The Clean Development Mechanism Worldwide and in Brazil - Implementing Environmental and Resource Management - page 76

nies' annual demand. Because this cycle can be repeated twice more, this compo-
nent aims to guarantee a sustainable charcoal supply over a period of 21 years.
According to the baseline methodology, it is assumed that without financial sup-
port resulting from the consideration as carbon project, Plantar could not continue
its reforestation activities. The land would be converted into pasture area for cat-
tle. All in all, this component is expected to generate 4.5 Mio CERs. The baseline
for the avoided fuel switch component is based on the tendency in Brazil's pig iron
industry to convert from charcoal to coke due to lower prices for imported coke
and shortages of fuel wood from native forests.
Another trend in the iron industry is to concentrate in large-scale coke-based
iron mills, because the usage of coke allows for operation of bigger blast furnaces.
Therefore, it is assumed that without incentives in form of carbon credits, Plantar
would cease its iron production. Plantar's market share would be conquered by
companies using coke, which unlike charcoal, is not considered as carbon neutral.
The company claims this activity avoids emissions of ca. 7.9 million tons of CO 2 -
equivalents. Currently, the carbonization process of converting timber into char-
coal is done in simple kilns causing the creation of methane as an undesired by-
product. Due to improvements of the process, Plantar expects to reduce methane
emissions by at least 70% and to generate further 437,326 tons of CO 2 -equivalents
(May et al. 2004).
However, the baseline scenarios for the components regarding the carbon stor-
age and avoided fuel switch are doubtful. Critical NGOs started to campaign
against the project, because they are also concerned about the negative impact on
biodiversity and high water consumption of eucalyptus monocultures, as well as
the risk of contamination of water bodies by fertilizers and pesticides. Furthermore
they criticize bad working conditions and the concentration of land property and
power in the region (Lohmann 2006). This argument is however not restricted to
the actual Plantar project, but mainly linked to impacts resulting from the history
of eucalyptus plantations in the region since their establishment in the 1960s.
On the other hand, proponents of the project stress that the project supports the
attraction of foreign investments and technology, creates jobs in a region that is in
economic recession and will reduce pressure on native forests as source for char-
coal production. Plantar claims to aim for an improvement of working conditions
and social benefits (May et al. 2004). With proper risk management, existing envi-
ronmental risks appear to be tolerable. However both groups address the impacts
on different levels. Therefore an impact assessment on a higher level than the pro-
ject level, comparable to the strategic environmental assessment, would be desir-
able to more adequately deal with the concerns. Due to doubts about the addition-
ality of two components, the future of the Plantar projects is rather unsure. So far,
only the methane reduction received registration by the CDM Executive Board.