Including forest protection measures in carbon markets would crash the price of carbon by up to 75% and derail international efforts to tackle global warming, according to a report commissioned by Greenpeace.
The group said that lower costs for relatively abundant forest credits would dilute carbon markets, discouraging needed investments in clean technologies.
Greenpeace says carbon markets should be focused on driving clean and renewable technologies in key industrial sectors; and that developed countries should make an additional “tropical deforestation commitment” to help finance forest protection in developing countries.
The study shows direct inclusion of forest credits into the carbon markets could lead to developing countries like China, India and Brazil losing out on tens of billions of dollars a year for investment in clean energy technologies. If these countries do not get incentives for a switch to low-carbon technologies, through carbon markets and funds, their emissions will continue to rise, leading to devastating climate change.
The report was released at the United Nations climate meetings in Bonn as part of the ongoing negotiations to reduce emissions from deforestation and degradation in developing countries (REDD). Deforestation, mostly in tropical forests, accounts for about 20% of global greenhouse gas emissions. Ending deforestation is one of the quickest and most cost effective ways of tackling climate change.
Discussions in the climate negotiations include various proposals to include REDD in emissions trading schemes. The report evaluates these proposals and their ability to avoid a dangerous climate tipping point (as far below 2 degrees Celsius as possible).
The report concludes that including REDD credits in carbon markets would:
- Cut the price of carbon by up to 75%, driving the developed world to buy cheap offsets instead of making necessary energy reductions at home
- Drastically reduce investments in clean and renewable technologies in both developed and developing countries
- Cause a “lock in” effect where dirty technologies, like coal fired power plants, continue to be built and operated for years; this in turn could increase the long term costs of combating climate change
- Slash the number and value of energy credits, so countries like China and India would get less money for sustainable development policies (an estimated $10 billion per year for China alone)
“Cheap forest credits sound attractive but a closer examination shows they are a dangerous option that won’t save the forests or stop runaway climate change. Of the many options for forest financing currently on the table, this one ranks as the worst,” said Rolf Skar, Greenpeace senior forest campaigner.
“Developing countries stand to lose tens of billions needed for low carbon technologies,” he added. “Without a strong price signal, how can anybody seriously expect the world to shift to a low-carbon economy?”
Moreover, such a move could ultimately result in temperature increases, which could lead to the irreversible loss of major tropical forests, like the Amazon, due to increased droughts, fires, insect infestations and diseases.
The most effective way to reduce emissions from deforestation and degradation is a new forest fund that would value both the climate and biodiversity, Greenpeace said. Such a fund could keep forests standing while fully respecting the rights of indigenous and local peoples.
Last month, Greenpeace released its U.S. roadmap for slowing climate change. In the report, called the Energy [R]evolution, Greenpeace supports a strong cap on global warming pollution, an end to fossil fuel and nuclear subsidies, mandatory efficiency standards for vehicles, buildings and appliances, binding targets for renewable energy generation and strong financial support for clean energy in developing countries.
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