Developed countries who have commitments under the Kyoto Protocol are negotiating loopholes for themselves that could lead to almost 400 Mt of extra emissions each year. After giving some background, I will describe the status of the negotiations, describe the loopholes, and quantify them. This will help us to see who the worst offenders are.

Emissions associated with land use are classified under the Kyoto Protocol as LULUCF – Land Use, Land Use Change, and Forestry. This includes deforestation – which is when you log a forest and replace it with some other form of land use such as grassland; but does not include forest degradation – which is what occurs when you log a forest and allow a forest to grow back. Because unlogged forests can store large amounts of carbon, emissions associated with forest degradation can be quite significant, but not accounted for. This can lead to perverse outcomes, for example it is possible to log old growth forests, use the wood to generate electricity, and not account for any of the emissions.

As a way of addressing this, the Kyoto negotiations have been looking at how to have countries include forest management in their accounts – this would include emissions from forest logging. Forests naturally absorb carbon dioxide, so when including forest management, reference levels (baselines) need to be negotiated so that countries don’t get credited for the removals that naturally occur anyway. Late in 2009, just before the Copenhagen negotiations started, countries submitted their preferred reference levels, as well as estimates of emissions in 1990, projections for the first commitment period (2008-2012) and projections for the second commitment period.

Each country proposed a reference level for itself, the numbers are given below (click on the image to enlarge it):

Forest Management Reference Levels

The problem with this approach is that each country has an incentive to choose a reference level that is generous to it. This is what has happened. Some countries who chose particularly generous reference levels for themselves include Russia, which chose a range between 0 and -177.8 Mt CO2-e of emissions, so that it gets credited if its forests are more of a sink than -177.8 Mt, but is only debited if its forests become net emitters and is projected to have emissions of -274 Mt in the first commitment period; New Zealand, who chose a reference level based on its forecast for 2013-2020, which is 19.4 Mt higher than its forecast for the first commitment period (over 23% of New Zealand’s 2005 emissions); and Japan, which chose a reference level of 0. These numbers all add up to 213-391 Mt CO2-e of excess allowances per year for Annex I countries compared to their projected forest management emissions for the first commitment period (depending on which number is used for Russia).

There was some extensive discussions on this issue at the Bonn climate negotiations on June 7, 2010, in the contact group on Further Commitments for Annex 1 Parties under the Kyoto Protocol. These negotiations were not broadcast, but some of what happened was broadcast on twitter (look up the #COP16 or #UNFCCC hashtag). I don’t know which countries did or did not have a constructive role in these negotiations, but would be very interested in finding out. The LULUCF negotiating text is here.

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There were three things that resulted from the talks in Copenhagen:

  • A 13 paragraph ‘political accord‘ was agreed by most of the parties, but could only be ‘noted’ by the COP because there was not consensus.
  • The negotiations on extending the Kyoto Protocol had unresolved issues, and the next meeting in Mexico will return to this. The key text that resulted from the Kyoto side of the negotiations is here.
  • The negotiations on long-term cooperative action also had unresolved issues, which the Mexico meeting will have to resolve. The key text that resulted from the long-term cooperative action (LCA) side of the negotiations is here.

What did not result from Copenhagen was a framework for developing a fair, ambitious and legally binding agreement. What was positive about the accord was a commitment on finance from developing countries, which would add up to $100 billion per year by 2020, but whether actual commitments will add up to this number is still unresolved.

While the the Kyoto and LCA negotiations did not result in a successful conclusion, the draft texts are now considerably shorter, and the unresolved issues are more obvious. Whether there is a successful outcome to the negotiations at a later date depends crucially on how these issues get resolved.

Some undecided issues related to the Kyoto Protocol include how land use, land use change, and forestry is accounted for; carry-over of permits from the first commitment period (hot air); the scale of the Annex I (developed country) commitments; and how these commitments are represented in a table, and the issue of base years and reference years (a less important issue, but the one that takes up most of the negotiators time). The most important unresolved issues for the LCA track are the precise nature of developing and developed country mitigation commitments and actions, and whether anything from the text will facilitate a legally binding agreement.

The Federated States of Micronesia, on behalf of the Alliance of Small Island States (AOSIS), has distributed among the contact group on ‘numbers’ a document titled ‘Potential effect of Surplus AAUs on Annex I allowed emissions in 2020: Technical Background and Assumptions’. It states:

Several economies in transition (EITs) have Kyoto first commitment period (KP.CP1) (2008-2012) targets that exceed their likely emissions for that period. Paragraph 13 of Article 3 of the Kyoto Protocol permits that surplus Assigned Amount Units (AAUs) from the first commitment period are carried forward to “subsequent commitment periods”. This leads to the situation where surplus AAUs are created and potentially available for transfer to other Parties where they may be used towards compliance with their obligations. As a result, surplus AAUs that are transferred to other Annex I Parties or carried forward will lead to more emissions to the atmosphere than would otherwise have happened.

The scale of surplus AAUs in the first commitment period is sufficient, if transferred to and used by other Annex I parties to meet their obligations, to permit Annex I as a group to emit as business as usual levels through 2020.

What the document is saying is that if Kyoto emission permits (AAUs) are carried over from the first (2008-2012) commitment period to the second commitment period, then the Kyoto Protocol will not have a significant impact on developed country emissions. In terms of emissions, this would be equivalent to not having a second commitment period, which is also a possibility (and has some support from Japan and Canada).

The document also has analysis of the impacts that each parties preference for accounting for land use, land use change, and forestry would have on emissions. It suggests that this would have a similar impact, but not quite as great as the impact of banking AAUs.

The EU has made similar statement on banking AAUs from the first commitment period, noting that banking could lead to an increase in emissions even if Annex I emissions added up to a 30% reduction (which they do not).

In an informal briefing to NGOs, an Australian negotiator did speak in favour of banking AAUs. I have not yet observed Australia saying anything on this in the negotiations.

Here is a summary of what happened at the December 9 meeting of the contact group on Annex I Parties’ emission reductions (aggregate/individual). Of particular interest was the discussion of the nature of Russia’s possible increased commitment, complaints from developing countries about conditional commitments having conditions related to the rest of the negotiation process, and a presentation from the EU on how a 30% aggregate reduction from Annex I countries could work, but how this would be undermined by permits being carried over from the first Kyoto commitment period, or a perverse LULUCF outcome.

There is coverage of the Contact Group on ‘numbers’ in the Earth Negotiation Bulletin. The particular bulletin covering this meeting is here.

At the same time as this meeting was happening, the COP Plenary was having a lively discussion on a proposal from Tuvalu for a strong legally binding treaty. The establishment of a contact group to discuss this proposal was blocked by Saudi Arabia, India, China, and some other oil exporting countries.

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A very important report on greenhouse gas emissions and Australia’s native forests has been released:

Brendan G. Mackey, Heather Keith, Sandra L. Berry and David B. Lindenmeyer, Green Carbon: the role of natural forests in carbon storage. Part 1, A green carbon account of Australia’s south-eastern Eucalypt forests, and policy implications. The Fenner School of Environment and Society, The Australian National University.

The report demonstrates that Australian forests have far larger carbon stocks than previously recognised. According to the report:

Our analysis shows that in the 14.5 million ha of eucalypt forests in south-eastern Australia, the effect of retaining the current carbon stock (equivalent to 25.5 Gt CO2 (carbon dioxide)) is equivalent to avoided emissions of 460 Mt(2) CO2 yr-1 for the next 100 years. Allowing logged forests to realize their sequestration potential to store 7.5 Gt CO2 is equivalent to avoiding emissions of 136 Mt CO2 yr-1 for the next 100 years. This is equal to 24 per cent of the 2005 Australian net greenhouse gas emissions across all sectors; which were 559 Mt CO2 in that year.

So the carbon in Australia’s south eastern forests is equivalent to approximately 25.5 billion tonnes of carbon dioxide. But the report also suggests that native forest logging has degraded forests to the extent that 7.5 billion extra tonnes of carbon dioxide are in the atmosphere. Unfortunately greenhouse gas emissions from logging native forests do not count as a “change of land use”, so emissions from forest degradation do not have to be accounted for under the Kyoto protocol.

Native forests are also more reliable than plantation forests as carbon stores, especially over long time periods.

The green carbon in natural forests is stored in a more reliable stock than that in industrialized forests, especially over ecological time scales. Carbon stored in industrialized forests has a greater susceptibility to loss than that stored in natural forests. Industrialized forests, particularly plantations, have reduced genetic diversity and structural complexity, and therefore reduced resilience to pests, diseases and changing climatic conditions.

The report also states:

It is possible to achieve protection of the carbon stocks in natural forests by switching to timber sourced from existing plantations and, if necessary, from new plantations on previously cleared land. In this way, the commercial demand for wood fibre can be met and the contribution of natural forests to greenhouse gas mitigation can be maximized.

Sounds like another good reason for not logging native forests.

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The carbon dioxide that plays a role in anthropogenic global warming is either from sediments including fossil fuels and cement production, or from soils and biomass. This relates to the well known carbon cycle. The carbon in soils and biomass can be transferred to the atmosphere via phenomena like fire and drought, while fossil fuels in the ground generally stay there (except for human activity and some volcanos). A planet with more carbon in soils and biomass and less in sediments is therefore for better or for worse different to a planet with more carbon in sediments and less in soils and biomass.

This suggests that the externality of greenhouse pollution from burning fossil fuels is qualitatively slightly different to the externality of greenhouse pollution from land clearing. Another issue is there is often much more uncertainty with measuring emissions from land clearing and deforestation, or CO2 sequestered by planting trees or reducing overgrazing. Other greenhouse gases also play a role – there are also issues with uncertainty when estimating methane emissions from cattle.

Reforestation and avoided deforestation can have huge cobenefits in terms of reducing habitat destruction which is an important driver of extinction. Unfortunately it is harder to measure emissions from activities with strong cobenefits such as biodiversity plantings or avoided deforestation than it is measure emissions from activities with less cobenefits, such as monoculture tree plantations.

Hansen’s recent paper suggests that when albedo and carbon cycle feedbacks are taken into account then climate sensitivity rises to around 6 degrees for a doubling of CO2. Hansen then suggests that “If humanity wishes to preserve a planet similar to that on which civilization developed and to which life on Earth is adapted, paleoclimate evidence and ongoing climate change suggest that CO2 will need to be reduced from its current 385 ppm to at most 350 ppm. … An initial 350 ppm CO2 target may be achievable by phasing out coal use except where CO2 is captured and adopting agricultural and forestry practices that sequester carbon.” It is therefore important that we address both parts of the carbon cycle.

In an emissions trading market credibility is vital, uncertainty in measurement could undermine that. In a submission to the Garnaut review, I argued that some money raised from auctioning permits could be spent on activities such as biodiversity plantings until land use could be included. But perhaps these issues with uncertainty will always be significant. Maybe we need to create a parallel market in emissions related to agriculture and forestry. This could either be price based or quantity based. Perhaps uncertainty issues would mean a price (tax) based approach would be better, with activities that sequester carbon having a negative tax.

While it is relatively easy to measure the carbon sequestered from something like a monoculture tree plantation, it is more difficult to measure the carbon sequestered from restoring an ecosystem, or at least to have the carbon sequestered accredited. Reforestation and avoided deforestation can have huge cobenefits in terms of reducing habitat destruction which is an important driver of extinction. We need to learn as fast as possible how much carbon is sequestered through activities such biodiversity plantings and reducing grazing from cattle.

There is also the issue of emissions from logging and burning old growth native forests. At present only land that is converted from a ‘kyoto forest’ to land which is not a ‘kyoto forest’ or vice versa is included, so if you log an old growth forest, which stores huge amounts of carbon in both its soil and biomass, and then burn it, then because a forest will grow back, the emissions from logging and burning are not included in our greenhouse gas accounts. We need to learn as quickly as possible how to measure the GHG emissions from all kinds of emissions, including forest degradation and grazeland degradation.

Forest degradation and rangeland degradation do not get mentioned in the Green Paper, but it does suggest that carbon sequestered in forest products should be included in an international climate change framework. This is a similar approach to Australia’s reporting to the UNFCCC (which is slightly different to Kyoto accounting), where carbon sequestered in wood products is reported but emissions from forest degradation and rangeland degradation appears not to be. The could be construed as a way that Australia is gaming international climate negotiations. Or it could be a result of the government being influenced by rent seeking from native forest logging industries. Ironically, if forest degradation and rangeland degradation were included, it would probably be much easier for Australia to reduce its emissions.

We also need to learn as quickly as possible how much emissions are sequestered through sustainable land use practices that sequester carbon. We should also consider the possibility that there will always be significant uncertainties about how much will be sequestered. The best way to learn is by doing, so the question becomes how do we fund a whole lot of different environmentally appropriate activities that sequester carbon that we can learn from?