active entry into the carbon market in early years. Opinions vary about whether the absence of a more proactive and universal policy may act as a source of uncertainty that suppresses participation in new compliance and voluntary markets. The National Congress of American Indians (NCAI) has called on the Department of the Interior to treat the revenue from the sale of carbon offset credits as “trust funds” as defined by 25 CFR Section 115. NCAI (2018). Some tribes feel that a more hands-off posture for both carbon markets and silvicultural guidelines and tools for integrating carbon stewardship into silvicultural and harvesting strategies and forest plans could put trust lands at a disadvantage in emerging and increasing competitive markets. Others prefer the status quo and the absence of oversight by federal authority. New opportunities for tribal carbon offset projects are developing with the state of Washington’s new Climate Commitment Act (CCA) (State of Washington 2023a), which is similar to the California program but with a special category of projects for federally recognized tribes and with new grant programs—a Tribal Carbon Offset Assistance Grant (State of Washington 2023b) that provides funding for tribes to plan, design, and assess the feasibility of carbon offset projects, and a Tribal Consultation Grant (State of Washington 2023c) that provides funding to tribes to consult on how CCA auction revenue is spent. The CCA
allows negotiations on the issue of required waivers of sovereign immunity, unlike the California program’s blanket requirement. Prices for carbon offsets have been historically low but have risen with reentry into the Paris Climate Accord and are projected to rise ever more as voluntary markets grow. The long-term implications of higher prices relative to timber values may create sharper tradeoffs between carbon and timber goals, and in adopting carbon friendly adjustments such as extending rotation ages or lowering harvest levels. So far tribes have found the two goals compatible, even complementary, as more tribes express interest in emphasizing non-timber goals in their management strategies (see A1, F2). There is also a rapidly growing demand for carbon offsets combined with additional attributes to satisfy corporate environmental, social, and governance (ESG) investments and supply chain resilience goals. At the same time, there is growing scrutiny of offsets and IMF projects based on public concerns about project integrity and the transparency of claims of additionality in carbon sequestration results. Tribes should expect higher standards in future markets. Although some of the larger tribes were recruited in the last decade and are already committed in compliance (CARB) markets, opportunities for smaller tribes may be available
in newer market arrangements with shorter commitment times, a broader sweep of payments for ecosystem services, and some help in organizing to reduce barriers to entry. Several tribes are now investigating voluntary market arrangements and are being approached by corporate investors. The National Indian Carbon Coalition (NICC 2023) was established to help tribes and their members generate income through sustainable management of tribal lands and successfully entering the carbon compliance and voluntary carbon markets. The future of these arrangements will be enhanced by addressing some lingering issues: ■ Improving the integrity and transparency of the carbon credit arrangement. ■ Dealing with the growing threat of fire and other disturbances and implications for contract terms. ■ Developing the ability to aggregate allotment ownerships and/or multiple tribal prospects into larger units for cost reduction and market positioning. ■ Refining methods for calculating the reversal risk and the leakage adjustments to reflect differences more accurately in risk profiles across regions, forest types, and management settings. ■ Developing better markets for reforestation, afforestation, and avoided conversion project types as well as offset protocols for woodlands ecosystems.
Task Findings and Recommendations 177
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