BAAC buys 'world's priciest carbon credits' in Thailand's first forest scheme

The bank bought 120 million baht worth of credits at 30,000 baht per tonne in the BAAC Carbon Credit project, the first forest carbon credit initiative in Thailand.

Centred on two treebanks in Khon Kaen province, Tha Li and Ban Daeng, the project aims to meet the needs of the public and private sectors in achieving carbon neutrality and zero net greenhouse gas emissions.

The process involves registering, conducting tree counts, certifying carbon credits through external assessors, and verifying the carbon credit quantity with the Thailand Greenhouse Gas Management Organization (TGO).

The initiative also supports farmers in the "3 Forests, 4 Benefits" programme, fostering their active participation in the sustainable management of community natural resources.

After deducting operational expenses, farmers in the project's communities will have a net income of 842,100 baht.

The Tree Bank project currently comprises 6,814 communities with 124,071 members. Over 12.4 million trees have been registered in the programme, with a total value exceeding 43 billion baht.

Transforming their trees into assets adds value to the land and serves as collateral for loans, contributing to the sustainable development of these communities.

Currently, BAAC members in communities generate an annual income of 116 million baht from products derived from trees and forests.

A carbon credit equals 9.5 kilograms per tree per year.

A one-rai area with 100 trees per rai will generate an estimated 950 kilograms of carbon credits per year, with a selling price of 3,000 baht per ton of carbon.

After deducting expenses at a 70/30 ratio, farmers can expect a net return of around 2,000 baht per rai per year.

Farmers who plant trees along the edges of fields for an average of 40 trees per rai are expected to earn about 800 baht per rai per year.

Currently, 84 registered communities have successfully stored more than 2.7 million tonnes of carbon dioxide.
The BAAC is supporting Tree Bank communities with a budget of over 3.8 million baht.

The project is also encouraging reforestation efforts on both private and communal lands, the bank said.
Approximately 108,000 trees are planted each year, and it is anticipated that this initiative will yield a carbon credit quantity of over 510,000 tonnes for the carbon credit market within the next five years.