B.C. Adopts New Carbon Accounting Method After Audit Findings

British Columbia’s Ministry of Forests has introduced a revised method for calculating forest carbon stocks, responding to findings from a critical audit. The changes aim to enhance transparency in carbon accounting, which the Office of the Auditor General of British Columbia highlighted as insufficient in its March 2025 report. The investigation revealed that previous projections, crucial for assessing the impact of forestry management decisions on carbon storage, lacked a defined methodology.

In a bid to rectify these shortcomings, the Ministry of Forests approved new guidelines on July 21, 2025, under the leadership of Shane Berg, the Assistant Deputy Minister and Chief Forester. The updated carbon budget model incorporates various carbon indicators, such as carbon stocks, density, and the net ecosystem carbon balance. This approach promises to deliver a comprehensive view of carbon dynamics, integrating forest inventory data and factors like tree growth, harvesting, and disturbances caused by wildfires or pests.

The ministry emphasized the importance of accurately understanding changes in forest carbon balance for calculating the annual allowable cut. This is vital because forests play a dual role in sequestering and releasing carbon, influenced by both natural events and human intervention. “Using the same defined method for every timber supply review will benefit people and organizations involved in forest management because it ensures transparency, consistency and credibility in forest carbon projections,” the ministry stated.

The auditor general’s investigation also flagged issues with the Ministry’s calculations related to the Forest Investment Program, which allocates approximately $95 million annually for reforestation and ecosystem restoration. The report criticized the lack of a “defined methodology,” which hindered the capability for review and replication of the carbon impacts from this investment scheme. The ministry is currently working to establish a clearly defined methodology for this program by the end of the year.

Global Context and Local Challenges

Globally, forests absorb an estimated 7.6 billion metric tonnes of carbon dioxide each year. However, activities such as logging, wildfires, and urban development threaten the integrity of these vital carbon sinks. In British Columbia, emissions from the forestry sector have shifted from being a net carbon sink to a significant source of greenhouse gases. By 2018, logging and forest management practices contributed to more than half of the province’s reported annual emissions, a trend echoed in other regions of Canada since 2001.

Notably, federal audits have repeatedly indicated that Canada has not accurately accounted for logging emissions. A report from Nature Canada estimated the industry’s net emissions at 147 megatonnes in 2022, positioning it as the third-highest emitting sector in the Canadian economy. Gary Bull, a professor emeritus of forestry at the University of British Columbia, has pointed out that the B.C. government has struggled to establish an effective carbon accounting standard for years.

Bull noted the potential for monetizing carbon stored in forests through carbon credits in compliance and voluntary markets. Compliance markets are regulated by governments to meet legally binding emissions targets, while voluntary markets allow businesses to offset emissions for various reasons. He emphasized that the success of these models requires a shift in how carbon dynamics are understood and managed in forestry.

Controversies in Carbon Credit Markets

Despite the potential benefits of carbon credit markets, challenges persist. In recent years, projects like the BigCoast Forest Climate Initiative, launched by Mosaic Forest Management Corp., have faced scrutiny. This initiative aimed to defer logging on 44,000 hectares of Vancouver Island land but was later criticized for a lack of transparency and significant accounting errors. An audit by Renoster Systems Inc. raised concerns about the project’s credibility, citing issues such as selective boundary drawing and insufficient consideration of fire risk.

The controversy surrounding carbon credits extends beyond British Columbia. In 2023, a report by The Guardian highlighted that a significant portion of rainforest carbon offsets provided by Verra, a leading provider of carbon offsets, were deemed “largely worthless.” Verra disputed the findings, indicating that they were based on flawed calculations.

As British Columbia advances its carbon accounting practices, experts like Bull suggest that while improvements are being made, the province may lag behind more progressive international models. Bull expressed concern that B.C. might be caught in an internal debate rather than engaging with global best practices and emerging standards.

The recent changes in how B.C. measures carbon signify a crucial step towards better forest management and sustainability. As the province navigates these reforms, the effectiveness of its carbon accounting will be closely monitored, both locally and globally, as stakeholders seek to address the pressing challenge of climate change.