Unlocking peatland restoration on crofting and common grazing land, part 2

Posted on Tuesday, July, 2nd, 2024

A summary of the FIRNS-funded project, led by Forest Carbon

In March 2024, the FIRNS (Facility for Investment Ready Nature in Scotland) project led by Forest Carbon, in collaboration with Finance Earth and Angus Davidson Ltd came to an end. This FIRNS project looked at peatland restoration on crofting territories, namely on land that’s subject to common grazing rights and was supported by a development grant provided by NatureScot.    

In March we released Part 1 of this article, which covered: 

As promised, we are following up with this article (Part 2) to cover the key findings from the final report.

Project context

It is estimated that degraded peatlands in Scotland account for around 15% of Scotland's total net emissions. SRUC estimates peatland covers 348,000 ha of common grazings. To date, there has been limited delivery of peatland restoration projects on crofting and common grazing land.  

More context can be found on slide 7 of the final report.

Two maps showing overlap of peatland on crofting territories in ScotlandImage source: Research Gate and Crofting Scotland

Key project objectives

The key objectives of this Project were as follows: 

Key findings from the final FIRNS project report and supporting legal paper

Challenges    

Lack of clarity causes hesitation on peatland restoration

Landlords and shareholders hesitate to engage in carbon-related activities due to a lack of clarity on several fronts. The main areas of concern are: 

Opportunities

We explored two potentially viable governance models for peatland restoration on common grazings

Stakeholder engagement at the two Pilot sites revealed some obstacles for shareholders and landlords in delivering peatland restoration projects and using carbon funding.

Two models were explored:

  1. A shareholder and landlord-led model, where both parties agree on income distribution.

  2. An investor-led model, where an investor finances the project and compensates shareholders and landlords through lease or profit-sharing agreements.

The FIRNS Project identified the investor-led model as a way to transfer certain risks to an investor, allowing landowners and occupiers to delegate restoration and maintenance responsibilities. However, limited awareness and understanding of financing options, along with limited private finance packages (whether this is a lease or joint venture type arrangement), restricts the practicality of this option.

More on the viable governance models we found in slide 10 of the final report.

Legal pathways exist but require cooperation

Flow chart showing legal pathways explored by Forest Carbon for FIRNS peatland restoration project on crofting territoriesPage 9 of the final report

The final FIRNS report highlights unique challenges in delivering peatland restoration projects on common grazing land, due to an uncertain legal framework for carbon credit ownership and the complexities of the Crofting Act. Harper Macleod's legal review identifies Sections 19A and 50B as the most promising legal pathways for peatland restoration on crofting land.

Pathway 1: Crofter-Led Applications

Pathway 2: Landlord-Led Applications

In both situations, cooperation between crofters and landlords is essential. Potential legal reforms may offer clarity on the legal pathways. There is further consideration to allow for joint peatland ventures between crofters and landlords, similar to forestry ventures, to facilitate peatland restoration and carbon sequestration.

More on the legal pathways in slide 9 of the final report.

Recommendations for the Scottish Government 

The final FIRNS report also presented three key recommendations for the Scottish Government, as follows: 

More on our recommendations in slide 28 of the final report.

Pilot projects’ status and future support 

Despite discussions being undertaken with stakeholders across both projects, no formal agreement was reached on a definitive legal pathway for proceeding with restoration. The FIRNS project partners wish to continue to support both Pilots towards identifying a preferred legal pathway and exploring access to a range of funding models.

By way of example, Forest Carbon and Angus Davidson have been asked to present to the Councillors of Shetland Islands Council (one of the FIRNS project stakeholders) in September 2024 as part of ongoing efforts related to the FIRNS project.

Systems map

Following the final report, FIRNS project partners are developing a systems map. This map aims to further the understanding of challenges associated with delivering peatland restoration on crofting tenure land and gather ideas for potential solutions.

Please contact us if you would like a link to the systems map to be shared with you once it is up and running. 

Contact details 

If you would like to discuss any aspect of the FIRNS project, please feel free to contact:

Links to PDF versions of the final FIRNS report and legal paper 

You will find the final FIRNS report here, and the legal paper here.

This project is supported by NatureScot through The Facility for Investment Ready Nature in Scotland (FIRNS)

Net Zero Scotland and Nature Scot logo


News & Articles

Unlocking peatland restoration on crofting and common grazing land, part 2

Jul 02, 2024

Exploring alternative revenue streams, financial models, and legal pathways for peatland restoration

Read More

Accelerating small woodland creation: our new sponsorship model

Jun 13, 2024

There is a huge opportunity for woodland creation on smaller plots of land in less productive ar...

Read More

From carbon markets to nature markets: are we ready?

May 06, 2024

Focus has moved beyond carbon reporting, with organisations seeking ways to report, disclose...

Read More

Unlocking peatland restoration on crofting and common grazing land, part 2

Jul 02, 2024

Exploring alternative revenue streams, financial models, and legal pathways for peatland restoration

Read More

Accelerating small woodland creation: our new sponsorship model

Jun 13, 2024

There is a huge opportunity for woodland creation on smaller plots of land in less productive ar...

Read More

From carbon markets to nature markets: are we ready?

May 06, 2024

Focus has moved beyond carbon reporting, with organisations seeking ways to report, disclose...

Read More