Leafy laws
Climate bills would save world's forests
Posted by Glenn Hurowitz (Guest Contributor) at 6:55 AM on 03 Jun 2008
Read more about: deforestation | climate | legislation | politics | agriculture
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* More money for forests and wildlife conservation than has ever been available in history
* The regrowth of many of the world's forests
* Massive quantities of greenhouse gases sucked out of the air
Those are a few of the benefits of the newest versions of the climate legislation now being considered in the House and Senate. Both the Boxer-Lieberman-Warner bill [PDF] and Rep. Ed Markey's latest proposal [PDF] include massive financing for forest and land conservation that could save these planetary lungs.
Both bills are based on a fundamental recognition that trees suck up vast quantities of carbon dioxide and convert it into oxygen -- and that standing pristine forests and grasslands (especially tropical forests) are a tremendous storehouse of carbon that we've got to keep safely locked up in forests. Indeed, deforestation for agriculture and logging is already driving 20 percent of greenhouse-gas emissions and is the biggest single source in the developing world.
And so these bills would unleash unprecedented levels of financing to preserve great natural reserves from Big Ag, Big Timber, and land-hungry peasants.
But the ways in which they do it -- and the overall scope of the bills -- could spell very different fates for the forests and grasslands they're meant to save. The Lieberman-Warner bill would allow polluters to offset their own pollution with more than 25 percent offsets through domestic and international forest, grassland, and agricultural conservation, reforestation, and afforestation -- amounting to billions of dollars a year in financing opportunities. Polluters are likely to jump at these forestry offset opportunities: Because of the relatively low price of land and the immense quantities of carbon stored in the forests, conserving forests is generally a lot cheaper than cleaning up industrial pollution.
The Markey bill takes a different approach. In the past, there's been some skepticism that offsets from forestry could be accurately tracked. In the words of a senior adviser to Markey's global warming committee, "You can't plug a meter into a tree to see how much carbon was sucked in that day." There were also concerns in the past that it would be hard to accurately track whether a forest that was "saved" would actually have been cut down in the absence of financing or conservation action.
Update [2008-6-4 10:15:34 by Glenn Hurowitz]:: Because of the concerns about accurately tracking international forestry, the Markey bill excludes international conservation and restoration from its offset programs, but not domestic forestry programs.
And so, when it comes to international forestry, domestic wildland and wildlife conservation, and improving agricultural practices (all of which could have a significant carbon benefit), Markey's bill proposes a different mechanism: Take the proceeds from the bill's auction of polluter permits and apply a certain percentage to conservation projects, both here in the United States and abroad (the Lieberman-Warner bill also includes provisions that channel money raised through the auctions to conservation, but it's not as central).
Each of these approaches has advantages and drawbacks. Doing conservation through offsets makes sense because there's a high level of certainty that the forests will actually get protected. Because of the cheapness of reducing carbon emissions through forest conservation and reforestation, to the extent they're allowed, polluters will pour money into conservation projects before turning their attention to the energy sector -- meeting a significant percentage of the approximately $11-15 billion needed annually [PDF] to halt deforestation worldwide.
On the other hand, the overall weakness of the Lieberman-Warner legislation means that any conservation gains achieved through its forestry and conservation programs could be completely undone by its lack of sufficiently aggressive action to truly solve the climate crisis. Because it doesn't achieve the 80-90 percent minimum reductions in greenhouse gases by 2050 that scientists say are needed to avoid catastrophe, it could spell doom for the very forests and wildlife it's meant to protect: Scientists warn that an increase of just 2-3 degrees C could cause the Amazon rainforest to turn into a vast grassland [PDF], releasing enormous quantities of carbon into the atmosphere and condemning millions of species to extinction (while turning grasslands around the world into lifeless deserts).
In contrast, the Markey bill goes much further toward reaching the carbon dioxide reduction goals scientists have laid out, and its forestry components are mostly gravy on top of the large reductions in pollution it achieves in the energy sector. But its land and wildlife conservation programs aren't guaranteed to reach anywhere near the scale projected, especially in the short run.
Because the Markey bill relies on auctions of pollution allowances to finance its forest and land conservation programs (as well as lots of other good programs), the amount of conservation is entirely dependent on the outcome of the auctions. Reducing global warming pollution could turn out to be far cheaper than anticipated (as occurred under the sulfur dioxide cap-and-trade system). Overall, that would be a good thing, but it would starve the essential forest and wildlife protection programs of the funds they need to play a part in stopping the climate crisis (and staving off mass extinction from other sources as well). Secondly, the $4 billion a year projected for international forest conservation is just in an average year. Because initial auctions would generate significantly less funding, it's unlikely the $4 billion figure would be reached for several years, likely condemning hundreds of millions of acres of rainforest to destruction in the meantime (these timeline concerns also apply to Lieberman-Warner).
In addition, Congress has shown a disturbing tendency to raid dedicated funding sources like this for the (non-environmental) priority du jour.
In contrast, requiring polluters to meet rigorous standards (or face large financial penalties) in order for their offset programs to be given credit will provide a virtually ironclad guarantee that all the forest protection offsets that are allowed under the bill will be achieved, and achieved through very high quality projects.
Finally, there's been tremendous progress in policy development around forestry that should allay some of the concerns at the root of the Markey funding mechanism. For instance, there has been a great deal of anxiety about "additionality" -- whether or not a forest saved through carbon finance would have been preserved through other means.
In fact, we know based on experience in Europe, the United States, and countries like Malaysia that business as usual will lead to the destruction of about 85 percent [PDF] of original forests in any given country. That means that almost any forest protected through carbon conservation would have fallen without it. To save governments the impossible task of figuring out which forests would have fallen and which wouldn't, it would be better to incentivize the protection of all pristine forests and, to be conservative, discount the value of their protection by, say, 50 percent (i.e., in most cases, reductions in energy pollution would be worth twice a forest saved).
Because of how cheap tropical forest conservation is, that wouldn't price many forests out of the carbon conservation market but would ensure that all forests and all forested countries, including those with strong preexisting forest protections, would benefit from carbon finance. (Of course, it's also a good idea to put a premium on the conservation of high biodiversity lands and lands close to the agricultural frontier that are in imminent danger of destruction.)
So what's to be done? Sens. Bernie Sanders and Bob Corker have teamed up to strip the Lieberman-Warner bill of its international offset provisions, preventing any climate funds from going to international forest conservation. That would achieve bigger reductions in pollution from energy sources, but it isn't likely to get that much support, as it would cause a significant increase in costs and leave a huge part of climate pollution uncovered.
But there is a way that could provide a guarantee for funding for conservation while allowing us to quickly and cheaply meet the biological imperative of large and rapid reductions in global warming pollution: change the way we look at those offsets. So far, they've been seen largely as a cost-containment measure. But that's not the only way to look at them. Instead, they could be seen as a way to achieve deep cuts more quickly and affordably than in current legislation. Currently, the Lieberman-Warner legislation would only generate a 71 percent reduction in greenhouse gases by 2050 and wouldn't achieve nearer-term reductions as fast as scientists say is necessary.
How could Lieberman-Warner be fixed and the Markey bill perfected? One way is to allow polluters to meet a greater proportion of their pollution cuts through forestry programs, saving them money. In exchange, they'd have to agree to meet much higher overall targets for pollution reduction, including more, relatively modest reductions from the energy sector. (Of course, this isn't a full remedy; the Lieberman-Warner bill's trillion dollar-plus windfall for polluters remains a major problem under this scenario.) Greenpeace has made an exciting and somewhat similar hybrid proposal on the international level to ensure high levels of funding for forest protection while bolstering more ambitious greenhouse gas targets).
This way, instead of aiming for 80 percent reductions by 2050, we could shoot for more than 90 percent or go even further to meet or exceed a 100 percent reduction rate. That's possible because a vast expansion of the world's forest carbon sinks along with a major clean energy transformation could actually mean that the earth is absorbing more carbon dioxide every year than it is emitting. That's the kind of breakthrough progress possible only through a real focus on protecting our forests and restoring the forests that we've already destroyed, both in the United States and around the world.
Of course, a massive tree-planting effort will require strong ecological protections of its own, and this is an area in which both bills could also be improved. Both bills include guidelines that favor the planting of native species so that these extensive new forests aren't just mono-cultural green deserts. But the bills need to go further to include explicit instructions that forests should be planted in a way that will enhance clean water and protect wildlife, avoiding the many problems that have bedeviled European forestry.
In short, robust forest conservation programs are essential to solving the climate crisis and achieving broad political support. In the same way that the clean energy revolution will bring prosperity, health, and a living planet to communities around the country and the world, powerful incentives to protect and restore the earth's forests will deliver major gains in greenhouse gas reduction, saving endangered species, and delivering prosperity to communities around the United States and the world by providing far more resources for development than traditional agriculture ever could.
Sunday, December 7, 2008
The tropical global warming solution
Bali conference could end deforestation overnight
Posted by Glenn Hurowitz (Guest Contributor) at 1:49 PM on 03 Dec 2007
Read more about: Bali 07 | climate | Indonesia | air pollution | deforestation | agriculture | greenhouse-gas emissions | climate change mitigation
Tools: print | email | + digg | + del.icio.us | + reddit | + stumbleupon
This post was co-written with Dorjee Sun, the head of Carbon Conservation, a company that works to protect forests in Indonesia from destruction.
-----
Photo: www.viajar24h.com via Flickr
Photo: www.viajar24h.com
Bali, Indonesia, is the perfect backdrop for this week's climate summit. No country better embodies the immense peril of inaction -- and the immense opportunity this meeting has to make massive and immediate progress in stemming the climate crisis.
Indonesia is the world's third largest global warming polluter, behind the United States and China, and just ahead of Brazil. But in Indonesia, like Brazil and the rest of the tropical world, pollution isn't coming from factories, power plants, or cars like it is in the industrialized world. Instead, almost all of it is coming from the rapid burning of the world's vast tropical forests to make room for timber, agriculture, and especially palm oil plantations. (Despite its green reputation, palm oil is anything but: a recent study in Science found that palm oil, like other biofuels, produces two to nine times more greenhouse gases than regular old crude oil because of the forests and grasslands destroyed for its production.)
Companies like Starbucks, Procter & Gamble, Cargill and Seattle's Imperium Renewables are paying top dollar to turn palm oil into food, cosmetics and biodiesel. That global demand has driven the value of a hectare of palms above $1000 (PDF) in some cases -- providing a powerful financial incentive to corporations, investors, and farmers to raze the forests, regardless of the consequences to the climate or to the endangered orangutans, tigers, and rhinoceroses - and indigenous people -- who need them to survive.
The Bali conference could immediately eliminate that perverse accounting by making sure forests and other wild lands around the world are financially valued for the carbon they store, and not just their potential as timber or agricultural land. The way to do that is to allow polluters to get credit for protecting forests that they can apply against their pollution reduction obligations, an idea called carbon ranching or avoided deforestation.
Polluters would jump at this opportunity. Protecting forests from destruction can cost as little as 75 cents per ton of carbon dioxide - even at higher costs, it's a fraction of the price (PDF) of cleaning up most industrial pollution. In the past, some environmentalists criticized carbon ranching for this very reason: they were concerned that if polluters focused their greenhouse gas reduction efforts on forest conservation, that would divert money from necessary clean-ups in industrial pollution. That's the wrong way to look at it. Because locking up carbon dioxide by protecting forests is so cheap, it means that the world can achieve bigger reductions in global warming pollution faster and for less money. Carbon ranching should be an argument for bigger immediate pollution reductions, from both forests and industry, not a way for polluters to get around their responsibility to clean up their own pollution.
Another concern is what's known as leakage (PDF): the idea that if you protect one parcel of forest, ranchers, loggers, and biofuel interests will just move their operations elsewhere, resulting in little additional protection. That worry, however, can be addressed if the forest protection project is global in nature, as the Bali conference is considering. If forests and other wildlands everywhere are valued for the carbon they store, it means that loggers, ranchers, and agribusiness everywhere will for the first time have to include environmental costs in their bottom line calculations -- and not just move their operations to an area with loose environmental protections. That will have a major side benefit, shifting production into areas where it does the least environmental harm.
Finally, there are concerns about enforcement: how can we ensure that once a polluter gets credit for protecting a forest that that forest stays protected? Many of the tropical countries whose carbon-rich forests will be the initial beneficiaries of the program lack the resources to implement existing environmental protections and are plagued by corruption. In many tropical countries, for instance, it's common for one underpaid forest ranger to have responsibility for an area of land the size of a small American state. And what happens if a government decides not to honor its international commitments -- could they just take a polluter's money, promise to protect a forest, and then let the loggers in anyway?
Fortunately, the unprecedented resources that carbon ranching will bring to forest conservation will provide the means to solve these challenges. Based on current carbon prices on European markets, a hectare of rainforest would be worth more than $10,000 purely for the carbon it stores. Applying just 1/10 of that amount towards enforcement will provide more resources than have ever before been available for forest conservation. In Indonesia, for instance, it could support more than 300,000 well-paying jobs in forest conservation (or one person for every 200 hectares of forest), while still leaving plenty of money for high-tech satellite monitoring. That would help ensure conservation provides permanent benefits and provides a major boost to the local economy.
Further guarantees can be secured through a system in which polluters don't receive all of the carbon credit at once for protecting a forest, but only get it on an annuity basis -- receiving credit for 1/50 or one 1/100 of the carbon stored in a forest per year. If the forest were destroyed, polluters wouldn't be able to recoup the remainder of their investment -- providing the polluters themselves with a powerful incentive to keep the forests safe.
Carbon ranching is a transformative idea whose time has long since come. Policy wonks and polluter lobbyists have spent the last ten years arguing over its merits and working out the details. In the meantime, the world lost (PDF) a whopping 125 million hectares of forest, resulting in a release of more than 50 billion tons of carbon dioxide into the atmosphere. And the biofuel boom has intensified the threat: in Brazil, agribusiness interests -- financed by George Soros, Goldman Sachs, and others -- are destroying the wildlife mecca of the Cerrado, at a rate of seven million acres a year. In the Congo, charcoal cartels are turning the living forest into fuel -- threatening to push mountain gorillas and other wildlife into extinction.
A decision at Bali to immediately give financial value to intact forests (and not wait until 2012, as some are proposing), would end this destruction (PDF) almost overnight (PDF). The world's climate -- and the forests and their creatures -- can't wait for anything less.
Posted by Glenn Hurowitz (Guest Contributor) at 1:49 PM on 03 Dec 2007
Read more about: Bali 07 | climate | Indonesia | air pollution | deforestation | agriculture | greenhouse-gas emissions | climate change mitigation
Tools: print | email | + digg | + del.icio.us | + reddit | + stumbleupon
This post was co-written with Dorjee Sun, the head of Carbon Conservation, a company that works to protect forests in Indonesia from destruction.
-----
Photo: www.viajar24h.com via Flickr
Photo: www.viajar24h.com
Bali, Indonesia, is the perfect backdrop for this week's climate summit. No country better embodies the immense peril of inaction -- and the immense opportunity this meeting has to make massive and immediate progress in stemming the climate crisis.
Indonesia is the world's third largest global warming polluter, behind the United States and China, and just ahead of Brazil. But in Indonesia, like Brazil and the rest of the tropical world, pollution isn't coming from factories, power plants, or cars like it is in the industrialized world. Instead, almost all of it is coming from the rapid burning of the world's vast tropical forests to make room for timber, agriculture, and especially palm oil plantations. (Despite its green reputation, palm oil is anything but: a recent study in Science found that palm oil, like other biofuels, produces two to nine times more greenhouse gases than regular old crude oil because of the forests and grasslands destroyed for its production.)
Companies like Starbucks, Procter & Gamble, Cargill and Seattle's Imperium Renewables are paying top dollar to turn palm oil into food, cosmetics and biodiesel. That global demand has driven the value of a hectare of palms above $1000 (PDF) in some cases -- providing a powerful financial incentive to corporations, investors, and farmers to raze the forests, regardless of the consequences to the climate or to the endangered orangutans, tigers, and rhinoceroses - and indigenous people -- who need them to survive.
The Bali conference could immediately eliminate that perverse accounting by making sure forests and other wild lands around the world are financially valued for the carbon they store, and not just their potential as timber or agricultural land. The way to do that is to allow polluters to get credit for protecting forests that they can apply against their pollution reduction obligations, an idea called carbon ranching or avoided deforestation.
Polluters would jump at this opportunity. Protecting forests from destruction can cost as little as 75 cents per ton of carbon dioxide - even at higher costs, it's a fraction of the price (PDF) of cleaning up most industrial pollution. In the past, some environmentalists criticized carbon ranching for this very reason: they were concerned that if polluters focused their greenhouse gas reduction efforts on forest conservation, that would divert money from necessary clean-ups in industrial pollution. That's the wrong way to look at it. Because locking up carbon dioxide by protecting forests is so cheap, it means that the world can achieve bigger reductions in global warming pollution faster and for less money. Carbon ranching should be an argument for bigger immediate pollution reductions, from both forests and industry, not a way for polluters to get around their responsibility to clean up their own pollution.
Another concern is what's known as leakage (PDF): the idea that if you protect one parcel of forest, ranchers, loggers, and biofuel interests will just move their operations elsewhere, resulting in little additional protection. That worry, however, can be addressed if the forest protection project is global in nature, as the Bali conference is considering. If forests and other wildlands everywhere are valued for the carbon they store, it means that loggers, ranchers, and agribusiness everywhere will for the first time have to include environmental costs in their bottom line calculations -- and not just move their operations to an area with loose environmental protections. That will have a major side benefit, shifting production into areas where it does the least environmental harm.
Finally, there are concerns about enforcement: how can we ensure that once a polluter gets credit for protecting a forest that that forest stays protected? Many of the tropical countries whose carbon-rich forests will be the initial beneficiaries of the program lack the resources to implement existing environmental protections and are plagued by corruption. In many tropical countries, for instance, it's common for one underpaid forest ranger to have responsibility for an area of land the size of a small American state. And what happens if a government decides not to honor its international commitments -- could they just take a polluter's money, promise to protect a forest, and then let the loggers in anyway?
Fortunately, the unprecedented resources that carbon ranching will bring to forest conservation will provide the means to solve these challenges. Based on current carbon prices on European markets, a hectare of rainforest would be worth more than $10,000 purely for the carbon it stores. Applying just 1/10 of that amount towards enforcement will provide more resources than have ever before been available for forest conservation. In Indonesia, for instance, it could support more than 300,000 well-paying jobs in forest conservation (or one person for every 200 hectares of forest), while still leaving plenty of money for high-tech satellite monitoring. That would help ensure conservation provides permanent benefits and provides a major boost to the local economy.
Further guarantees can be secured through a system in which polluters don't receive all of the carbon credit at once for protecting a forest, but only get it on an annuity basis -- receiving credit for 1/50 or one 1/100 of the carbon stored in a forest per year. If the forest were destroyed, polluters wouldn't be able to recoup the remainder of their investment -- providing the polluters themselves with a powerful incentive to keep the forests safe.
Carbon ranching is a transformative idea whose time has long since come. Policy wonks and polluter lobbyists have spent the last ten years arguing over its merits and working out the details. In the meantime, the world lost (PDF) a whopping 125 million hectares of forest, resulting in a release of more than 50 billion tons of carbon dioxide into the atmosphere. And the biofuel boom has intensified the threat: in Brazil, agribusiness interests -- financed by George Soros, Goldman Sachs, and others -- are destroying the wildlife mecca of the Cerrado, at a rate of seven million acres a year. In the Congo, charcoal cartels are turning the living forest into fuel -- threatening to push mountain gorillas and other wildlife into extinction.
A decision at Bali to immediately give financial value to intact forests (and not wait until 2012, as some are proposing), would end this destruction (PDF) almost overnight (PDF). The world's climate -- and the forests and their creatures -- can't wait for anything less.
Avoided Deforestation: Banking Green
Avoided Deforestation: Banking Green
By BRYAN WALSH
Right now in Noel Kempff Mercado National Park, a day's drive over rutted tracks northeast of the Bolivian city of Santa Cruz, they're counting the trees. Members of nearby indigenous communities, with help from the Bolivian green group Friends of Nature Foundation (FAN) and the American nonprofit the Nature Conservancy (TNC), have fanned out across the Noel Kempff's 4.2 million acres (1.7 million ha), which range from Amazon rain forest to dry savanna. In the footsteps of howler monkeys and endangered black jaguars, they follow mapped plots in the forest, drive stakes into the ground and measure out circles with diameters of 13 ft. (4 m) to 46 ft. (14 m) — and then within that area they chart the diameter of every tree. But it's not the number of trees they want to discover. They're really measuring carbon, and FAN and TNC can use those calculations — together with sophisticated satellite data — to work out precisely how much potential greenhouse gas is locked within Noel Kempff.
That matters, because in 1997 TNC, U.S. utility companies American Electric Power (AEP) and PacifiCorp, and oil major BP Amoco paid Bolivia $10.8 million for the credits represented by all that carbon. In return, the government simply has to ensure that the forest remains standing and healthy for the next 30 years. It's called avoided deforestation, and projects like this may represent one of the most promising ways to simultaneously slow the destruction of tropical forests and the pace of climate change — if we can get it right.
An estimated 50,000 sq. mi. (129,500 sq km) of forest are lost to the logger's ax or to fire every year, and that hurts the planet in two very important ways. Rare plants and animals, many still undiscovered, depend on the forests — especially the rich rain forests that encircle the earth either side of the equator. When the forests disappear, all that wildlife disappears as well. But trees also contain carbon, and while they live, they absorb CO2 from the atmosphere, compensating in part for the greenhouse gases spewed into the air from cars, power plants and factories. When trees are cut down or burned, that carbon is put back into the atmosphere, accelerating climate change. At least 20% of annual global carbon emissions come from deforestation. If we can't stop forest loss, we'll struggle to stop climate change. That fact was recognized by the British government's recent Eliasch Review on forestry, which estimated that failure to halt deforestation could increase the cost of damages caused by global warming by $1 trillion annually by 2100. "If we're going to solve climate change we need to take advantage of the opportunity to reduce deforestation," says Duncan Marsh, TNC's director of international climate policy. "We have no choice."
That's the promise of avoided deforestation, in which rich countries pay to keep rain forests standing and receive carbon credits in return. Currently, the international carbon cap-and-trade system organized by the Kyoto Protocol only recognizes industrial projects — such as a rich country paying to improve energy efficiency at a power plant — or programs to actively reforest land already cleared. It doesn't recognize avoided deforestation — also known by the acronym REDD, for Reduced Emissions from Deforestation and Degradation. With timber and biofuel plantations so valuable, that means "rain forests are worth more dead than alive," says Andrew Mitchell, director of the Global Canopy Programme, an alliance of forestry institutions. But a handful of pilot projects, like the one in Noel Kempff and others in nations such as Belize, Indonesia and Madagascar, are proving the logic of paying to keep forests standing. Supporters are confident that when the world meets for the annual U.N. summit on climate change in Poznan, Poland, this month, avoided deforestation will be one of the main topics of discussion. "This is too important not to be front and center on everyone's minds," says Jake Schmidt, head of international climate policy for the New York City-based Natural Resources Defense Council. "It will be a major focus."
For international companies looking to invest in REDD projects, there's another reason for signing up. Not only can they bank carbon credits for future use, but there's a p.r. benefit that comes from protecting an endangered tropical forest that might not come, say, from cleaning up a chemical factory in China (even though the value to the climate is identical).
That bonus appeals to corporations like AEP, which provided the bulk of the funding for Noel Kempff. "It's not just about the greenhouse gases, but the habitat preservation and the watershed enhancement," says Diane Fitzgerald, AEP's managing director of environment and safety. But as long as avoided deforestation isn't recognized by the Kyoto Protocol or the European Union's greenhouse gas-trading system (the two main mandatory programs in the world) there is a limit to how useful it can be for companies that need credits to meet a carbon cap. AEP plans to take its credits to the Chicago Climate Exchange, a voluntary U.S. trading system — but if Washington doesn't include REDD in any future carbon cap, the credits would have little more than symbolic value. "I think there won't be real action until we see domestic and international policy that recognizes avoided deforestation," notes Fitzgerald. "We'll compare forestry offsets to projects like renewable energy, and we have to make the best financial decision." Until then, REDD will remain a boutique carbon investment.
A Forest of Problems
Avoided deforestation seems like a no-brainer — so why wasn't it included in the Kyoto Protocol? Ironically, it was omitted in part due to the work of a number of prominent environmental groups, including Greenpeace. They feared that avoided deforestation schemes could flood the trading market with countless cheap carbon credits; after all, there are an estimated 638 billion tons of carbon locked in the world's forests. If even a fraction of those credits are put on the market, it could let developed countries off the hook when it comes to making the hard changes in industry and energy use needed to really dent carbon emissions.
Then there is the problem of compliance. Who can guarantee that a "protected" forest won't go up in flames in a few years, or even be logged, rendering the credits useless? And if a REDD project succeeds in preventing a vulnerable forest from being ruined, won't loggers just move down the road, or to another country — again, with no net benefit for the climate?
At first, skeptics also fretted that countries with high rates of deforestation — Indonesia, the Congo, Nigeria — tend to rank high for corruption, making them less-than-reliable partners. "The environmental community developed a distaste for forest offsets, for a lot of valid reasons," says Bill Stanley, director of TNC's Global Climate Change Initiative.
More than a decade after Kyoto was signed, however, that opposition has eased. (The holdouts, like Greenpeace, tend to be skeptical of market-based solutions to climate change in general, not just REDD.) That's partly thanks to a better understanding that "if deforestation is 20% of the problem, it should be 20% of the solution," according to Benoit Bosquet, team leader of the World Bank's Forest Carbon Partnership Facility, which helps developing countries prepare for REDD projects. Tree-spotting has improved; Japan's alos satellite uses cloud-penetrating radar to detect deforestation even in the rainy Amazon, making projects cheaper to police.
Most importantly, the tropical nations that stand to benefit most from avoided deforestation began to make their voices heard in international climate talks, thanks to innovative leaders like Papua New Guinea's Kevin Conrad, one of TIME's Heroes of the Environment. That has prompted big rain-forest nations like Indonesia and Brazil, which were initially suspicious of exposing their sovereign forests to an international carbon market, to rethink REDD. Last month, representatives from a handful of Indonesian and Brazilian states signed a memorandum of understanding with several large U.S. states — including California, which has already adopted a carbon cap of its own — to explore avoided deforestation projects. The possibility of tapping into California's rich carbon markets has tropical nations salivating. "Until now, no one has said to [rain-forest nations] 'We'll give you a market for your credits,' " says Dorjee Sun, CEO of the avoided-deforestation group Carbon Conservation, which helped broker the deal. "This is the next step."
Advocates have been busy refining avoided deforestation to answer early criticisms. Because firms investing in carbon credits need to estimate how much deforestation would have happened without a scheme, REDD projects can only work in countries with high rates of deforestation. That alleviates concerns that money will be spent to protect forests under no threat. To address fears that protected forests might be lost through a fire or logging, brokers build in reserves — selling, for example, only 80% of the carbon actually contained within a forest, and tapping the remainder if some part of the protected area should be lost. To prevent leakage — the possibility that protecting one place will only move deforestation down the road — TNC in Bolivia measured the baseline rate of deforestation in the country to know just how much difference their efforts would make, and monitors the edges of Noel Kempff for forest loss. Third-party verifiers like the Climate, Community and Biodiversity Alliance and the Voluntary Carbon Standard help assure companies that their credits are worth the carbon and that local forest communities are helped and not harmed by the potential flood of REDD financing.
It may be that avoided deforestation's biggest obstacle will be its own success. If REDD is enshrined in the next global climate-change deal, set to be negotiated by the end of 2009, there is likely to be a sudden spike in demand for avoided deforestation projects, as developed countries angle to meet new carbon caps and tropical nations start to turn their forests into cash. But doing a REDD project right isn't easy, points out Zoe Kant, TNC's carbon markets manager and the brains behind the Noel Kempff project: experts are few, locales are remote and most countries lack the technical capacity to run schemes on their own. Some places will be tempted to take shortcuts. "We have to make sure our standards are credible, and we're not just delivering money that ends up in the bank accounts of central governments," says nrdc's Schmidt. "We need to change behavior on the ground, not just tomorrow but for the long term."
For those who care about forests and the climate, the promise of REDD is undeniable. The truth is that weaning the world off fossil fuels will be a monumentally difficult and expensive process, one that will demand technological innovations we haven't yet thought of. But halting deforestation, while not cheap — Britain's Stern Review in 2006 pegged the price at $5 to $15 billion a year — is doable now, provided we have the political will. If you want to know why, visit Noel Kempff. Its biological value was incalculable, but to the people who lived in the forest, its only financial value lay in dead logs. REDD changes that — and with 29% of the carbon revenue from the project promised to local communities, it can change their lives too. "We finally have a way to pay countries for protecting forests," says TNC's Marsh. That's good news for all.
By BRYAN WALSH
Right now in Noel Kempff Mercado National Park, a day's drive over rutted tracks northeast of the Bolivian city of Santa Cruz, they're counting the trees. Members of nearby indigenous communities, with help from the Bolivian green group Friends of Nature Foundation (FAN) and the American nonprofit the Nature Conservancy (TNC), have fanned out across the Noel Kempff's 4.2 million acres (1.7 million ha), which range from Amazon rain forest to dry savanna. In the footsteps of howler monkeys and endangered black jaguars, they follow mapped plots in the forest, drive stakes into the ground and measure out circles with diameters of 13 ft. (4 m) to 46 ft. (14 m) — and then within that area they chart the diameter of every tree. But it's not the number of trees they want to discover. They're really measuring carbon, and FAN and TNC can use those calculations — together with sophisticated satellite data — to work out precisely how much potential greenhouse gas is locked within Noel Kempff.
That matters, because in 1997 TNC, U.S. utility companies American Electric Power (AEP) and PacifiCorp, and oil major BP Amoco paid Bolivia $10.8 million for the credits represented by all that carbon. In return, the government simply has to ensure that the forest remains standing and healthy for the next 30 years. It's called avoided deforestation, and projects like this may represent one of the most promising ways to simultaneously slow the destruction of tropical forests and the pace of climate change — if we can get it right.
An estimated 50,000 sq. mi. (129,500 sq km) of forest are lost to the logger's ax or to fire every year, and that hurts the planet in two very important ways. Rare plants and animals, many still undiscovered, depend on the forests — especially the rich rain forests that encircle the earth either side of the equator. When the forests disappear, all that wildlife disappears as well. But trees also contain carbon, and while they live, they absorb CO2 from the atmosphere, compensating in part for the greenhouse gases spewed into the air from cars, power plants and factories. When trees are cut down or burned, that carbon is put back into the atmosphere, accelerating climate change. At least 20% of annual global carbon emissions come from deforestation. If we can't stop forest loss, we'll struggle to stop climate change. That fact was recognized by the British government's recent Eliasch Review on forestry, which estimated that failure to halt deforestation could increase the cost of damages caused by global warming by $1 trillion annually by 2100. "If we're going to solve climate change we need to take advantage of the opportunity to reduce deforestation," says Duncan Marsh, TNC's director of international climate policy. "We have no choice."
That's the promise of avoided deforestation, in which rich countries pay to keep rain forests standing and receive carbon credits in return. Currently, the international carbon cap-and-trade system organized by the Kyoto Protocol only recognizes industrial projects — such as a rich country paying to improve energy efficiency at a power plant — or programs to actively reforest land already cleared. It doesn't recognize avoided deforestation — also known by the acronym REDD, for Reduced Emissions from Deforestation and Degradation. With timber and biofuel plantations so valuable, that means "rain forests are worth more dead than alive," says Andrew Mitchell, director of the Global Canopy Programme, an alliance of forestry institutions. But a handful of pilot projects, like the one in Noel Kempff and others in nations such as Belize, Indonesia and Madagascar, are proving the logic of paying to keep forests standing. Supporters are confident that when the world meets for the annual U.N. summit on climate change in Poznan, Poland, this month, avoided deforestation will be one of the main topics of discussion. "This is too important not to be front and center on everyone's minds," says Jake Schmidt, head of international climate policy for the New York City-based Natural Resources Defense Council. "It will be a major focus."
For international companies looking to invest in REDD projects, there's another reason for signing up. Not only can they bank carbon credits for future use, but there's a p.r. benefit that comes from protecting an endangered tropical forest that might not come, say, from cleaning up a chemical factory in China (even though the value to the climate is identical).
That bonus appeals to corporations like AEP, which provided the bulk of the funding for Noel Kempff. "It's not just about the greenhouse gases, but the habitat preservation and the watershed enhancement," says Diane Fitzgerald, AEP's managing director of environment and safety. But as long as avoided deforestation isn't recognized by the Kyoto Protocol or the European Union's greenhouse gas-trading system (the two main mandatory programs in the world) there is a limit to how useful it can be for companies that need credits to meet a carbon cap. AEP plans to take its credits to the Chicago Climate Exchange, a voluntary U.S. trading system — but if Washington doesn't include REDD in any future carbon cap, the credits would have little more than symbolic value. "I think there won't be real action until we see domestic and international policy that recognizes avoided deforestation," notes Fitzgerald. "We'll compare forestry offsets to projects like renewable energy, and we have to make the best financial decision." Until then, REDD will remain a boutique carbon investment.
A Forest of Problems
Avoided deforestation seems like a no-brainer — so why wasn't it included in the Kyoto Protocol? Ironically, it was omitted in part due to the work of a number of prominent environmental groups, including Greenpeace. They feared that avoided deforestation schemes could flood the trading market with countless cheap carbon credits; after all, there are an estimated 638 billion tons of carbon locked in the world's forests. If even a fraction of those credits are put on the market, it could let developed countries off the hook when it comes to making the hard changes in industry and energy use needed to really dent carbon emissions.
Then there is the problem of compliance. Who can guarantee that a "protected" forest won't go up in flames in a few years, or even be logged, rendering the credits useless? And if a REDD project succeeds in preventing a vulnerable forest from being ruined, won't loggers just move down the road, or to another country — again, with no net benefit for the climate?
At first, skeptics also fretted that countries with high rates of deforestation — Indonesia, the Congo, Nigeria — tend to rank high for corruption, making them less-than-reliable partners. "The environmental community developed a distaste for forest offsets, for a lot of valid reasons," says Bill Stanley, director of TNC's Global Climate Change Initiative.
More than a decade after Kyoto was signed, however, that opposition has eased. (The holdouts, like Greenpeace, tend to be skeptical of market-based solutions to climate change in general, not just REDD.) That's partly thanks to a better understanding that "if deforestation is 20% of the problem, it should be 20% of the solution," according to Benoit Bosquet, team leader of the World Bank's Forest Carbon Partnership Facility, which helps developing countries prepare for REDD projects. Tree-spotting has improved; Japan's alos satellite uses cloud-penetrating radar to detect deforestation even in the rainy Amazon, making projects cheaper to police.
Most importantly, the tropical nations that stand to benefit most from avoided deforestation began to make their voices heard in international climate talks, thanks to innovative leaders like Papua New Guinea's Kevin Conrad, one of TIME's Heroes of the Environment. That has prompted big rain-forest nations like Indonesia and Brazil, which were initially suspicious of exposing their sovereign forests to an international carbon market, to rethink REDD. Last month, representatives from a handful of Indonesian and Brazilian states signed a memorandum of understanding with several large U.S. states — including California, which has already adopted a carbon cap of its own — to explore avoided deforestation projects. The possibility of tapping into California's rich carbon markets has tropical nations salivating. "Until now, no one has said to [rain-forest nations] 'We'll give you a market for your credits,' " says Dorjee Sun, CEO of the avoided-deforestation group Carbon Conservation, which helped broker the deal. "This is the next step."
Advocates have been busy refining avoided deforestation to answer early criticisms. Because firms investing in carbon credits need to estimate how much deforestation would have happened without a scheme, REDD projects can only work in countries with high rates of deforestation. That alleviates concerns that money will be spent to protect forests under no threat. To address fears that protected forests might be lost through a fire or logging, brokers build in reserves — selling, for example, only 80% of the carbon actually contained within a forest, and tapping the remainder if some part of the protected area should be lost. To prevent leakage — the possibility that protecting one place will only move deforestation down the road — TNC in Bolivia measured the baseline rate of deforestation in the country to know just how much difference their efforts would make, and monitors the edges of Noel Kempff for forest loss. Third-party verifiers like the Climate, Community and Biodiversity Alliance and the Voluntary Carbon Standard help assure companies that their credits are worth the carbon and that local forest communities are helped and not harmed by the potential flood of REDD financing.
It may be that avoided deforestation's biggest obstacle will be its own success. If REDD is enshrined in the next global climate-change deal, set to be negotiated by the end of 2009, there is likely to be a sudden spike in demand for avoided deforestation projects, as developed countries angle to meet new carbon caps and tropical nations start to turn their forests into cash. But doing a REDD project right isn't easy, points out Zoe Kant, TNC's carbon markets manager and the brains behind the Noel Kempff project: experts are few, locales are remote and most countries lack the technical capacity to run schemes on their own. Some places will be tempted to take shortcuts. "We have to make sure our standards are credible, and we're not just delivering money that ends up in the bank accounts of central governments," says nrdc's Schmidt. "We need to change behavior on the ground, not just tomorrow but for the long term."
For those who care about forests and the climate, the promise of REDD is undeniable. The truth is that weaning the world off fossil fuels will be a monumentally difficult and expensive process, one that will demand technological innovations we haven't yet thought of. But halting deforestation, while not cheap — Britain's Stern Review in 2006 pegged the price at $5 to $15 billion a year — is doable now, provided we have the political will. If you want to know why, visit Noel Kempff. Its biological value was incalculable, but to the people who lived in the forest, its only financial value lay in dead logs. REDD changes that — and with 29% of the carbon revenue from the project promised to local communities, it can change their lives too. "We finally have a way to pay countries for protecting forests," says TNC's Marsh. That's good news for all.
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