Published in the Nova Scotia Business Journal, March 2011, which you can see here.
Protecting the environment and increasing revenue can seem like opposing goals, but one Nova Scotia paper company is achieving both at the same time. Minas Basin Pulp and Power sells carbon credits to buyers across North America, making money and helping other groups reach their carbon-reduction goals.
In a regulated carbon market such as Europe, companies must reduce their greenhouse emissions by certain amounts. They make reductions themselves, or pay another company to reduce emissions on their behalf. Every metric ton of carbon dioxide or an equivalent amount of other greenhouse gas that isn’t released equals one carbon credit.
Canada doesn’t have a regulated carbon market yet, so Minas Basin trades in a voluntary North American market and sells all the carbon credits it generates.
“The voluntary market exists when individuals or companies want to reduce their own carbon footprint, just to sleep better at night, or for companies that want to offer carbon-neutral products”, says Aaron Long, manager of energy resources for Minas Basin.
Minas Basin started energy-efficiency projects at its mill in 2002. The company has its projects independently examined, with experts calculating how many carbon credits it will earn. Projects are re-evaluated annually.
“It’s detailed,” says Long, “and it has to be. There’s been a history of lack of knowledge in the carbon credits industry. The better the standards, the better it is for everybody.”
The projects generate more than 10,000 carbon credits annually, which currently sell for around $5 each. More projects are planned.
Long says carbon trading has been positive for Minas Basin, increasing its focus on efficiency and sustainability, and bringing in revenue. Others in forestry have been slow to adopt it. Reforestation projects are popular with buyers, but that’s not enough.
“You’d probably get another $4 or $5 per carbon credit for forestry projects,” says Long, “but it really needs to be $60 or $70 more to make those projects economically viable.”
Jeff Bishop, spokesperson for the Forestry Products Association of Nova Scotia, says the lack of provincial structure for carbon trading is also discouraging many forestry companies.
“In two years, there could be a system set up with government regulations, and your project that you just spent money on might not qualify under the system,” says Bishop. “Things could dramatically change.”
The provincial government is currently examining the potential supply of carbon offsets in Nova Scotia, including the forestry sector. This is part of the work being done to implement the Voluntary Carbon Offset Fund Act which was passed last spring. More information is expected this summer.
Provincial guidelines and a rise in the value of carbon credits could see more forestry companies following Minas Basin’s lead.
Long says a provincial carbon market can’t come fast enough.
“It’s inevitable that we are going to be entering into a carbon-constrained economy, where every company has to address these issues. By addressing them early, we become better able to manage those risks and help others do so.”
