German firm pilots blended ARR, IFM carbon methodology

7 Feb 2024

Quantum Commodity Intelligence – German startup Pina Earth is piloting a new type of carbon project methodology that is a mix of reforestation and improved forest management techniques and is best suited for the European context, chief executive Gesa Biermann said this week.

When it launched in 2021, the company focused on developing a technology platform for owners to estimate the carbon potential of their land and adapt their forests to climate change, but now it is developing its own carbon projects.

Biermann lists four schemes on its website and a further six in the pipeline, all situated in Germany.

"In Germany, we don't need conservation projects. We're very highly populated, so there's not much room for afforestation projects," said Biermann.

"But we have a problem that 96% of our forests are managed forests, and a lot of them are in a monoculture state, and they are carrying so much risk due to climate change... dying due to drought, heat stress, and so on," she said.

"And so what we wanted to do is to find or develop a methodology that would address these types of forests," she added.

Pina Earth worked with TÜV Nord, a well-known carbon auditor, to ensure its projects meet so-called ISO norms before partnering with Germany-based Ecosystem Value Association on a standalone carbon methodology for European forests.

The Forest Climate Standard, launched last October, allows developers to plant mixed species within existing forests under a protocol managed by Pina Earth, thus strengthening the forests' ability to cope with future threats, such as disease or drought, and to earn carbon credits from the process.

The company estimates survival probabilities of particular types of tree species, based on climate models from the Potsdam Institute of Climate Impact Research, within certain regions over several decades to fine-tune the perfect mix of trees.

Biermann said these types of carbon credits sell for a minimum of €50 ($54) a tonne of carbon dioxide equivalent (tCO2e), although some projects have fetched as much as €80/tCO2e or even €100/tCO2e, with Germany-based companies seen as providing a large pool of demand.

"From €50 on, it starts to be interesting because you're able to cover a larger part of the costs of the forest project, though not necessarily all of them," Biermann said.

"We want to position this type of methodology and project as its own category that really has the problem of climate change at its core," she added.

While the company's projects are spread across Germany, a large focus currently is on the areas around Berlin, where there are many monocultures.

Next, Pina Earth said it is evaluating the feasibility of diversifying its projects' geography, type and standard, in line with requests from credit buyers.