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Science & Data Bytes

Forest Carbon Offsets for Colorado Landowners​

  • Amanda West Fordham, Ph.D., Associate Director of Science and Data, Colorado State Forest Service
  • Ethan Bucholz, Ph.D., Forest Monitoring Program Manager, Colorado State Forest Service
  • Tony Vorster, Ph.D., Research Scientist, Natural Resource Ecology Laboratory, Colorado State University
  • Ashley Woolman, Forest Carbon Specialist, Colorado State Forest Service
  • Amy Bulger, Communications Specialist, Colorado State Forest Service
forested mountainside with young growing trees in the foreground.
Trees regenerate at the Colorado State Forest near Gould, Colo. Photo: CSFS/Lockwood

Forest carbon markets are one natural solution to increasing carbon sequestration, which reduces the amount of greenhouse gases entering the atmosphere in the long term. Carbon markets exchange carbon credits and provide a way for forest landowners to derive long-term, non-consumptive value from well-managed forests.

A carbon credit represents the removal of one metric ton of carbon dioxide equivalent (tCO2e) from the atmosphere. These credits are derived from activities called carbon offsets that capture greenhouse gases (GHGs) to compensate for GHG emissions.

Forestry activities that may be classified as carbon offsets include forest conservation, avoided conversion of forests, reforestation, afforestation and improving forest management. Forest management can, in some cases, provide quantifiable increases in carbon stocks through mitigating carbon lost to disturbance (e.g. wildfire, insect and disease). Entering a carbon market does not preclude timber harvest or other management activities, but it does influence forest management decisions. For example, it may necessitate changes to how timber is harvested during a project, such as extending the rotation period.

Carbon Market Types

There are two main types of carbon markets forest landowners will encounter:

  1. “compliance” markets that are mandated by legislation designed to reduce or offset emissions
  2. “voluntary” markets that allow organizations to voluntarily purchase carbon credits to offset emissions
  • These markets cap total allowed GHG emissions – major polluters such as industry, energy producers and transportation are granted a specific amount or cap in emissions. This cap typically declines over time.
  • Polluters can reduce net emissions and/or purchase offsets to meet this cap – offsets may be from another polluter who is below their cap, or from organizations that reduce GHGs through actions such as growing trees or using landfill methane emissions.
  • California Assembly Bill 32: The Global Warming Solutions Act created the largest regulated carbon market in the world that allows managed forests to generate offset credits, including in states such as Colorado. The CA Cap-and-Trade Program is regulated by the California Air Resources Board (CARB).

“CARB requires rigorous third-party verification of offset projects to ensure that their reductions are real, quantifiable, permanent (for a minimum of 100 years for forest projects, for example), and additional – that is, above and beyond what is legally required and what normal practices are for any given project. This approach means that offsets deliver multiple benefits even beyond the carbon reductions they generate.” – CARB

There are other regulated markets already established (e.g. the Regional Greenhouse Gas Initiative in the eastern U.S.) or that may be established soon (e.g. Washington, Oregon). These are small markets compared to California’s forest carbon offset program.

  • These markets are not regulated, but many forest carbon “protocols” have been developed by nonprofit organizations to quantify, track, verify and manage projects.
  • Voluntary credits are verified by auditors and tracked in official registries:
    • Climate Action Reserve Registry (CAR) – a California nonprofit that includes reports for carbon market projects in all 48 continental U.S. states. It uses U.S. Forest Service datasets for regional carbon storage averages and allows forest managers to receive credits for carbon stored above this baseline. There are additional requirements, including maintenance of native species diversity, forest management on the site must not be required by law, the additional carbon sequestered by the project must be stored for 100 years, broadcast fertilizer is not allowed, downed woody debris must be maintained and project activities cannot start more than 6 months prior to project listing on the CAR.
    • Verra Registry System (formerly Verified Carbon Standard (VCS)) – this nonprofit is currently the most widely used voluntary GHG program across the globe. Projects are certified against the VCS rules and requirements and then issued tradeable GHG credits called Verified Carbon Units (VCUs).
    • American Carbon Registry was founded in 1996 as the first private voluntary GHG registry and joined the nonprofit Winrock in 2007.
  • Programs such as Climate Forward allow companies to make proactive investments in GHG mitigation projects to mitigate expected emissions.
  • A new program developed by the American Forest Foundation and The Nature Conservancy uses Forest Inventory and Analysis (FIA) data combined with modeling and analysis to help owners of small forests participate in the carbon market. The CSFS collects FIA data across Colorado and parts of Wyoming! Called the Family Forest Carbon Program, it designed for family forest owners with forested properties as small as 30 acres that have historically had barriers to enter these markets.

Basic Project Framework for a Landowner

Landowners can hire a project developer to manage the entire process of generating forest carbon offset projects. These developers may cover the up-front investment for the landowner, with an agreement to receive a portion of the proceeds. They will also typically prepare a financial analysis to estimate costs and revenues in advance of initiating the project. The following items are common parts of project development.

The protocol and type of project (e.g., improved forest management, avoided conversion, reforestation) selected should align with the landowner’s management goals. Determining the requirements, eligibility, fee structure and current prices for each protocol will help a landowner decide the best course of action.

Most projects require detailed field sampling of the various carbon pools on the property. The pools included depend on the project type and protocol selected, and they can include above-ground live biomass, below-ground live biomass, dead biomass, soil litter and harvested wood products.

Initial project development requires modeling forest growth and calculating anticipated credit yield.

Each project must develop documents that describe the project and ensure that the activities outlined will be eligible for the project type. This documentation can be completed by the landowner or an outside project developer, and in many cases may require the assistance of certified foresters to attest to the details of the new project scenarios.

Once all the project field work, modeling and documents have been completed, the forest landowner must hire an accredited third party to perform a verification. This includes a site visit to review the property and inventory accuracy. It also includes an office visit to review all the management planning details, carbon modeling and project documents. All documents are submitted to a registry.

After verification, projects are registered in public databases, which certifies authenticity and availability for sale. Selling carbon credits requires knowledge of the different buyers looking to purchase credits. This often involves generating a term sheet or brief document describing the project, terms of sale and amount of credits generated. This can be distributed to a variety of buyers to begin the process of creating a sales contract.

Monitoring, reporting and verification requirements must continue to be met throughout the lifetime of the project. These requirements are defined by each protocol. For California cap-and-trade projects, for example, monitoring of the project is required for 100 years after the final issuance of credits. Over this time, reporting is required annually and verifications requiring remeasurements are required at least every six years.

Connections for Colorado Landowners

  • The Natural Capital Exchange (NCX) is a marketplace for connecting interested buyers and sellers of forest carbon and other ecosystem services. It operates across the continental U.S. and focuses on providing an unbiased assessment of opportunities to participate in natural capital markets for both public and private landowners.
  • Finite carbon connects projects to carbon markets and operates throughout the continental U.S. A program called Core Carbon is in development, which will include landowners with as few as 40 acres.
  • RenewWest provides valuation assistance for landowners and also focuses on leases for reforestation.
  • Anew Climate provides services in project development and is beginning to expand scope throughout the continental U.S.

Various consulting forestry companies may be employed to provide consultation and project development throughout the state.


Brown, M. (2021). Forest Landowners and carbon: How actively managed woodlands can help fight climate change. National Association of State Foresters. Retrieved from

New Reduced Emissions from Megafires Forecast Methodology published by Climate Forward

“Fuel treatments are typically not considered a feasible project activity under traditional carbon offset crediting programs because of the initial carbon loss resulting from the removal or manipulation of forest biomass to reduce wildfire risks, the long period of time before a project would achieve sufficient ex post climate benefits for crediting, and the relatively high initial and ongoing project costs until such net climate benefits could be shown and payments for resulting credits are received. This misalignment between project costs and potential revenues from credit generation provides a barrier to entry that would be difficult to overcome by most would be project proponents. The ex ante approach under this methodology recognizes and credits for the future climate benefits resulting from fuel treatment activities, thus helping to finance a substantial portion of project activity costs. In doing so, the methodology expands the scope of GHG mitigation projects recognized by the market, especially for mitigation projects that would not happen otherwise.”

News in Related National Legislation

The Growing Climate Solutions Act was included in the 2023 omnibus spending bill; now, the U.S. Department of Agriculture (USDA) may expend up to $4.1 million over fiscal years 2023 to 2027 to create and administer a new “Greenhouse Gas Technical Assistance Provider and Third-Party Verifier Program” to provide U.S. farmers, ranchers and private forest landowners with technical guidance for reducing GHG emissions and sequestering atmospheric carbon on working lands. The program would also guide third-party entities that verify and validate claimed GHG reductions to support the generation of credits in voluntary carbon offset markets. The legislation has the potential to advance “climate-smart” agriculture and agricultural commodities in the U.S., through both new and existing USDA programs, while expanding access to carbon markets for U.S. farmers, ranchers and foresters.

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