Carbon rights
The single clause that decides whether a restoration project is a business or a favour. We state our default openly, and we will negotiate it, because a term nobody discusses is a dispute waiting for year eight.
Why this page exists
A landowner leases a parcel. Somebody plants it. Twelve years later the trees are worth something as carbon, and nobody can say who owns that value because the lease deed never used the word.
This is common, and it is the reason a great deal of Indian restoration work quietly stops being commercial. The party who spent the money planting discovers they were a labour contractor. The landowner discovers a value they were never told about. Both sides feel cheated, and the lawyer bill exceeds the credit revenue.
We would rather have the conversation at signature, in plain language, than in year eight through advocates. So our position is published rather than negotiated in private, and this page is the same document we open the discussion with.
Our default
On land BAASLAB leases, all carbon rights and environmental attributes arising from the planting, including carbon credits, removal certificates and any successor instrument, vest with BAASLAB for the full lease term. This is the default, and it applies unless a different arrangement is expressly agreed in writing.
The reasoning is straightforward, and we think it is fair rather than merely convenient:
- We carry the costCapital
- Establishment, protection, water infrastructure and maintenance are funded by us, in full, before anything is earned.
- We carry the riskDownside
- Drought, fire, grazing loss and replanting are our loss, not the landowner's. The rent is paid whether the season was good or ruinous.
- We carry the measurementVerification
- Carbon revenue only exists if survival and growth are measured to a standard a buyer accepts. That work costs money every year and it is ours.
- The landowner is paid regardlessCertainty
- Fixed rent from year one, on schedule, with no investment and no exposure to whether carbon markets are strong or weak in any given year.
In other words the default trades certainty to the landowner for upside to us. That is the same trade a solar developer makes when it leases a field, and it is why the rent can be paid before the asset earns anything.
Three other structures we will sign
The default is a starting position, not a condition of doing business. Landowners, corporate clients and government bodies want different things, and the structure should follow what they actually want rather than what is easiest for us.
| Structure | Who holds carbon rights | What the landowner or client gets | The trade |
|---|---|---|---|
| Default | BAASLAB, full term | Highest fixed rent, paid from year one, no risk | No exposure to carbon upside |
| Revenue share | BAASLAB, with a contractual share of net carbon revenue paid across | Lower fixed rent plus an agreed percentage of what the carbon actually earns | Some rent traded for upside that may or may not arrive |
| Split rights | Divided by vintage or by block, as specified in the deed | Direct ownership of a defined portion of the credits | You take on your own verification and sale, which is harder than it sounds |
| Client retained | The client, in full | All credits, typically to meet the client's own net zero commitment | Priced as a service contract, so the client funds establishment and carries survival risk |
If you are a company planting to meet your own decarbonisation commitment, client retained is usually correct. You need the credits themselves, not a share of their sale value, and retiring a credit you own is far cleaner to report than buying one. Say so early, because it changes how the whole project is priced.
What goes in the deed
Whichever structure is chosen, the same points are written into the lease at signature. A handshake on carbon is worth nothing in year twelve, when the people who shook hands have often moved on.
- Definition. What counts as a carbon right, written broadly enough to cover instruments that do not exist yet, since this market changes its vocabulary every few years.
- Who holds it, and for how long. Named party, and whether it survives the lease term or ends with it.
- What happens on early termination. Who holds credits already issued, and what happens to sequestration that has occurred but not yet been certified.
- Permanence obligations. Carbon buyers require the planting to remain standing for a defined period. That obligation has to bind whoever holds the land at the time, including a successor owner.
- Access for measurement. A right to enter and measure on a schedule, because a carbon claim without verification is not saleable.
- What happens if the rules change. This market is regulated by instruments that are being rewritten continuously, so the deed says what happens if a mechanism is withdrawn or replaced.
This page is our commercial position, not legal advice, and the wording above is not a substitute for a deed drafted by a lawyer for your specific parcel. On government or institutionally held land the position can differ materially from private land. Where we cannot secure clear carbon rights on a parcel, we say so and we do not take the land on the assumption that it will resolve later.
Carbon rights
- Who owns the carbon credits from trees planted on leased land?
- Whoever the lease deed says. Carbon is a separate right from the land itself.
- If the deed is silent, the position is unsettled and usually goes against the planter.
- So it is written into the deed at signature, never assumed later.
- What is BAASLAB default position on carbon rights?
- Carbon rights stay with BAASLAB for the full lease term, unless we agree otherwise in writing. Because we carry:
- The cost of establishing the planting.
- The risk if a season fails.
- The cost of measuring and verifying it.
- And the landowner is paid rent regardless.
- Can a landowner share in carbon revenue instead?
- Yes. The default is a starting point, not a condition. Take a share of carbon revenue in place of some rent, and we will price the rent to match. Whatever is chosen goes in writing before planting starts.