Since 2017, Wild + Pine has called the EIA’s City Sustainability Campus home, where Business Operations Associate Dave Hochhalter brings me inside the main floor bay, then inside again, into the company’s Bioprism Advanced Vertical Greenhouse. It uses multi-spectral lighting to grow a wide array of hearty tree and shrub seedlings much faster than traditional methods, all under the adorable supervision of Penny the pup. Inside, we discuss the certified B-corporation’s ability to grow better trees faster, on a scale that will help reverse the terrifying impact of human-made climate change.
When it comes to addressing climate change, the traditional paradigm puts big business on one side, hippy dippy tree planters on the other, and the government overseeing it all. Today, the reality is more blended. Hippies run businesses too, and even some of the most reluctant corporations are buying into the idea that they should pollute less, or at least offset their carbon footprints, because the end of the world could really affect their profits. But if the government stays on the sidelines, any regulatory system is doomed to fail — or at least be exploited. Because without refs, dirty players ruin the whole game.
The people at Wild + Pine plant huge numbers of trees, but they aren’t hippies. They’re entrepreneurs who run a small environmental restoration company that uses afforestation techniques (the planting of trees on currently tree-less land) to help reforest land across western Canada.
Clients who invest in their projects can receive carbon offsets once the forests have grown and their carbon-removal effects have been verified. One credit counteracts up to one tonne of carbon dioxide emissions from a company (or country) up to a certain limit. If a company exceeds the limit, it can buy extra credits from Wild + Pine clients. If it stays under the limit, a company can sell the difference to other emitters. It’s a system intended to provide funding for environmentally positive impact projects.
At least, that’s the theory. Upstairs in Wild + Pine’s EIA office, Hochhalter gives me a practical lesson. “Let’s start with Company A,” he begins. “They have an emissions profile, which includes the cause of all their greenhouse gas emissions — driving a truck out in the field, running a diesel generator to run tools, even things like the lights in their office.” Total all that up and you know how many tonnes of CO2 Company A creates. Typically, a third-party audit produces the emissions profile.
Once they define that profile, there are three basic ways to manage it: Company A can stop the emitting activity, do it more efficiently, or pay for it. Paying for it has two options: pay the government’s carbon tax, or pay someone else less to manage it. “That’s what the verb ‘offsetting’ is,” Hochhalter says. “You go to Company B and say, ‘I want to drive my truck, so I will pay you [less than the carbon tax] to not drive your truck, or drive an electric truck, to counter-balance that.’” And so a carbon credit system is born.
Since 2017, even Walmart, a heavy polluter, has encouraged its suppliers to join its Project Gigaton, influencing its supply chain by telling suppliers to meet carbon removal goals or risk losing their biggest customer. That’s a big ship slowly turning in the right (green) direction, and it should pull others in its wake.
But for a small company like Wild + Pine, which develops carbon offsets as part of its business model, the market is too wild west. “We need to democratize sustainability in the sense that it can’t just be big companies that can afford to play in this market, it needs to be the coffee shop, it needs to be the household,” says Wild + Pine’s President and CEO Chris Kallal (a Top 40 Under 40 alumnus). “But what can happen when it goes up that chain to the retailers and brokers, is that it pushes out those groups that bring the sheer collective action, and sheer scale, to an effort that needs every single business to participate to really make that huge impact.”
The problem is that some companies and brokers are bad actors. They’ll do things like register a forest on their land — containing trees they were never going to touch — as an “avoided deforestation project” and get credits by telling auditors that they totally were going to cut it down.
The registries don’t act as buy-sell points — participants transfer money directly to each other while the registries transfer the serialized “credits.” The problem there is that some companies sell offsets from the same projects at different prices, and the purchasers resell them again at a markup. It’s a way to make money off of nothing but defeats the environmental (and moral) purpose of the whole system. “The chain of custody is too long,” Hochhalter says. “Who added value? What value did they add? Once a credit gets retired, that should be the end of it.”
Despite all this carbon chicanery, Hochhalter remains a big fan of the carbon credit market. He applauds John Oliver’s Last Week Tonight for calling out big companies and putting social pressure on them for engaging in shady projects, but says that, for now, the market is driven by quantity, not quality projects.
Alberta has a relatively mature carbon credit market, which started in 2007. Since 2020, it’s operated under Alberta’s Technology Innovation and Emissions Reduction (TIER) system. It’s registered and retired tens of millions of offsets across more than 300 Alberta-based projects to date. Enrolment is mandatory for any emitter producing 100,000-plus tonnes of CO2 per year, and many under that threshold, including small, independent companies, choose to enrol rather than pay the federal carbon tax.
John Storey-Bishoff is the executive director of TIER’s climate regulation and carbon markets team. As a government entity that sets regulations, he says TIER is satisfied with its baseline conditions for entering its market. And it doesn’t find many bad actors “because in our regulatory space, the value of an offset basically defers a payment of $65 per ton,” which is more expensive than most voluntary markets, so trying to resell them at higher prices isn’t worth their time.
But he feels the pain of Wild + Pine, which is on the United States-based Verra registry, not TIER’s, in part because TIER doesn’t yet have protocols for afforestation projects. “We’re playing the role of a regulator in Alberta. But some of the voluntary markets, there isn’t really a role of a regulator,” Storey-Bishoff says. “And you don’t necessarily have transparency between the purchaser and the seller. So the folks who are the end users of the credits, or the businesses that are going to be using it for compliance purposes, they’re on the hook if those credits are not well founded.”
This brings us to the federal government, which has only recently completed its regulations to enable the creation of a federal offset system. “So it’s only been creating kind of a regulatory demand for offsets over the last two or three years,” Storey-Bishoff says. “They are at the early stages of evolving a system, but I would fully expect it will have a good deal of rigour.”
A rigorous regulatory system is what Wild + Pine wants. The team even hosted Prime Minister Justin Trudeau in its greenhouse, and later met with Minster of Natural Resources Jonathan Wilkinson, whom it asked to provide a framework for nature-based carbon projects. The Wild + Pine team left the meeting feeling optimistic. But in any federal government, bureaucracy abounds. “There’s intent — they’re working, they’re trying,” Hochhalter says, but as the only entity that can set up a well-regulated, national market for honest players, it needs to act fast.
Because with reversing climate change, pace is everything, and “net zero by 2050” is too late. No one quoted is a climate scientist, but everyone can read the Intergovernmental Panel on Climate Change reports and see the almost daily “unprecedented” floods and fires around the world. And in the case of an ahead-of-the-carbon-credit-curve company like Wild + Pine, it’s seen the disturbing change of pace firsthand. “When we first started having conversations about trying to market sustainability as a service, it took some convincing,” Kallal says. “But now, we don’t have to convince people. With all the wildfires and heat waves and flooding, that’s our marketing. It works, but it’s the worst kind of marketing tool.”
This article appears in the May 2023 issue of Edify
