Carbon offsets: cost of CO2 removal per tree planted?

Cost of CO2 removal per tree planted

The purpose of this data-file is to calculate the cost of CO2 removal per tree planted, using a simple modelling methodology, based around the tree’s risked and discounted future carbon absorption.

The reason this is important is that some organizations, especially charities, are committing to plant trees in return for financial contributions. But in order to compare this option with other CO2 abatement options, we need to convert the units into $/ton of CO2.

This is actually quite difficult and variable. ‘Planting’ can range from scattering seed balls through to raising seedlings for 1-3 years in nurseries and then planting them out carefully. ‘Trees’ can also ultimately range from 40kg mangroves through to the 2,000 ton General Sherman Redwood.

Our methodology estimates how many tons of CO2 will be absorbed per tree as it grows to maturity, then ‘discounts’ future CO2 removals into ‘present CO2 terms’, then risks the calculation according to the survival rates and permanence of the CO2 absorption.

A good rule of thumb is that tree-planting should cost $15/ton of CO2 that is removed on a risked net present carbon basis. Numbers can realistically vary from $10-100/ton, but will mostly be in the $15-30/ton range.

Costs are likely lower than fully certified and verified nature-based CO2 removals. The trade off between lower-cost and lower-quality CO2 removals can be evaluated on a case-by-case basis (examples here).

Our key points on the cost of CO2 removal per tree planted are highlighted in our article here.

CO2 Removals: BaumInvest Mixed Reforestation, Costa Rica?

BaumInvest Mixed Reforestation Review

This BaumInvest Mixed Reforestation review is the first report in a new series evaluating nature-based CO2 removal projects, to assess whether they are real, incremental, measurable, permanent and bio-diverse, using a quantitative, apples-to-apples framework. Over time, we will use this framework to inform our own CO2 offsetting, and hope it is helpful for an increasing number of clients who are looking to do the same.

In this data-file, we have assessed the BaumInvest Mixed Reforestation Project in Costa Rica (Gold Standard overview here), on our 100-point review framework.

The project is generating 5kTpa of CO2 removal credits, after reforesting former over 800 hectares of pasture-land in Costa Rica in 2007-2012, with semi-wild plantations, comprising 40 combinations of 17 tree species. We think 75% of c75 sub-plots comprise 3-species, c20% comprise mono-cultures and another 25% of the project area is natural forest.

The project achieved a score of 82/100 on our framework. It scored weakest on permanence (12/20) as timber will periodically be harvested from the plot, albeit using continuous cover forestry practices, and enabling slower-growing species to mature as part of the land’s long-term re-forestation. The project scored highly for being incremental (20/20), real (17/20), measurable (17/20) and bio-diverse (16/20).

As a result, we have purchased 67 tons of CO2 removals from the project, at $45/ton, for a total consideration of $3,015 in July-2022. Details are in the short data-file below.

To read more about our thoughts on the BaumInvest project, please see our article here. To find out how they nature-based CO2 removals are re-shaping the energy transition, please see our article here.

Carbon offsets: costs and leading companies?

This data-file tabulates the costs of carbon offsets being offered to consumers and commercial customers by c30 companies. Prices are surprisingly low, ranging from $4-40/ton of CO2.

Which projects are most economical? Costs are lowest at forestry projects, particularly at companies where you pay “per tree” rather than “per ton” of CO2. They are also lower at non-profits (which also means contributions are tax-deductible). Finally, they are lowest at companies undertaking projects directly, rather than as “middlemen” (charts below).

Are they CO2 offsets real? The also file contains detailed notes on each company, to assess their credentials. Moreover, it tabulates 1,600 carbon offset projects which are assured by agencies such as the ‘Verified Carbon Standard’, Gold Standard and Green-E, for a broader perspective.

Offset your own CO2? We have used the data-file to select and allocate carbon offsetting dollars to Eden Reforestation, One Tree Planted, The Gold Standard and Sea Trees. We are happy to discuss CO2 offsetting with TSE clients and those using the data-file.

Copyright: Thunder Said Energy, 2022.