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Carbon trading under Kyoto Protocol - Vital to restoring forests
By Swarna Sadasivam Vepa
INDIA'S
forest cover has been decreasing steadily. Between 1972-75 and 1993-95, the
dense forest area in India declined from 46.42 million hectares to 36.73
million hectares. Further, only 11.8 per cent of the geographical area is
dense forest. The open forest area is 7.7 per cent, and the scrub forest
area 1.58 per cent.
India
can improve the dense forest cover by converting at least part of the 25.5
million hectares of open forest area into dense forest area. However,
long-term finance is required.
Carbon
sequestration and carbon trading
The
role of forests in stabilising the atmospheric temperature is well known.
The removal of atmospheric carbon is known as carbon sequestration. It has
been estimated that carbon sequestration in Indian forests was 6.9 million
tonnes in 1996 (Ravindranath1996).
Despite
the depleting forests, the estimation of net annual carbon sequestration
from 1972-73 to 1999-2000 appears to be positive. This has been attributed
to the plantation of secondary forests in the past two decades, as the
carbon sequestration from the old forests has been taken as zero (Kanchan
Chopra, et al 2002).
Thus,
Indian forests can raise funds by carbon trading under the Kyoto Protocol.
However, under the new provisions of the Kyoto Protocol, things are not
easy.
Kyoto
Protocol: Implications
In
1992, many nations — alarmed at the increase in greenhouse gases (GHGs)
— signed the United Nations Framework Convention on Climate Change (UNFCCC),
which had a legally non-binding, voluntary pledge stating that the major
developed nations would reduce their GHG emissions to 1990 levels by 2000.
Parties to the treaty decided, in 1995, to enter into negotiations on a
protocol to establish legally binding limitations, or reductions in GHG
emissions. The negotiations took place in 1997 at Kyoto in Japan. Eight
Conferences of the Parties (COPs) have been held since 1992. The Kyoto
meeting was the fourth.
The
Kyoto Protocol only recognises the land use and land use change in forestry
activities (LULUCF), and the associated net carbon sequestration flows
estimated for the purpose of emission trading in terms of net removal units.
At the COP 7 in Marrakesh, naturally occurring carbon removal, and removals
as a result of anthropogenic effects, were excluded. Also, any re-release of
the GHGs through forest fires will have to be accounted for.
The
forest has been defined. The trees have to be at least two-five metres tall
in a forest. The value can be chosen by a country. However, they remain
fixed and cannot be changed.
The
parties should choose the land use activity to be used for emission targets
in addition to afforestation, reforestation and deforestation. The carbon
sink activities in addition to forest regeneration are forest management,
cropland management, grazing land management and re-vegetation. Removal of
GHGs is measured in removal units called RMUs. For the first commitment
period there is a four-tier capping system. Only afforestation and
reforestation projects are eligible for the clean development mechanism.
Removal units cannot be carried forward to the next year.
Emissions
and removals from crop land management, grazing land management and
re-vegetation management can be accounted for on a net to net basis, meaning
the levels of removal over and above the 1990 level are taken into account.
If the carbon removals are the same as the 1990 level there will not be any
credits. Issues such as emissions, from forest harvesting and wood products
have been resolved.
There
are still many issues to be settled before the methodologies of computations
of removal units, and emission units are standardised and other issues, such
as verification and compliance, are resolved.
As it
appears now the emission trading for carbon sinks does not help the
countries that have been using sustainable logging for some time, since the
cutting down of the forests and regeneration was a regular activity by 1990.
Growing forests in a big way beyond the high levels achieved is not possible
and difficult to compensate by other activities. Other activities, which
also account for carbon removals may be small in the countries, where
croplands are left fallow.
Further,
there is a cap on the credits one can get from these activities. The land
may not be available to substantially increase these activities beyond the
1990 levels. Thus, many South-East Asian countries with large forest areas
may not benefit from the emission trading under the Kyoto Protocol.
The
case of India is different. The net annual flows of carbon calculated for
India have not changed much since 1990 (Kanchan Chopra 2002). In fact, there
was a small decline between 1990 and 1996. Even if we presume that the
methodologies adopted in the present estimation are acceptable to the Kyoto
Protocol, which is doubtful considering the discrepancies that often occur
between the Indian and UN estimates, the net carbon removal is not much. If
we take into consideration forest fires, it may come down further. All the
same, considering the large areas of open forest, India can still benefit
from emission trading, provided a real effort is made to stop all illegal
felling, and improve the forest cover. However, India has to closely follow
the developments, and do the needful to collect more accurate statistics,
and the net forest wealth index for various States. More has to go into
choosing the tree height and the re-vegetation activities, which can include
some horticultural activity, where the trees are perennial.
Another
important point to note is that once the Kyoto Protocol is in place, the
present system of private companies buying emission units from plantation
companies will not hold. All the signatory countries will have to abide by
the rules.
(The
author, an economist, is with the M.S. Swaminathan Research Foundation,
Chennai.)
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