Carbon offset legislation signed into law this week gives the state authority to develop carbon management projects on state lands, sell the carbon offset credits and lease state lands for carbon management purposes. Senate Bill 48 earlier this year said the law will generate new revenue for the state, enable more active forest management, and ensure continued public access and use of state lands.
“Just like oil, just like gas, just like our timber, this is a commodity that can be monetized now, and Alaska is going to play a big role,” Gov. Mike Dunleavy said on Tuesday while signing the legislation into law during the Alaska Sustainable Energy Conference in Anchorage.
Carbon emissions occur in a variety of ways, from burning of fossil fuels to wildfires.
Along with establishing the framework for carbon offset projects, the bill gives the Alaska Oil and Gas Conservation Commission authority to pursue primary authority over Class VI underground injection wells. Class VI wells are used for geologic sequestration of carbon dioxide.
While approved by legislators, some of those observing Alaska’s interest into the clean energy market are skeptical of the benefits this carbon offset legislation will bring. While supporting moves for carbon offset, the Dunleavy administration has continued to support projects for more fossil fuel production, including the Willow oil project.
The state’s new carbon offset plan would allow the state to get paid to protect its forests, an idea that some Alaska Native corporations have already made financial use of, and the demand for more carbon offset options is predicted to increase.
A report for the Alaska Department of Natural Resources (DNR) — prepared by Anew, a firm offering carbon offsets programs, and released in August 2022 — evaluated carbon offset opportunities in Alaska to generate revenue for DNR. It concluded the most promising and easily implementable opportunities are in forestry, but cautioned that only in circumstances where the credit revenue exceeds project costs are such projects recommended.
