Ecosystem Marketplace, Marketplace Mitigation Mail

October 13, 2011

From the Editors

The Ecosystem Marketplace's Forest Carbon News
Tracking Terrestrial Carbon

We’ve spent the last two weeks flying around the US and UK promoting the just-published State of the Forest Carbon Markets: From Canopy to Currency, our latest report on the forest carbon market. If you haven’t read it yet, you can download a copyhere. We’re always striving to improve this annual report, so send us any comments or suggestions at general@forestcarbonportal.com.

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Now, onto the news.

Most people following international carbon markets have had their eyes on what promises to be the newest major emissions trading markets: California and Australia. And after months of uncertainty about whether the legislation behind those two markets would pass muster, both are now seeing the light at the end of the tunnel.

In California, the Supreme Court ruled that the California Air Resources Board (ARB) could move forward with implementing the cap-and-trade program, while still waiting for a decision from the State’s Superior Court on whether the ARB has properly examined alternatives to cap-and-trade.

Australia, after a bitter political debate, saw it’s Clean Energy Future legislation pass the Lower House in Parliament, an outcome that was far from certain. The vote came at the narrowest of margins with 74 for and 72 against, and will now move to the Senate, where it is almost certain to pass into law. The post-vote celebration saw some odd moments, including a kiss between current Prime Minister Julia Gillard and the man she ousted, former Prime Minister Kevin Rudd, who was thrown out after not securing the votes to pass his own version of climate change legislation in 2010 and opposition leader Tony Abbott’s blood oath to repeal the legislation.

There have been a number of developments and changes to the forest carbon standards with the Programme for the Endorsement of Forest Certification (PEFC) opening a consultation on their global forest management standard appendix and the American Carbon Registry announcing a new methodology to help US forest owners access carbon markets. Meanwhile, the Qinghai Environmental Energy Exchange is developing a new proposed standard for the Three Rivers region of China which is on track to be delivered mid 2012.

As always, read on for all the headlines and more in this, the latest edition of Ecosystem Marketplace’s Forest Carbon News Brief.

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—The Ecosystem Marketplace Team

If you have comments or would like to submit news stories, write to us at general@forestcarbonportal.com.


News

National Strategy & Capacity

Carbon Legislation Passes in Canberra

After months of debate and bitter protest, Australia’s Labour party has succeeded in passing carbon legislation that will initiate a carbon tax on around 500 of the country’s biggest emitters in mid-2012. This follows on the heels of Australia’s Carbon Farming Initiative, which will allow Australian farmers and other land-owners to generate carbon credits. The new legislation is widely expected to be passed in an upcoming vote in the Senate, but the opposition Liberal party is proclaiming an oath to repeal the law pending the next round of elections in 2013. Read more coverage from Reuters here, from the Guardian here and from Australia’s The Age here.

Back to Basics for Indonesia REDD Governance

In a meeting with the National Council of Climate Change and several ministers on 29 September, Indonesian President Yudhoyono called for a “return to our vision and basic policies relating to climate change.” He called on the government, along with the private sector and NGOs to work together constructively to achieve this vision, which has become increasingly questioned in recent months owing to numerous administrative challenges and apparent conflicting interests among the full array of stakeholders. Read more from the Jakarta Post here.

Patchy Maps in Panama

While building capacity in monitoring forest cover has been a focus of REDD+ activity, researchers from McGill and the Smithsonian Tropical Research Institute set out to investigate whether currently available in-country monitoring techniques would be sufficient to reveal whether emission reductions were taking place in REDD+ project sites. The answer seems to be a very clear “no.” In the case of Panama, the clearest land-use maps were from 1992 and 2000, but these were found to be composites of images from a number of years (the 1992 map was made up of images dating back to 1988, for example). The use of a number of methodologies to measure carbon stocks also increased the modeling error for the report authors. Read coverage of Panama’s forest monitoring difficulties here and here and read the new report here.

US Policy

California uncapped

A California Supreme Court judge has ruled that California’s Air Resources Board may continue implementing the state’s cap-and-trade program that had been challenged by legal disputes since March. The program’s challengers have argued the market-based approach to reducing emissions would expose minority groups to greater levels of pollution. While this dispute may be over for now, the attorney for Center on Race, Poverty and the Environment, has been quick to suggest that "this case is far from over." Read more from IB Times here.

International Policy

Funders Remain Committed to Indonesia

Speaking to nearly a thousand listeners in Jakarta last week, Indonesia’s Environment Minister asked, rhetorically, “Can Indonesia conserve the forest and continue with 6 to 7 percent economic growth?” Reiterating Norwegian support for Indonesian REDD at a conference hosted by the Center for International Forestry Research (CIFOR), he was unequivocal: ”The answer is yes,” Solheim said. And at a low-key meeting at the UN General Assembly, Australian officials ensured a $70 million pledge for Indonesia is still being pursued to help deliver Indonesian REDD tonnes into the Australian cap-and-trade scheme by 2015. Read more about Minister Solheim’s comments and watch the speech on the CIFOR blog here. Read about Australia’s backing from The Australian here.

Latin America Talks Carbon

The Latin American and Caribbean Forum on Carbon took place at the end of September, providing a look at regional concerns and strategies. The most pressing risk being felt globally seems to be the post-Kyoto question. A dimming market outlook for demand by major Kyoto players (particularly in Europe) is feeding a pessimistic outlook for CDM projects and is surely not being bolstered by the slow progress UN climate talks have been showing over recent meetings. Read more about the Forum in original Spanish here and translated into English here.

REDD+ Partnership Meeting report+

Last time we gave an early report from the REDD+ Partnership meeting that took place at the end of September in Panama City. A full report is now available from the REDD+ Partnership websitehere. Discussions focused broadly around reviewing the effectiveness of multilateral REDD+ initiatives with Partner countries welcoming the significant successes to date but calling for more private sector engagement and greater efforts to promote overlap with other multilateral initiatives and processes already taking place in-country, such as work promoting the Forest Law Enforcement, Governance and Trade (FLEGT) program. The other big agenda item was the Voluntary REDD+ Database where participants discussed reasons for discrepancies in the REDD+ finance tracking data. Partners agreed that these need to be minimized in time for Durban and suggested improving collaboration to streamline data reporting. Read more on the meeting from the REDD+ Partnership meeting here.

Carbon emissions fire up in drying Amazon

A report in Environmental Research Letters argues that the 2010 drought in the Amazon triggered nearly 500 million tonnes of carbon to be released. The scientists from the NASA Ames Research Centre suggest that some of the losses in carbon could be offset by plant growth but there are concerns regarding increasing periods of severe drought in the Amazon. Read more from Mongabay here. Access the article from Environmental Research Letters here.

CDM in question after not so clean Honduran developments

The integrity of offsets in the EU Emissions Trading Scheme is being challenged as carbon credits from a Honduran palm oil project remain on sale despite claims that 23 local farmers were murdered when they tried to reclaim land alleged to have been illegally sold to developers. The CDM Executive Board has tried to distance itself from the case, saying they “are not investigators of crimes," and lacked the “scope to refuse the project (as) all the consultation procedures precisely had been obeyed." Because the murders followed the letter of regulations required for CDM approval, the Executive Board has disavowed the authority to revoke credits or suspend the project. This outcome has been met with concern from some members of the board, green EU members of parliament and human rights NGOs who have pledged to ramp up pressure on the Commission to take action. Read more from the Guardianhere.


Don't Forget About Biodiversity

The Secretariat for the Convention on Biological Diversity (CBD) has submitted a report on safeguards in REDD+, summarizing four workshops that took place over the last three months around the world. CBD has been tasked with providing guidance on the links between biodiversity and REDD, and further the work of forest conservation in tandem with biodiversity conservation. The workshops were attended by representatives from 63 countries, as well as intergovernmental organizations, NGOs, indigenous groups, and the private sector. You can see the report here (PDF).

Project Development

Holy Carbon Allianz

Allianz SE, the financial services firm based in Germany, has taken a 10% stake in Wildlife Works. The agreement also gives Allianz a multi-year option to buy credits from the Kasigau Corridor REDD project. The investment will help Wildlife Works expand their growing portfolio of REDD projects and is planned to enable Allianz to achieve carbon neutrality by 2012. Read more about the deal in Environmental Finance here and read an interview with Allianz’s Martin Ewald here.

DRC’s private success

A privately-developed CDM forest carbon project in Africa has been approved in the Democratic Republic of Congo and has secured the right to sell credits. Funded in part by the World Bank, the Ibi project is set to absorb 2.4 million tonnes of CO2 over the next thirty years and provide employment for 400 local people. The Bank’s BioCarbon Fund agreed to buy 500,000 of the carbon credits generated under the project, while French corporation Danone and emissions trader Orbeo have also been lined up as customers. This project marks the third in forestry project in Africa to be approved under the CDM following projects in Uganda and Ethiopia. Read more from Reuters here.

Tasmania adapts to the devil of drought

Tasmania started implementing the second stage of an environmental restoration project aimed at planting native Tasmanian tree species adapted to dryer regions. The project, funded by the Tasmanian government and the Australian Research Council, also aims to research on-farm carbon storage as well as determining the available species that will grow best in dry regions. Read more in the Tasmanian Government press release here.

Timely delivery of tree planting packages

UPS have awarded funding to a number of environmental initiatives aimed at increasing urban and rural tree coverage in both the US and globally. Projects receiving funding include The Nature Conservancy work in Brazil and China, the US National Park Foundation’s Flight 93 project, constructing a park to commemorate 9/11 victims and the Earth Day Network in four urban tree planting locations each in Europe's Landers Forest and in the U.S. Read the press release from MarketWatch here.

Methodology & Standards Watch

Consultation heats up on PEFC tropical forest standard

The Programme for the Endorsement of Forest Certification (PEFC) has announced an open consultation period on their global forest management standard appendix. The requirements for sustainable forest management have been revised by the PEFC Revision Working Group over the last three years and while they were approved in 2010, a number of stakeholder revisions have been proposed specifically on tropical forest management. The appendix, which seeks to define sustainable management requirements and interpretations, is open for comments until 27 November. Read more from PEFC here.

A new Chinese Carbon Standard

The Qinghai Environmental Energy Exchange (QHEX) has announced that it will be developing a new Three Rivers Carbon Standard for the Chinese region. This standard will be developed over the next few months and aims to manage carbon dioxide emissions while preserving a number of ecologically important areas. The guidelines for the standard are expected to be finished by mid 2012. Read more from QHEX here.

Family Forests Welcomed by ACR

The American Carbon Registry (ACR) has approved a new methodology aimed at providing carbon market access for family-run forestland, which amounts to around 35% of US forest cover. Tribal and public forest lands at state and local levels are also eligible. The methodology is expected to encourage greater involvement in emissions reduction projects with qualification resting on owners making a long term commitment to carbon sequestration. Their lands must also be subject to timber harvesting under a government sanctioned forest management plan. Read more from the ACR press release here.

Standardizing communities

A study published in Frontiers in Ecology and the Environment journal argues that Community Forest Management (CFM) schemes are ineffectively assessed. The article argues that data used in such schemes to estimate carbon storage is “patchy” while assessments of the social benefits to local communities varies extensively between projects. Researchers therefore recommend developing better monitoring and evaluation systems to ensure that funding for the 2,700 CFM projects in 160 countries is producing effective results. Read more from the BBC here. Access the original research article here (membership required).

Science & Technology Review

Monitoring Deforestation? There’s an App for That

From embedding radio frequency ID tags in trees to lasers with names that would make Bond villains jealous, a lot of technologies have been promoted to help track deforestation. But while many are expensive and require a high degree of expertise, Google has looked towards crowd-sourcing solutions coupled with in-house hardware and software power. Their first foray into the realm of tracking forests was with the release of it’s Earth Engine, which gave anyone access to 25 years of satellite maps and other data. Now they’ve released the Earth Engine for mobile phones, which will be trialed in pilot projects in the Amazon, Tanzania, Uganda and Mexico, where locals will help monitor forests. The application lets a user take a photo of an area of forest that might be being logged, which will then be uploaded along with GPS coordinates. Users will also be able to measure the height and diameter of trees, uploading that information to give a rough calculation of the carbon sequestered in trees in the area. Read more about the application here.

Seeing the forest and the trees in 3D

The Carnegie Institution for Science has developed an Airborne Taxonomic Mapping System which can capture detailed images of forests and is expected to inform the quantification of carbon emissions from deforestation and different forms of forest management. The new imaging system has the ability to produce a three dimensional view of forests, with airborne sensors able to map individual trees at a rate of over 500,000 per minute. Read more from environment360 here.

Publications & Tools

From Canopy to Currency

That’s right! Ecosystem Marketplace’s latest in-depth look into the global marketplace for forest carbon offsets is now freely available. Get your copy of the State of the Forest Carbon Markets 2011 report here!

Governing transparency

The 2010 Annual Transparency Report Card by the Centre for Indigenous Knowledge and Organisational Development (CIKOD) in collaboration with Global Witness was launched last Thursday in Accra. The report is part of the 'Making the Forest Sector Transparent' project, which began in 2009 as an effort to support civil society and advocate for accountable forest sector governance. Read more from Modern Ghana here.

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