlands, for example, have a greater sequestration average compared to heathlands [8,9]. Furthermore, the overall quality of the habitat will influence its ability to sequester [10]; a 30-year-old mixed native broadleaved woodland has a flux range of −2.5 to −25.5 tCO2e ha−1 yr −1, averaging at −14.5 tCO2e ha−1 yr −1 [9]. A habitat in pristine condition will sequester more carbon than if it was degraded [10], so a woodland in good condition may sequester a value closer to the higher end of the flux range, and closer to the lower end if degraded. As such, traditional conservation management practices which aim to improve habitat quality and enhance biodiversity should also result in improved carbon sequestration in most habitat types.
Highly biodiverse, species-rich habitats, such as a high-quality grassland community, may also show greater ecological resilience compared to species-poor communities [11]. This means they will have a stronger potential to support and promote biodiversity and ecosystem resilience, a component which is important in the face of climate extremes [12,13]. In terms of carbon sequestration, these stronger, biodiverse habitats may provide a more consistent sequestration rate, compared to an ecologically poorer habitat that may degrade with ecological stress [10]. However, it should be noted that habitats with low biodiversity, such as a conifer plantation, have high sequestration rates [14,15]. However, the fact remains that the lack of ecological resilience makes the monoculture less resistant to change and more prone to collapse if environmental perturbations are high [12]. As a result, trade-offs may arise, especially if the management measures proposed (i.e., to maximise carbon sequestration) encourage low biodiversity options, like afforestation with non-native monocultures [16].
Traditional conservation, especially within the UK, has been based on managing a diverse range of habitats, often in different stages of ecological succession [17], with the focus being on protecting biodiversity as a whole, or a taxonomic group (e.g., birds) or even a particular species (e.g., Dartford Warbler) [18]. As such, a rich mosaic of landscapes and habitats exist. Despite this, conservation in the UK is considered underfunded, and overall biodiversity trends are poor [19]. However, almost all habitats offer the potential to sequester carbon [20], and the selling of carbon credits can provide a vital funding mechanism to finance conservation, resulting in reduced atmospheric carbon, enhanced biodiversity, and more resilient habitats. With targets to conserve and protect 30% of land and sea by 2030 being adopted by several countries [21], understanding the extent to which conservation measures for biodiversity can sequester carbon is also important. We focus this study in Dorset, UK, a county with high levels of biodiversity and habitat types, and a wide range of ongoing conservation incentives from local and national organisations, including rewilding schemes and creation of large nature reserves [22,23]. This provides the opportunity to assess carbon sequestration across multiple habitat types, with similar habitats occurring across much of northern Europe. To our knowledge, this is the only study to examine carbon sequestration from conservation activities across multiple habitat types in a northern European setting. As such, the aim of this study is to obtain preliminary data on likely carbon sequestration of different conservation projects across different habitat types, and to calculate the cost of these conservation initiatives. As such, we can estimate necessary costs to sequester a tonne of CO2e and see if a conservation-based approach to carbon sequestration is financially viable.

4. Discussion

In this study, we demonstrate the enhanced carbon sequestration which can be obtained from small changes in management to conservation sites (herein conservation-based sequestration or conservation-based offsetting). Sequestration applies across multiple habitats and is not restricted solely to tree planting. Our estimated costs of sequestration are typically higher than several cheap carbon offset schemes, but well within the suggested ranges proposed by the UK government [25], even when including labour costs, but not when purchase of land is required. As such, conservation-based offsetting can be used as a mechanism to drive conservation funding in the UK, as long as the work is based on habitat creation and enhancement on existing land.
The conservation-based sequestration rates found in this study can, on average, be considered modest when compared to typical tree planting schemes (across the entire site, ~1 t CO2e.ha−1.yr−1 compared to ~10 t CO2e.ha−1.yr−1 for a typical tree planting scheme). However, the sites used in this study do cover a range of habitats and uses of land and illustrate how these habitats can be managed for biodiversity and carbon sequestration. While this is a small proof of concept study based in a single county in the UK, the 30 by 30 initiative to protect 30% of land by 2030 is an international effort [21]. If similar improvements to carbon sequestration were made to 30% of the Earth’s landmass, then an additional ~4.5 × 109 t CO2e.yr−1 might be sequestered, or a little over 10% of global emissions, based on 2021 data. Clearly, this figure is a very rough estimate, and is provided solely to show that additional carbon sequestration through well-managed conservation of what should be ear-marked protected sites can have a considerable impact on any drive to net-zero emissions and as such have global consequences in fighting the biodiversity and climate crises.
The main purpose of this study was to examine the market potential of conservation-based offsetting to finance conservation work. Averaged across the five sites studied, the costs, excluding labour, of creating or restoring habitats are ~GBP 80 t CO2e−1. Compared to several offsetting schemes, this cost is considerably higher (as of 12th September 2023, the top sponsored offset cost from a Google search was from Carbon Neutral Britain at GBP 7.55 t CO2e−1, or ~10 times lower). However, carbon offsetting has come under considerable criticism in the recent year, with journalists and academics finding that most carbon credits sold fail to sequester any additional carbon (or lack ‘additionality’ in terms of carbon offsetting policy [26,27]). This is on top of additional concerns surrounding land grabbing for afforestation and neo-colonialist approaches to carbon offsetting in the global south [28]. While the values in this study are estimates, based on typical carbon sequestration rates per habitat, and might need quantitative verification before carbon credits were sold, they are based on additional gains in sequestration (true additionality) over the current base rates, and prices based on the cost of achieving these additional gains.
However, in terms of the valuation of a tonne of carbon, the UK government suggests the value should lie between GBP 126 and GBP 378, with a typical value of GBP 252 for 2023 values [25]. Our figures, including labour costs, fall well within this range, although as noted by the UK government [25], valuation and market price can and do show high degrees of discrepancy. While Rodemeier [29] suggested a ‘public willingness to pay’ valuation, based on typical ecosystem service valuation methods, for carbon offsets of up to EUR 200 per tonne, he suggests that these valuation mechanisms are flawed and a realistic market price at present is ~EUR 16 per tonne.
While habitat types vary from location to location, our study in Dorset has examined conservation across multiple habitat types. While sequestration benefits and labour costs for a given intervention in each habitat are likely to be broadly the same across the UK and much of northern Europe, it is clear that different areas have different habitat types. For example, the large number of peatlands in areas such as Scotland and Ireland might result in different conservation priorities, and successful management of those peatlands for conservation (including rewetting) might likely create significantly more emission reductions and more potential for carbon credits [20], likely costing a lower amount per tonne. While labour costs are likely to be similar in Dorset to other regions in the Global North, land prices are very high, inflating the costs in this study when land is included. However, within Global North countries such as the UK, where land prices are high (if not quite as high as our study location), conservation-based offsetting appears to be overly costly, without a multi-facetted approach to justify the high costs above market value. Currently, government grants under land stewardship schemes can be applied for, which can greatly reduce the cost of conservation work which can also sequester carbon. Our estimates show that, on average, these grants can fully cover the cost of any work, excluding labour costs, or that with these grants a tonne of carbon can cost ~GBP 40 with paid labour. However, if carbon offsetting was routinely used for generating conservation funding, it is highly possible that grants such as these might be reduced or limited, given an additional funding mechanism had been put in place.
Conservation work has been shown to provide a wide range of benefits, well beyond carbon capture alone. Through policy initiatives such as Biodiversity Net Gain (BNG) in England and similar approaches in other regions of the UK and throughout Europe, markets for biodiversity credits are beginning to open, creating additional market mechanisms for conservation funding. Practical conservation work can also form a key part of a green workforce and Green New Deal strategies [30], yet several practical conservation skills are lacking in the general public, and even in graduates from degrees such as Ecological or Environmental Sciences [31]. In addition, working on practical conservation in a volunteering role has been shown to have physical and mental well-being benefits, often beyond those found from just being in nature [32]. Creating paid placement or apprenticeship places for students and trainees, as well as providing volunteering opportunities for conservation creates a low wage yet high-value workforce, considering the social, biodiversity, and carbon benefits which can be created. As such, a credit system encompassing biodiversity, carbon, and social benefits can be marketed, commanding a higher cost which might justify the full price (likely excluding additional land purchase) of the work. Such credit schemes may be attractive to companies, especially if they are local to the conservation projects, as a measure of cooperate social responsibility and supporting local access to nature schemes.
Carbon offsetting schemes are controversial, with several people expressing concern that they can prevent urgency in reducing carbon emissions [2]. However, carbon removal forms part of all IPCC scenarios, and nature-based processes to remove carbon are essential alongside large emission cuts to mitigate climate change [33]. Conservation-based gains in carbon sequestration can provide large areas of land to enable carbon removal but also provide additional ecosystem services, including increasing biodiversity, reducing nutrient input into fresh and coastal waters, and human welfare benefits [20]. Furthermore, the additionality of carbon sequestration as calculated in this study (rather than the background rate of sequestration from the land in its current form) creates a genuine decrease in atmospheric carbon dioxide. While our results are obtained in a local context, the concept of conservation-based carbon credits can apply globally, and, in several cases, can be utilised by local industries, thereby helping mitigate some of the ethical and neo-colonial issues resulting from buying land for tree planting alone.
At present, the role of conservation-based offsetting is likely to be small-scale and unlikely to make a big impact on global carbon budgets. However, there is potential for the approach to play a powerful role in reducing atmospheric carbon dioxide, as estimated above. Currently, while some premium carbon offset schemes do exist, charging prices in line with the UK government’s valuations, most prices are significantly lower than both this figure and the typical figures estimated in this study (~GBP 80 t CO2e−1). Policy changes are necessary for conservation-based offsetting to play a significant role in carbon budgets, but such policy changes may also help to regulate other carbon offset markets. For example, while codes of best practice for carbon offsetting exist (e.g., the International Carbon Reduction and Offsetting Accreditation, which large organisations such as Verra align with [34]), compliance with these codes is not compulsory. While flaws in verified carbon markets have been identified, especially around the principal of additionality [27], these codes do help to ensure social and ethical issues are considered in the establishment and running of offsetting projects, and it might make sense for such codes to be mandatory for any official offsetting activity (e.g., reaching net-zero in the UK). A greater understanding of an individual and organisational biodiversity footprint (e.g., [35]) and an equivalent drive to net-zero for biodiversity loss might also strengthen biodiversity credit systems (the existing net gain approach is only required for developments such as housing or infrastructure, whereas most supply chains for any organisation have negative effects on biodiversity [35]) and might allow for duel credits from conservation-based sequestration, which might help justify the higher price and drive markets for integrated credit systems as discussed above. Finally, maintaining government funding for biodiversity actions, even if additional money might be obtained from environmental credits, helps to keep costs of conservation work manageable. While land purchase may be expensive, utilising much of the area inside of a protected area network might enable using land already set aside for nature to its maximum potential for biodiversity and carbon sequestration.

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