Farmers and landowners looking at alternative ways of generating income are being reminded that they have just weeks to apply for a government tree planting scheme.
The Woodland Carbon Guarantee is a Government scheme which incentivises landowners to plant trees on their land by ‘selling’ the carbon dioxide the trees capture in the form of ‘carbon credits’. The price of the credits is agreed through an online auction, and the Government will buy them every five or 10 years until 2055/56.
Our agribusiness experts at Fisher German are reminding farmers and landowners that they have until 9 July 2021 to apply for the scheme ahead of the next online auction which will take place between 26 July and 1 August this year. Senior Agribusiness Consultant, Julie Wade, said that it provides a great way of earning reliable extra income to those with spare land where they can plant trees.
“The Woodland Carbon Guarantee provides an excellent opportunity to farmers and landowners. The credits’ price is guaranteed once it’s been initially agreed, and the government will buy them every five or 10 years up to 2055/56. This will provide regular long-term income for those who plant trees, and also resists the volatility of the price of the credits on the open market. However, farmers can also choose to sell their credits to the open market if they feel they can get a better price for them than what was agreed.”
The scheme is open to land managers who are owner occupiers, tenants, landlords and licensors, as long as they have control of the land. To apply, landowners must register for the ‘Woodland Carbon Code’ which measures how much carbon their trees will capture. They must then participate in an online reverse auction where farmers make their bids on what price the government should buy their carbon credits for. If a landowner is successful, the government will offer them a conditional 30 to 35-year contract which will allow them to plant the trees. Once the trees are planted, the government will then pay for the credits at regular intervals.
Julie added: “We would advise landowners to get advice from a farm consultant or woodland specialist before applying to ensure they are in the strongest position possible. These experts will be able to advise on what to bid to the government and recommend a minimum price which landowners should not bid under. With the deadline just weeks away it’s important that anyone interested acts now to make the most of this opportunity.”
For more information or for support with your application, don’t hesitate to get in touch with our agribusiness team.
Read more about carbon auditing here