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New plan would pay tropical countries for saving forests, regardless of level of threat

New plan would pay tropical countries for protecting carbon sinks

New plan would pay tropical countries for protecting terrestrial carbon, regardless of where it is stored
July 24, 2008 [Corrected Aug 5, 2008]

Deforestation and forest degradation account for around a fifth of global carbon emissions from human activities, but new policy measures are focusing reducing such emissions as a cost-effective way to fight global warming. While the concept — known as REDD for “Reducing Emissions from Deforestation and Degradation” — has found wide support from politicians, scientists, and environmentalists, there are lingering concerns over how to compensate countries that have extensive forest cover and low rates of annual forest loss, since payments are based on historical deforestation rates. A new proposal seeks to get around this issue by factoring in all the terrestrial carbon in a tropical landscape — regardless of where it is stored — and packaging it as a tradable commodity.

The concept is presented in a paper by the Terrestrial Carbon Group, a group of scientists, economists and public policy experts. The paper, “How to Include Terrestrial Carbon in Developing Nations in the Overall Climate Change Solution” (PDF), lays out a series of “guiding principles” for action to address emissions from terrestrial carbon sources.

“The Terrestrial Carbon Group’s paper recognizes that over the coming decades, vegetated land in developing nations will be increasingly threatened with conversion to agricultural and plantation use, and to human settlements and infrastructure. This will cause greenhouse gas emissions, underscoring the ongoing importance of terrestrial carbon in the climate change solution,” said Terrestrial Carbon Group in a statement.

“Both market and non-market approaches to terrestrial carbon and climate change are necessary. Within that context, the Terrestrial Carbon Group proposes a market-based system that includes all the components that would need to be agreed at an international level (whether bilateral, multilateral or global).”

“Nations would determine national and sub-national implementation systems targeted to their specific circumstances. The proposed system is as simple as possible and has two purposes: (i) to allow the international trading (whether bilateral, multilateral, or global) of carbon credits based on the maintenance and creation of terrestrial carbon, and (ii) to guarantee that action under the system contributes to long-term climate change mitigation.”

The group says its plan “encourages broad participation because it provides incentives to developing nations regardless of their historic rates of deforestation and terrestrial carbon emissions.”

In other words countries that would potentially lose out from the currently-proposed REDD mechanism — nations like Guyana, Suriname, and DR Congo — could cash in on their forest stewardship, earning funds to continue conservation efforts and improving the quality of life of people living in and around forests.

“Our proposed system does not restrict economic use of land, but instead opens up one new economic development option — generating and selling terrestrial carbon credits. This puts a new economic value on terrestrial carbon, including trees, soil and peat,” said Terrestrial Carbon Group member, Dr Chatib Basri of the Institute for Economic and Social Research at the University of Indonesia.

How it would work

Ralph Ashton, who leads the Terrestrial Carbon Group, told that the proposal “first categorizes all terrestrial carbon into protected and tradable, and then pays to keep the tradable terrestrial carbon. The protected terrestrial carbon must be retained for the nation (or sub-national entities) to remain eligible for payments.

“It is therefore not a carbon stock approach that rewards the maintenance of all forest carbon, but an avoided emissions approach using terrestrial carbon stocks and a protected / tradable categorization to set the baseline,” he continued. “The level of threat determines whether particular terrestrial carbon is tradable or protected.”

The group says that the proposed system also overcomes some of the other criticisms of forest carbon trading initiatives, including “permanence” (whether a county can ensure that forest carbon savings are permanent); “leakage” (what happens when carbon conservation in one area drives deforestation in another?); baseline data establishment (how does one measure historic deforestation to establish a baseline for calculating reduction?); and “additionality” (how is it determined that the carbon offset adds to the decrease of carbon dioxide content in the atmosphere?). The system would limit number of credits that can be sold each year, buoying market prices, while it would require countries to maintain protected areas.

“The good news is that, while some uncertainty remains, we know how to use forests and land management as part of the climate change solution. The science, the economics, and the drivers of land-use decisions are all well enough understood. And the institutional arrangements are possible,” said Terrestrial Carbon Group member, Dr Thomas Lovejoy of the Heinz Center.

“Climate change is not just an environmental issue; it has impacts on all facets of life in developed and developing nations alike. Avoiding dangerous climate change is an essential task for the whole world. It is a difficult task, and we must therefore use all available means,” added Terrestrial Carbon Group member, Professor Hadi Soesastro of CSIS in Indonesia.

“Terrestrial carbon is a critical untapped element that could provide up to 25% of the climate change solution,” added Ashton.

  • The Terrestrial Carbon Group
  • TCG’s Blueprint

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