Carbon Credit Markets

Note: This issue is evolving quickly, please review specific carbon program websites for the latest information.

Carbon credits have recently become available as a source of potential income for smaller acreage landowners in Indiana. Third party companies can make payments for the carbon sequestered by the trees on your property. Each program uses different methods to calculate carbon and make payments, but all are based on paying landowners for additional sequestration, above what you would sequester under normal conditions.

There are several programs available in the US, but some are in various stages of piloting and not yet available in the Midwest. Many factors are still to be determined, including original and final forest inventories, audits, calculations of additional carbon stored, and certification by independent third parties to ensure standards are met.

NCX and Forest Carbon Works are the only programs available in Indiana at this time. There are minimum eligibility requirements and some landowners may not qualify. All programs require a contract period and obligations by the landowner. Landowners are recommended to do their due diligence before signing any contract. It is recommended you consider talking to your forester, your attorney, and your accountant before signing any contract. Contracts may limit your ability to participate in future carbon programs, may impact future forest management, and payments have tax implications.

Here are some resources to learn about carbon and the programs available:
Chart comparing various carbon programs, Sept 2021
Carbon Storage, Credit Markets and Forests: What do we have and what do we need? Dovetail Partners, Sept 2021
Webinar: Accessing Carbon Markets, October 2021. Compares and contrasts the various carbon programs. (Note: This program is free to view but requires registration)
Webinar: NCX: A New Carbon Program for Hardwood Landowners, June 2021
American Forest Foundation Advocacy Center: Federal policy on forest carbon and climate change