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Climate Change, Kyoto, Carbon Trading, and Trees

A conversation with John O. Niles and Sonal I. Pandya

By John Tidwell

On February 16th the Kyoto Protocol went into effect, becoming the first international treaty to regulate carbon dioxide (CO2) and other emissions, the notorious ‘greenhouse gases’ that cause global warming. After seven years of political wrangling, 141 countries signed and ratified the protocol, with 35 industrialized nations pledging to reduce their CO2 pollution levels by an average of around 5 percent while helping poorer countries to develop clean alternative energy sources. A notable exception to this is the U.S., which withdrew from the process when the Bush Administration took office in 2001.

With the Kyoto Protocol firmly in place, conservationists now see it as a legal bulwark that can be strengthened by other programs to prevent global warming. But what would such programs do, and how would they show governments and corporations that ‘green’ solutions could benefit business as well as biodiversity? CELB Enewsletter asked John O. Niles, who manages the international Climate, Community & Biodiversity Alliance (CCBA), which includes CI, and Sonal I. Pandya of CI’s Center for Environmental Leadership in Business (CELB), to address these issues and explain how CI is forging partnerships to solve the problem.

CELB Newsletter: What is different about the Kyoto Protocol from other kinds of environmental legislation?

John O. Niles: The Kyoto Protocol is more ambitious than anything humans have tried in terms of managing pollution worldwide. Greenhouse gases come from virtually every type of activity, from driving cars and turning on lights, to clearing land to fertilizing crops. Hopefully, the Kyoto Protocol will become a holistic approach to limiting a very serious threat.

Sonal Pandya: With the Kyoto Protocol, you are only talking about 5 percent reductions below 1990 levels. And the U.S., which contributes about 25 percent to global CO2 emissions, hasn’t even ratified it. So the largest source of greenhouse gases isn’t even doing anything. You have to think about how to encourage US businesses to make voluntary reductions in their emissions.

CELB Newsletter: Good question. How do you do that?

SP: Eighty percent of the problem is CO2 emissions from fossil fuels (coal, oil etc.), and cutting them should be 80 percent of the solution. Our work here at CI focuses on the remaining 20 percent, the greenhouse gases that largely arise from poor land management. We think the most effective way to approach land management is with holistic, multiple-benefit projects that address climate, biodiversity and social issues–we call these Conservation Carbon Projects. So a Conservation Carbon project is one that will reduce global warming, restore or rebuild habitats and help local communities in the Amazon or in Asia to find alternatives to slash and burn agriculture.

JN: In a practical sense, it means that a project under the Kyoto Protocol should be able to make a strong case that it is really combating climate change, conserving biodiversity and assisting communities to live better lives. A project shouldn’t fight climate change on one-hand and cause social or environmental problems on the other. We created the Climate, Community & Biodiversity Alliance (CCBA) to design international peer-reviewed standards that assess whether a project is likely to deliver multiple benefits. We hope this will help donor agencies move away from a single-issue mind frame and develop solutions that help people and the environment without causing difficult tradeoffs.

SP: Michael Totten and I at CELB focus primarily on ways to encourage corporations to reduce their greenhouse gas emissions and adopt a Multiple Benefit approach so it’s cost effective. They can do that by becoming more energy efficient, buying green power, or doing whatever they can within their operation’s four walls to reduce CO2 emissions.

CELB newsletter: I remember from biology class that plants breathe in CO2 the way we take in oxygen. If we are trying to reduce CO2 in the atmosphere wouldn’t it make sense to focus on reforestation?

SP: Regenerating native vegetation is a key multiple benefit opportunity. Its one of the most cost effective and quickest ways we can reduce CO2 in the atmosphere. What we are suggesting is that reforestation can be done following the Kyoto Protocol in a way that will promote biodiversity and also open the door to things like agro-forestry systems that help local communities. By restoring native tree species, you reduce soil erosion, you get water benefits, you give species a larger habitat in which to roam and escape potential risks of fire, climate change and poaching. CI has a project in Ecuador where we are replanting along the slopes of this particular valley, which is also a wetland of international concern. What that will do is reduce soil erosion and protect the watershed so that the people will have a source of portable drinking water.

JN: In addition, our groups have been arguing that planting trees is really the second best way to deal with global warming. The best way to deal with a problem is stop it in the first place. In other words, we should first focus on stopping carbon from getting up into the atmosphere. This means curbing fossil fuel emissions from industry and cars and stopping deforestation in the tropics. The Kyoto Protocol has ignored tropical deforestation even though it is almost a quarter of the problem. Any treaty that has to do with carbon should include incentives to conserve tropical forests. This has been a difficult debate within the conservation community and among parties in the Kyoto Protocol.

CELB newsletter: Are you saying tropical deforestation is a more urgent issue than climate change?

JN: In terms of preventing irreversible loss of biodiversity, yes. However, it’s not an either/or trade-off. Cutting fossil fuels and preventing deforestation both address climate change. Both solutions are important and they’re too interrelated to separate. Tropical deforestation is a significant source of greenhouse gases, and climate change will stress forests like we’ve probably never seen. There are many good climate-related reasons to have measures that protect tropical forests included in the Kyoto Protocol. You stop greenhouse gas emissions and you maintain a biome that absorbs carbon already in the atmosphere– a double carbon benefit. And saving tropical forests also stabilizes our climate and weather beyond greenhouse gases. Think of tropical forests as a cool, moist green wet sponge that shelters the part of the planet where solar radiation is most intense. Scientists speak of “land surface parameters.” The land surface parameters of tropical forest, such as albedo and evapotranspiraton, help distribute how heat and energy move around our world. In other words, tropical forests stabilize global weather and climate even more than one would suspect based on carbon alone.

CELB newsletter: So, you’re saying tropical forests are important for our planet’s climate stability beyond the greenhouse gases, which the Kyoto Protocol addresses. These wet green sponges, as you call them; help preserve weather patterns just by being forests?

JN: Precisely. One-way to think of it is this: would you rather hold this interview on a hot day in Brazil in the forest or out in a field? Forests keep the equator’s surface cool by shading and misting and building a cool wet microclimate. Summing across millions of hectares worldwide, tropical forests influence climate even for people who have never seen or heard of a greenhouse gas!

CELB newsletter: Aren’t there other reasons to save rainforests? Even outside of climate change?

JN: Of course. Tropical deforestation is the leading cause of biodiversity loss. It destroys watersheds and causes water pollution in some of the world’s poorest communities. There are a ton of good reasons to save tropical forests. Unfortunately, when it came time to save tropical forests, the Kyoto Protocol punted. Or dropped the ball. Or whatever the appropriate sports metaphor is...

Instead it chose to focus on industrial, or fossil fuel, fixes. And since this is the vast majority of the problem, it’s a good thing. We just felt it would’ve been better to include all the causes of climate change under the same tent. Particularly since there will hopefully be some technological ‘fixes’ for the fossil fuel aspect of climate change. There isn’t going to be a technological fix for Congo’s deforestation problem. Each acre of forest kept from being cut down will require different approaches and resources.

CELB newsletter: Certainly combining protection of existing forests with reforestation projects makes sense. What does the Kyoto Protocol say about that?

SP: Kyoto doesn’t have rules about how to do reforestation—it just says, “any area that was not forested in 1990 you can plant on.” It doesn’t say what you can plant with (it prohibits GMOs). So you could plant eucalyptus or oil palm plantations as far as the eye can see and it’s still creditable. So here you have a potential new subsidy program for oil palm or eucalyptus plantations, whose tree monocultures don’t support biodiversity at all! And that’s scary.

JN: This is why good regulations are so important. As Sonal said, you can’t get “carbon credits” for reforesting areas cut down between 1990 and 2005. The protocol didn’t want to give bogus credit for activities that weren’t carried out with the explicit intention of fighting climate change. For instance, let’s say 10 years ago the US raised car emissions standards. They shouldn’t get carbon credits today from the international community for something they did 10 years ago that had nothing to do with climate change. This notion, called ‘additionally’ in the Kyoto Protocol, was necessary to prevent gaming the system and is an artifact of the way the treaty was designed. With reductions based on 1990 emission levels, but now, with an old 1990 baseline, a country can’t get credit for rebuilding ecosystems destroyed in past 15 years! Which for tropical forests, amounts to 100s of millions of acres. To make matters worse, these are precisely the areas we should be reforesting. The last areas to be cut often have the highest conservation value since they can be stitched back together to reconnect intact wildlife corridors.

CELB newsletter: Explain what carbon credits are, and how trading in carbon works.

SP: Carbon trading can mean anything that helps reduce greenhouse gas emissions or sequester carbon already pumped into the atmosphere. So it can mean recovering methane gas at coalmines or displacing coal power with renewable energy. It can mean a company becoming more energy efficient and trading its carbon credits to other companies. For a long time people have been trading the chemical emissions that cause acid rain like sulfur dioxide. Carbon would become another emissions commodity to be traded.

JN: For forestry, the benefit of carbon trading is that it could help change how conservation is financed. And we need new ideas. Traditional conservation works like this: a donor gives money to a recipient country or NGO, and then everyone hopes conservation happens. Often it doesn’t work out and the resources have never been at a scale commensurate with the problem. With carbon trading, it’s a binding agreement. The agreement is often a contract between a company willing to treat conservation as an investment and a host government or community that finds the investment attractive enough to protect or restore an ecosystem. A carbon market will build more incentives into any conservation agreement so that it’ll be more likely to work and persevere. For the first time, standing forests can have real market value and in fact can become more valuable as carbon repositories than for their timber. The challenge is to make sure that these agreements are fair to all parties and that the agreement really delivers long-term benefits all around.

CELB newsletter: You mentioned earlier that the Kyoto Protocol only addresses 5 percent of emissions, but climate scientists say to really impact climate change you need something more like 50-to-60 percent reduction of CO2. Are carbon credits and trees going to do all that?

SP: Something that would have an even bigger impact would involve changing our energy sources. That means going from a carbon-based energy plan to a hydrogen-based plan. Going to fuel cells. Going to renewable energy. That’s going to take some time. And the Kyoto Protocol is really a first step.

JN: In short, the Kyoto Protocol is trying to reduce the wealthiest countries’ emissions by about 5 percent from their 1990 levels. This amounts to real cuts –since have emission have continued to grow—on the order of 15-25 percent for most of these countries, which is not insignificant. True, the reductions called for in this first iteration of the Kyoto Protocol won’t amount to much of a change in global temperatures. But over a long time, such cuts would make a real difference. What’s more important is there is a framework that can be ratcheted up. Deeper transformations in how we pollute the atmosphere will require even more political will, which is really the main issue. Our work is trying to show that we can use carbon markets in a manner that protects our atmosphere, helps biodiversity and benefits local communities. Over time, we hope that success breeds success and allows the political environment to catch up with the natural environment. Along the way, we hope to improve some people’s lives and save a few species that would otherwise be knocked out.
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