The governance of forest carbon in a subnational climate mitigation system: insights from a network of action situations approach

As one of the leading programs and largest subnational carbon-crediting mechanism in the world, California’s Offset Program and carbon market reflect key aspects of polycentric governance, including public and private actors interacting in rule-governed relationships, multifaceted strategies for carbon reductions, multiple jurisdictions, and standards of accountability, legitimacy, and environmental integrity. Participation in California’s program, however, remains low particularly among private forest owners who own the majority (56%) of forests in the United States (Butler et al. Family forest ownerships of the United States, 2018: results from the USDA Forest Service, National Woodland Owner Survey. General Technical Reports NRS-199. U.S. Department of Agriculture, Forest Service, Northern Research Station, Madison. https://doi.org/10.2737/NRS-GTR-199). This paper therefore asks: what characteristics encourage or discourage participation in California’s program, and which interactions among related situations inform participation and the supply of forest offsets? To address these questions, the analysis adopts the network of action situations approach as a diagnostic tool for understanding interactions among related decisions for forest carbon commoditization under California’s system for climate mitigation. The analysis relies on policy documents, offset projects data, semi-structured interviews, and empirical literature. Findings show how technically complex rules designed to protect the environmental integrity of offsets create interdependencies via multiple long-term contracts and increase participation costs relative to uncertain future payoffs. Results also highlight the important role of expert and state actors, and suggest that experimentation with carbon accounting methodologies, issues of scale, and uncertainty are likely to shape the future of forest carbon governance.