CDM Issues First A/R Credits for Brazil Project

The CDM has officially issued its first carbon credits for an afforestation/reforestation (A/R) project under the Kyoto Protocol. The project in question is a reforestation project in the Brazilian state of Minas Gerais run by the Plantar Group, a company specializing in forestry and iron production. Plantar has reforested 11,600 hectares of degraded land, with a portion of the new plantings converted to sustainable charcoal for use in pig iron manufacturing. In exchange for carbon sequestration and other benefits, the project has received more than 4 million temporary Certified Emission Reductions, or tCERs (under CDM rules, A/R projects are issued temporary CERs due to their potential non-permanence--for more, see BioCF Makes Recommendations for CDM A/R Offsets, 3/14).

The "Plantar Project" is expected to be the first of several A/R projects receiving credits under the CDM this year. CDM regulations permit the issuance of CERs to A/R projects only once per Kyoto commitment period, and the current (first) commitment period ends in December 2012. This rule creates incentives for A/R project developers to delay requesting credits as long as possible in order to maximize the amount of carbon sequestered and hence the amount of carbon credits issued. It is hoped that practical experience gained from these maturing A/R projects will inform the proceedings of the CDM Policy Dialogue, meeting throughout this year with the goal of making recommendations for reform of the CDM.

UK Relaunches CCS Policy

In a post last week (Scotland Aims at CCS for All Coal Plants by 2025), I briefly mentioned the UK government's resurrection of its £1 billion ($1.6 billion) CCS funding program. This funding opportunity, referred to as the "CCS Commercialisation Programme," forms the centerpiece of a newly revamped British CCS policy known as the "CCS Roadmap," about which more information is now available. The CCS Roadmap envisions "widespread deployment of cost-competitive CCS. We are seeking to support the development of a sustainable CCS industry that will capture emissions from clusters of power and industrial plants linked together by a pipeline network transporting CO2 to suitable sites offshore" (p. 6). More specifically, the government proposes to achieve commercialization of CCS facilities in the UK by the 2020s through 5 key interventions:

1. The Commercialization Program - This £1 billion funding program is premised on the argument that, in order for CCS to make a meaningful emissions abatement impact, it will need to be widely adopted by the 2020s, which in turn requires that "final investment decisions for commercial-scale CCS will need to be made in the early 2020s" (p. 3). To meet this objective, the government plans to support multiple offshore storage projects in the power sector scheduled to begin operations between 2016 and 2020.
   



2. A 4-year, £125 million ($199 million) R&D program including the establishment of a new UK CCS Research Center.




3. Electricity market reform, including the introduction of pre-arranged "contracts for difference" to ensure cost recovery for utilities.




4. The removal of key market barriers such as gaps in the supply chain and the absence of suitable industrial applications.




5. International engagement to help position British firms as global CCS market leaders .
   

The CCS Roadmap is accompanied by a detailed Action Plan, shown here.With its new Roadmap, the UK has cemented its place as a world leader in the push for CCS deployment, which is essential for the development of CDR technologies such as DAC and BECCS. Of course, whether CCS is widely adopted in the UK by the 2020s remains to be seen, and there are many obstacles that stand in its way, as demonstrated by last year's failure at Longannet. Nevertheless, DECC and the government deserve credit for redoubling their efforts to support CCS, particularly given the current climate of fiscal austerity.

Australia's Chief Scientist Advocates Research

Australia's Chief Scientist, charged with advising the federal government on scientific matters, has released a brief report calling for research on geoengineering. The document is generally unremarkable, highlighting potential advantages and disadvantages of various techniques and underlining possible risks. But its authors conclude by stating, "Scientific research into the usefulness and safety of geoengineering needs to proceed so that the best information is available for policy discussions." The Australian government currently provides limited funding for research related to CCS and carbon farming.

Scotland Aims at CCS for All Coal Plants by 2025

The Scottish government recently declared its goal to ensure all coal-fired power plants are equipped with CCS by 2025. Specifically, plans call for all existing coal plants to be retrofitted with CCS technology by 2025, and for all new plants to be fitted with CCS starting in 2020. Currently, all new coal plants with a capacity greater than 300 MW must be equipped with CCS.

On a related note, last week the UK government relaunched its £1 billion ($1.6 billion) CCS funding competition, which had been suspended following the breakdown of talks over the proposed Longannet plant last year (see CCS Stumbles in the UK, 10/30/11).

Update from Planet Under Pressure

For the past few days, I have been attending the Planet Under Pressure 2012 conference in London. While geoengineering has not figured prominently here, two individual sessions were devoted fully to the subject. The first of these, titled "Geo-Engineering: Engineering Constraints," focused primarily on the apparent technical limits of specific strategies, in particular CDR techniques. Enhanced weathering came off especially badly, with one presenter noting that the physical infrastructure required to support global-scale silicate weathering would effectively constitute the largest industry in history. Other carbon approaches such as A/R were also criticized for inherent ecological, economic, and resource constraints, and the general tone was one of discouragement regarding current technical potentials.

The second panel was titled "Geo-Engineering Governance," and looked at various institutional and policy dimensions of the field. Presenters discussed governance at conceptual levels (e.g., the Oxford Principles on research) and practical levels (e.g., regulation under the LC/LP). This session was characterized by greater agnosticism toward geoengineering compared to the engineering panel. Several presentations were excellent, particularly those on geopolitics and SRMGI, and left the impression that research on the governance aspects of geoengineering is in some ways beginning to outpace engineering and technical work.

Other items worth noting include:

• Word that the Japanese government has finalized plans to fund two research projects, one focused on modeling and the other a general assessment of geoengineering technologies.
• SRMGI will hold two final meetings this year in Africa, bringing its dialogue Phase I to a close. The Royal Society is looking to obtain funds for a more regularized Phase II.
• The ETC Group is promoting an International Convention for the Evaluation of New Technologies (ICENT), which would of course apply to geoengineering technologies.

Lastly, below is an image of the poster I presented at the conference, titled "The Global Politics of Climate Engineering." (I am happy to provide a PDF version upon request.)

Climate Scientists, Geoengineering Community Slam AMEG

For months now, the Arctic Methane Emergency Group (AMEG) has been warning of impending climate catastrophe linked to observations of methane venting, and calling for immediate geoengineering in the Arctic (see Arctic Methane, Emergencies, and Alarmism, 12/29/11). The rationale for this position rests on weak science and bad politics, but AMEG has pressed its case regardless, even appearing before a UK parliamentary committee in February (see Environmental Audit Committee Hearing in the UK, 2/25). Last week, AMEG made a similar presentation to the UK All Party Parliamentary Climate Change Group (APPCCG). This time, however, the catastrophists appear to have taken one step too many.

A BBC story on the APPCCG meeting not only reported the exaggerations and occasional hysterics typical of AMEG pitches, but relayed the apparently unfounded assertion that "The idea of putting dust particles into the stratosphere to reflect sunlight, mimicking the cooling effect of volcanic eruptions, would in fact be disastrous for the Arctic ... with models showing it would increase temperatures at the pole by perhaps 10C." Mainstream climate scientists were quick to cast ridicule on the main arguments presented by AMEG. More importantly, prominent members of the geoengineering community took the group to task, chastising AMEG for scientific carelessness and public-relations ineptitude. This reaction was summed up best by well-known New York Times Dot Earth blogger Andy Revkin: "I'm with Stoat, Ken Caldeira, David Keith, Alan Robock and others who see this 'emergency' effort to rush cloud intervention in the Arctic on behalf of sea ice (and indirectly seabed methane) as undermining the case for a serious push on geo-engineering options, impacts and policy issues. ... 'Yelling fire on a hot planet' can have unanticipated consequences."

AMEG is unlikely to alter its stance based solely on this pushback, but that is not really the point. What is important is that leading advocates of geoengineering research have publicly disavowed the extreme views of a fringe element. If (when?) the AMEG bubble bursts, critics of geoengineering will have a much harder time painting the entire geoengineering community with a single broad brushstroke as techno-fanatics committed to rash action. Instead, responsible supporters of research can rightly claim to have opposed the alarmists as well, not having indulged in either apocalyptic visions or messianic pretensions.

BioCF Makes Recommendations for CDM A/R Offsets

The World Bank's BioCarbon Fund (BioCF) has released a report detailing its experience supporting afforestation/reforestation (A/R) offset projects under the CDM since 2004. The BioCF functions as the primary World Bank vehicle for funding A/R projects under the CDM, with approximately 80% of its resources going to support 21 such projects. The report makes 4 overall recommendations for the CDM and stakeholders:

1. Improve the regulatory process


2. Increase access to finance


3. Strengthen capacity


4. Increase demand for credits

These are general recommendations, but some of their more specific aspects deserve further attention.

The CDM project validation and verification process is notoriously complex, and this applies equally to A/R projects as it does to other project types. Among other problems, this unwieldy process is difficult for project developers, national authorities, and independent auditors to navigate; threatens to postpone credit issuance, which is particularly troublesome for A/R projects where upfront costs are high and there is a great need for early, reliable cash flow; is subject to constant revision by the CDM Executive Board (EB), creating a significant regulatory monitoring burden for stakeholders; and adds considerable transaction costs to any project, discouraging many otherwise compelling proposals from being made in the first place. Simplifying the project cycle is one of many items on the agenda of the high-level CDM Policy Dialogue, currently underway.

A/R is unique in the CDM in that credits issued for A/R projects are distinct from normal Certified Emission Reductions (CERs). Ordinary CERs are considered permanent, but because forestry projects are regarded as "non-permanent" (due to natural events or possible logging), A/R credits are considered temporary. A/R project participants must choose to receive either "temporary CERs" (tCERs), good for 5 years, or "long-term CERs" (lCERs), good for 20-40 years. Buyers of tCERs and lCERs are obligated to replace them with regular CERs before the former expire. For this reason, A/R credits sell at a discount in the carbon market, resulting in reduced demand. The BioCF strongly backs innovative efforts to make temporary A/R credits more fungible in the broader carbon market.

Lastly, although depressed demand in the carbon market is ultimately attributable to structural features of the EU ETS (see ZEP to Rescue CCS in Europe?, 3/1), European policymakers could provide a minor boost to A/R CDM credits by tweaking institutional rules. Currently, the EU prohibits use of tCERs and lCERs in the European market out of concerns over the permanence of forest carbon sequestration. As the European market is the largest in the world, this puts A/R credits at another distinct disadvantage vis-a-vis other offset credits. Many safefuards against non-permanence in A/R projects have been proposed. EU authorities could lift the prohibition on A/R credits and instead work constructively to help develop mechanisms to ensure against non-permanence, thereby boosting the prospects of A/R credits in Europe and globally.