THE ROLE OF FORESTRY IN CLIMATE CHANGE AND SUSTAINABLE ENERGY PRODUCTION - Economics of Sustainable Energy in Agriculture - page 128

strange about the Kyoto Protocol is that the 1990 baseline for greenhouse
gas emissions does not include terrestrial C flux, but the calculations for
determining compliance for 2008-2012 do. Baseline emissions are founded
on gross emissions, while compliance is based on net emissions. A country
could conceivably meet its emissions reduction target even though its gross
emissions have increased. It can do this, say, through domestic LUCF
projects and/or foreign ones under the CDM or through JI.
The role of terrestrial sinks and whether market mechanisms
should treat carbon offsets the same as emissions reduction are a source of
dispute. An attempt to reach an agreement on these and other outstanding
Kyoto issues was made at the sixth COP in The Hague, Netherlands,
during November 2000. COP6 failed partly because European countries
took the view that there should be limits to the role of sinks and LUCF
projects so that countries would be forced to address emissions reduction.
Europeans fear that LUCF projects are ephemeral and do not help to reduce
the long-term, upward trend in emissions. The opposite view is that
emissions reduction and carbon sinks are no different in their impact
and should be treated the same on efficiency grounds (Chomitz 2000).
In principle, a country should get credit only for sequestration
above and beyond what occurs in the absence of C-uptake incentives, a
condition known as “additionality” (Chomitz 2000). Thus, for example, if
it can be demonstrated that a forest would be harvested and converted to
another use in the absence of specific policy (say, subsidies) to prevent this
from happening, the additionality condition is met. Carbon sequestered as a
result of incremental forest management activities ( e.g., juvenile spacing,
commercial thinning, fire control, fertilization) would be eligible for C
credits, but only if the activities would not otherwise have been undertaken
(say, to provide higher returns or maintain market share). Similarly,
afforestation projects are additional if they provide environmental benefits
( e.g., regulation of water flow and quality, wildlife habitat) not captured by
the landowner and would not be undertaken in the absence of economic
incentives, such as subsidy payments or an ability to sell carbon credits
(Chomitz 2000). Which LUCF projects meet the requirements for
additionality?
2.1 Land use change
Consider first the role of tropical deforestation. 1 Tropical forests generally
contain anywhere from 100 to 400 of timber per ha, although much of it
may not be commercially useful. This implies that they store some 20-80