One of the dilemmas facing Scotland, as the forestry and land sectors strive to meet the government’s target of planting 15,000 hectares of new forest a year from 2024, is dealing with the complexities of new forest creation. 

Forests come under the heading of natural capital. Two of the biggest sources of that natural capital are the timber and wood pulp that comes from harvesting the trees, along with the carbon that the forests sequester. Also key is the impact new planting can have on regulating or mitigating natural hazards like flooding and the loss of biodiversity.  

As Scotland progresses towards its target of being a net-zero carbon economy by 2045, the issue of carbon mitigation is very likely to become more urgent. As such, the carbon value sequestered in woodland could well become more valuable even than the trees. 

This is one of the findings suggested by a recent case study of a 1,000-acre new plantings site. The study is the first in the UK to apply the Natural Capital Protocol’s Forest Products Sector Guide to a significant forest creation project at Larriston, in the Scottish Borders. 

The Natural Capital Protocol is a decision-making framework that enables organisations to identify, measure and value their direct and indirect impacts on natural capital. In other words, it attempts to put some real or estimated numbers to the benefits and/or adverse impacts projects can have on natural capital. It was carried out by the infrastructure engineering consultancy AECOM on behalf of Scottish Forestry, in association with Tilhill Forestry and the Scottish Environment Protection Agency (Sepa). 

Commenting on behalf of Scottish Forestry, Pat Snowdon, head of economics, said: “This innovative approach has been a joint exercise with businesses in the forestry sector and is a new way to bring together values for a range of natural capital benefits from planting new woodlands. The survey provides important evidence about how woodland creation and nature supports a green recovery and will contribute towards our challenging climate change targets.

“The study will be of interest across the forestry and land-use sector, including the forest products chain and potential investors in planting new woodlands. It demonstrates how well-designed woodland planting is a win-win for the economy, local communities and nature,” he added.

John Gallacher, who heads up ecological studies at Tilhill, carried out the original, two-year environmental impact assessment (EIA) on the Larriston site on behalf of the owner, and was one of the Tilhill experts involved with the AECOM study. 


“The site involved 550 hectares of new plantings and 450 hectares that would remain open ground,” he explained. “The EIA study addressed many of the natural capital issues the case study examined.” 

In all, the study covered six different material impacts, trying to put qualitative, quantitative or monetary values to those impacts.

These come under the headings: timber, carbon sequestration, natural hazard regulation, recreation, aesthetics and biodiversity. 

Gallacher points out that putting monetary values to each of these headings is extremely complex, perhaps none more so than working out a monetary value for carbon. The price of carbon has bounced about much like the price of Bitcoin over time, so trying to guestimate what it might be in 50 years – the lifespan of a new forest – is anyone’s guess. 

The case study estimated that the amount of carbon sequestered by forest areas around Larriston works out at about 145,000 tonnes of carbon dioxide equivalent over the life of the forest. That part of the equation can be worked out with some confidence. 

It is probably also likely that as the world gets much more serious about combating climate change, the market price of a tonne of sequestered carbon will rise sharply. Putting a monetary value on this is difficult, but what can be said with some confidence is that it will likely be significant.

The study estimates that the value of the timber on the property will be around £2.5 million, while it suggests a figure of £9m for the carbon, at present values. The excess of the carbon price over the timber value is fairly startling and suggests that the carbon value could be a huge incentive to landowners to plant forests in the years ahead. 

Working out a monetary value for hazard prevention is probably nearly as tricky as working out a carbon value. As Gallacher points out, decades of grazing marginal hillsides to the bone has both compacted them and denuded them of rough grasslands to slow down the flow of rainwater to lower lying land.

This hugely increases the risk of flooding and has a massive impact on the damage floods are likely to do.

The study also found that forest cover at Larriston over the life of the forest will store nearly three million cubic metres of water. This storage will be both in the forest canopy and in the soil. 

“What people tend not to realise is that we have had decades where government subsidies have actively supported sheep farming on marginal hill land,” Gallacher says. “Sheep farming on these uplands makes no profit until subsidies are taken into account.” 

What this means, he points out, is that the government has been actively subsidising a process that leads to a much faster runoff of rainwater from the hills. This, in turn, has led the government to pour money into flood defences in towns downriver, at the same time as its subsidies encourage flooding. 

Gallacher points out that Tilhill is getting a lot of interest in a new line of business, Carbon Store, which helps companies tap into high-quality carbon sequestration schemes through forestry investment. “There are big structural changes coming and this study helps to highlight this,” he says.

What the Larriston case study does show with remarkable clarity, as Scottish Forestry’s Pat Snowdon pointed out, is that when they are carried out properly, new forestry plantings are hugely beneficial in multiple ways.