BioCarbon Fund Harnessing the carbon market to sustain ecosystems and alleviate poverty Basics of biological sequestration

The carbon cycle

Atmosphere Fossil Deposits Plants Soil Oceans ,000 About 16, The Global Carbon Cycle Units Gt C and Gt C y -1

The carbon pools Each Party included in Annex I shall account for all changes in the following carbon pools: 1.above-ground biomass, 2.below-ground biomass, 3. litter, 4.dead wood, and 5.soil organic carbon. A Party may choose not to account for a given pool in a commitment period, if transparent and verifiable information is provided that the pool is not a source

What is allowed under Kyoto?

Some terms … Annex 1 countries – developed countries with targets Non-Annex 1 countries – the rest (almost!) UNFCCC – UN Framework Convention on Climate Change (Most nations are parties to it) Kyoto Protocol – the agreement on targets for GHG reductions (USA, Australia and a few dveloping countries have not ratified it) CoP – Conferences of the Parties to the UNFCCC MoP – Meetings of the Parties that have ratified the Kyoto Protocol JI {Joint Implementation} – trading between Annex 1 countries CDM {Clean Development mechanism} – trading between an Annex 1 and a non-Annex 1 country LULUCF - Land Use, Land-Use Change and Forestry GHG – greenhouse gases (carbon dioxide and methane are the important biological gases)

CDM Rules LULUCF 1 activities under the CDM are limited to afforestation and reforestation Avoided deforestation excluded; but currently moves to have it included in a second commitment period (post 2012) Forest management, agricultural management, grazing land management area all excluded from the CDM – 1 Land Use, Land-Use Change and Forestry

JI Rules The full range of Article 3.3 (Afforestation, reforestation and [avoided] deforestation) ; and of those elements of Article 3.4 (Forest, agricultural and grazing land management) are acceptable

UNFCCC Definition Decision 11/CP.7 “Forest” is a minimum area of land of hectares with tree crown cover (or equivalent stocking level) of more than per cent with trees with the potential to reach a minimum height of 2-5 metres at maturity in situ. A forest may consist either of closed forest formations where trees of various storeys and undergrowth cover a high proportion of the ground or open forest. –Young natural stands and all plantations which have yet to reach a crown density of per cent or tree height of 2-5 metres are included under forest, –as are areas normally forming part of the forest area which are temporarily unstocked as a result of human intervention such as harvesting or natural causes but which are expected to revert to forest;

Afforestation and Reforestation “Afforestation” is the direct human-induced conversion of land that has not been forested for a period of at least 50 years to forested land through planting, seeding and/or the human-induced promotion of natural seed sources; “Reforestation” is the direct human-induced conversion of non-forested land to forested land through planting, seeding and/or the human-induced promotion of natural seed sources, on land that was forested but that has been converted to non-forested land. For the first commitment period, reforestation activities will be limited to reforestation occurring on those lands that did not contain forest on 31 December 1989; These definitions have no practical difference

10% projected crown cover Crown cover = canopy cover = crown closure Percentage of ground covered by a vertical projection of the outermost limits of the natural spread of the foliage of plants. Cannot exceed 100%

10% projected crown cover

At what scale is cover measured? Exclude

Additionality and Leakage

What additionality is not Additionality is not a requirement that some sort of additional effort should be carried out – i.e. going beyond BAU Additionality is not achieved by simply demonstrating that there will be less GHG in the atmosphere if the project goes ahead, than if it did not

Emissions Before Project Annex 1 Host Total Watch this level

But Annex 1 country anticipates it will exceed its target Annex 1 Host Total

CDM project initiated Annex 1 Host Total

Transfer of credit Annex 1 Host Total $ Credit Atmosphere neutral

2 nd Case - Emissions reductions/uptake planned before Project Annex 1 Host Total

Host is already committed to project Annex 1 Host Total GHG in atmosphere will fall without the project

Transfer of credit and annex 1 increases emissions Annex 1 Host Total Atmosphere worse off $ Credit But, CDM deal goes ahead and Annex 1 country emits more GHG

Additionality In summary: –The opportunity to engage in a CDM transaction (and usually the incentive of a payment) –must have caused a non-Annex 1 country to carry out a project that it would not otherwise have started in the reasonable future. –The project leads to GHG being removed from the atmosphere that would otherwise have not been removed –This creates a valid ‘credit’ that can be transferred to the Annex 1 country to counterbalance its extra emissions

How to demonstrate additionality? Usually by showing that the project is financially attractive only with the funding/assistance from the carbon transaction, or By showing that there are barriers to the activities in the project that can be surmounted only via the carbon transaction Is additionality ever fully achieved? In time additionality will become increasingly difficult –Barriers will no longer exist –Costs of implementation will fall making the carbon finance less important

Leakage Some projects will lead to “offsite” consequences that will partially negate the atmospheric benefits of the project itself – this is leakage –e.g. Reforesting an area leads to displaced cattle owners clearing forest elsewhere to re- establish pasture –Increased income from agroforestry, leads to higher demand for timber and fuel woods leading to deforestation

Types of projects

Land rehabilitation Often community based Usually small plantings Complex monitoring issues; but we have examples Modest carbon contents (<20 t CO 2e /ha/yr) Usually clearly additional Low leakage risk

Plantation forests Usually commercial enterprises Often high rates of sequestration (e.g. 40+ t CO 2e /ha/yr) Must be able to demonstrate additionality Leakage is possible through displaced land uses Best examples where the reforestation is part of a wider landscape project and/or is contribution to land rehabilitation

Landscape management Multiple activities including reforestation, improved soil management and forest retention Socially and environmentally very desirable Complex to justify and monitor Some activities not eligible for Kyoto credits

Agroforestry Must convert non- forest to forest Significant gains from carbon in the trees; sometimes from the under- crops; and usually from improved soil carbon Additionality usually based on barrier tests

Revegetation Use of vegetation other than trees Often used for land rehabilitation or to improve pastoralism Low rates of sequestration (<< 10 t CO 2e /ha/yr), but very large areas at relatively low cost But not A&R under Kyoto rules

Biofuels Replace the unsustainable use of fuel woods (eg from cutting native forest), with alternative sources –E.g. methane digestors; sustainably managed plantation fuel woods Troubled history in the negotiations

Reforestation and pastoralism Good, biologically, economically, socially and in terms of GHG reduction Carbon sequestered in trees; methane emissions from cattle often reduced But complex to set up as they must be split into two projects because of Kyoto rules Care in selection of the tree species

Improved agricultural management Gains mostly through improved soil carbon Usually community-based projects with large coverage Sequestration rates c. 10 t CO 2e /ha/yr Do not generate Kyoto credits since they are not A&R

Beyond A&R in the CDM Many activities with the greatest value to developing countries were excluded via the negotiation process Need to explore activities accepted in Annex 1 countries but excluded from the CDM Forest restoration, revegetation, improved tillage, and avoided deforestation (or “forest conservation”) Subject to the same standards as all other activities Additionality, permanence, measurement, verification

Wider issues

BioCarbon Fund and Adaptation Adaptation challenge: to increase the biological and social resilience of communities reliant on agricultural and forest ecosystems Fund can act as a catalyst for changing land-use practices –Source of funding –Demonstration of new practices/crops –Conservation of buffers, genetic resources etc Most Host Countries are more concerned with successful adaptation to climate change than with mitigation

Seeking synergies between the major environmental conventions Climate, environmental and livelihood goals Compatibility with national sustainable development goals Local participation: communities, NGOs, private and public sectors Actions that assist adaptation to climate change Emphasis on managing the whole landscape UNCCD