The Sierra Club and American Electric Power, the nation’s largest coal-burning utility, don’t agree on much, but there is this:

Money does grow on trees.

Along with other big environmental groups and such businesses as Duke Energy and El Paso Corp., they are part of a coalition that wants to use markets to protect the world’s forests and curb climate change.

Jeff Horowitz

The coalition—called Avoided Deforestation Partners, a name that will never win a branding contest—is the brainchild of Jeff Horowitz, a 58-year-old architect and newcomer to the environmental movement who has quietly become an influential player as climate change legislation inches its way through a divided Congress.

Protecting forests “is our single most important strategy, with respect to solving the climate crisis,” Horowitz says. “If we don’t tackle forestry immediately, we can’t buy enough time to get at the technological advances we need and scale them.”

I met Jeff in December at the UN climate talks in Copenhagen, and visited him last week at his office in a lovely, hilly neighborhood of Berkeley. A mechanism to protect forests by steering millions of dollars from the developed world to poor countries, known as REDD (Reducing Emissions from Deforestation and Forest Degradation), was endorsed by governments in Copenhagen, so Horowitz felt good about the climate talks. “As far as we’re concerned, Copenhagen was a tremendous victory,” he told me.

Now he wants to make sure that forestry offsets are part of a U.S. climate bill. That will enable regulated polluters in the U.S. to offset their carbon emissions by paying to protect forests elsewhere. Protecting forests is a cheaper and quicker way to curb emissions than by switching from coal or natural gas to low-carbon energy sources like nuclear, wind or solar power.

While offsets are controversial, no one doubts is that protecting forests matters: Scientists estimate that nearly 20% of the world’s greenhouse gas emissions come from deforestation, as trees are slashed and burned to make way for agriculture. Standing forests also act as carbon sinks by absorbing CO2. Environmentalists and governments from Norway to Brazil have for decades tried to stop deforestation, but they  have made limited headway.

Neither afforestation (planting trees) nor avoided deforestation (stopping trees from getting cut down) were part of the Kyoto climate agreement, largely because of opposition from enviros. They argued that forest protection could not be reliably monitored and verified and that offsets would allow polluters to avoid mending their ways.

Critics of forestry offsets worry about arcane concepts known as “leakage” (paying to save one forest only to have another one nearby cut down) and “additionality” (how do you know the forests would not have been saved anyway?). They’re right that if mismanaged, offsets could do more harm than good.

Brent Blackwelder, president of Friends of the Earth, which released a 28-page report attacking offsets last fall, said: “Offsetting does not lead to promised additional emissions cuts in developing countries while it delays essential structural change in the U.S. economy.”

But the politics of offsets have shifted in the last year or two, in part because of Horowitz’s persistent behind the scenes efforts. Early on, he enlisted the support of Nobel Peace prize winner Wangari Matthai, the founder of the Green Belt Movement, which planted trees across Africa. Her fellow Nobel laureates Al Gore and Oscar Arias came around as well. A key turning point, in retrospect, came when Carter Roberts, the president and CEO of  the World Wildlife Fund U.S., spoke in favor of market mechanisms at an ADP event. The WWF had previously opposed offsets.

Last year, Horowitz and ADP — other members include Conservation International, Environmental Defense, NRDC, The Nature Conservancy among green groups, and PG&E, Marriott, Starbucks and Walt Disney among companies–developed “consensus principles” on forest offsets. They call for both public and private money to be steered to forestry protection.

Horowitz argues that the best way to overcome objections to offsets is to regulate forestry projects to insure that they are real, verifiable and long-lasting. Besides lobbying in Washington, ADP is developing a protocol to help poor communities seek financing to protect and monitor forests. “This allows indigenous groups to team up with NGOs, without hiring expensive lawyers they can’t afford,” he says.

Meanwhile, he explains, there are three categories of companies that can profit from forestry offsets.

If climate legislation passes, regulated utilities and their customers will save money by using offsets rather than shutting down coal or natural gas plants.

Branded consumer companies like Marriott, Disney and Dell, whose emissions are not regulated, use offsets to establish their green cred and burnish their reputations. (See my blogpost about Marriott and this press release from Disney, Conservation International, The Nature Conservancy and The Conservation Fund.)

Finally, a entire industry of project developers, carbon traders, verifiers and regulators has emerged to create and manage offsets. “There is profit all along that food chain,” Horowitz says, “and in my view that’s good.”

A native New Yorker, Horowitz designed large-scale projects around the world as an architect and became concerned about deforestation. He previously founded a nonprofit called Urbanists International, which provides design  and land planning services to developing countries, and was vice chair of Equator International, a forest carbon firm. He and his wife, Lynn,  own Rio Lago Ranch and Vineyard, which produces cabernet sauvignon grapes for the Clos du Bois Winery of Sonoma.

But his energies now are focused on forestry, with the goal of making it more profitable to preserve forests than it is to cut them down.

Thereby proving that your parents were wrong.

–

Disclosure: I was paid in Copenhagen by the Coalition for Rainforest Nations to host a celebration of REDD.

Not long ago, the only people who could access and analyze satellite images of the earth were government officials, the military, well-equipped scientists and oil, gas and mining companies.

Today, anyone with a computer and Internet connection can access to Google Earth. Since its introduction in 2005, Google Earth has become a powerful tool for scientists, activists and ordinary citizens who want to better understand, monitor and communicate about the environment.

It’s not just westerners either: Tanzanian villagers are working with the Jane Goodall Institute to monitor deforestation and identify chimpanzee habitats and elephant paths. Indigenous tribes in Brazil can map their lands and track illegal logging and mining. All they need are mobile phones equipped with cameras and GPS technology.

What’s more, the technology is getting better all the time. Last week in Copenhagen during the UN climate negotiations, Google Earth announced that it has worked with experts in remote sensing to build a new platform that incorporates satellite images, massive data and online computing power, making it easier, faster and cheaper to analyze forest ecosystems. (See this and this at the google.org blog.) It’s currently being tested by a handful of organizations, but will be rolled out more widely before long. The red spots on map below, for example, show new deforestation in the Brazilian state of Mato Grosso.

On my way home from Copenhagen, I learned about these new developments from Lilian Pintea, who is the director of conservation science at the Jane Goodall Institute, which is best known for its pioneering research on chimpanzee behavior. We met when we missed a connection in Geneva, so we arranged to have dinner during the layover.

Lilian Pintea of the Jane Goodall Institute

You could say that Lilian, who is 38, has already lived through two democratic revolutions. A native of Moldova, he was studying ecology in Moscow when the Soviet Union collapsed in 1991. He subsequently came to the U.S. as a Fulbright scholar and earned a PhD in conservation biology from the University of Minnesota. As a specialist in geographic information systems (GIS) and remote sensing, he has watched technology that was once reserved for elites in the developed world spread to the rest of the world, including remote villages in the global south.

“As a biologist, I was always frustrated that I was in the middle of a lake or forest and I would collect my data, and I didn’t know what was happening a few kilometers away,” Pintea says. Now, satellite images reveal landscape patterns that simply aren’t visible from the ground—evidence of illegal logging or gradients in deforestation.  “You can then look for political, social economic and ecological factors that explain the pattern,” Pintea says.

Lilian, who lives in Maryland and works the northern Virginia suburbs of Washington, travels frequently to Tanzania and Uganda.

“One problem which we often face in our project areas is the lack of capacity,” he told me.  “Every trip to Africa, I do training…We want to empower local communities and governments  to take charge and manage their lands.”

In places were traditional land tenure systems are breaking down, the technology had help settle boundary disputes. “Sometimes people don’t agree on where their village begins and ends,” he said. Not surprisingly, geospatial technologies are also used to better understand the relationship between chimpanzees and their habitats.

If all goes well, the Google mapping tools announced in Copenhagen will enable communities to generate accurate and timely information about their forests. That’s crucial to a financing mechanism known as REDD  (Reducing Emissions from Deforestation and Degradation), which is designed to prevent deforestation. Regular readers of this blog know that emissions from tropical deforestation account for about 17% of global warming pollutants, more than all of the world’s cars, trucks, trains, boats and planes.

The government of Norway, a major backer of REDD, has given the Goodall Institute a $2.7 million grant to equip and train villagers in western Tanzania and their institutions to prepare for REDD. Google programmers including Rebecca Moore, an evangelist for Google Earth Outreach, visited the region last fall to train Goodall Institute staff, village forest monitors, local government officials, university staff and others to gather data, take pictures and upload their findings to “the cloud”–meaning the Internet, where powerful software and data are stored..

“It’s still a work in progress but we are already doing it,” Lilian told me. “They’re mapping the forests and monitoring the threats.”

The number of scientists, NGOs and companies working on GIS and forestry issues is impressive: Students and professors at the University of Washington have created free software called ODK (Open Data Kit) that makes it easy to collect survey data and upload it from Android phones. Digital Globe, an imagery and information firm based in Longmont, Colorado, gathers more detailed satellite images than those available on Google. ESRI, a software firm based in Redlands, Ca., is the world leader in GIS, proving tools to build geospatial infrastructure. For its part, Google collaborated with Greg Asner of Carnegie Institution for Science, and Carlos Souza of Imazon to build its newest platform, and it got support from the Gordon and Betty Moore Foundation.

In my job, I hear a lot of blah-blah-blah about the importance of public-private partnerships. Usually that means a nonprofit wants a business to write a check.

Here you have businesses, NGOs and communities combining their brainpower, passion and knowledge to do vital work. That’s exciting.

all I got was this lousy T-shirt.

Hey, I’m kidding. This is actually a very cool T-shirt, albeit not suitable for December in Copenhagen, where it was snowing heavily this morning. (That didn’t stop the bike commuters.) The T-shirt is a limited edition, designed by Vivienne Westwood and Anvil Knitwear, to support the efforts of rainforest nations at the climate change negotiations here.

I’ll be meeting Vivienne Westwood this evening – she is speaking at the Support Redd Gala, where I will be master of ceremonies — but in a prepared statement, she said this about the shirt:

I am so glad to have had the opportunity to do this tiny, tiny thing – design a T-shirt – every little bit helps. ACT FAST/SLOW DOWN and stop climate change. That’s the message…Say YES to the rainforest.

The message is important. Deforestation accounts for an estimated  17% of global greenhouse gas emissions, more than all the world’s cars and trucks combined. Rainforests have enormous environmental, social and spiritual value  – they absorb carbon, they purify water, they protect biodiversity and they are beautiful — but their value is not, for the most part, recognized by the market. Instead, trees are most valued as timber or they are cut down to make way for farming or ranching.

The Coalition for Rainforest Nations wants to change that through a mechanism known as REDD (Reducing Emissions from Deforestation and Degradation), which I wrote about the other day. REDD is one way in which rich countries–which are primarily responsible for causing climate change–can help poor countries which are mostly likely to suffer from its impacts. Conveniently, it is also a low-cost way of fighting global warming.

Put simply, without protecting forests, there’s no solution to climate change.

As for the T-shirt, it’s made by a company called Anvil Knitwear which says:

Each shirt is made with a blend of recycled polyester, derived from approximately three recycled plastic bottles, and transitional cotton that comes from farms that are converting to organic farming methods, a three-year process required for receiving organic certification. Eco-friendly printing for the shirts was provided by New Buffalo Shirt Factory.

For those of you who, like me, are neither fashionistas nor punk music fans, Vivienne Westwood is a designer who helped bring modern punk and new wave fashion into the mainstream, at least according to her Wikipedia entry. A major restrospective of her work was shown at the Victoria and Albert Museum in London in 2004, and she was appointed Dame Commander of the British Empire by Queen Elizabeth II in 2006.

In Amazonas, Brazil’s largest state, children and adults are going to school for the first time, families are paid $25 a month and startup businesses and community organizations are getting funded. The money comes from the state government and corporations including Marriott International, two Brazilian banks, Bradesco and Banco de Planeta,  and Coca-Cola’s bottler in Brazil.

In return, the Amazon dwellers simply agree not to cut down trees.

This deal—in which companies and governments pay people who pledge not to destroy rainforests—is the essence of a concept known as REDD, which stands for Reducing Emissions from Deforestation and Degradation.

REDD is an important element of the UN climate negotiations unfolding this week here in Copenhagen, as well as a vital – and potentially controversial – plank of the climate bills pending in Congress.

“We will only win this deforestation battle if we can find ways to make the forest worth more standing that they are when cut down,” says Virgilio Viana, direct of Fundacao Amazonas Sustentavel, which oversees the project in the Juma Preserve of the Amazon. Juma is a 1.8 million acre region—about the size of Delaware—which is 98% forested.

Today, I went to a briefing by Marriott about the Juma project and REDD. If REDD projects can be made to work, in a verifiable and lasting way, they can be potent weapons against climate change. [Disclosure: I am hosting an event this week sponsored by the Coalition of Rainforest Nations, which paid my way to Copenhagen and strongly backs REDD.]

The arguments for REDD are environmental and economic. Between 15% and 20% of the world’s carbon emissions come from cutting down forests, burning wood or peat. These forests are destroyed for timber or to make way for farming and ranching. Because of deforestation, Indonesia and Brazil are the No. 3 and 4 ranked all countries in carbon emissions. Deforestation causes more carbon emissions that the world’s transportation sector—a stunning fact, when you think of all the attention paid to (and money invested in) electric cars or fuels.

What Amazon deforestation looks like

The other appeal of REDD is that it’s cheap. REDD projects cost an estimated $5 t0 $15 to eliminate each ton of carbon emissions, far less than it costs to, say, substitute solar panels for coal plants. They can also be done quickly, compared to, say, the time it takes to permit and build a nuclear plant.

The Juma Project being touted by Marriott is a voluntary offset. No one requires hotel chains to reduce their carbon emissions. but Marriott has committed $2 million to the effort as part of its sustainability program. It also asks hotel guests to contribute $1 per night to offset their own carbon emissions when they stay in a Marriott  hotel.

Marriott’s contributions have, among other things, built the first school in one community. The Amazon foundation has also helped finance such alternative livelihoods as the harvesting of Brazil nuts, the development of fish farms and sustainable logging, where tress are planted as quickly as they are cut down. “It is quite moving to see lives being changed, while the rainforest is being preserved,” says Mari Snyder, who oversees Marriott’s sustainability work. (You can watch a Marriott video here about Juma and REDD.)  Even critics of offsets regard voluntary ones like this as benign.

But REDD will only have a major impact if offsets are incorporated into legally binding cap-and trade regulations like those being debated here in Copenhagen and in Congress.

This is where things can get sticky. Some critics—most prominently, Friends of the Earth—say offsets are dangerous gimmicks and  trading schemes are subject to abuse. REDD projects in particular are hard to measure and verify. One problem is described as “leakage”–the notion that if forests are protected in one place, rangers or farmers who want land will simply tear down trees elsewhere.

The other argument against REDD is that cheap overseas offsets will allow coal and oil companies in the U.S. to buy their way out of carbon controls, rather than reform their own practices.

I asked Glenn Hurowitz, who works for a coalition called Avoided Deforestation Partners, to respond to the criticisms. He said verification of forest projects had become easier with the democratization of satellite technology, like Google Earth. As for leakage, rules can  be written to prevent it by only allowing credits to go to  countries or large regions that agree to limit deforestation on a broad basis.

As a practical matter, Hurowitz said, without offsets like  REDD, passing a strong U.S. climate regulation bill will be  difficult if not impossible becausethe costs of reducing emissions without them would be much higher. (As much as 89% higher, an EPA analysis says.) “IF you didn’t have the inclusion of offsets, particularly forests, you would see weaker emissions caps,” he said.

The Avoided Deforestation Partners coalition includes carbon emitters like American Electric Power and Duke Energy and such big NGOs as Environmental Defense, The Natural Resources Defense Council, The Nature Conservancy and the Sierra Club. The coal burners like REDD because they’d rather pay for offsets that shut down their plants; the enviros like it because, done right, it works.

Two other interesting things to know about REDD:

First, REDD advocates say that protecting the  Amazon will help U.S. timber and agriculture interests who now compete with loggers and farmers who use deforested Brazilian land. Backers of REDD will use that argument to try to persuade senators from farm or timber states to support climate legislation—as a way to protect jobs in their home states.

Second, REDD is a form of what activists call climate justice. They argue that rich countries are responsible for most of the greenhouse gases in the atmosphere, so they should  finance the solutions to the climate crisis. Under the REDD provisions, an estimated $12 to $14 billion in government and corporate money will be dedicated to forest protection.

Mark Tercek left Goldman Sachs after a long and successful career midway through 2008, just before the global financial meltdown. Good timing, except that Tercek moved on to become the president and CEO of The Nature Conservancy, the world’s biggest environmental organization, as  the global climate crisis is intensifying.

He feels the pressure. There’s more work than ever to do, and money is tight at the conservancy. “This is really hard,” Tercek told me recently. “What a responsibility we have to get this right.”

Mark Tercek

By “this,” Tercek means climate change policy in general and REDD in particular. REDD stands for Reducing Emissions from Degradation and Deforestation, and it’s an absolutely crucial strategy for dealing with climate change that requires slowing the growth of agriculture, forestry and cattle ranching to protect forests in places like Indonesia and Brazil. Because tropical forests are being degraded or cut down at an alarming rate, Indonesia and Brazil are ranked No. 3 and No. 4, respectively, by some studies when it comes to carbon emissions, behind the U.S. and China  but ahead of Japan or Germany. Deforestation could account for as much as 25 percent of emissions, these studies show.

The fundamental idea behind REDD is to get businesses and governments in richer countries to help finance sustainable livelihoods for people in poor countries so they don’t have to cut down trees to earn a living. While it takes some doing to get your head around the idea that Americans and Europeans will pay poor people not to cut down trees, some countries like Norway are already big backers of REDD and companies like Dell and Marriott  are working with enviros like Conservation International to preserve forests in Madagascar and Brazil. The Nature Conservancy has for more than a decade been leading a project to protect 1.5 million acres of tropical forest that were threatened in Bolivia. The conservancy says the project “is expected to prevent the release of up to 5.8 million tons of carbon dioxide over the next 30 years,” while preserving biodiversity and protecting communities.

“There’s no higher priority for me at The Nature Conservancy than REDD,” Tercek says. “We’re extremely confident it can work, which is not say that it’s easy.” In fact, there are tricky technical, political and governance isues around  REDD, as this post on the conservancy’s blog, Cool Green Science, explains. How, for instance, after paying people not to cut down trees do the financial types make sure they get the sequestered carbon they have paid for? The answer is, essentially, satellite photography, but trust me, there are other, more complicated issues.

Give his experience as a deal-maker, Tercek would seem to be the right man to help figure all this out. Mark, who is 52, grew up in a working class neighborhood of Cleveland. His first exposure to business—as a paperboy for the Cleveland Plain Dealer—gave him an opportunity to win a scholarship to the Western Reserve Academy, an elite prep school. (He is a loyal alum who has been president of its board.) From there, he went on to Williams College, did a stint in Japan with Bank of America, picked up an MBA at Harvard Business School and found a home at Goldman, beginning in 1984. “I liked investment banking, every minute of it,” he says.

In 2006, Tercek was put in charge of the Goldman’s new Center for Environmental Markets by Hank Paulson, who was then Goldman’s CEO and the board chairman of The Nature Conservancy. Paulson wanted the bank to turn environmental issues into a business opportunities, which is why he put a commercial banker like Tercek in charge. For his part, Tercek got a crash course in climate change, which only intensified his interest in the environment. That had taken root when he and his wife, Amy, took their four children on nature trips to places like Costa Rica, Belize and Tanzania.

“If you see the wonders of nature through the eyes of children, you’d have to be a real dolt not to step back and think about, ‘what kind of world are we going to leave them?’ “ Tercek says.

The Nature Conservancy job puts him in a position to have a big impact. The conservancy is by far the world’s biggest conservation group, with an operating budget of nearly $500 million, about 3,600 employes including hundreds of scientists, and chapters in all 50 states and 36 countries. Unfortunately, the group, like other NGOs, has suffered during the current recession, and so Tercek has overseen the layoffs of about 10 percent of the staff. He’s also got to balance the needs of the state chapters, which raise most of the money, and the global operations, where the needs for conservation are greatest.

The financial crisis, Tercek says, has been “a huge reminder that we don’t have unlimited resources. We have to be really disciplined about identifying our highest priorities, and making sure they are fully funded not only with money but with talent.”

Tercek is looking to build alliances with other NGOs—the Nature Conservancy has joined the U.S. Climate Action Partnership, for example—as well as with business. Corporate backing for both the voluntary and regulated carbon markets, for example, will be essential to save forests.

“I believe we can harness the power of business to solve big issues,” Tercek says.

Mark spoke at FORTUNE’s Brainstorm Green conference about business and the environment while at Goldman in 2008, and I’m pleased to say that he will be back again in 2010, this time representing The Nature Conservancy.

Measuring trees in Bolivia as part of a sustainable forestry program

photo credits: The Nature Conservancy