Reduced deforestation in developing countries as a means for combating

global climate change

Brent Swallow

Global Coordinator, ASB Partnership for the Tropical Forest MarginsWorld Agroforestry Centre (ICRAF), Nairobi, Kenya

Open seminar organized by the Finland Ministry of Foreign Affairs, 7 February 2008, Helsinki, Finland

Background on Avoided deforestation: 1. important

• tropical deforestation contributes 17% of all GHG emissions

• Clean Development Mechanism has effectively excluded the forestry sector

• EU Emission Trading Scheme deliberately excludes forestry

• Tree planting comprises about 36% of the voluntary carbon market (Forest Trends)

• US forestry and agriculture allowed by the (low-priced) Chicago Climate Exchange

Background on Avoided deforestation: 2. back on the agenda in 2005-2006

‘Compensated reductions discussed seriously again in 2003

• Avoided deforestation back on UNFCCC agenda in 2005

• Huge emissions from deforestation of peatlandsreported in 2006

Background on avoided deforestation:3: Reduced Emissions from Deforestation in

Developing Countries at COP 13 in Bali• Avoided deforestation supported by most high-

level presentations at COP 13 in Bali.• Indonesia had two-day side event to present

results of its Indonesia Forest Climate Alliance• CIFOR and the Collaborative Partnership on

Forestry hosted Forest Day with over 800 participants

• REDD contact group met throughout COP13• Major concerns that REDD outside of negotiations

that REDD will result in re-centralization of forest governance:

• Decision at COP13 supports: methodology development, lesson sharing, Demonstration activities, Sub-national projects within national-level accountability

Background: 4. important but (too) costly

Obersteiner et al at IIASA adopt these suggestive numbers and argue that actual costs of REDD will be even higher because of difficulties in targeting low opportunity cost emissions.

Cost ofAbatementIn Euro /tonne CO2eq

Abatement beyond BAU (GtCO2eq per year in 2030)

0

50

100

50

100 Building insulation

Efficient lighting, air conditioning, heating

low cost afforestation

Medium costafforestation

Avoided deforestation

Sugarcane biofuel

McKinsey Vattenfall

• Stern Report identifies avoided deforestation as a cost-effective approach for achieving large reductions in GHGs, based on bottom up comparisons of returns to land .

• Chomitz in At Loggerheads, underlies Stern Report and draws heavily on previous ASB results.

• Woods Hole Research Centre results, show low opportunity costs associated with avoided deforestation in Brazilian Amazon

Background: 5. important and potentially cost effective

The ASB Partnership• Alternatives to Slash and Burn (ASB) began in 1994• ASB Partnership for the Tropical Forest Margins in 2006• Network of international and national organizations known for sound comparative studies across the margins of the humid tropical forests• Global Coordination Unit at the World Agroforestry Centre (ICRAF) in Nairobi and regional coordination for SE Asia, Africa and the Amazon

Objectives of ASB collaborative study:

• Estimate opportunity costs of avoided deforestation for large multi-functional landscapes in the humid tropics

• Present results in the form of pollution abatement cost curves for comparison with other (net) emission reduction activities

• Help climate change negotiators and investors at national and international levels to have a more realistic understanding of the potential and challenges of REDD

OpportunityCost ofAbatementIn $ / tonne CO2eq

Abatement beyond Business as Usual0

50

100

50

100Abatement costs = opportunity costs

+ transaction costs (info + contracting + enforcement) + costs of fixing policy and market distortions

Sites

Cameroon

Results for Ucalayi, Peru

Results for Cameroon

Results:

Different land use and C dynamics in the two sites• Very little land in cocoa agroforests despite apparent win-win • Agr pressure in Awae: C loss • Logging and outmigration in Akok: C gain

Overall Conclusions:

(1) Farmers respond to market incentives in choices to shift to lower-carbon and higher-carbon land uses.

(2) About 80% of emitting land-use changes in the study areas since 1990 could have been offset by payments of less than $5 / tonne. Large amounts less than $1 / tonne.

(3) Future opportunity costs will depend on REDD incentives and land-use incentives. Large increases in farm price of biofuels may be a major threat to standing carbon, especially in areas with good market access.

Key messages:

(1)Powerful economics driving deforestation and C losses. Markets for products, and lack of markets for C and other services, drive deforestation and afforestation.

(2)Stern is rightThere are cost-effective opportunities for large reductions in CO2 emissions from avoided deforestation in the humid tropics, esp. in areas of low market access and certainly including Asia.

(3) Peat forests and converted peatlands are the biggest ‘bills left on the sidewalk”: including conversion and use of peatlands

(4) There are opportunities forever lost every day to reduce deforestation. Governments and other stakeholders should take positive pragmatic steps (eg bilateral deals for medium-term Carbon leases?) as they negotiate long-term agreements.

(5) Overall patterns of forest transition underlie C loss and gain in different locations – defining opportunities for compensated reductions and need for accompanying measures.

1990 2005

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