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LULUCF and greenhouse gases

The Earth’s lands and forests are part of a natural cycle regulating the amount a carbon in the Earth’s atmosphere. Through photosynthesis, trees, plants and crops absorb carbon dioxide (CO2) in the atmosphere and store it as carbon in soil and biomass (tree trunks, branches, foliage and roots). As the plants “burn” carbohydrates and other energy, carbon is added back to the atmosphere through a process called respiration. ²

How land is used greatly influences atmospheric levels of CO2.  Carbon sequestration rates vary greatly according to the biomass type, the soil type, regional climate and topography, and management practices.  Certain land use activities, such as the conversion of forests to agricultural lands, can  contribute significantly to the accumulation of this green house gas in the atmosphere because most forests usually absorb more CO2 than agriculture lands. Other land use activities, such as afforestation and reforestation, can help mitigate the effects of climate change by sequestering CO2 over decades, even centuries, until mature systems reach the stage of carbon saturation.  In the language of global climate change, forests, as well as croplands and grazing lands, are “carbon sinks” if they sequester more carbon than they release of a time period.

For thousands of years prior to the industrialization of Europe and the United States, the atmospheric concentrations of in the Earth’s atmosphere were relatively stable. Since the middle of the 19th Century, however, the levels of CO2 in the atmosphere have grown exponentially, largely due to the burning of fossil fuel and the loss of forests. Every year these two activities now emit almost eight billion metric tons of carbon to the atmosphere, about 17 percent of which is the result of land-use change such as tropical deforestation.³   In developing countries, conversion of forestlands to agriculture lands, slash and burn techniques, over harvesting and illegal timber problems all contribute to making this problem particularly acute.

Land use activities have also contributed sugnificantly to atmospheric concentrations of two additional potent greenhouse gases, methane (CH4) and nitrous oxide (N2O). Since the pre-industrial era, atmospheric concentrations of methane have increased nearly 250 percent, which the Intergovernmental Panel on Climate Change (IPCC)  concludes is “very likely” due to human activity, predominantly agricultural and fossil fuel. ⁴  Nitrous oxide concentrations have increased by 18 percent, more than one third of which, the IPCC concludes, is anthropogenic, primarily due to agriculture.⁵  Mitigation potential arises from soil carbon sequestration and altering practices that release methane and nitrous oxide, such as manure management.⁶

United Nations Framework Convention on Climate Change

The UNFCCC laid the foundation for the inclusion of LULUCF activities in the Kyoto Protocol by requiring all Parties (Annex I and Annex II) to develop national inventories of all anthropogenic greenhouse gas emissions and removals by sinks⁷ and to promote the sustainable management and cooperation between countries in the conservation and enhancement of sinks and reservoirs, including biomass, forests and oceans as well as other terrestrial, coastal and marine ecosystems.⁸

The Parties in Annex I, developed countries and those with “economies in transition”, are required to adopt national policies and take measures to limit their anthropogenic emissions of greenhouse gases and protect and enhance their greenhouse gas sinks and reservoirs , and to report on resulting projected anthropogenic emissions by sources and removals by sinks of greenhouse gases, with the aim of returning individually or jointly to their 1990 levels these anthropogenic emissions of carbon dioxide.⁹

Kyoto Protocol

The Kyoto Protocol makes provisions for the Parties to use LULUCF activities to address climate change. Under Article 3.3, a Party’s emission reduction commitment can be partly met by the net changes in GHG emissions by sources and removals by sinks through direct human-induced afforestation, reforestation and deforestation that occurred since 1990.¹⁰ Under Article 3.4, Parties may elect under certain circumstances to include human-induced forest management, cropland management, grazing land management and revegetation in their accounting of anthropogenic GHG emissions and removals for the first commitment period of the Protocol.¹¹ When LULUCF activities under Articles 3.3 and 3.4 result in a net removal of GHGs, an Annex I Party can issue removal units (RMUs) on the basis of these activities as part of meeting its commitment under Article 3.1. These units may be traded pursuant to the Kyoto’s emissions trading scheme established under Article 17.¹²

The Clean Development Mechanism (CDM) and Joint Implementation (JI) make provisions for the implementation of LULUCF project activities by Parties. CDM, which allows Annex I countries to invest in GHG reduction projects in developing (non-Annex I) countries and have the credits count toward their emission targets, limits the implementation projects to those involving afforestation and reforestation. Under JI, an Annex I Party may implement projects that increase removals by sinks (through afforestation, reforestation and avoided deforestation, revegetation, forest management, cropland management and grazing land management) in another Annex I country and use the credits generated to meet its emission targets. ¹³

Inventories

A number of challenges exist to creating GHG emission inventories for LULUCFs. Emissions can be natural or anthropogenic and are highly dependent on vegetation types, soils, topography and a number of other biological, chemical and geological factors. In 2006, the IPCC released guidelines on preparing GHG inventories in the Agriculture, Forestry and other Land Use (AFLOU) sector.  These guidelines integrate and update previous, separate guidances covering both the agriculture and LULUCF sectors.  The guidelines contain guidance and methods for estimating GHG emissions and removals from the AFLOU sector for:

• CO2 emissions and removals resulting from C stock changes in biomass, dead organic matter and mineral soils, for all managed lands;
• CO2 and non-CO2 emissions from fire on all managed land;
• N2O from all managed soils;
• CO2 emissions associated with liming and urea application to managed soils;
• CH4 emissions from rice cultivation;
• CO2 and N2O emissions from cultivated organic soils;
• CO2 and N2O emissions from managed wetlands;
• CH4 emission from livestock (enteric fermentation);
• CH4 and N2O emissions from manure management systems; and,
• C stock change associated with harvested wood products. ¹⁴

 Offsets and Credits

Each trading scheme adopts its own policy and procedures regarding the use of LULUCF activities to generate offset credits. A number of difficult issues exist in determining how many credits these projects should receive, including:

• Establishing baseline measures against which to evaluate the GHG benefits of the project (e.g., the level of GHG emissions or carbon sequestration that would occur in the absence of the project).
• Identifying leakage, or a decrease in GHG benefits outside of the project's accounting boundary as a result of project activities (e.g., will protecting one forest simply moving the logging to another forest);
• Addressing duration (also referred to as reversibility or permanence) to account for the fact that the benefits of carbon sequestration in agriculture and forestry are partially or completely reversible (e.g., a fire could destroy the forest); and,
• Monitoring and verifying GHG benefits to ensure that the benefits are real and credible. 

Approaches to these issues vary, and offsets and credits from LULUCF are not widely used in the regulated carbon markets. The CDM accepts only afforestation and reforestion projects, and these projects must be validated using a methodology approved by the Executive Board.   As of March 2009, only two projects have been registered with the CDM, one to facilitate Reforestation for Guangxi Watershed Management in Pearl River Basin, another a soil conservation project in Moldavia. These two projects are projected to result in an estimated emission reductions of 205,037 metric tons of CO2 equivalent.¹⁶   JI also has a methodology for LULUCF projects, but to date there have been no such projects approved.¹⁷  

Because of methodological and policy concerns, the European Union's Emission Trading System (EU-ETS) does not accept LULUCF credits of any kind,¹⁸ and Australia's New South Wales Greenhouse Gas Reduction Scheme accepts only local projects.¹⁹ The Regional Greenhouse Gas Initiative in the Northeastern United States allows for the very limited use of offsets from the sequestration of carbon due to afforestation.²⁰ Carbon offsets derived from land use and forestry projects are much more popular in the voluntary offset market, although many certification companies refuse to certify them and many retailers refuse to sell them because of concerns over their quality and reliability.²¹

Future

Because of the role land use and forestry play in climate change, the LULUCF sector will play an important role in discussions about a follow up agreement to the Kyoto Protocol.  Forestry and land use issues will continue to be view as increasingly intwined with agricultural issues.  Discussions are currently underway on whether their should be major changes to the existing Kyoto rules, whether certain LULUCF activities should be mandatory, and on whether rules should be liberalized for allowing LULUCF activities to become part of emissions trading regimes.