Suz-Anne Kinney
The MarketWatch Blog is Transitioning to ResourceWise Forest Products
Forest2Market: July 14, 2023
The United Kingdom’s Timber Procurement Policy will soon require electricity generators to demonstrate at least 70 percent of the wood biomass used in wood pellets was legally and sustainably harvested. Generators can do this in one of two ways: source wood from a forest certified through the Forest Stewardship Council or a Programme for the Endorsement of Forest Certification [1] (Category A evidence) or offer chain of custody and other documentation from the forest owner to the end user (Category B evidence). Because the majority of forests in the US South are not certified, the use of Category B evidence is expected to play a key role in how generators demonstrate compliance. Adherence to applicable laws and the use of best forest management practices will be considered Category B evidence. Parties in the wood supply chain must comply with local and national laws as they relate to:
- Environment
- Labor & welfare
- Health & safety
- Other parties’ tenure and use rights
- Forest management
Environment
Enforced by the US Environmental Protection Agency (EPA), the Clean Water Act requires that forest industry participants take proactive steps to minimize the effects of their operations on water quality.
To ensure compliance with this Act and others, 44 states have recommended or required best management practices BMPs for forestry related activities. BMPs vary by region and by state, but all include guidance on these basic concepts:
- Streamside Management Zones or Riparian Management Zones—The strips of land adjacent to streams where forestry operations may impact water quality.
- Stream crossings—Areas where forestry operations (roads, skid trails, etc.) cross streams.
- Forest roads and skid trails—Proper construction limits erosion and other sources of pollution.
- Fertilizers and pesticides—Prevents water contamination.
- Harvesting and reforestation—Prevents soil damage.
- Waste disposal—Removes potential sources of pollution from a harvest zone.
Another important piece of environmental legislation is the Endangered Species Act. Administered by the US Fish and Wildlife Service, and in some instances the National Marine Fisheries Service, the Endangered Species Act protects at-risk species and the ecosystems they rely on to survive.
Species protected by the Endangered Species Act may be listed as either endangered (in danger of extinction) or threatened (likely to become endangered within the foreseeable future). Five factors are considered during the evaluation process to list a species as endangered or threatened:
- Habitat damage or destruction
- Overutilization of the species
- Disease predation
- Inadequate existing protection
- Natural or manmade factors that affect continued existence
It is illegal to kill or harm species listed under the Endangered Species Act unless granted a permit from an agency that oversees the Act. Habitat modification or destruction that leads to the death or injury of protected species through negative impacts to “breeding, feeding, or sheltering” patterns is considered a form of harm.
As such, the Endangered Species Act requires critical habitat designations that contain the features essential to species conservation. Critical habitat can include areas the protected species does not inhabit at the time of its designation but that are nonetheless essential to its conservation.
Labor & Welfare
In addition to robust environmental protection laws, the US has well-established labor and safety laws that govern workplace environments. The US Department of Labor administers the Fair Labor Standards Act which sets minimum wage and overtime pay rates and regulates the employment of youth under age 16. Reforestation in the US is widely accomplished through the use of guest workers from the H-2B visa program, which is also administered through the Department of Labor.
Health & Safety
The Occupational Safety and Health Administration (OSHA) regulates and enforces federal and state laws that pertain to safety in the workplace, including collective bargaining, compulsory or forced labor, child labor and employment discrimination.
Specific to the forest industry, OSHA regulates manual and mechanical logging operations and establishes safety practices, means and methods for all types of logging operations, regardless of the end use of the wood. Twenty-six states have adopted safety standards although in most cases they are identical to federal OSHA standards.
OSHA regulations require logger training; a number of states and state logging associations have developed training programs as well as continuing education courses to help loggers acquire and maintain required safety certifications. Master Logger or ProLogger certifications are also required in some states, while in others, these programs are voluntary.
Other Parties’ Tenure and Use Rights
Strong personal property protections upheld by clear property titles and robust judiciary protections of owner rights are commonplace in the United States. A long judicial history and proven legal recourse for mitigation of real property disagreements through a series of lower and higher courts also exists. An example of this is the unique legal and political relationship between the United States and its native populations. These relationships are established by the Constitution of the United States, treaties, court decisions and Federal statutes.
The Bureau of Indian Affairs (BIA) administers programs that enable tribes to enhance the quality of life for their members via improvements to tribal government infrastructure, community infrastructure, education, job training, and employment opportunities. Other BIA programs include natural resources management on trust lands representing 55 million surface acres and 57 million acres of subsurface minerals estates. The BIA also implements land and water claim settlements.
Forest Management
The forestry supply chain operates under broad-reaching and complex federal, state, and local regulations. In addition to these laws, high rates of voluntary BMPs are found at state and regional levels.
Because of this legal framework, which is strictly enforced, electricity generators, UK utilities and the Department of Energy and Climate Change believe that there is low to no risk associated with wood sourced in the US as far as legality is concerned. As a result, the standard for verification here is fairly straightforward and carries a low standard of proof. In most cases, evidence of compliance with legal standards can be based on the absence of any substantive claim of non-compliance.
[1] The PEFC currently recognizes the Sustainable Forestry Initiative, American Tree Farm System and Canadian Standards Association.
