Climate 411

Saving and restoring tropical forests has enormous value for the planet and the economy

Aerial view of the Amazon Rainforest, near Manaus, the capital of the Brazilian state of Amazonas. Neil Palmer (CIAT). Source: Wikimedia Commons.

This post was authored by Sabine Fuss, Group Leader for Sustainable Resource Management and Global Change at the Mercator Research Institute on Global Commons and Climate Change (MCC), Ruben Lubowski, Chief Natural Resource Economist at EDF, and Alexander Golub, Adjunct Professor of Environmental Science at American University

The protection of tropical forests globally is indispensable for significantly increasing climate ambition in line with Paris Agreement goals as illustrated by a tremendous return on climate investment, according to our new article in the journal Global Sustainability.

Without dedicated efforts to protect tropical forests, tropical deforestation will contribute to the atmosphere on the order of 200 billion tons of carbon dioxide emissions through the end of the century. Allowing this deforestation to occur would make the transition extremely difficult, requiring drastic immediate cuts in difficult-to-decarbonize sectors at high costs with no flexibility to allow benefitting from ongoing innovation and cost reductions. Unmitigated tropical deforestation would also put net zero emissions out of reach without large-scale deployment of Carbon Dioxide Removal (CDR) technologies, which would require an unanticipated ramp-up of new infrastructure pervaded by a diverse array of uncertainties.

Protecting and restoring tropical forests as envisioned under the international finance framework REDD+ (Reducing Emissions from Deforestation and Forest Degradation) thus provides the world with greater flexibility to implement deeper cuts in emissions. Other studies have also recognized the importance of REDD+ for climate stabilization, but ours goes a step further by determining the economic value that REDD+ can provide by enhancing global flexibility for reducing emissions.

For our study, we applied the widely used climate economics model DICE developed by US Nobel Prize winner William Nordhaus. DICE shows the cost of achieving climate targets by using the most favourable mix of mitigation measures, but has so far not explicitly reflected the mitigation potential of tropical forest conservation. Our analysis incorporates more recent estimates from Jonah Busch and colleagues of the CO2 impacts of protecting and restoring tropical forests and of the direct opportunity costs of such activities, i.e. how much it would cost to forego the economic benefits of clearing or of allowing forests to regenerate – a key concern in many developing countries and often a strategic decision because of the large role that agricultural exports play in the economy.

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Posted in Carbon Markets, Forest protection, REDD+, United Nations / Leave a comment

Farmers and environmentalists team up to push Congress to act on climate

By Callie Eideberg

This blog was originally posted on EDF’s Growing Returns.

America’s farmers, ranchers and forest landowners are on the frontlines of the climate change. Planting windows and growing seasons are shifting, and droughts and floods are more likely to occur. At the same time, these working lands hold enormous potential to help slow climate change and increase resilience to its effects. Photo credit: Iowa NRCS.

Agricultural and environmental advocates have joined forces to push Congress to act on climate change. The new Food and Agriculture Climate Alliance developed more than 40 joint policy recommendations for making farms, ranches and forests more climate resilient, harnessing the power of natural climate solutions.

Environmental Defense Fund, American Farm Bureau Federation, National Council of Farmer Cooperatives and National Farmers Union co-chair the alliance, and membership has expanded to include FMI-The Food Industry Association, National Alliance of Forest Owners, National Association of State Departments of Agriculture and The Nature Conservancy. Read More »

Posted in Agriculture, Climate Change Legislation, Greenhouse Gas Emissions, Policy / Comments are closed

Firms can manage climate policy uncertainty. Here’s how.

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This post was authored by Ruben Lubowski, Chief Natural Resource Economist at EDF, and Alexander Golub, Adjunct Professor of Environmental Science at American University.

For companies that are large emitters of greenhouse gases, uncertainty about policies to address climate change can be a real challenge. But our new paper in the journal Energy shows how companies that invest now in a novel approach to climate mitigation could help manage their risk of future policy obligations more effectively and at a lower cost.

The challenge

In Energy, we demonstrate how policy uncertainty puts greenhouse gas emitting companies in a bind, raising risks for these companies and making it likely that carbon prices—an indicator of costs—will rise in a series of sudden bursts, rather than following a smooth transition.

Policy uncertainty discourages private investment in low-carbon technologies. However, when credible climate policy is finally in place, industry will have missed out on prudent investment opportunities and face spiking costs as they rush to catch up with tightened emissions controls requirements.

In the paper, we show that companies have a latent demand for suitable strategies that can help manage these risks.

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Posted in Carbon Markets, Forest protection, International, REDD+ / Read 1 Response

Study: Consumers willing to pay carbon offsets for air travel

New social science research finds people are willing to put a price on carbon; just don’t ask them to pay taxes

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This post was authored by Rainer Romero-Canyas, Lead Senior Social Scientist for EDF.

Flying shame has gone mainstream—just ask the Duke and Duchess of Sussex. But are travelers who won’t face the wrath of the tabloids for flying willing to chip in to offset the cost of flying on the environment? A new study from the University of British Columbia and EDF suggests they are. It all depends on how it’s labeled and who is viewed as paying for the environmental impact of the flight.

We wanted to see if it was possible to introduce policy instruments designed to price carbon, without triggering an aversion to taxes, a common challenge in the United States. So, we tested two aspects of the fee: one, both how it was labeled (a carbon offset or a carbon tax), and two, if it was important to see who got the bill (the company that imports or processes fossil fuel or the consumers who use their products and services).

In an upcoming issue of the Journal of Environmental Psychology, my co-authors and I detail the results of three studies focused primarily on the airline industry, because its emissions are slated to triple in the coming decades, absent policy change, making it one of the fastest sources of carbon pollution worldwide. The good news: consumers are willing to pay more for flying responsibly, just as long as it’s the airlines they’re flying that are stepping up and shouldering that responsibility.

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Posted in Aviation, Carbon Markets, Science / Read 2 Responses

The Getting to Zero Coalition: a step further towards decarbonization

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This post was authored by Aoife O’Leary, Natacha Crete and Marie Hubatova from Environmental Defense Fund Europe

Today at the United Nations Climate Action Summit, the youth movement with Greta Thunberg at its helm, called out the world leaders in attendance for a lack of action in the climate emergency. Greta’s impassioned plea again makes clear that the time for action is now. Action from all sectors. In the absence of real transformative action, we have no hope of meeting the temperature goals established by science and enshrined in the Paris agreement.

The UN Secretary General Antonio Guterres convened the climate action summit asking that countries and sectors come forward with scalable action. The summit is supposed to clarify the “how” in our path to avoiding catastrophic climate change. These provide the necessary catalyst for countries to take more ambitious commitments at the international climate negotiations in Glasgow in 2020. While much of what was announced today at the summit was pretty underwhelming, major players in the shipping sector have made significant effort to answer Guterres’ call.

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Posted in International, Paris Agreement, United Nations / Comments are closed

CDM design flaws can taint CORSIA, but supply from small developing countries could provide real emissions reductions

Aruba’s Vader Piet Wind Park

Aruba’s Vader Piet Wind Park. Credit: Miles Grant

By Kristin Qui, Environmental Defense Fund Tom Graff Fellow, International Carbon Markets

Last month, the 36 countries that make up the Council of the UN’s International Civil Aviation Organization (ICAO) adopted the set of rules that will guide the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA). Known as the Standards and Recommended Practices (SARPs), these rules constitute a significant step to get CORSIA up and running, and contribute to ICAO’s goal of capping net emissions from international aviation at 2020 levels.

However, much work remains to be done at ICAO between now and the end of 2018. The Council has not yet adopted some key elements, including details on CORSIA eligible emissions units, sustainable aviation fuels and criteria for both. Furthermore, the Council has yet to establish the Technical Advisory Body (TAB) that will make recommendations to the Council on which emissions units airlines can use. A transparent TAB, with broad stakeholder participation, is necessary to provide recommendations on high-quality units that represent real emissions reductions in CORSIA.

One mechanism under consideration to satisfy CORSIA demand for emissions units is the Clean Development Mechanism (CDM) established by the Kyoto Protocol 20 years ago. The purpose of the CDM, as specified by Article 12 of the Kyoto Protocol, is to assist rich countries in complying with their Kyoto emission reduction commitments by using emissions reductions credits from projects in developing countries, and to help the latter achieve sustainable development and contribute to the ultimate objective of the Convention, i.e., averting dangerous interference with the climate system. However, the CDM has run into a number of obstacles. In fact, several studies, including a new EDF analysis, finds that in many cases, the CDM’s methodologies and design don’t address additionality, don’t provide real and credible baselines and don’t avoid double counting. Below are some of the biggest issues with the CDM:

  1. Lack of additionality: Some CDM projects have been found to be non-additional, meaning that those projects would have happened in the absence of the CDM and its finance from the sale of CERs. Thus, under the CDM’s current design, countries can earn credits from projects for which they did not require CDM financing. This is quite alarming in a landscape where many smaller developing countries have trouble accessing the necessary climate finance to cope with the harsh impacts of climate change.
  2. Crowding out small countries: The majority of CDM projects originate in large developing countries, e.g. 85% of issued Certified Emissions Reductions (CERs) occurs in China, India and Brazil, effectively crowding out smaller countries in need of finance for low carbon development. Even further, EDF’s analysis shows that one large developing country has a potential supply of about 10 times the demand of CORSIA, when projecting the maximum potential CDM supply out to 2030.
  3. Accounting issues: Other projects like HFC-23 destruction projects have been flagged for baseline inflation, meaning that project proponents overstated the number of reductions resulting from a given project. The atmosphere therefore sees less emissions reductions than the CDM project promises, setting back mitigation progress. Using such credits to offset an increase in emissions under CORSIA means that airlines would not be meeting their goals of carbon neutral growth from 2020.
  4. Lack of Transparency: Lack of transparency in the CDM Executive Board decision-making, communication and publishing of CDM data makes it challenging to understand the CDM project cycle. Shockingly, there is no way to tell when CERs have been used by an entity to offset an emissions increase.
  5. Lack of legal basis for using CERs in CORSIA: The future of the CDM is legally uncertain. The Kyoto Protocol establishes the CDM only for the twin purposes of helping non-Annex I Parties (developing countries) with sustainable development and Annex I Parties (developed countries) to meet their Kyoto emissions reduction commitments. The Protocol does not establish the use of CDM CERs for CORSIA or the Paris Agreement. Thus, the CDM Executive board has no legal authority to issue CERs after 2020, and may not have authority to issue CERs now. To use CERs in CORSIA, ICAO and the Conference of the Parties serving as the meeting of the Parties to the Kyoto Protocol must take the necessary legal decisions.
  6. Fraud: Recent analyses have demonstrated that a significant number of CERs may be fraudulent. In particular, large dams in Brazil were registered as CDM projects based on assertions that the projects depended on carbon finance for their future construction and operation. However, investors have successfully prosecuted lawsuits demonstrating that their funds disappeared in the Lava Jato corruption scandal, and the dams were built anyway. Airlines face big reputational risks if the units they use to meet CORSIA requirements are fraudulent in any way.

Some CDM projects could deliver environmental benefits

A recent analysis by EDF shows that CDM activities in small island developing states (SIDS), least developed countries (LDCs) and other African countries are more vulnerable to discontinuation without support from market mechanisms, meaning that such activities are more likely to be additional. Because of these reasons, and to improve access to market mechanisms for smaller developing countries that were effectively denied access by larger countries, rules for post-2020 use of CERs should focus on a particular subset of CDM activities. EDF’s analysis concludes that the highest likelihood of delivering environmental benefits from CDM activities, would arise from limiting use of CERs to those originating from activities in SIDS and LDCs, provided that they satisfy quality and accounting standards, including the need to avoid double counting.

Posted in Aviation, Carbon Markets, International, Policy / Comments are closed