By promising not to develop lands no one plans to develop, Alaska dreams of cashing in on carbon

Gov. Mike Dunleavy is jumping on the carbon sequestration bandwagon, pitching it as the next best thing to free money, a cash cow that no one will oppose.

“The reason we landed on this is it doesn’t gore any ox,” Dunleavy said at a budget press conference when asked why he chose carbon sequestration as his only option for raising new revenue for the state.

The idea is to promise to lock up large parcels of land that no one is planning to develop—and get companies to pay the state for the amounts of carbon that won’t be released into the atmosphere because the land is locked up for the next 100 years.

The state has a lot of land on which it has no intention of ever cutting the trees down, so that is why Dunleavy figures that the oxen will remain ungored in perpetuity.

One of the first specific plans comes from the the University of Alaska, which has just announced a plan to sell non-development rights on 21,000 acres across the state in parcels large and small.

The university said it would seek competitive bids to lock up the land for 100 years, saying development “will be limited” for the duration. A lot of the land is in the Interior, north and west of Fairbanks, but there are parcels in Southeast and Southcentral. Here is a link to the map.

Comments on the university plan are due by Jan. 19.

“This disposal will be completed through a competitive bidding process at or above fair market value and will not convey land or mineral estates out of University ownership; only those interests relating to carbon credits will be transferred for the term of the credit,” the university says.

One question I have is what happens if and when the trees on a parcel burn down. Will the buyer of the carbon credits get its money back the the inevitable happens?

Will the buyer want the university to try to prevent fires?

Especially in Interior Alaska, forested areas are likely to burn in a given century. And fires are a natural part of the ecosystem every few centuries.

While Dunleavy is suggesting that the state could soon collecting hundreds of millions a year without going anyone’s ox, the state 10-year budget forecast doesn’t mention carbon sequestration.

Instead, the 10-year plan claims that the state will collect $300 million from an unnamed source starting next July, tripling in three years to $900 million a year. The $300 million target for next summer seems unconnected to any specific plan. The number appears to be one plucked out of thin air, plugged into the budget chart to try to make a deficit disappear.

New revenue, according to Dunleavy, should not come with an “imposition on Alaskan residents or businesses.”

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