Trees for Life

Summary

Trees for Life, a charity based in the Highlands of Scotland, has developed a model to fund the rewilding the Scottish Highlands. In 2008, Trees for Life acquired 10,000 acres of land in the Dundreggan Estate to support its rewilding efforts. The charity uses the Woodland Carbon Code to sell carbon credits, some of the proceeds of which it shares with the local community. The charity has also developed the world’s first rewilding visiting centre, which created further revenue streams in addition to providing educational opportunities for visitors.

Background

The Highlands of Scotland support a number of diverse and ecologically important species and are home to three UNESCO landscape areas. Of the 2,000 priority species on the Scottish Biodiversity List, 1,500 of these are found in the Highlands [1]. Despite this, there has been significant biodiversity loss due to deforestation and a change in upland land management to large scale sport shooting, deer and sheep grazing that began in the 1700s.

For example, the unique habitat of the Caledonian Forest once covered a significant area of Highland Scotland – a huge wilderness of around 15,000 square kilometres. Today only around 1% of the original Caledonian Forest remains.

Established in 1993, Trees for Life is a small charity working on rewilding in the region. It focuses on landscape restoration efforts, including but not limited to the planting of native trees, the restoration of peatlands and the reintroduction of native species. It also has a focus on community engagement, aiming to ensure that local communities are included in the activities and benefits of nature restoration in the Highlands.

In 2008, Trees for Life acquired a 10,000 acre estate at Dundreggan Estate as a flagship site for its reforestation and rewilding ambitions, thanks to some significant voluntary donations. The estate is home to over 4,000 species of plants and animals, including many rare and protected species.

Revenue Generation from Carbon Credits

In the early years, the charity struggled to cover the running costs of the on-site tree nursery, volunteering programme and land management. Native trees cost from £0.35p to £0.80p per tree depending on species and sapling height, while rarer species might cost £1.50.  At the same time, planting costs using hand mounding vary from location to location but tend to be around £0.85 per tree (prices as of 2021).

In 2017, the charity started to explore the sale of carbon credits, and now uses the UK Woodland Carbon Code – a standard backed by the UK government – for selling carbon sequestered at Dundreggan.

As of October 2024, Trees for Life has sold 48,000 Pending Issuance Units (PIUs) that cover 132,000 hectares and the planting of 200,000 trees. These have been sold ahead of sequestration occurring over a 100-year period, so that the proceeds can be used to cover the initial costs.

Trees for Life has achieved high premiums for these carbon units – initially achieving a price of £50 per unit, and growing to £80 with its latest tranche. In comparison, the UK Carbon Price Index reports an average price of £25.36 for Woodland Carbon Code PIUs (results from 2023).

Alan McDonnell, Head of Nature Restoration at Trees for Life, says that carbon credit buyers proactively approach Trees for Life and are willing to pay this premium because of Trees for Life’s track record (having planted over 2 million native trees in total), its charitable status, and its focus on community inclusion and benefits sharing (see below).

 Alan McDonnell, Trees for Life at Dundreggan

Community Engagement and Benefits Sharing

Trees for Life aims to engage local communities from across the Highlands in its activities. The charity believes that including communities is important for a socially just transition in solving the climate and biodiversity crises. On a practical basis, it also wants to ensure that the nature-based livelihoods within the Estate – such as ecologists, land managers and deer stalkers – are supported within a sustainable local economy that offers, for example, housing, schools, shops, and health services.

Historically, local communities in the Highlands (and Scotland more broadly) have been excluded from land use decisions and wealth generation. More recent economic drivers have led to a reduction of local populations and an economic dependence on farming and tourism, such as estate sports.

To counter this, Trees for Life is committed to sharing one third of its revenue from carbon credits with local communities. For example, it shared c.£70,000 from its first tranche of credits with the nearby village (Glenmoriston) via two established community groups. These funds were used for community building and accessibility improvements, and a new playpark in the village.

McDonnell says that it is crucial to understand a community’s level of connection with the land and their wider priorities in order to build an effective engagement strategy.

Trees for Life is iterating its community engagement strategy as it expands its reach, and wants to work more closely with disenfranchised groups, such as young people, with educational and professional prospects offered through the Estate.

Establishing a New Rewilding Centre through Private Investment

To support its work for the long term, Trees for Life built the world’s first Rewilding Centre at the Dundreggan estate in 2023, aimed at drawing in sustainable tourism.

The Centre offers guided walks and tours, family activities, events and specialist workshops in skills like woodcraft, photography and creative writing. The centre also has an on-site café and an accommodation facility that can host up to 40 people, offering residential stays to businesses and other organisations.

The centre enables the charity to engage a larger, more diverse audience with the natural and cultural heritage of the Highlands, and inspire and educate more people on rewilding and the restoration of the Caledonian Forest. Vitally, it will also generate a new source of income for Trees for Life’s wider restoration work.

The total construction cost for the Centre was approximately £6 million. This was funded through a combination of grant funding, donations, the charity’s cash reserves and a £2 million bond promoted through a crowdfunding platform.

In 2021, the charity partnered with Triodos Bank – a sustainability focused UK retail bank – to  raise £2 million through a nine year-bond, using Triodos Bank’s crowdfunding platform.

The bond offering was launched in 2021 with a £2 million target and closed less than 48 hours later. The minimum investment was £50 and the average investment amount was £4,800. Some 8% of investors are based in Scotland.

The bond offers a return of 6% a year to investors and are also eligible to be held in a Triodos Bank Innovative Finance ISA, which means bond interest payments will be received tax-free.

For Trees for Life, the debt is repayable in four annual instalments from 2027 to 2030 that will be paid back from cash reserves [2]. The projections assume that the Rewilding Centre will provide a sustainable recurring income for the charity – some £1.5 million in annual income by 2030.

As of October 2024, the centre has proved to be popular, and is expected to welcome over 70,000 visitors annually by 2030, and benefit the local community and economy by providing jobs and attracting more visitors to the area.

Dundreggan Rewilding Centre, Paul Campbell Photography

Partnering with Local Landowners

McDonnell comments that a landscape-scale approach is often needed to address wider ecological issues, such as excessive deer populations, which travel across estate boundaries and can quickly destroy newly planted woodlands [3].

In 2021, Trees for Life launched Affric Highlands in order to scale its work across the Highlands area and work with landowners to help achieve nature restoration over 200,000 hectares. It has been developing its landowner engagement strategy, offering free surveying services and identifying ecological hotspots – such as peatlands and woodland remnants – on which to focus restoration. Affric Highlands presents its recommendations to the landowners and then develops restoration plans with those willing.

For example, Affric Highlands is currently developing a peatland restoration project with landowners in the Knoydart peninsula to restore 400 hectares of upland blanket marshes. It is exploring the use of the UK Peatland Code (the peatland equivalent of the UK Woodland Carbon Code) to fund restoration activities with the sale of peatland-based carbon credits.

McDonnell says that price sensitivity is important when engaging with local landowners and discussing community benefits sharing: “The landowners are open to sharing profits with communities, but the funding needs to be big enough so that they aren’t making a loss over the period (30-100 years) the land is committed, including the cost of long-term maintenance. To that end, we shouldn’t expect carbon to be cheap.”

Next Steps

Trees for Life wants to scale its engagement across the Highlands and move from carbon-based activities towards wider biodiversity and ecosystem services, as different finance and funding options develop.

For example, the charity has recently started to apply for a licence to reintroduce the Eurasian lynx to Scotland, which were last seen in Scotland around 1,300 years ago [4]. It has undertaken a feasibility study and engaged with a range of stakeholder groups to understand the socio-economic barriers. McDonnell says that Trees for Life is not currently looking to finance the reintroduction with private funding, but believes that Lynx could bring a wide range of ecological and societal benefits to Scotland.

Trees for Life is also exploring ways to assess potential buyers and financiers for their own sustainability positions, for example, whether they have credible Net Zero or Nature Positive transition plans. As of October 2024, it has paused its carbon credit sales while it works on further restoration plans and develops a new selling strategy.

Updated as of October 2024

Sources:

1. Highland Environment Forum (2021) Highland Nature Biodiversity Action Plan, 2021-2026
2. Triodos Bank (2024) Triodos Bank Trees for Life bond offer
3. Reforesting Scotland (2023) The Impact and Management of Deer in Scotland
4. Trees for Life (October 2024) Lynx to Scotland

Interview with Alan McDonnell, Trees for Life, October 2024.

Note: For further information, listen to our Financing Nature Podcast with Alan McDonnell here. (Episode 3) for further insight on the project or visit the rewilding centre’s website here.