Are We Too Late To use UK Nature To Meet Net Zero Targets?
Hot off the press are several exciting announcements and publications aimed to drive progress and confidence for corporates seeking to enter or increase existing investment into the UK and global Voluntary Carbon Market (VCM).
- The UK Woodland Carbon Code recently announced its on track for initial Integrity Council for the Voluntary Carbon Market (ICVCM) approval.
- IKEN published data on the future of the UK VCM, deep diving into integrity and speculating pricing trends.
- And most recently, SBTi (the global standard setter for corporate climate targets) released its latest Corporate Net-Zero Standard guidance: Version 2.0.
At Forest Carbon, despite geopolitical uncertainty, we’ve seen first-hand this flurry of demand activity over the past 6-12 months, particularly with parties interested in supporting local nature-based removal projects as part of a wider ‘net zero’ curated carbon portfolio. However, whilst ambitious net zero goals create much needed demand and opportunity for scaling UK projects, applying this in practice isn’t quite that easy.
This article explores the misalignment between net zero targets and reporting vs. the UK carbon credit delivery timelines for woodlands and peatlands. This highlights why acting now is critical and why we are showcasing a rare UK project opportunity to enable earlier movers to get ahead of the curve: Forest of Mamlorn.
What drives interest in UK projects?
The UK has long been a financial powerhouse and is home to some of the biggest global companies, particularly within the banking and finance sector. It is also leading in climate action and carbon markets. For those companies, UK customers, staff, and investors are central to their activities (and emissions).
With fluctuation in the VCM strongly linked to integrity issues over the years; UK projects – sitting under UK laws and a stone’s throw away – can feel tangible and provide greater assurance to investors that their money is being spent wisely.
And finally, the UK remains one of the most nature-depleted countries in the world, therefore action on our doorstep is as important as anywhere.
Understanding timeframes of UK woodlands and peatlands
At present, the majority of UK nature-based carbon projects sit within the UK government-backed Woodland Carbon Code and IUCN’s Peatland Code. In addition to these two bodies, we are seeing emerging project methodologies and technologies beginning to scale, including soil carbon, blue carbon, and engineered solutions among others, as well as new standards such as the likes of Wilder Carbon, UK Carbon Code of Conduct, and Verra’s Verified Carbon Standard (within the UK).
So, what does this mean? Well, UK woodlands and peatlands are comparatively slow in their delivery of the removal and reduction of carbon. It doesn’t have the same conditions as similar projects in other parts of the world, due to variables such as the smaller size of projects, slow growing native species and peat formation in our current geographical climate, and other restraining factors.
In short: a tree takes a long time to grow and a long time to sequester carbon.
This is why in the early days of the market, a two-credit mechanism was created to help early capital flow into projects, to enable landowners and developers to take risk, and subsequently prove a market. This mechanism still exists today through the use of ex-ante and ex-post credits. Pending Issuance Units (PIUs) represent a “promise to deliver” expected future carbon savings. These convert to verified Woodland Carbon Units (WCUs) and Peatland Carbon Units (PCUs) as a project is monitored in future verifications to ensure it is delivering against expected outcomes. Under current minimum requirements of standards such as the Woodland Carbon Code and Peatland Code, projects must be assessed and verified at year 5, and every 10 years thereafter. Verifications involve independent auditors taking measurements at sample sites within a project boundary to monitor project performance.
For woodlands certified under the Woodland Carbon Code, depending on variables such as species mix and the management plan, projects can take up to 100 years to remove the estimated carbon. It is however expected that they will continue to grow and evolve beyond this point. This delivery of carbon removal by trees is also non-linear, with projects following a typical vegetation growth curve (and accounting for soil/ground disturbance in establishment). Woodlands typically deliver very few verified carbon credits within the first 15 years, with the bulk happening between years 25 and 55, before tailing off in the remaining years.
Similarly, restoration certified under the Peatland Code can have long project durations (from 50 to 100 years). Again, verifications are conducted at year 5, year 15, year 25 and so on. However, delivery of units occurs linearly (pro rata at each verification) and therefore doesn’t have quite the same imbalance of woodlands over the first 15 years.What is available then?
The UK voluntary carbon market is still relatively young. Trading only really began in the late 2000s, with Forest Carbon among the earliest developers (you can read more on our Our Story page). When you apply the timeframes noted above, it unfortunately means there is only a very limited supply of available WCUs and PCUs in the market for purchase and under current sustainability reporting guidance PIUs cannot be used to compensate for emissions until they become verified (ex-post).
Even then, it is not like there’s loads of PIUs from the early days available either!
Many PIUs from projects developed from the inception of the Code up to the current decade have also been bought up by businesses already. Therefore, a lot of the available credits come from projects established and validated within the last 5 years (or projects still in development). Depending on species mix, a project planted and validated in 2025 may deliver only 1-2% of its expected carbon removals by 2030, a further 10% by 2040, before really peaking in 2050 and onwards.
You can find more info on the Woodland Carbon Code’s buyer’s page.
All this makes a project unsuitable for near-term offsetting, but they can be a smart, forward-looking investment to prepare for future net-zero needs.
So, does this mean I can support UK woodlands and peatland to fulfil a 2035 net zero target?
We often get asked by prospective net zero buyers if Forest Carbon has WCUs or PCUs available now. The follow up question to that is:
“Can we buy only your credits delivering pre-2035/2040/2050?”
Historically, organisations supporting UK projects have purchased PIUs over the lifetime of the projects (typically 40-100 years). This has been done from either a philanthropic / softer CSR angle, or more recently as part of an SBTi Beyond Value Chain Mitigation (BVCM) claim.
However, as organisations progress net zero ambition into action, we are seeing increasing requests where organisations can’t buy over 100 years and are seeking to only purchase credits from UK projects that deliver within the first few forward vintages.
For projects and developers this leaves an extremely hard question. We know the cost of establishment and can approximate costs of ongoing project maintenance and future verifications. Therefore, we have a good idea of the total capital costs and where we value unit price in today’s market. We have some transparency of what the average weighted market price is. However, if we are to sell the early vintages in isolation of any credits delivering after 2050, we need to understand what value any post-2050 credits would be worth, if any. This is million+ pounds question for many landowners entering the market. Understanding what cashflow is required today vs. hedging against future prices. If only selling the first 15-25 years of credits, what % of the total lifetime cost is a landowner happy with. Therefore, when modelling income over varying contract durations of a project with buyers, how much should they front weight costs into the earlier delivering units.
This has created a wide range in market pricing. Whilst average weighted price today likely sits somewhere between £25.00 – £35.00 / units, sales of only early delivering vintage strips may go north of double and even triple that value. Unit prices can rise further still during negotiations as buyers place greater emphasis on permanence, risk reversal, and project failure, as they tie in delivery requirements with the liability of underdelivering against their net zero target in future years.
How will the UK VCM play out
Most pathways to net zero suggest demand for carbon removals will continue to grow through the 2030s and beyond, while the supply of high-quality UK nature-based projects remains inherently limited. That does not guarantee future prices, but it does point towards a market where quality, credibility and proven delivery are likely to become increasingly valuable.
As more organisations develop net-zero transition plans, demand for high-quality UK carbon removals is expected to increase. In turn, this should be a catalyst to further project development and an increasing supply of UK credits coming to the market. However, woodland creation projects operate on nature’s timescales, meaning whilst overall supply increases, as each year goes by the delivery timeframes of said projects take us further away from pre-2050 targets, shortened supply and subsequently driving a higher price for what is a limited volume of early credits.
Other project types, including soil carbon and technological solutions, will scale and plug the early delivery deficit by offering immediate to near-term verified credits, whilst projects will also seek to diversify and bring in other early income streams by stacking wider ecosystem and social benefits, such as quantified improvements to biodiversity, water and nutrients.
But woodlands and peatland will be critical to ensure the UK and UK organisations meet climate targets. Projects entering the pipeline sooner are better positioned to align delivery timelines with anticipated buyer demand. For organisations with long-term climate commitments, engaging with the market early can take advantage of current opportunities to plan for future carbon requirements. Businesses looking to get ahead of the potential demand peak in the leadup to approaching net zero deadlines need to be proactive in engaging with the market now to take into account the realities of long term delivery timelines of nature based solutions. Buyer support (through the spot purchase of PIUs or forward offtake agreements) has the compound impact of signalling to the supply side of the market that interest is there.
In addition to contributing to your long-term net-zero goals, buying UK credits supports domestic nature restoration, builds climate resilience in landscapes your organisation may depend on, and delivers visible co-benefits to local communities, biodiversity, and water quality – all of which can strengthen trust and environmental credibility.
The corporate requirement to deliver positive climate and nature benefits will undoubtedly live beyond targets set between now and 2050. Those restrained by shorter budget cycles who won’t see returns from UK projects in the near term, will face a similar dilemma in years to come. We therefore need to act now to stimulate demand for the development of projects over the next 5 years to help support those longer term targets.
Project Spotlight: Forest of Mamlorn
Forest of Mamlorn, Glen Lochay woodland creation is located in the Scottish Highlands, west of the village of Killin on the banks of Loch Tay. The project will re-establish native woodland using seed from the nearest viable sources, helping the glen regenerate its own seed resource for future woodland expansion.
Due to its project design, including aspects such as scale and species mix, Forest of Mamlorn offers buyers access to larger volumes of earlier delivery vintages between 2029 and 2049. For organisations planning ahead for 2040 and 2050 climate commitments, this presents a rare opportunity to align future carbon requirements with anticipated delivery.
The project is suited to buyers seeking to secure larger volumes of early delivering units, making it particularly relevant for organisations planning future net-zero programmes and long-term carbon strategies.
The project aims to establish mixed plantings of native trees to create areas of permanent forest cover, restoring lost biodiversity across the wider glen. This new woodland will form extensive habitats, including valuable woodland edge environments, supporting the recovery and expansion of native plants, insects, and species such as black grouse, pine marten, and golden eagle. In addition, the creation of suitable habitat may enable the future reintroduction of Scottish wildcats, contributing to ongoing conservation efforts.
A further anticipated benefit is the improvement of water quality and management within the River Tay SAC. Initially by allowing trees to slow the run-off of major rainfall events in the higher reaches of the catchment, while leaf litter and woody debris will return nutrients to the soil. This process is expected to increase insect and invertebrate activity, revitalising soils and strengthening the wider ecosystem. As the woodland matures, it will provide shelter for native wildlife, such as red deer, as well as for grazing livestock including cattle and sheep.
The planting design uses a diverse mix of species suited to local conditions. At lower elevations, species such as oak, ash, and silver birch will be established, transitioning to downy birch, Scots pine, and rowan at higher altitudes. Alder and willow will be planted near watercourses and wet flush areas. This varied structure will also increase the extent of valuable woodland edge habitat.
The project is also working closely with the James Hutton Institute to support the identification and management of areas in the glen for the purpose of enhancing biodiversity.
Planting has been carefully integrated into the landscape to enhance the natural character of the surrounding hills. Detailed soil mapping and topographical analysis have been used to match species to location, creating a woodland that appears organic and well aligned with its environment.
The glen itself is a quiet and secluded place, never a major through-route for transportation and often escaping the historical record. A notable exception are the works of 18th-century poet Duncan Bàn MacIntyre, whose writing vividly documents the area’s rich flora, fauna, and interconnected ecology.
For businesses seeking to build a future portfolio of UK carbon removals, projects such as Forest of Mamlorn highlight the importance of considering delivery timelines alongside future carbon requirements.
Support for projects like Forest of Mamlorn comes at a crucial time. Expanding nature-based solutions is essential if we are to address the growing climate crisis while restoring biodiversity and strengthening ecosystem resilience. Action taken today can help shape both your organisation’s future climate strategy and the future of nature itself.
