33 Comments

Thanks for sharing your experiences, Neal. I'm so sad and infuriated for you and all your partners that the Delgadito project hasn't been able to find funding. I know how much you put into this - and if anyone could have made it work, you would have.

What makes me maddest is that the derisking involves so much trust-building with local stakeholders, and every time the money fails to arrive it erodes that trust, and makes it harder to ask for it when entering into the next projects.

I have so much respect for the work that you (and other skilled project developers) are doing - and look forward to hearing your thoughts on alternative approaches to this huge challenge. Hugs from the UK!

Expand full comment

Kat i'm still determined to get biodiversity data on these things, but first things first! Thanks for always championing our work!

Expand full comment

This is happening to hundreds of us around the world. You're the best of the best and if you can't do it then....

"I’ve only touched on the finance aspect of this, but it deserves a couple paragraphs. I have never felt more frustrated than when folks sitting on the corporate or investor side of these deals have told me how much money is available for blue carbon. It’s a smokescreen. Buyers and investors are waiting for project developers like myself to deliver unicorn projects on a silver platter— projects that can deliver a million tons per year, with all the political, financial, geographic, ecological, and local community risks tied up in a pretty bow. They have no idea how difficult and costly it is to put that kind of thing together, or they simply don’t care. They take no risk, despite having enormous amounts of capital at their disposal. The investors put money into platforms, or tech that supposedly enables restoration and carbon credit development, failing to recognize that all MRV and tech needs viable projects to deploy them. Bottom line: There is no money for projects until they are completely derisked. People say to me, “Don’t give up Neal, there’s so much money out there for this stuff.” They haven’t learned that the money out there isn’t for those of us taking the risk to put these projects together. Derisking everything is a process that takes lots of time and capital and skill. I’ve got time and skill, but i don’t have capital. And the folks with capital aren’t willing to share risk."

Expand full comment

Way too asymmetric to keep trying this way.

Expand full comment

Dear Neal - thanks so much for these stories - as another practitioner working in the field of ecosystem regeneration (including restoration of viable livelihoods for the people living in the zone) I see ( and suffer) the same frustrations. That the folks with the money mostly won’t take the risks and, indeed, expect ‘good returns’ if they do eventually show willing to support projects but only when they are established.

I am grateful for your tellings - now I can point people to your confirming tales when they tell me ‘there is plenty of money about for this sort of thing, you just need to show up with de-risked projects that will reward investors well from the outset and all will be well’.

There is a deep and tragic contradiction in there somewhere because the risks of collapse is so very acute - what returns and from what investments will folks be making when, for example, the North Atlantic Current dies and renders all of Europe frigid and barely habitable? Shouldn’t we be de-risking that probability if at all possible and others of a similar magnitude as fast as we can so that all life might thrive?

There is a stubborn pattern of not seeing the real risks and, instead, hoarding wealth and power as if that will save a person.

I am reminded of an old joke : - “Your money or your life” threatens the highway robber. “Take my life” cries the victim, “ I’m saving my money for my old age.”

Expand full comment

It’s really quite infuriating

Expand full comment

Very interesting as always Neal, understanding that this has obviously been wearing to arrive at. I'm looking forward to understanding what the alternative funding or revenue streams you are thinking of are, figuring out the business model for great ideas always seems the most complicated and fraught aspect.

Expand full comment

Hey Neal. I really appreciate your candor in sharing this experience.

Do you think this project would have been less of a headache had it been developed beginning today? I can see how advances in sequestration modeling would have given definitive answers on viability earlier in the process.

Expand full comment

We would have ruled it out as a possibility and gone with a different strategy altogether. I have a strategy for mangrove restoration without relying on carbon revenues (stay tuned!) but it’s super innovative and until we build one outside of a unesco biosphere, Mexico won’t let us build one inside it

Expand full comment

Hi Neal, I’m an early career land steward, and I’ve admired and been interested in your work since Dave Hodgson turned me onto it at GRC. Thank you for your honesty and clarity around issues I’ve heard many bosses and other practitioners talk around. I’ve tended to be most inspired by the persistence of grassroots work, and have been consistently disappointed by the impacts of intrusive capital interests in US and especially abroad (speaking from experience in coastal agroforestry in Ecuador), but I’m looking forward to the solutions you share!

Expand full comment

HI Neal, in Australia they have been successfully trialing the planting of seagrass by seed by bursting the buoyancy bladder so the seed will immediately sink and if currents and wave energy do not move them around too much they will grow where sown from seed. Have there been any trials with mangrove seeds? Either weighing them down by glueing sand or pebbles and / or by piercing the seed coat to reduce buoyancy? I love the iconic pictures of lone mangroves which I assume would have been a single seed trapped by a piece of waterlogged wood. Drone seeding has been successful but with high set up costs and the conditions need to be right but sink seeding may offer an alternative if one can perfect a relevant practice. Like most other readers say we need a new holistic approach to our footprint upon this planet before we cannot climb out of it. Many thanks

Expand full comment

Hi Theodore—I should write a post on this but in my experience, the actual planting is the least expensive and easiest part of any restoration project. This tech is helpful in reducing ops costs, so it changes the margins but not the game.

Expand full comment

True as you stated in your article the locals have been doing an excellent job with limited resources. Sad how a mangrove tree which has millions of years of natural adaption to help in such an important ecological habitat and transition zone has almost no economic value. Looking at the situation in the opposite direction we have an opportunity to purchase the intellectual property evolved on this planet from billions of years of evolution for so little money before they are lost forever and no one is buying??? We do not deserve the connotation of an intelligent species.

Expand full comment

Neil, I wanted to pick your brain on the possibilities that may arise from cobenefits, which in your case sound like having been difficult to realize.

In the Cispatá mangroves project in Colombia, the carbon offset credits came with an additional certification called CCB, the community climate and biodiversity certification, because of the endangered species they are working with.

Would something like that be a possibility in your case, given the connection with the protection of key habitats for whales, among other species? Or is it that such cobenefits are not rewarded well enough by potential financiers to offset the lower carbon potential that the Delgadito project may have compared to Cispatá or other geographies?

Expand full comment

Cobenefits are why blue carbon credits tend to be higher value than ARR credits, because it's generally accepted that blue means higher impact. In the geographies i've been though, it's mostly immaterial because the carbon numbers are so low anyway, vs with seagrasses, the cost of restoration is so high that you'd need carbon prices to be 20-30X what they are now before it were a viable pathway. It's a question of projects cost vs output, so you either need a lot of output or low project costs.

Expand full comment

Thank you for sharing your experiences—this is a really insightful article. How do you feel the market needs to evolve to address the kinds of challenges you highlighted? In particular, how might a higher cost per tonne help in these scenarios?

Given that Delta Blue Mangroves is one of the most sought-after and highly rated projects in the market, what do you think are the key factors that have enabled its success?

Expand full comment

Delta Blue in Pakistan has much higher sequestration numbers per hectare per year, because it's in a tropical delta. Low salinity + lots of sunlight = higher sequestration. Plus I expect that project costs are also very low due to low labor rates. I'm not up to speed on how much active vs passive restoration vs conservation they're doing though.

Expand full comment

Thanks! That makes sense. I think DB is circa 2/3s restoration, 1/3 preservation.

Expand full comment

Thank you for your honest appraisal in this case study, Neal. I keep coming back to the saying, "You can't dismantle the master's house using the master's tools." I know this is under discussion with several serious groups out there, so don't retire quite yet.

Expand full comment

I don't have much of a choice Mark. As I wrote, I already put my widow's mite into these efforts, and it was all I had.

Expand full comment

Always my thoughts are with you and all this data you have feeds into finding strategies and ways to avoid all these issues. Thank you for your dedication even though i know my thanks don’t pay the school fees!

Expand full comment

Hi Neal, thanks for sharing your frustrations in detail. We have been working with SeaTrees who just released mangrove and seagrass restoration methods on Regen and are selling credit on their own platform. Derisking is certainly a huge blocker! It could be interesting for you to learn from them about how they financed their projects. I will be following along to see what you come up with for a solution to finance this important work!

Expand full comment

Methodologies are helpful but, the carbon numbers don’t justify any kind of carbon finance in most geographies. So if you’re going to do carbon, you can’t just find degraded areas—you have to start with the right geography and politics first and hunt for those. Which is the exact opposite of what I try to do, which is work with local communities in degraded areas and figure out how to make things work.

Expand full comment

There is no greater teacher than failure, if we are willing to learn. (Something T. Edison would have said).

Expand full comment

We need anti-human-extinction credits or some equivalent...

Expand full comment

Trying to solve public good problems with private money is a devilish problem

Expand full comment

David, may I offer the terminology "human-anti-extinction credit", to avoid including the wording "anti-human" in the syntax. But how does one value or claim any credit for people's lives when pitching for climate project finance? Even the 17 UN-SDGs don't mention the term. Accountants' GAAP code may argue that they are non-fungible, just as slaves were "non-fungible" in 18th-century accounting practice.

My climate startup's most worthwhile goal is to prevent the extinction of up to five million people in one of the Great Lakes of Africa. Nature is the villain; a rare combination in the form of volcanoes, a lake, and the bio-processes that generate gigatons of contained GHGs that will erupt. We have a plan and a project to head off this threat, but it too is hard to get funded, like Neal's work.

Within this century, with a massive volcanic side-spill as its trigger, nature will perform a coup de grâce on those millions of lakeside residents. A lava spill deep into the water will trigger a massive eruption of gases from deep in the lake, filling much of the valley with heavy, toxic gas. As I try to imagine this event, would it silently envelop us like a sea fog?

Right now, I can hear foghorns persistently warning of heavy fog in Vancouver's harbour. It's rolling in on a still wintery evening here, but at least we are warned. On that African lake, no warning system is there to tell people, "Run for the hills!"

I digress. We have to look for fungible benefits like gigatons of carbon credits or billions of dollars of energy sales. Human-anti-extinction credits may register as a footnote to investors in the accounting valuation of your worthy climate project. We could just emphasize the carbon emissions reduction as the headline achievement instead.

Expand full comment

Neal,

This is my favorite new substack, thank you, I look forward to reading more of these. I was wondering if you could break down the cost of a project like this? I sometimes find it hard to imagine how expensive a project like this is. A few dozen people, some kayaks, mangrove seedlings, a lot of time?

I've noticed other ecological restoration projects take approaches very dependent upon huge inputs of labor, paying for saplings instead of seeds, mechanized inputs, and huge teams of expensive scientist, and unfortunately a fetish for complexity.

I've wondered if this "industry" needs a cost revolution savings getting to the cost per hectare to be an order of magnitude cheaper, by better taking advantage of the ecologies natural will to expand and conquer. Are the Human systems too impatient, to work on this timescale?

Ecological succession also seems to work in much different ways compared to the projects I've looked at. One of the few projects i've seen to find its stride by working with natural ecological succession is Hinewai Reserve in New Zealand. All that was required is for them to allow Gorse a quickly growing spreading groundcover shrub to take over the whole Banks peninsula. It allowed restoration of soil moisture and shade from the sun. The birds simply spread native trees which grew up through the groundcover, then fires killed off the gorse, but sparing the trees. This allowed the restoration of a traditional new Zealand rainforest. I know this is not a blue carbon project, but perhaps blue carbon could learn a thing or two from less input, more ecological momentum?

Expand full comment

I'm really sorry to hear about all the walls you've hit. This seems like yet one more example of why the carbon-centric framing of climate is wrongheaded. It also speaks against the notion that capitalism can save the climate through investment schemes.

I remember your presentation at The Global Earth Repair Conference, during the Ecosystem Restoration for Climate workshop. You seemed pretty optimistic about the potential of the private sector to help with restoration. Given your frustrating experience, how are you now directing your considerable skills?

And one small question. You said the funding tends to go to projects that result in high level rates of carbon sequestration, upwards of 15-19 tons per acre. That seem like an awfully high expectation. What type of projects result in such drawdown? Is it forests, ag? Is it big tree-planting projects, which are problematic in so many ways?

Expand full comment

Rob -- it's mangroves in big deltas in the tropics. Pakistan, Indonesia, Mozambique, the Yucatan are all places where blue carbon for mangroves will work if a developer can line up everything right. Where that's not the case, it's really a case-by-case basis.

Still very much a believer in markets, but I don't think carbon can anchor this in most places, and when it comes to seagrasses, my belief is that none of them can be restored with carbon finance alone.

Expand full comment