Carbon problem for damaged peatlands | FT Climate Capital

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I'm in one of the fragile bogs of northern England's Lake District. A damp and difficult task is under way here; rewetting a landscape which for centuries was deliberately drained of its water.

Around the world, wherever peatlands are burning or drying out, they're releasing carbon dioxide. The question is whether conservationists can restore our peatlands fast enough and cheaply enough to turn them back into the gigantic carbon sinks they once were.

We're on Wassdale Head here. And this big fell, as we call it in Cumbria, has been drained, probably for a mixture of grazing and for forestry. So there's lots of little what we call grips, the little small drains. And they're very close together. And what that does is it draws the water from the surface of the peat.

So before this has been drained you would have had a nice mosaic of sphagnum carpets and mosses, different species. And there they're kind of living, growing carpet, which makes peat bogs quite a special habitat.

So an active peat bog is where these sphagnums are growing, in a nice, wet, acid environment. When the tops of the plants grow up, it dies off. Now it doesn't fully decompose. And then the sphagnum carries on growing.

So that keeps on growing, and it lays peat. Keeps on growing, lays peat. And so that's what then forms the peat. We've got 2 or 3 metres of peat here. And that's over many, many thousands of years of this slowly accumulation of peat.

When you drain a peat bog, because it dries, air gets in, and that carbon within the plant then gets released. So that's kind of why the rewetting is so critical, is to keep it wet. Locks in that carbon. And it also locks in methane as well, which is another sort of greenhouse gas.

Do you think there's an appreciation of what peatlands are and what they're doing for the planet among the landowners and the farmers?

The whole nature recovery alongside farming is coming to the fore. The funding mechanisms are changing from government-based to blending with private finance, and bringing private finance, and people paying for the kind of the ecosystem services that come off the land, whether it's carbon, biodiversity, flood risk mitigation.

There could be lots of stakeholders who may be interested in the benefits of slowing the flow, whether it's water companies, insurance companies. This is how we maybe need to start developing models to attract the blended private sector finance.

Peatlands have accumulated carbon over hundreds of years, in many cases thousands of years. So they're drawing down carbon from the atmosphere through the photosynthesis of the peat-forming vegetation. Peatlands around the globe store about 650bn tonnes of carbon. And that's actually more than all the carbon that's stored in the world's vegetation cover.

We have huge areas of peatland in the northern Hemisphere, most of which actually are on a reasonably intact condition. Then, when we go into the tropics, we've got huge areas of peatland in Southeast Asia. Then, more recently, peatlands in the Cuvette Centrale of Africa have been described.

Wherever peatlands form there has to be an excess of water in the landscape. I was involved in a study a few years ago where we thought that probably around about the year 2000, peatlands globally shifted from a carbon sink to a net carbon source.

That doesn't mean to say that all peatlands in the world have been impacted by human activity. They haven't. But where you have a peatland that has been drained, it becomes a very intense source of carbon to the atmosphere.

Around the world, damaged peatlands emit about 2bn tonnes of carbon dioxide a year according to the UN environment programme. That's 5 per cent of annual emissions from human activities.

If all peatland really needs to stay healthy is water, what's driving peatland degradation globally?

OK. Well, a lot of peatlands around the world, particularly in the tropics in Southeast Asia, but also in Europe, it has been possible to drain them to use those peatlands as agricultural land. In the tropics we have very extensive palm oil plantations, and also pulpwood plantations, fast-growing acacia plantations where the timber is used for paper production.

Peatland covers about a 10th of the UK's land area, but most of this is severely damaged, which means it's emitting CO2. Policymakers are exploring whether environmental conservation could boost economic growth rather than holding it back.

There are loads of benefits to what we're doing on peat, but in other nature-based solutions, that will actually benefit the economy and create more jobs. For me, they're equal. You can't do one without the other. In fact, you shouldn't do one without the other. If you do one without the other, it's kind of ignoring the power of nature.

Nature-based solutions are a really important element of what we're doing. If we rewet our peat, it has a really useful extra function in helping us not only hold water and slow its flow down the catchment - so it can reduce flooding - but it actually helps clean the water.

Our target was 35,000 hectares by the end of this parliament. That's only potentially the end of this year. And we're already on track for 27,000 hectares, and we've got more in the pipeline.

However, the climate change committee, which advises the UK government, said in 2023 that peatland and woodland restoration policy was falling substantially short. It warned that peatland restoration was moving five times slower than needed.

Historically, we are looking at human factors from a range of different sources. So you've got things like burning on muir. You've also got drainage for sheep, peat cutting. And even now, where the trees have come in to this site they wouldn't have been here if it hadn't have been for man planting the trees next door.

So Rossdale, they've got huge grips that go across the site that reduces the hydrology of the area. And this site, although we still have a hydrology issue, it's mainly due to trees from the neighbouring plantation self-seeding onto the land. So they're drying out the peat.

To help restore this site volunteers are removing some of the trees that have been drying out the land after seeds drifted over from the neighbouring timber plantation. But removing trees can be contentious, as they're often seen as a synonym for environmental protection.

How do local people feel about having to cut trees down?

There's probably still a lot of engagement work to be done about why we're removing these trees. But I think peatlands are more in the limelight now and people are understanding it more. So it's just really our job to make sure that when this work is happening people are aware of why it's necessary, and that it's actually beneficial to the natural environment.

In some of our lowland sites we've had concerns that if we rewet the peatland, that will actually make the area more liable to flooding. But actually, when we rewet and we restore the bog it should be able to slow the flow of water more. So these are kind of misconceptions that we have to work through.

Working with our farmers and landowners is really important because they own or manage 70 per cent of the land. A good proportion of that is peat, particularly lowland peat. So it's a matter of working with them. We're really increasing payments to farmers on those lowland peat areas to raise the water table in those areas.

One of the biggest problems facing conservation groups around the world is negotiating with the landowners. In the UK, this means navigating the complexity of rights shared between the landowners and those who use the land - the commoners - in a relationship that dates back hundreds of years.

It's all about negotiation, really, but there has to be some agreement come to to say we're going to positively manage this land, some kind of internal agreement to say how it's going to work to ensure that there's positive management going forward.

These are landscapes now that support livelihoods. So, very extensive areas of plantation landscape. Plantations provide an economic return. They support livelihoods and so on.

Can we find a middle ground where we can still have some sort of production, some level of production, at least in the short to medium term, but try to reduce our emissions? This is the challenge, is that particularly in the tropics, where you've got high rainfall, you've got to have a system that can be responsive. So during dry periods you definitely want to bring the water levels up, but during the rainy season, when you might have very intense rainfall, you don't want to flood your land.

How effective and cost effective do you think peatland restoration is as a carbon capture method compared to all the other techniques that are being discussed?

Well, I think in terms of when we compare it with so-called technological solutions, carbon capture and storage, pumping carbon dioxide into geological reservoirs and so on, peatland restoration is far cheaper, and also is a proven technique as well.

In the UK, Germany, and elsewhere, landowners have started to plug gaps in government financing for peat restoration by turning to the market for carbon credits. The peatland code can help work out the level of emission reductions from each site so that these can be monetised.

Companies need a reason to invest in peatland, unfortunately. Carbon is a very understandable, because it kind of works the same as money - 1 tonne, £1. Like it's an understandable quantification of an ecosystem that's really difficult to understand. We want to see the carbon price to pick up, and that public finance can be significantly reduced.

I do think there will always be a element of public funding needed. Our projects will be able to get ongoing finance into their projects through the sales of carbon credits that will help them with the ongoing management and maintenance of the sites, where indeed, with the public finance that certainty is not there.

What we sell is not the carbon that's stored in a peatland. That takes a very long time and it's only a very minimum amount is stored every year. What we sell is emission reductions. In a healthy functioning peatland, that carbon is stored and locked up for a very long time.

Peat takes thousands of years to form.

Yes.

But then it can be degraded incredibly fast.

Yes.

How quick is restoration?

We don't really know. We do have some success stories, and we know that we can see within a few years quite a good response from the ecosystem. So we start to see the system wetting up. We start to see the bog mosses starting to come back in, which are the peat-forming features of the landscape.

In the tropics, where we have a really big challenge, very extensive areas of peatland that could be restored, we're really just at the starting point of understanding what we need to do.

We always refer to what we're doing as peatland restoration, but I think we're really setting it on the path to restoration, and we're trying to restore the hydrology so that the bog can begin to build itself again.

And does the funding model for restoration take into account how long it takes to get to successful peatland restoration?

We really, really would benefit from longer-term projects and longer-term funding. So a two-year project, a three-year project, even that is too short-term, because you have to find out who the landowners are. You have to find out what their interests are. We then have to look at getting planning if we're going to be working around a watercourse or removing trees. There's all of these things.

And you've got to build in the fact that a lot of these sites are remote as well. So you build in sort of remoteness as well. And we have various biosecurity and environmental measures we've got to put in place as well.

Unfortunately, peat only grows 1 millimetre a year. So realistically, we're not really going to see a change that quickly. So we might take a peat depth before we restore the site, but it might be 30 years before we see an actual change. It's going to take hundreds of years before we can see peat completely restored.

It will take time and money to restore the damage done to peatlands and to protect those which are still intact. And that job is set to get harder as rising global temperatures dry this landscape out even further.