A new space race for the future of the uplands is underway

Implementing nature-friendly moorland management which lives up to the aspirations of landowners has always presented environmentalists with a conundrum. Now, eco-entrepreneurs reckon they’ve solved the challenge.

If asked to name a location where tech revolutions are born, some might say Silicon Valley, others might say Tel Aviv. Halfway around the world, however, a new hotbed of innovation is emerging in the heart of the Scottish Highlands, on the Kinrara Estate, where one of the first landscape-scale investments in climate innovation is underway to help drive the global transition to net-zero.

Like many of its kind, for a good part of the last century Kinrara has been intensively managed as a grouse moor. Its 9,000 hectares of heather hills are a chessboard of charred patches, having been set alight for six months each year to cultivate younger, more nutritious shoots for game birds to eat. Yet for an unspecified reason the old owners put the estate on the market last year and it was snapped up by a buyer with an unlikely portfolio.

BrewDog, the multinational brewery and pub chain, announced in April that it had purchased Kinrara to offset its carbon footprint through replacing grouse moor management with habitat restoration. The business intends to start work on what CEO James Watt describes as the “biggest native woodland establishment and peatland restoration project ever carried out in the UK”, which will help the company become the world’s first carbon negative brewery.

Amid the pandemic, investment in climate solutions grew significantly

It may sound like a wildcard, but BrewDog is tapping into a genuine trend among businesses to invest in nature’s recovery in the race to reach net-zero. Big corporate buyers—from supermarket chain Iceland to tech powerhouse Google—have invested into the carbon offset market over the past year. And despite the coronavirus crisis resulting in reduced emissions from industries like aviation that are set to become big buyers, the value of the global offsetting market shot up by 20% in 2020 to $277 billion (£195 billion).

Under a business as usual scenario a company could expect to emit a certain amount of carbon. In the long-term, the goal is for the company to find new ways of trading without emitting as much carbon: to meet its regulatory burden in the short-term, it will need to buy carbon offsets to progressively bring its emissions down to net zero.

At the same time a landowner owns an area that is currently or has the potential to be monetised through unsustainable practices. If the landowner agrees to forgo aggressive management practices on a certain tract of land in perpetuity, it can receive an offset credit that it can sell to businesses. The landowner can generate cold, hard cash; the business can meet its regulatory mandate. The process also allows for customisation: for example, BrewDog has by-passed carbon brokers by becoming a landowner itself and in the process brought its strategy for reaching net-zero entirely in house.

Suddenly ideas surrounding making land use more effective to address climate change have started attracting attention. “Taking carbon out of the atmosphere to be stored in ecosystems, including woods, peatlands and saltmarshes, is a vital part of the journey to net zero,” Tony Juniper, Chair of Natural England, the government’s nature protection agency, says. “By combining different policies and strategies then major climate-related benefits can be achieved.”

The carbon offsetting market is rife for expansion

These are not empty declarations. Britain’s peatlands store as much carbon as all the forests in the UK, France and Germany combined. That’s a colossal 3.2 billion tonnes of carbon locked in the ground. But whilst the benefits of the natural carbon bank are clear a decades-long programme of burning and draining has left only 4% of England’s upland peatlands in favourable condition, causing many to convert from carbon stores into carbon emitters.

What’s more, a new study published by Natural England has placed the vast peatlands which characterise the uplands in the top trio of habitats most important for carbon storage. As a new report from the Environment Agency argues, the roll out of carbon capture technology is being obstructed by intensive land management practices, such as burning, and it will be a challenge to unlock the new market if they continue. Carbon offsetting presents an obvious entry point to tackle the systemic environmental problems associated with intensive grouse moor management regimes.

But it’s not only environmental concerns which are driving forward change. It is becoming increasingly clear that carbon offsetting is able to succeed as a new entrant because it may soon not be economically viable to compete.

Current land management is resource intensive and an economic gamble

Despite a large amount of resources going into running a grouse moor, this idiosyncratic way of managing moorland is a huge gamble. Its success pivots on enough sensitive wild birds breeding and their young surviving until shooting season, at a time when a turbulent climate brings extremes of weather which prevents them from doing anything but. For the past three years this punt has not paid off, with some estates reporting grouse stocks at their ‘lowest levels in living memory’.

“Nature, I’m afraid, is to blame,” said Robert Benson, then-Chair of the Moorland Association, when the last shooting season was cancelled. “A very dry spell in the spring saw no rain and therefore no moisture for insect life to thrive, and this led to some chicks sadly not making it”.

But it would appear that the game shooting industry’s woes go beyond the humble grouse being ill-adapted for the contemporary climate. In recent years grouse moors have seen unprecedented outbreaks of heather beetles stripping vegetation bare and leaving little for game birds to eat. As these pressures have hit grouse stocks, some moors have reportedly doubled down on intensive management—burning, predator control and dosing grouse with industrial strength veterinary medicine—in a last-ditch attempt to force game bird numbers back up. But this brings its own problems of a rapidly increasing parasite and disease load: recent research published by the industry shows that as many as 80% of grouse moors have observed birds with a painful disease known as ‘bulgy eye’, which causes swollen eyes, nasal discharge, lesions and breathing difficulties. And if that wasn’t enough of a challenge for grouse moors, these externalities are underpinned by a tightening regulatory grip on the use of intensive management practices by policy-makers being motivated to act by the environmental and animal welfare lobby.

With around 190 moorland estates in England, Scotland and Wales hedging their bets on grouse breeding for an income it’s no wonder that it’s fast being seen as a risky, inefficient and increasingly unviable land management model. By comparison, the world’s largest independent energy trader Vitol has said that it expects carbon offsets, through habitat restoration, may be the biggest growth area of the burgeoning climate solutions industry: these land use initiatives are already the largest sector of the market in dollar terms.

The prize to be won will be held up by the bold

It is clear that a crossover point is near to being reached with the viability of grouse moors decreasing and the value of carbon offsetting rapidly increasing. On this basis alone landowners need to think how the uplands are used so they can be re-designed and optimised for maximum security and resilience. As this happens, we can expect landowners will seek to diversify. It should be noted that this is not an objective to make moorland estates obsolete, but to offer a better alternative to grouse moor management, which is why it should be considered as systemic innovation. It’s about an innovation that operates on a systems basis that connects all the stakeholders together to re-think a better land management system for future generations, whilst getting back into balance with nature.

Like coal and diesel powered cars, the end of intensive management of the uplands looms not only because of effective campaigning, but in the face of cheaper, better and environmentally benign alternatives that are coming to the fore.