Comment: The Proposed Methodology explicitly contemplates crediting forests whose landowners have sold the option to harvest to third parties, illustrating its failure to screen obviously non-additional behavior. Option holders control the decision to harvest, not the landowners being credited for outcomes outside their control. Timber sale contracts often provide a third party with the right to harvest the landowner’s timber within a specified period of time. 13 The Proposed Methodology mentions this arrangement in passing, asserting that an exercisable harvest option could reasonably be interpreted as implying a 100% probability of future harvest. 14 This example illustrates the Proposed Methodology’s profound failure to screen obviously non-additional behavior. When a landowner sells a harvest option to a third party, the landowner no longer controls the decision to harvest or not harvest. That decision rests with the third-party option holder. Nevertheless, the Proposed Methodology allows projects to assign a 100% probability of harvest to lands subject to an exercisable third-party option. This would allow the landowner who has sold a harvest option to claim full credit for deferring harvest for every year the third-party rightsholder elects not to harvest timber. But contractually, the decision to harvest rests exclusively with the third-party option holder. In this situation, it makes no sense to claim that compensating a landowner with credits induces a change in harvest behavior. This potential loophole calls into question the Proposed Methodology’s ability to screen non-additional behaviors that are particularly concerning in light of the unique challenges of short-duration crediting periods.
Proposed Change: Verra should prohibit landowners with outstanding harvest options from claiming credits for avoiding harvests that they no longer control.
NCX response: We note the confusion around this line in the methodology and have reworded this section to clarify the intent which is that the owner of the exercisable option may generate carbon credits.
Commenter Organization: CarbonPlan
Commenter: Danny Cullenward
2021 Deferred Harvest Methodology Section: No Section Indicated
Comment: The Proposed Methodology explicitly contemplates crediting forests whose landowners have sold the option to harvest to third parties, illustrating its failure to screen obviously non-additional behavior. Option holders control the decision to harvest, not the landowners being credited for outcomes outside their control. Timber sale contracts often provide a third party with the right to harvest the landowner’s timber within a specified period of time. 13 The Proposed Methodology mentions this arrangement in passing, asserting that an exercisable harvest option could reasonably be interpreted as implying a 100% probability of future harvest. 14 This example illustrates the Proposed Methodology’s profound failure to screen obviously non-additional behavior. When a landowner sells a harvest option to a third party, the landowner no longer controls the decision to harvest or not harvest. That decision rests with the third-party option holder. Nevertheless, the Proposed Methodology allows projects to assign a 100% probability of harvest to lands subject to an exercisable third-party option. This would allow the landowner who has sold a harvest option to claim full credit for deferring harvest for every year the third-party rightsholder elects not to harvest timber. But contractually, the decision to harvest rests exclusively with the third-party option holder. In this situation, it makes no sense to claim that compensating a landowner with credits induces a change in harvest behavior. This potential loophole calls into question the Proposed Methodology’s ability to screen non-additional behaviors that are particularly concerning in light of the unique challenges of short-duration crediting periods.
Proposed Change: Verra should prohibit landowners with outstanding harvest options from claiming credits for avoiding harvests that they no longer control.