CARBON FORESTRY AND CARBON TRADING
ShirongLiu
Member, China Economic and Social Council
Vice President, ChinaAcademy of Forestry
Abstract:
Forest is the main componentof terrestrial ecosystems, it absorbs and sequestrates large quantity of CO2 in the air, serving as a huge carbon sink. Global forest carbon storage accounts for 77% of the total terrestrial vegetation, while carbon storage in forest soil makes up for 39% of the global soils. However, deforestation,without doubt will increase green house gas emission such as CO2 etc, and thusit has become the second mainCO2 emission source closely after fossil fuel burning. In this sense, forest ecosystem has played an important and irreplaceable role in global carbon cycle and carbon emission and sequestrationbalance.
To mitigate the ever aggravated global climate change, forestry is now undertaking a developing transition and conversion. Seen from an international view,carbon forestry has taken a new rise. Carbon forestry covers the following four aspects:1) to promote those forest activities which will enhance the capacity of carbon sink, such as: afforestation, reforestation, ecological restoration, and setting up Agro-forestry compound system so as to increase the carbon store in terrestrial vegetation and soil; 2) to conserve and sustain forest carbon pool, namely to protect the carbon store already sequestrated in the existing forest eco-system and restrict and reduce carbon emission;3) to take a series of measures of carbon management through sustainable forest management process to reduce disturbance to soil while increase tree growth, and therefore carbon emission from forest management is decreased while carbon sink is enhanced; 4) to implement carbon replacement action, use durable forest timber products to replace energy-intensive materials, utilizing the renewable wood fuel (such as bio-diesel and lignose-cellulose transformed ethanol)and recycledlogging residues for fuel.
Kyoto Protocol, reached in 1997 for the purpose of mitigating global climate change, prescribed that: industry countries can obtain carbon credit by implementing afforestation, reforestation, reducing of deforestation and other forest managementor byimplementing CDM in developing countries to compensate for and reach its quantified emission limitation and reduction commitments.The creationof CDM sets up the mutual benefit marketing function between developing countries and developed countries,it materialized the conversion as from eco-capital to industrial currency, realizing the carbon trading. Implementing CDM forest project in less developed areasof developing countries can not only make developed countries fulfillits quantified emission limitation and reduction commitments but also make benefits to the poor people in the area. It will relieve poverty, create new employment opportunity, develop economy and improve environment. China hasbright prospects for developing carbon forestry and implementing CDM projects. Implementing carbon forestry will accelerateforestry eco-construction, regional eco-environment improvement,povertyreductionand forestry bio-energyexploration. It is a new starting point for Chinese forestry development.
China and Europe have played a significant role in international politics, economy, trade and global climate changemitigation, and a major role in international conventions implementation and environment negotiation. Therefore, China and Europe shall intensify the wide cooperation in carbon sequestration and expand the cooperative CDM project, and explore a series of related new issues, such aspolicy management, carbon sink assessment methodology, carbon trading etc, all these are constructive to two parts’ carbon trading market,by doing so, China and Europe will set up a good example for global CDM carbon project implementation, offering experience, experimentaldemonstration, which is of critical importance of global environment benefts and demonstration significance.
Key Words: Forest, carbon sequestration, carbon sink, carbon trading
One: Introduction
IPCC fourth assessment report (2007) noted that in the past 100 years, global average temperature has risen by 0.74C±0.18C. Temperature rise range in the northernhemisphere during the 20th century might be the highest in the past 1000years. The rainfall distribution has changed as well. Rainfall in continental areas, especially in middle and high altitude has increased, while rainfall in Africa region has reduced. In some areas, extreme climate events(EI Nino, draught, flood, thunder storm, hailstorm, windstorm, high temperature and sand storm, etc.) have increased its frequency and intensity. According to IPCC’s fourthforecast assessment report (2007), till the year 2100, global average temperature will rise by 1.8Cto 4 Cwith sea level rising by18 to 59 cm.
China’s climate change trend coincides with that of global climate change. In the past 100 years, China’s temperature has risen by 0.4－0.5C, a bit lower than the global average level of 0.74C. Viewed from the regional variation, northwest, north China and northeast area have seen a more obvious greater warming, among which northwest is above the national average level. According to the forecast of China climate change scenarios, to the year 2020-2030, national average temperature will see a rise of 1.7C; andin the year of 2050, national average temperature will get ariseof 2.2C.
Accumulated observation facts and studies show that, the ever increasing emission of CO2and other greenhouse gas has brought in the greenhouse effect which leads to global climate change. The fourth IPCC assessment report (2007) observed that, for the past 50 years, the rise of global average temperature has much possibility to do with human being’s increasing burning of fossil fuel, that means 90% of the temperature riseresulted from the green house gas emissioncaused by human being’s activities.
The global warming hasin many areas laid grave negative influences on natural ecological systems. Such as the rise of the sea level, the glacier retreat, tundra ablation, prolonged growing season in the middle and high latitude, the extending distribution of fauna and flora to polar region and high latitude areas, some wildlifepopulationdecreased, some plants’ flowering period advanced etc. At the same time, climate change has imposed immense influence and grave threat for human being’s living, health and economicsocial sustainable development. Climate change has aroused deep concern in international community, becoming one of the hotspots in international politics, economics, diplomacy and state security.
Forest is the main component of terrestrial ecosystems, forest area accounts for 1/3 of the total land area in the earth. The total photosynthesisyieldof world forest takes 2/3 of that of terrestrial ecosystem. Forest has played a duel role in regulating CO2in the air. On the one hand, forest can absorb and sequestrate huge quantity of CO2 inthe air, serving as an immense CO2absorption sink, storage and buffer. On the other hand, the deforestation is a bigCO2emissionsource.Forest is an important factor in global carbon recycling andcarbon emission and sequestrationbalancein terrestrial eco-system. Therefore, international climate change convention and other related conventions all regard forest as a major approach for obtaining global greenhouse gas reduction.In adapting to and mitigating global climate change, forest management and forestrydevelopment arenowconfronted with new challenges and developing opportunities.
Two:Forest Ecosystem is a Major Global Carbon Pool and Carbon Sink
Forestis large in terms of distribution area and quantity of biomass.The total area of forest over the world covers3.869billion hm2, about 30% of world’s total land area. IPCC(2001) estimated that global terrestrial ecosystem carbon storagereached2477GtC, among which, carbon store fromvegetation accounts for 20%, carbon store in soil 80%. Forestvegetation carbon storage accounts for 77% of that of total global vegetation, while its soil carbon storage accounts for 39% of that of total global soil. Unit areaforest ecosystem carbon storage is 1.9—5 times that of farmland. Obviously, forest ecosystem is the largest carbon pool in terrestrial eco-system, whose increase or decrease will bring about significant influence on the quantity ofCO2in the air.
Table one: Global Vegetation and 1m Soil Carbon Storage
(Ciais et al., 2000)
Biomes / Area(106hm2) / Carbon Storage(GtC)
Vegetation / Soil / Total
TropicalForest / 1,760 / 212 / 216 / 428
Temperate Forest / 1,040 / 59 / 100 / 159
Boreal Forest / 1,370 / 88 / 471 / 559
Savanna / 2,250 / 66 / 264 / 330
Temperate Grassland / 1,250 / 9 / 295 / 304
Desert and SemiDesert / 4,550 / 8 / 191 / 199
Tundra / 950 / 6 / 121 / 127
Wetland / 350 / 15 / 225 / 240
Farmland / 1,600 / 3 / 128 / 131
Total / 15,120 / 466 / 2,011 / 2,477
China’s estimated carbon storage in forest vegetation and soil is approximately 5GtC and 15GtC, respectively (Zhang Xiaoquan etc. 2005).And China forest’s carbon sequestration ability is continuously growing. According to China’s National Climate Change Program, in 2004, China’s forest net carbon sequestration is 450 million tonsCO2equivalent, making up 8% of the concurrent year’s total national greenhouse gas emission.China’s afforestation carbon sequestration will enjoy a continuous increase, till 2010, forest coverage rate is expected to reach 20%, whose carbon sequestration increased to 500million ton CO2equivalent.Expected till the year of 2050, China forest net carbon sequestration capacity will increase by 90.4% compared with that of 1990. Taking 1990 as the base year, till 2010, 2030 and 2050 carbon sequestration from afforestation and reforestation will be 26million tons C/year, 124million ton C/year and 191 million tons C/year, respectively.
Forest, compared with farmland and grassland has a higher net primary productivity(NPP) and huge biomass accumulated for a long time which made it a stronger carbon sink than grassland plants and crops.Atmospheric measurement and simulation research shows that: in the 1980s, land is a 0.21.0 GtC carbon sink, that is the number of 1.91.3 GtC.a-1 land carbon sequestration removing1.70.8 GtC.a-1carbon emission resulted from land use conversion. In the 1990s, the carbon sequestration increased to 0.71.0 GtC.a-1, which means 2.31.3 GtC.a-1 of land carbon sequestration eliminated the 1.60.8 GtC.a-1 carbon emission resulted from the land use conversion. (Ciais et al., 2000). The field measurementand model simulation conducted in North America shows that, middle and high latitude vegetation in northernhemisphere is a major carbon sink, which plays a critical role in reducing theimbalance between carbon sequestration and carbon emission.（Brown et al.，1999；Schimel et al.，2000）. Analyzed from the flux measurement of CO2, forests, either of boreal, temperate or tropical forest all showed carbon sinks, their intensity varied with the different forest types, climate change and other natural or man-made interference(Mao Zijun,2002).
Deforestation, forest damage or degradation, all will result in carbon release from forest biomass and soil, which will weaken forest carbon storage and carbon sequestration capacity.When the conversion of forestland to farmland occurred, thelossof SOC in the soil can be as high as 75%, and the average SOC will drop 30.32.4% after 10 years, excepting the factor of soil unit weight change, SOC average drop is 22.14.1% (Murty et al., 2002). According to IPCC estimation, during 1850 to 1998, on the global level, carbon release resulted from the land use change is 13655 GtC, among which, 87% is due to deforestation, 13% is from the grassland reclamation, while during the same period, the carbon release from fossil fuel and cement production was 27030 GtC (Ciais et al., 2001). So the massive deforestation and forest damage as well as degradation are the second main CO2 emission sources closely after fossil fuel burning.
Three: Carbon Forestry and Carbon Emission Mitigation& Carbon Sink Enhancement
To mitigate the ever acute global warming,forestry is now undertaking a developing transition and conversion, playing an important and irreplaceable role in the process. At the moment,carbon forestry has taken the shape of forestry development as a new direction in the world. Carbon forestry covers the following four aspects:
First, by virtue of afforestation, reforestation and ecological restoration, setting up agro-forest compound ecosystemto improve the forest’s carbon sequestration capacity.In the world,the land area which can be used for afforestation and reforestation is 345million ha, if all mentioned areasare used for afforestation and reforestation as well as agro-forest system, the carbon sequestration capacity can be 28 GtC from afforestation, and 7 GtC from agro-forest（Reed et al., 2001).Revegetation on the 217 million ha tropical degraded land can bring about 11.5～28.7GtC carbon sequestration(FAO，2001b). From 2008 to 2012, in the first session, by massive afforestation and reforestation,China’s net carbon sequestration can be 0.667GtC, till 2050, China forest annual net carbon sequestration will be enhanced by 90.4% compared to that of 1990 (Zhang & Xu, 2003).China’s agro-forests have much room for developing carbon forestry.
Second, to conserve and sustain forest carbon storage, namely to protect the existing carbon storage in the existing forest eco-systems. This can prevent carbon emission from ecosystem into theair. Core measures include: reduce deforestation, improve wood utilization efficiency and implementing a more effective forest disaster control(forest fire, flood, wind damage and pest disease) which can mitigate the carbon emission resulted from human being’s interference to trees and soil. It can not only protect the carbon storage in forest ecosystem, but also serves the purpose of conserving biodiversity and ecosystem functions.These measures are mostly suitable in those areas with slow growth, and poor stem-wood stand and less opportunity for lumber. As deforestation will directly result in the emission of carbon stored in forest ecosystem to the air, compared with afforestation and reforestation, reducing deforestation is a more direct approach for mitigatingCO2density in the air. In the next 50 years, forest carbon sequestration capacity can reach 14 GtC by decreasing deforestation（Reed et al., 2001).
Third, taking a series of carbon management measures through implementing forest sustainable management to reduce carbon emission and increase carbon sink. By refining forest management, such as modifying cutting operation, interference to forest and soil can be minimized and therefore carbon release from logging and tending operation can be reduced.Traditional cutting work laid fair negativeinterference to forest stand, by improving forest cutting measure, the damage rate of maintenance stand can be reduced by 50%(Sist et al., 1998) and thus mitigated the carbon emission from forest cutting. Besides, by improving timber utilization efficiency, the decomposition and carbon emission speed can be reduced; prolonging forest timber product longevity can slow the stored carbon emitted to the air;Land filling waste and old wood product canpostpone its carbon emission, in some cases, the carbon can even be permanently stored.
Fourth, from the renewable resource point of view, focusing on forest ecosystem carbon cycle and traditional forest timber production,carbon replacementapproaches should be encouraged and adopted, Namely, using durable wood-based products to replace the energy-intensive materials such as cement, steel, plastic and bricks, which can not only increase the land carbon storage but also can reduce the greenhouse gas emission generated duringthose materials’production processes. Despite that carbon in part of forest timber products will eventually return back to the air by decomposition, still forest resource’s renewable nature can absorb and sequestrate these carbon back, finally avoiding the irrevocable net carbon emission caused by fossil fuel burning. Using renewablebio-fuel such as bio-energy plantation and recycling use of cutting residue can make bio-energy replace fossil fuel reducing the carbon emission from human being’s activities. (See Figure 2). IPCC estimated that, from 2000 to 2050, global energy plants replacement can obtain 20～73GtC (Watson et al., 1996). Carbon replacement measure can be adopted in fast-growth, even-age plantation and short-rotated coppice forest, on the condition of minimum forest management interference to forest soil.
Four: Carbon Trading and Its Potential
To mitigate global climate change and materialize the aim listed on United Nations Framework Convention on Climate Change, in 1997, KyotoProtocolwas agreed. The Protocol promulgated: industrial countries in the first session from 2008 to 2012, greenhouse gas emissionreduction should be at less by 5% of 1990 emission level. Industrial countries can use afforestation, reforestation and reduce deforestation and other forest management activities or implementing CDM in developing countries to gain carbon credit so as to achieve its quantified emission limitation and reduction commitments. TheMarrakech Accordsreached in 2001, made uniform definition and related implementation of land use and forest activities listed in KyotoProtocol. In December 2003, the ninth convention of the parties to the protocolmade a detailed CDM afforestation project implementation internationalrule(UNFCCC, 2003). The creation of CDM sets up a win-win mechanism between developed countries and developing countries, offering a new staring point for carbon forestry.
In view of the world regulation agreed that:total carbon credit gained for each country through CDM by using afforestation and reforestation is fixed, no more than its base year emission’s 1% times 5 (UNFCCC, 2001). Therefore, countries to the protocol are allowed 32million tC as CDM’s carbon sink credit. Based on calculationof 30—50tC carbon sink per ha, world’s CDM afforestation project potential is approximately 3.2—5.3 million ha. World’s CDM afforestation project area is less than China’s one year plantation area, accounting for about 6%--10% of China’s plantation area from 2001 to 2020, in this sense, China has a huge potential in CDM afforestation project.
At the moment, CDM is solely confined to afforestation and reforestation project, so forest CDM provides afforestation and reforestation with a good marketing operational mechanism.As a marketing operation model, CO2 emission enterprise can purchase carbon credit to neutralize its extra CO2 emission over the limited quota, realizingthe conversionfrom eco-capital to industrial currency, which meansrealizing carbon trading.In the first session, the available CDM afforestation and reforestation project marketing is 40million to 100million tco2-e.a-1.China takes up 6.7%～37%, optimistically estimated, China can obtain 20% market quota in the first session, that is 3.3million t CO2, equals to 0.7 million to 1.1 million ha of plantation area.Calculated by World Bank Bio-carbon Fund stipulated carbon sink price(one ton of CO2 for 3 to 4 US dollars), the whole price can be 363 to 484 million US dollars(Zhang et al., 2005).