In exchange for maintaining a healthy forest, the Passamaquoddy Tribe in Maine is being rewarded by environmental polluters more than 3,000 miles away. Confused? Don’t be. The tribe earned national recognition and is developing new economic opportunities while preserving its environmental legacy by participating in an innovative carbon offset program in California.
On April 20, the Passamaquoddy Tribe received an award at the Navigating the American Carbon World Conference in San Francisco for registering the most offset credits with the Climate Action Reserve during 2016. The Project Developer of the Year award recognizes one of the largest tribally owned cap-and-trade projects in the United States. The tribe has registered the removal of 3.2 million metric tons of carbon dioxide from the atmosphere through measured tree growth over a 98,000-acre project area on tribal land in Maine.
This is an over-simplification, but essentially the Passamaquoddy Tribe is being paid to commit to a long-term forest maintenance program, because mature forests absorb carbon dioxide in the air and are huge reservoirs of stored carbon. In exchange for preserving its forests and pledging to grow more trees than it harvests, the tribe receives credit for removing carbon dioxide from the atmosphere. The credits are paid for by companies, governments and other entities to comply with emissions caps. Every ton removed can be converted to one credit, which the tribe can sell to offset carbon emissions generated by polluters.
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The tribe has participated in the program since 2014, and recently sold about 484,000 credits. The tribe invested money from the sale in a tribal-run blueberry company, its forestry department and a new maple syrup bottling company, Passamaquoddy Maple. It currently taps about 18,000 sugar maples on 65,000 acres of tribal land in northwestern Maine and is on its way to becoming what tribal chief William Nicholas hopes will be “one of the biggest maple producers in the state of Maine and the Northeast.”
The carbon offset program is a big success story for the tribe, which has limited economic development opportunities in Washington County, one of Maine’s poorest and most remote counties. The Passamaquoddy has 3,600 members among three self-governing communities. Two are in Maine: Indian Township and Pleasant Point, one inland and one on the Atlantic Ocean, about 55 miles apart. The third is in St. Andrews, New Brunswick, Canada.
The tribe debated participating for about six months, before agreeing to a feasibility study, which led to its decision to commit to the carbon-offset program. It wasn’t an easy decision, because it committed the tribe to a long-term rigid forest management program, Nicholas said. But ultimately, it was the right decision for myriad reasons.
“We are already doing what they are asking, which is to grow more than you cut,” Nicholas said. “The more you grow, the more credits you receive. This fits us like a glove. It helps us maintain our healthy forests, which is always our goal. We never want to overharvest our land. It’s part of our culture and part of our identity.”
Nicholas declined to say how much money the tribe earned from the sale of offset credits. According to CaliforniaCarbon.com, which reports on the North American carbon market, credits were selling for between $10.98 and $14.25 last week. The tribe is marketing its remaining 2.25 million credits, Nicholas said. “We can sell some or sell all, or hang on to them to see if there will be more value over time,” he said.
Thursday’s award represents the first recognition of a tribal project by the Climate Action Reserve, which develops, promotes and supports market-based climate change solutions. Among the attorneys who advised the tribe on its participation in the program was Corey Hinton, from the Washington, D.C.-based law firm Akin Gump Strauss Hauer & Feld LLP.
Hinton is a Passamaquoddy tribal member from Pleasant Point, Maine, who specializes in American Indian policy. He approached the tribe in 2013 when the Climate Action Reserve opened its program to out-of-state participants, including tribes. “It makes a lot of sense for tribes. It is unique and perfect interaction between natural resource management and economic development,” Hinton said.
The program especially made sense for the Passamaquoddy, because the tribe already complies with federal regulations requiring it to maintain its forests in sustainable ways. The California program requires similar guidelines as the federal program, which made it easy for the Passamaquoddy to qualify, Hinton said. “We have an excellent forest department that has developed a stringent forest-management plan under federal law. That made it an especially advantageous opportunity,” he said.
Nicholas said the award felt significant “because it exemplifies how tribal nations can pursue self-determination while also adhering to our solemn commitment to environmental stewardship.”
The money the tribe has received so far “is a tip of the iceberg,” Hinton said. “The tribe is in the process of marketing a sum of credits that is four or five times larger than what they have already sold. There is real potential to create long-lasting economic development in addition to a long-lasting positive environmental impact.”
The award represents smart, forward-thinking economic development, as well as a shift in tribal economic development policies, Hinton said, predicting larger carbon transactions in the near future. “We’re seeing a shift away from the recent trend of gaming and hospitality-type services to sustainable economic development, while assuring that economic development is married to traditional stewardship. That’s what this project is all about,” Hinton said.