Carbon Market Asia

CARBON FORUM ASIA 2010 Presents Asia’s Views on Emissions Trading Post-2012
October 30, 2010 by Editor
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Singapore, 29 October 2010: The fifth CARBON FORUM ASIA ended today, recording yet another successful outing for carbon market professionals in Asia and around the world. Held on 27 and 28 October in conjunction with the Singapore International Energy Week, CARBON FORUM ASIA 2010 attracted a turnout of close to 1,100 participants from 44 countries, an increase of 10 percent from the previous year.
Continuing its role as a leading platform for Asia to showcase the carbon market opportunities in the region, CARBON FORUM ASIA 2010 brought together 120 exhibiting organizations from the public and private sectors as well as 120 global industry experts.
With just two years before the end of the Kyoto protocol, CARBON FORUM ASIA 2010 served as an opportune platform for governments, private organizations and financial institutions across the world to level out key issues and carry forward insightful viewpoints that will outline future dialogues.
The Future of the Asian Carbon Market
The pioneering move to consult the expertise of an advisory panel has paid off for CARBON FORUM ASIA 2010. Attendees to the CARBON FORUM ASIA Conference were able to gain insights from a wide range of viewpoints on the future international climate change framework, while keeping up-to-date on the latest developments within the regional and global carbon trading markets.
“Asia has been the dominant source of supply so far for the Clean Development Mechanism (CDM). However, the world’s urgent need for emissions reduction projects is not yet matched by expansion of the CDM or development of alternative systems. The debates at CARBON FORUM ASIA showed Asian suppliers are ready to adjust to the uncertainty to encourage new investors, and to deal with a fragmented market of multiple national regimes, if necessary,” said Henry Derwent, President and Chief Executive Officer, International Emissions Trading Association (IETA).
Among the sessions that tabled the future of global climate change abatement were “What will the market look like in 2012?” moderated by Henry Derwent, as well as “The new investors: Post-2012 climate and carbon funds”, moderated by Stuart Cerne, Managing Director, Enecore Carbon.
“Whilst policy uncertainty is slowing the activity of traditional carbon funds, innovative finance solutions that provide carbon pricing certainty with project development support are emerging. The panelists at the session agree that this is an exciting development and anticipate huge growth in the market,˝said Stuart, who moderated the session.
CARBON FORUM ASIA also tackled the emerging carbon forest trading sector. The session on “Growing Money on Trees: The Forest Carbon Market” generated a lively discussion among the many interested parties made up of financiers, traditional carbon market players, and the growing number of REDD organizations. While there were differences of opinion as to how the REDD market should be managed and measured, there was general agreement that there is potential in forest carbon offsets. Given that many more developed countries have exhausted their natural forest assets, the focus is on Asia and the growing number of REDD projects in countries such as Canada, Indonesia and Malaysia.
Another well-attended session was the “Roadmap to a low-carbon power sector by 2050”, which discussed the energy sectors’ investments in emissions reduction. Subhash Chandra Mathur, Managing Director, Samarpit International Group said, “Global warming is a real issue which calls for action from both the developed and the developing world to promote free flow of technology, manpower, skill sets and investment funds . CARBON FORUM ASIA, with its participants ranging from policy makers, project implementers, international experts and thought leaders, has provided the perfect platform to share and promote such thinking that will go a long way in developing globally cohesive solutions.˝
Asia up in arms to combat climate change
With climate change efforts gaining much prominence and traction in the region, the Conference sessions at CARBON FORUM ASIA 2010 focused on climate change abatement efforts in key markets across the region. Among the topics discussed were “China’s drive to create a new market” and “Japan and South Korea: New and existing forms of offset demand”.
“The carbon market is currently in a transition period. There has been growing interest in the topics of climate finance and the key question moving forward is how to bridge to the future of the Carbon Market. The coming year wil be an important one for the market as the world anticipates new developments in the fight against climate change. Japan is ready for the future emissions abatement landscape but we are also highly anticipating a new international framework,“ said Takashi Hongo, Special Advisor and Head, Environment Finance Engineering Department for the Japan Bank for International Cooperation.
Developing nations still dominate the CDM landscape
The Sellers’ Pavilion, sponsored by the Asian Development Bank (ADB), drew attention to up-and-coming sustainable development projects from 16 developing nations, spanning biomass, coal gasification, CO2 capture, hydro, wind, rural development and transportation sectors. With project developers making up 40 percent of the exhibiting companies, CARBON FORUM ASIA saw many carbon credit buyers and sellers forging connections to explore opportunities for future cooperation.
Among the projects showcased was the Lanzhou Sustainable Urban Transport project which includes activities, such as road reconstruction and an intelligence system. The project seeks to reduce emissions from conventional small buses, taxis, motorcycles for motorized vehicles by introducing the Bus Rapid Transport infrastructure.
First-time participant Vietnam showcased a total of five project entities. Vietnam Electricity showcased the Song Bung 4 Hydroelectric Project, estimated to result in 235, 028 tonnes CO2 reductions per annum as well as a reduction of other pollutants associated with fossil fuels-based power generation. Nepal, also making its debut at CARBON FORUM ASIA, showcased several projects including a hydro-powered mini-grid project under its Alternative Energy Promotion Centre. Seen as a pre-grid electrification for rural areas, the project is expected to develop between 600 to 700 micro-hydropower systems, generating a total of 40,000 CERs annually.
“There are so many moving parts in the Carbon Market that it is critical for us to be able to come together to work on key issues. CARBON FORUM ASIA is a valuable platform for me to speak directly with many different people over two days in one centralized location and an important region like Asia,˝ said Robert Hansor, Head of Climate Change and CSR – Asia, Lloyd’s Register Quality Assurance.
SHAPING ASIA’S VIEW
As one of the last gatherings of climate change opinion leaders prior to the 16th Conference of Parties (COP 16) meeting in Cancun, Mexico in December, CARBON FORUM ASIA has certainly aired Asia’s ardent concerns and hopes for the future climate change framework.
“CARBON FORUM ASIA 2010 attracted a notable number of CDM projects, exhibitors and event participants. We continue to see increased participation from fund owners and managers in carbon finance, mirroring the significant growth and opportunities in Asia’s carbon trading market. Experts agree that Asia will play a central role in the future climate change framework. Having established itself as an important meeting of minds for the industry in this part of the world, we eagerly anticipate the growth of CARBON FORUM ASIA in years to come,” said Michael Dreyer, Vice President, Asia-Pacific, Koelnmesse.
CARBON FORUM ASIA 2011 will be back in Singapore and held within the Singapore International Energy Week.
This is a press release from CARBON FORUM ASIA.

Forest carbon boost in California ETS offset rules

Forest carbon boost in California ETS offset rules
Carbon News and Info > Climate change news > Carbon finance, emissions trading & offsets

Tuesday, 2 November 2010
[This story updates an earlier version Monday 1 Nov]


The forest carbon sector in the US has received a boost with the release of draft rules for the Californian cap and trade scheme. The rules released by the state’s Air Resources Board (ARB) for consultation include a doubling of the limit originally proposed for the use of offsets in the scheme, from 4 per cent of an emitter’s obligation to 8 per cent, and early-action recognition of voluntary-market credits back to 2005.

To help lower the cost of compliance to the scheme, Californian emitters can buy offset credits generated across the United States from projects to reduce emissions in four areas initially. The four are forestry, urban forestry, livestock manure treatment and the reduction of ozone-depleting substances.

The increased offsets limit means a total of 232 million offset credits will be allowed over the period 2012 to 2020.

Offset protocols in other reduction activities will be considered for inclusion as soon as next year. Offset projects from Canada and Mexico may also be eligible in future. As well as project-based offsetting, the ARB will also pursue larger, sector-wide offsetting programs over time, including avoided deforestation, or REDD, in tropical developing countries such as Brazil and Indonesia.

The rules of the forestry offset protocol would make carbon credits from afforestation & reforestation, improved forest management and avoided conversion activity - to the Climate Action Reserve (CAR) standard - eligible for compliance in the California trading scheme. The relevant version of the protocol is CAR’s Forest Protocol, version 3.2, which updates the voluntary market standard for use in the state regulatory compliance scheme.

In detail, ARB’s Forest Offset Protocol allows the following activity:
Reforestation; planting trees on land that has been out of forest cover for at least 10 years or has been subject to a recent significant disturbance. Sustainable harvesting is allowed, if certified.
Improved Forest Management (IFM); undertaking management activities to maintain and increase carbon stocks on forested lands. Must use a mix of native species.
Avoided Conversion; preventing the conversion of high-risk forestland to a non-forest land use by dedicating the land to continuous forest cover through a conservation easement or transfer to public ownership.
Reforestation and IFM projects on private, tribal and non-federal public lands are eligible, and only private land for avoided conversion.

Permanence of emissions reductions must be ensured for 100 years from the date of the last credit issuance in a project, via third party verification every six years over that time. A buffer reserve account must be held with ARB to cover any losses. The proportion to held in reserve will vary from project to project depending on an individual risk rating assessment.

Early action
The cap and trade scheme is set to begin in 2012 but provision for early-action recognition in the draft rules would see offset credits from voluntary-market projects already underway to earlier versions of the CAR standard in the four approved areas become eligible. Specifically, credits from projects conducted between 1 January 2005 and the end of 2014, but commencing before 2012, will be eligible. The early action recognition of voluntary credits is designed to help jump-start offsets supply to the compliance market, ARB says.

California’s cap-and-trade scheme is emerging as a critical market for forest-based offset credits, said MaryKate Hanlon, senior analyst at forestry investment manager New Forests. “The latest draft regulation takes important steps to clarify how forests can play a role in generating early action and regular offsets as well as in sector-based offset programs.”

“Increasing flexibility for covered entities to meet emission-reduction liabilities is likely to improve market performance and environmental outcomes,” Hanlon said. “A clear signal of forthcoming regulations means more projects on the ground, and specifically, commitments to long-term land management strategies for forest owners.”

Final approval of rules is expected in a vote by the Air Resources Board on December 16.


Download:
Compliance Offset Protocol for US Forest Projects [3.3 MB]

Indonesia- haze

“HAZE” is a weasel word for the eye-stinging, throat-rasping smog that periodically engulfs parts of South-East Asia. The resort to euphemism points to why the pollution, which smothered much of the region in 1997, has been a nearly annual torment since the early 1990s: a reluctance to get tough with the country responsible, Indonesia, whose forest fires cause the scourge. Unlike the earthquake, tsunami and volcanic eruption that ravaged Indonesia this week, the fires are man-made.

The haze has returned this year. Air-pollution indices in Singapore and the south of the Malaysian peninsula had reached their highest levels since 2006 until rainfall on October 23rd brought relief. In parts of Sumatra, the neighbouring Indonesian island spewing out the smog, it had been getting hard to breathe.

This was trivial compared with 1997, when huge tracts of Borneo as well as Sumatra smouldered and the haze covered an area more than 3,000km (1,900 miles) wide. It affected six countries and perhaps 70m people and closed airports. That year was one of El Niño conditions and extended drought. Fires set to clear land for plantations spread into forests. Apparently extinguished, many smouldered in underground peat, then inflamed again.

This year much more limited fires have raged, mainly in Riau, a province in central Sumatra of 6m people and about 90,000 sq km—roughly the size of Portugal. But some schools in Malaysia had to shut. In Singapore, where the air quality helps attract expatriates fleeing pollution in Hong Kong, the environment agency advised people with heart and respiratory conditions to avoid outdoor activities.

The timing of the haze’s reappearance was cruel for the Association of South-East Asian Nations (ASEAN), a ten-member regional block whose impotence the smog mocks. The group’s environment ministers had just met to discuss their 2002 agreement on “Transboundary Haze Pollution” and note that their efforts had helped reduce haze. The galling truth is that Indonesia—the prime source of the problem—has not ratified the agreement. A club that works by consensus and abhors sanctions has only moral suasion. And Indonesia is the regional giant.

It would be wrong, however, to think that regional diplomacy is as pusillanimous and Indonesian environmental hooliganism as unchecked as in 1997. ASEAN does, albeit ineffectually, now set some standards of behaviour for its members, as opposed to tiptoeing fastidiously away from their “internal affairs”. And, unlike in 1997, Indonesia has been quick to acknowledge its responsibility for this year’s smog, and to ask for help.

Using fire to clear land has been illegal in Indonesia since 1995. But everywhere corruption and inefficiency undermine implementation of the law. And fire remains for many smallholders and big plantations the cheapest, quickest way of clearing logged land of rejected or overlooked trees and the undergrowth, thereby making it available for other uses—often, these days, to serve the booming palm-oil industry. In Riau, even beside main roads there are bleak, blackened landscapes, shrouded in white smoke, where the peat soil still smoulders under charred tree-stumps. Between them, infant oil palms are already growing.

The haze is an acute and chronic symptom of a disease even more serious for Indonesia and the world: Indonesia’s deforestation. In 1982 more than three-quarters of Riau was forested. Only about a quarter is now. But here too there are signs of hope. Stung by the criticism Indonesia receives as one of the world’s biggest emitters of carbon—a consequence of its destruction of so much carbon-rich forest and peatland—its government is cleaning up its act. It plans to cut carbon emissions by 41% by 2020, so long as it receives the compensation from an inchoate scheme, known as REDD (Reduced Emissions from Deforestation and Degradation), whereby rich countries pay poorer ones to conserve trees.

As a signal of good intent, Indonesia’s president, Susilo Bambang Yudhoyono, in May announced a two-year moratorium in 2011-12 on commercial deforestation. The reward was a promise of $1 billion in REDD funds from Norway. Many greens are cheering this. Joko Arif of Greenpeace calls it “a really good step”. But he laments that it does not cover existing logging concessions, so felling will continue. He also cautions that much must be done to make the moratorium work—starting with a proper mapping of forests. Otherwise, enforcing the ban will be arbitrary.

Norway’s environment minister, Erik Solheim, was in Jakarta this week to thrash out some thorny disputes, such as one over who will monitor the Norwegian money—an international institution or an Indonesian one? This was not resolved, though the United Nations Development Programme is to be the conduit for an initial $30m for a “preparation phase”.


The colour REDD

That dispute is based on doubts about Indonesia that colour both regional anger over the haze and worries about whether REDD is feasible there. Cynics see the country as irredeemably corrupt. It will continue, they say, to light bonfires that shorten its neighbours’ lives, having its cake of REDD money, even as its chainsaws eat the rainforest. But there is a more optimistic interpretation: it is beginning to assume a role of regional leadership and enjoys its seat on the G20. It badly wants the respectability that comes with a reputation for environmental responsibility.

Moreover, there are two reasons for taking the moratorium seriously. Indonesia’s palm-oil, pulp-and-paper and coal-mining industries are trying furiously to scupper it. And one theory as to why so many fires have been set this year is that those lighting them fear they may not be able to clear land as easily once the moratorium is in force. If you try hard, you can see light through the haze. Just don’t breathe too deeply

Bloomberg EU May Allow Forest Carbon Credits to Fill Gap, BNP Trader Says

Bloomberg
EU May Allow Forest Carbon Credits to Fill Gap, BNP Trader Says
November 11, 2010, 10:41 AM EST
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By Mathew Carr
Nov. 11 (Bloomberg) -- The European Union may allow use of emission credits from forest protection to help fill any gap from a ban of some industrial-gas credits, a banker at BNP Paribas SA said.

The EU carbon market may have room in its third phase, which runs from 2013 to 2020, for credits under a program known as Reduced Emissions from Deforestation and Forest Degradation, or REDD, should the bloc restrict industrial-gas credits and adopt a tighter emission-reduction target for 2020, said Christian Del Valle, director of environmental markets and forestry at the Paris-based bank. The region’s target is currently to cut emissions by 20 percent from 1990 levels.

“Policy makers might seek to offer another source of credits for cost control,” Del Valle said yesterday in an interview at the Climate Finance 2010 conference in London. “Some member states may be open to allowing REDD in certain circumstances.”

Almost 200 nations are meeting later this month in Cancun, Mexico, to discuss replacing or extending the Kyoto Protocol, which runs through 2012, slowing emissions and shifting the world to low-carbon energy sources. Inclusion of forestry projects would increase the number of credits available to polluters to cover greenhouse-gas emissions after 2012.

Some EU officials are saying the bloc reserves the right to allow additional UN credits into its program, the world’s biggest carbon market, De Valle said. “Doing so would send a strong signal internationally that Europe is serious about addressing deforestation in tropical countries.”

“There is still some resistance from the east and south” of Europe to the adoption of a tighter emission target for 2020, possibly a 25 percent or 30 percent reduction on 1990 levels, he told the conference earlier.

--Editors: Mike Anderson, Catherine Airlie.

To contact the reporters on this story: Mathew Carr in London at m.carr@bloomberg.net

To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net

Carbon Forester, ERA Ecosystem Restoration Associates Inc.

Carbon Forester, ERA Ecosystem Restoration Associates Inc.
Ecosystem Marketplace
The Carbon Forester position assists in determining the feasibility of
areas for forest carbon projects, carries out carbon modeling, prepares
project ...

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Forest carbon boost in California ETS offset rules

Tuesday, 2 November 2010
[This story updates an earlier version Monday 1 Nov]


The forest carbon sector in the US has received a boost with the release of draft rules for the Californian cap and trade scheme. The rules released by the state’s Air Resources Board (ARB) for consultation include a doubling of the limit originally proposed for the use of offsets in the scheme, from 4 per cent of an emitter’s obligation to 8 per cent, and early-action recognition of voluntary-market credits back to 2005.

To help lower the cost of compliance to the scheme, Californian emitters can buy offset credits generated across the United States from projects to reduce emissions in four areas initially. The four are forestry, urban forestry, livestock manure treatment and the reduction of ozone-depleting substances.

The increased offsets limit means a total of 232 million offset credits will be allowed over the period 2012 to 2020.

Offset protocols in other reduction activities will be considered for inclusion as soon as next year. Offset projects from Canada and Mexico may also be eligible in future. As well as project-based offsetting, the ARB will also pursue larger, sector-wide offsetting programs over time, including avoided deforestation, or REDD, in tropical developing countries such as Brazil and Indonesia.

The rules of the forestry offset protocol would make carbon credits from afforestation & reforestation, improved forest management and avoided conversion activity - to the Climate Action Reserve (CAR) standard - eligible for compliance in the California trading scheme. The relevant version of the protocol is CAR’s Forest Protocol, version 3.2, which updates the voluntary market standard for use in the state regulatory compliance scheme.

In detail, ARB’s Forest Offset Protocol allows the following activity:
Reforestation; planting trees on land that has been out of forest cover for at least 10 years or has been subject to a recent significant disturbance. Sustainable harvesting is allowed, if certified.
Improved Forest Management (IFM); undertaking management activities to maintain and increase carbon stocks on forested lands. Must use a mix of native species.
Avoided Conversion; preventing the conversion of high-risk forestland to a non-forest land use by dedicating the land to continuous forest cover through a conservation easement or transfer to public ownership.
Reforestation and IFM projects on private, tribal and non-federal public lands are eligible, and only private land for avoided conversion.

Permanence of emissions reductions must be ensured for 100 years from the date of the last credit issuance in a project, via third party verification every six years over that time. A buffer reserve account must be held with ARB to cover any losses. The proportion to held in reserve will vary from project to project depending on an individual risk rating assessment.

Early action
The cap and trade scheme is set to begin in 2012 but provision for early-action recognition in the draft rules would see offset credits from voluntary-market projects already underway to earlier versions of the CAR standard in the four approved areas become eligible. Specifically, credits from projects conducted between 1 January 2005 and the end of 2014, but commencing before 2012, will be eligible. The early action recognition of voluntary credits is designed to help jump-start offsets supply to the compliance market, ARB says.

California’s cap-and-trade scheme is emerging as a critical market for forest-based offset credits, said MaryKate Hanlon, senior analyst at forestry investment manager New Forests. “The latest draft regulation takes important steps to clarify how forests can play a role in generating early action and regular offsets as well as in sector-based offset programs.”

“Increasing flexibility for covered entities to meet emission-reduction liabilities is likely to improve market performance and environmental outcomes,” Hanlon said. “A clear signal of forthcoming regulations means more projects on the ground, and specifically, commitments to long-term land management strategies for forest owners.”

Final approval of rules is expected in a vote by the Air Resources Board on December 16.


Download:
Compliance Offset Protocol for US Forest Projects [3.3 MB]

Related stories:
California issues softened ETS rules

PENNVEST Announces Results of First Nutrient Credit Trading Auction

HARRISBURG, Pa., Nov. 1, 2010 /PRNewswire-USNewswire/ -- The Pennsylvania Infrastructure Investment Authority (PENNVEST), working closely with the Department of Environmental Protection and representatives of the Chicago Climate Exchange, held its first auction for nutrient credits on Oct. 28 and 29. Credits representing the annual removal of 21,000 pounds of nitrogen from the Susquehanna River watershed and the Chesapeake Bay over each of the next three years were sold for a price of $3.04 per credit.
"This first auction demonstrates the viability of the financial mechanism that we have developed to aid in improving the waters of the Chesapeake Bay," said Paul Marchetti, PENNVEST executive director. "This auction was a significant first step forward in our plan to foster trades in the Bay watershed."
PENNVEST is implementing a new initiative to encourage the trading of nutrient credits within the Chesapeake Bay watershed to promote cost-effective solutions to the problem of nitrogen and phosphorous discharges. These nutrients encourage algae growth in the Bay, which ultimately reduces oxygen levels needed by aquatic plants and animals.
There are many ways to reduce nutrient discharges, including implementing farming practices that reduce water runoff. Reducing discharges below certain levels creates nutrient credits that farmers can sell to wastewater treatment plants, which must meet certain permitted limits for these discharges. By using the credits purchased through the auction, treatment plants can, in many cases, meet required discharge levels in a much more affordable way than by building upgrades to their facilities.
PENNVEST will encourage the trading of nutrient credits by acting as a clearinghouse in the credit market. It will enter into contracts to both buy and sell credits. By participating in these transactions, PENNVEST will provide market certainty to both buyers and sellers which, in turn, should help encourage more activity in this market. Hosting periodic auctions, such as the one held last week, will be one way in which PENNVEST will facilitate these nutrient credit trades.
More information on the auction and the nutrient credit trading program is available online at www.pennvest.state.pa.us, under "Recent News."
Media contact: Paul Marchetti, 717-783-4496

Cloud over CO2 storage in trees

Carbon News and Info > Climate change news > Forest carbon & sustainability
Projects and Activities > Forest carbon > News & commentary

Thursday, 28 October 2010
Two separate studies have thrown doubt over forests’ ability to help offset global warming. Because trees rely on carbon dioxide to grow, it has been predicted that as CO2 levels rise in a warming world, trees would thrive on the increase, grow faster, and thus help soak up excess atmospheric carbon.

As a result of their findings, the authors of both studies have called into question the growth models for worldwide vegetation being used in official climate change forecasting for this century. The results of the studies may also have implications for some types of forest carbon projects such as reforestation and improved forest management, depending on the growth models they use. Ex ante, or upfront, crediting under some standards may see too many credits issued on forecast carbon sequestration with issuances having to be revised after later verification events during a project’s lifetime.

A study led by Dr Richard Norby of the Oak Ridge National Laboratory in Tennessee, and published in the Proceedings of the National Academy of Sciences, has found that while increased CO2 levels engender higher growth for the first five to six years, after that time the growth rate tails off.

The study team, including US and Australian scientists, found the limiting factor was the fixed level of nitrogen in the soil. After five or six years, the extra soil nitrogen being used to fuel the growth of the trees starts to run out, preventing the trees from being continuing to make the most of the elevated CO2 levels.

Researchers exposed forest stands to CO2 levels 25 per cent higher than the current global concentration, a level expected to be reached by the second half of this century.

“The implication of that for the broader landscapes is that, particularly in nutrient poor soils, the rising CO2 concentration in the atmosphere is probably not going to be as beneficial to plants as we've been hoping,” Dr Belinda Medlyn a biologist at Macquarie University, Sydney, said. She said the models used in the IPCC 4th assessment report are likely to overstate CO2 sequestration on land by “a fair bit”.

A second study, from the University of Guelph in Ontario, Canada, looked at 86 types of trees at more than 2,300 sites on six continents. It found that 80 per cent failed to respond to higher CO2 levels regardless of their species or geographical location. The researchers drew their results from examining tree rings, the distinctive marks left on trees allowing researchers to see how much growth takes place from year to year.

“There might be a very slight increase in the total rate of growth in trees, but they’re not going to be these vacuum cleaners that will magically suck up the CO2 that we’re emitting,” said Ze’ev Gedalof, study co-author and Associate Professor of Geography at the University of Guelph.

Other experts examining the study questioned whether growth rates observed in tree rings give an accurate measure of overall carbon uptake.

ABC Online, Canadian Press.

American Carbon Registry lifts carbon offset benchmark

28 September 2010

The American Carbon Registry (ACR) has raised the bar for the level of carbon that landowners must sequester under its forestry programmes in a move that it claims will stimulate the carbon offset market.

It has approved an Improved Forest Management (IFM) methodology for quantifying greenhouse gas removal and emissions reductions, targeting privately-owned industrial timberlands in the US already managed under a commercial timber harvesting programme.

ACR said that the methodology unleashes groundbreaking possibilities in the market, partly because it applies conservative assumptions to ensure that no additional activities are credited, a flaw that has plagued existing IFM methodologies.

Under the new methodology, which is the first to specifically target industrial timberlands, landowners must make a long-term commitment to sequester carbon on their properties above and beyond what would normally occur under an institutional timber owner’s typical business-as-usual management.

‘The Finite Carbon IFM methodology fills a critical gap in the US forest carbon market by providing a straightforward and scalable framework for commercial timber land managers to develop high-quality IFM projects,’ said Nicholas Martin, ACR’s chief technical officer.

To date, only five forest carbon projects have been registered and verified, four of which are California-based projects registered under the Climate Action Reserve, and the fifth is a large multi-state project registered on ACR.

ACR said that the methodology has been included as an eligible project type under both House and Senate cap-and-trade bills.

It is also consistent with pre-compliance recognition in recent federal bills and state programmes, making projects formed under the standard appealing for corporate social responsibility buyers.

ACR said it plans to complement the methodology in the future with additional methodologies for non-industrial private forests and public land.

‘The end result is a methodology that balances concerns of commercial operability, environmental integrity and cost, all of which are crucial for high-quality projects to be developed on a scale that will have an impact,’ said Finite Carbon president Scott Nissenbaum.

ACR was founded in 1996 as the US GreenHouse Gas Registry by the Environmental Defense Fund and Environmental Resources Trust.

Copyright © 2010 NewNet

Denman Island - 750 ha.

October 21, 2010, Vancouver, British Columbia: ERA Carbon Offsets Ltd. (TSX¬-V: ESR) through its 100% owned subsidiary ERA Ecosystem Restoration Associates Inc, (ERA) is pleased to announce that it has executed a term sheet with the German-based company The Forest Carbon Group AG (FCG) for the sale of all Verified Emission Reductions (VERs) arising from the Denman Island project. This unique public – private partnership involves the acquisition of 750 hectares of private and Crown land on Denman Island for inclusion in the provincial parks and protected areas system. The transaction, which is subject to due diligence and entering a formal Verified Emissions Reductions Purchase Agreement (VERPA), would deliver several hundred thousand tonnes of VERs immediately following third party validation and verification.

The multi-faceted public-private partnership has involved the British Columbia Government, North Denman Island Lands Inc., ERA, and FCG. This arrangement involved the transfer of carbon rights associated with the private portion of the 750 hectares by North Denman Lands Inc. to ERA. The British Columbia Government will ultimately add these ecologically sensitive lands to the provincial parks and protected areas system. Without this partnership the private land area would have been slated for development. The newly protected lands are within the rare Coastal Douglas-fir biogeoclimatic zone. The acquisition also includes lands within the Chickadee Lake watershed and a previously logged area that provides habitat for the endangered Taylor’s Checkerspot butterfly.

The VERs will be validated and verified to the International Standard Organization’s 14064-2 standard and to either the Community, Climate and Biodiversity Alliance’s CCBA standard or to a mutually agreed upon equivalent standard. All VERs will be serialized and registered on the Markit Environmental Registry.

Holger Mayer, director of FCG, commented: “The rich biodiversity of B.C.’s forest ecosystems makes the province, and in particular the Pacific Coast, an ideal source of high-quality forest-based carbon offsets. And Denman Island is a “charismatic” project that has marketing appeal to our potential clients in Europe, because of its beauty and protection of biodiversity. We’re pleased to continue our partnership with ERA and contribute to the restoration of Denman Island’s natural environment.”

Dr. Robert Falls, ERA’s Chief Executive Officer, commented: “This agreement represents ground-breaking leadership in climate policy and environmental stewardship, using creative public – private partnerships. We wish to thank the Forest Carbon Group for seeing the value of the program, and the unique attributes of the carbon offsets that will be generated for the voluntary carbon market. The initiative and participation by North Denman Lands were essential to the success of this project. We also wish to recognize the Government of British Columbia for its forward-thinking resolve in facilitating climate mitigation solutions that provide multiple wins for the environment and for future generations.”

About The Forest Carbon Group AG.

The Forest Carbon Group works to protect and restore forests. Driven by the idea that ecology and economy should mutually benefit from one another, it invests in and co-develops large-scale forestry projects world-wide. These projects not only give value to forests’ ecosystem services but also have many social co-benefits that enable involved communities to create sustainable local economies. The Forest Carbon Group offers companies tailor-made solutions for becoming more sustainable and carbon neutral using the mechanisms of the voluntary carbon market. The full service approach includes identifying, developing and financing forestry projects, and providing guidance in marketing and communications to leverage the potential of companies’ sustainable investment. The Forest Carbon Group offers real, additional, and verifiable VERs that are approved and audited by internationally renowned third parties. Founded in 2009, the Forest Carbon Group consists of specialists with ma ny years’ experience in carbon markets, forestry, project development, marketing, communications and financing. The company’s headquarter is in Frankfurt, Germany.

Additional information on The Forest Carbon Group can be found at www.forestcarbongroup.ag or by contacting contact@forestcarbongroup.de

About ERA Carbon Offsets Ltd.

ERA is a Canadian pioneer in forest restoration and conservation carbon offset projects. The company’s Community Ecosystem Restoration Program located in the Lower Fraser Valley, British Columbia, began in 2005 in the District of Maple Ridge, and has grown to include five communities including Metro Vancouver. ERA has delivered over 1,000,000 tonnes of carbon offsets to the voluntary market and is engaged in the development of forest carbon projects in Canada, Africa and the Hawaiian Islands to supply international and North American voluntary and pre-compliance markets. ERA’s clients and product users include Air Canada, Catalyst Paper, HSE – Entega, Rolling Stone Magazine, Shell Canada Limited, The Forest Carbon Group, and The Globe Foundation of Canada. ERA’s carbon offsets are being validated to the ISO 14064, CCBA, and VCS standards.

Additional information on ERA can be found on the corporate website www.eracarbonoffsets.com or by contacting investor@eracarbonoffsets.com

World Bank pays $4 for forest CERs

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Friday, 22 October 2010

Africa’s first significant CDM forest carbon project has attracted a price of $US4 per tonne in temporary CER (tCER) carbon credits, according to a media report. The World Bank will buy the credits for half the carbon stored up to 2017 from an Ethiopian forestry project, the Humbo Assisted Natural Regeneration Project.

The first large-scale afforestation and reforestation (A/R) project to be registered under the Kyoto Protocol’s CDM, the Clean Development Mechanism, began in 2007. It involves the restoration and replanting of indigenous tree species on 2,728 hectares of degraded mountain forest area that has been stripped for fuel wood in south-western Ethiopia.

The Humbo project developer, World Vision, has arranged 800 local people into seven reforestation cooperatives. The carbon credit proceeds fund payments to the members, replacing their previous incomes from the sale of firewood. To minimise the potential leakage - the pushing of wood collection into forest outside the project area - the project also includes growing plantations for fuelwood harvest.

The World Bank BioCarbon Fund is buying tCERs for 165,000 tonnes of Humbo’s CO2 emissions reductions, nearly half the 338,000 tonnes the project is expected to sequester in its first ten years.

The Bank has agreed to pay $726,000 at $US4 per tCER, according to Hailu Tefera, manager of Climate Change Programmes at World Vision Ethiopia, one of the project proponents. His comments were published in the Addis Fortune newspaper.

The World Bank does not generally reveal the prices paid for CERs by its various carbon funds. But it did confirm in March a commitment to purchase 165,000 tonnes of CO2e for a sum suggesting a price of just over $US4 each.

Under the CDM rules for its A/R segment, permanent CERs cannot be issued over forest carbon sequestration, only temporary or long term CERs. This is because of the questions marks over the permanence of the planted forests. tCERs expire after five years and must be reissued upon verification the forest is still standing, or replaced with permanent CERs from elsewhere.

The World Bank says the development of such forestry and land-use projects is crucial for Africa, a continent that has so far attracted little CDM project investment

Wesfarmers signs carbon offset deal - Australia

Published 9:44 AM, 5 Oct 2010

By a staff reporter

The insurance arm of Western Australian conglomerate Wesfarmers has signed a deal to offset its 2010 carbon emissions.

Wesfarmers Insurance says the deal will see carbon forest sink developer Carbon Conscious Ltd plant 26,000 eucalyptus trees in West Australian farmland.

“We are pleased to be a part of a program where Carbon Conscious was planting trees in many of the regional areas where our business operates. Additionally, by retiring voluntary carbon units, we have also ensured that we will be National Carbon Offset Standard compliant and this is important to our efforts around sustainability,” Wesfarmers Insurance corporate affairs manager Georgie Morell said in a statement.

Carbon Conscious has carried out similar carbon offsetting projects with Origin Energy and BP Singapore, the statement said.

ERA Denman Island Project

October 12, 2010, Vancouver, British Columbia: ERA Carbon Offsets Ltd. (TSX¬-V: ESR) through its 100% owned subsidiary ERA Ecosystem Restoration Associates Inc, (ERA) is pleased to announce Canada’s first carbon project involving a unique public-private partnership. The Denman Island Conservation Project will protect over 750 hectares of ecologically sensitive lands, distributed over 18 properties on Denman Island in British Columbia.
The public-private partnership involving the British Columbia Government, North Denman Island Lands Inc, ERA Ecosystem Restoration Associates Inc (ERA), and the Forest Carbon Group AG (FCG) uses an innovative agreement involving land donations, the transfer of local development rights, and carbon sequestration rights. This multifaceted agreement enabled the British Columbia Government to purchase the land for future inclusion in the BC parks and protected areas system. Without this partnership the future park area, approximately 15% of Denman Island, would have been slated for subdivision into residential properties and agricultural properties including vineyards and hayfields.
The newly protected lands are within the Coastal Douglas-fir biogeoclimatic zone, one of the rarest zones in B.C. The acquisition also includes land within the Chickadee Lake watershed and a previously logged area that provides habitat for the globally endangered Taylor's Checkerspot butterfly.
“Achieving the protection of such a large amount of both private and Crown land demonstrates that capital investment can effectively be put to the service of community and conservation goals,” said Henning Nielsen of North Denman Lands Inc.
Dr. Robert Falls, ERA’s Chief Executive Officer, commented: “This project represents groundbreaking leadership in climate policy and environmental stewardship, using creative public–private partnerships – a triple win for the province, the environment and the climate. The rich biodiversity of B.C.’s forest ecosystems makes the province, and in particular the Pacific Coast, an ideal setting for high quality forest-based carbon offset programming.”
Alexander Zang, FCG’s Director, commented: “We’re pleased to continue our partnership with ERA and contribute to strengthening Denman Island’s natural environment.”
About The Forest Carbon Group AG.
The Forest Carbon Group works to protect and restore forests. Driven by the idea that ecology and economy should mutually benefit from one another, it invests in and co-develops large-scale forestry projects world-wide. These projects not only give value to forests’ ecosystem services but also have many social co-benefits that enable involved communities to create sustainable local economies. The Forest Carbon Group offers companies tailor-made solutions for becoming more sustainable and carbon neutral using the mechanisms of the voluntary carbon market. The full service approach includes identifying, developing and financing forestry projects, and providing guidance in marketing and communications to leverage the potential of companies’ sustainable investment. The Forest Carbon Group offers real, additional, and verifiable VERs that are approved and audited by internationally renowned third parties. Founded in 2009, the Forest Carbon Group consists of spec ialists with many years’ experience in carbon markets, forestry, project development, marketing, communications and financing. The company’s headquarter is in Frankfurt, Germany.
Additional information on The Forest Carbon Group can be found at www.forestcarbongroup.ag or by contacting contact@forestcarbongroup.de
About ERA Carbon Offsets Ltd.
ERA is a Canadian pioneer in forest restoration and conservation carbon offset projects. The company’s Community Ecosystem Restoration Program located in the Lower Fraser Valley, British Columbia, began in 2005 in the District of Maple Ridge, and has grown to include five communities including Metro Vancouver. ERA has delivered over 1,000,000 tonnes of carbon offsets to the voluntary market and is engaged in the development of forest carbon projects in Canada, Africa and the Hawaiian Islands to supply international and North American voluntary and pre-compliance markets. ERA’s clients and product users include Air Canada, Catalyst Paper, HSE – Entega, Rolling Stone Magazine, Shell Canada Limited, The Forest Carbon Group, and The Globe Foundation of Canada. ERA’s carbon offsets are being validated to the ISO 14064, CCBA, and VCS standards.
Additional information on ERA can be found on the corporate website www.eracarbonoffsets.com or by contacting investor@eracarbonoffsets.com
On behalf of the Board of Directors of
ERA CARBON OFFSETS LTD.
“Robert Falls”

Chief Executive Officer

For further information, please contact:

Alex Langer,
Telephone: 604-646-0400
Email: alex.langer@eraecosystems.com
FORWARD LOOKING STATEMENTS: This document includes forward-looking statements as well as historical information. Forward-looking statements include, but are not limited to, the continued advancement of the company’s general business development, research development and the company’s development of forest-based carbon offsets. When used in this document, the words “anticipate”, “believe”, “estimate”, “expect”, “intent”, “may”, “project”, “plan”, “should” and similar expressions may identify forward-looking statements. Although ERA Carbon Offsets Ltd. believes that their expectations reflected in these forward looking statements are reasonable, such statements involve risks and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements. Important factors that could cause actual results to differ from these forward-looking statements include fluctuations in the marketplace for the sale of carbon credits, the inability to implement corporate strategies, the ability to obtain financing and other risks disclosed in our filings made with Canadian Securities Regulators.
NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

Pulp and paper firm signs carbon deal in Sumatra

Rhett A. Butler, mongabay.com
October 05, 2010


Indonesian pulp and paper firm Asia Pulp and Paper (APP) has signed a deal to protect 15,640 hectares of peat forest in Sumatra in exchange for carbon payments, reports Reuters.

Under the agreement signed with Carbon Conservation, a forest carbon broker based in Singapore, APP supplier PT Putra Riau Perkasa will forgo conversion of a concession located in carbon-dense peat forest on the Kampar Peninsula in Sumatra. The deal could avoid emissions of million tons of carbon dioxide over its 33-year life.

To complete the deal, Putra Riau Perkasa will need to change its Industrial Timber Plantation (HTI) conversion permit for the concession into one that allows for conservation or restoration. If the licensing change is approved by the forest ministry, it would set a precedent for Riau province, potentially ushering in other forest carbon pacts.

The Kampar Peninsula, which has one of the largest intact peat forests in the province in Riau, is a chief battleground between APP and international environmental groups, including the Rainforest Action Network, WWF, and Greenpeace. Greens blame APP for destructive logging practices, while APP maintains it operates in compliance with Indonesian law.


Location of PT. Putra Riau Perkasa (PRP) plantation forest concession in Semenanjung Kampar, Riau, Sumatra. APP's suppliers manage about 2.5 million hectares according to Aida Greenbury, sustainability director for APP. The animosity between APP and environmentalists recently reached new heights following Greenpeace's release of How Sinar Mas is Pulping the Planet, a report that alleged environmental transgressions by APP's suppliers. APP fired back with a report of its own, claiming that Greenpeace made errors in its mapping and sourcing of information. Greenpeace responded by affirming its conclusions and noting that APP's 'auditor' is controlled by Alan Oxley, who also is involved in the company's public relations efforts, negating the claimed independence of the report.

Perhaps unsurprisingly, activists were skeptical of the forest carbon deal.

"While we support the conservation of the Kampar, this project in no way makes up for the tremendous amount of damage that APP and its affiliates are having on rainforests and peatlands across Indonesia," said Lafcadio Cortesi, forest campaign director at the Rainforest Action Network (RAN), in a prepared statement. "APP should not be praised or compensated for doing something that they should have been doing in the first place."

"A critical question that needs to be answered, with public private partnerships and all land related agreements, is whether or not local communities and government know that this is happening and have a meaningful role in decision-making," he continued. "RAN maintains that if these types of conservation projects are to be successful, they must have the free, prior and informed consent of local communities and these communities must participate and receive an equitable share of the benefits."

But Dorjee Sun, CEO of Carbon Conservation, which has another project in Aceh Province in northern Sumatra, told mongabay.com, the Kampar is an opportunity to engage a historic destroyer of forests, perhaps helping it down a more sustainable path.


Conversion of forest land for a plantation in Riau, Sumatra, May 2010. Photo by Rhett A. Butler "This is an important project that Carbon Conservation had to undertake," he said via email. "After 2 years of deliberation on this APP opportunity we realized that to change the world we must change the economy. To change the economy we must change the multinational corporations. To change the multinational corporations, we must engage multinational corporations. Furthermore in Indonesia someone has to engage massive land owners like APP and it needs to be a credible carbon partner and not a fly-by-night operation."

Ultimately though, for this project to work we must ensure long lasting community benefits and that is only possible via active conservation bring poverty alleviation, healthcare, family planning & alternative livelihoods. This is of great significance because it comes at a time when UN leadership is adrift and REDD+ is one of the few rays of hope prior to Cancun. So as the first commercial REDD peatland plantation concession and will lead to a globally replicable pilot all partners have agreed to having total accountability and regular updates the media because so much is at stake.”

American Carbon Registry Approves IFM Methodology for US Commercial Timberlands

Unleashing US Forest Carbon Offset Potential
September 27, 2010 7:42am EDT

ARLINGTON, Va. — The American Carbon Registry (ACR) announces approval of an Improved Forest Management (IFM) Methodology for Quantifying GHG Removals and Emission Reductions through Increased Forest Carbon Sequestration on U.S. Timberlands developed by Finite Carbon Corporation, a leading U.S. forest carbon project developer.


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The methodology targets privately owned industrial timberlands in the U.S. managed under an existing commercial timber harvesting program. Landowners must make a long-term commitment to manage their properties to sequester carbon above and beyond what would normally occur under an institutional timber owner’s typical business-as-usual management.

The methodology approval is groundbreaking for the possibilities it unleashes in the market. Despite the enormous potential for hundreds of millions of acres of private forestlands in the U.S. to participate in the carbon market, to date only five forest carbon projects have been registered and verified. Four of those are California-based projects registered on the Climate Action Reserve (CAR), and the fifth is a large multi-state project registered on ACR. The dearth of projects is due to the lack of workable, scientifically sound methodologies for key project types such as IFM. The methodology, the first to specifically target industrial timberlands, applies conservative assumptions throughout to ensure no crediting of non-additional activities, a flaw that has plagued existing IFM methodologies. It will be complemented in the future by other ACR methodologies for non-industrial private forests and public lands.

“The Finite Carbon IFM methodology fills a critical gap in the U.S. forest carbon market by providing a straightforward and scalable framework for commercial timber land managers to develop high-quality IFM projects,“ said Nicholas Martin, ACR’s chief technical officer. “We expect to see many good projects come to market.”

IFM has been included as an eligible project type under both House and Senate cap-and-trade bills and ACR’s methodology approval process of public consultation and expert peer review is consistent with criteria for pre-compliance recognition in recent federal bills as well as state and regional programs. This means that offsets resulting from projects developed following the new ACR methodology are a strong pre-compliance choice. Forest carbon offsets are also widely sought after in the voluntary market, where corporate social responsibility buyers seek “charismatic” carbon offsets, such as those that protect forests.

“We appreciate the rigor of ACR’s public comment and external scientific peer review process for methodology approval,” said Sterling Griffin, Finite Carbon’s vice president for project development and the methodology’s lead author. “The process really helped clarify and improve the methodology. Finite Carbon has been impressed by how quickly, yet comprehensively the process was completed, creating confidence that the methodology was meticulously evaluated by experts and found to be environmentally sound.”

“This is a major milestone for Finite Carbon and our forest carbon project portfolio throughout the United States,” added Scott Nissenbaum, president of Finite Carbon. “We need to offer solutions and options to landowners and quality offsets to buyers. We have been impressed with the knowledge and expertise at Winrock and ACR, which will facilitate this process,” he continued. “The end result is a methodology that balances concerns of commercial operability, environmental integrity and cost, all of which are crucial for high-quality projects to be developed on a scale that will have an impact.”

About the American Carbon Registry

The nonprofit American Carbon Registry (ACR), an enterprise of Winrock International, is a leading carbon offset program recognized for its strong standards for environmental integrity. Founded in 1996 as the GHG Registry by Environmental Defense Fund and Environmental Resources Trust, ACR has 15 years of experience in the development of rigorous, science-based carbon offset standards and methodologies as well as in carbon offset issuance, serialization and transparent online transaction and retirement reporting. As the first private voluntary GHG registry in the world, ACR has set the bar in the global voluntary carbon market for offset quality and operational transparency. For more information, please visit www.americancarbonregistry.org

About Finite Carbon Corporation

Finite Carbon is the country’s No. 1 forest carbon developer based on listed U.S. projects. It provides landowners with a single-source, end-to-end solution to create and monetize carbon offsets. Solely focused on forest carbon, the company was founded in 2009 by forestry and finance experts, and offers the most comprehensive forest carbon project development and commercialization service in the country. Finite Carbon, which has to date secured contracts for two million carbon offsets, valued at $12 million, is headquartered in Wayne, Pa., and has offices in San Francisco, Calif., and Cherry Creek, N.Y. For more information, please visit www.finitecarbon.com

Photos/Multimedia Gallery Available: http://www.businesswire.com/cgi-bin/mmg.cgi?eid=6443684&lang=en



Read more: http://www.centredaily.com/2010/09/27/2233508/american-carbon-registry-approves.html#ixzz10lTCaEJg

Tanzania project first to earn VCS forest credits

Thu Sep 23, 2010 2:24pm GMT Print | Single Page [-] Text [+]
SINGAPORE (Reuters) - A Tanzanian reforestation project has become the first forestry investment to be issued carbon offsets under an industry-backed standard that assures investors the emission reductions are credible and long-term.

The Voluntary Carbon Standard said on Thursday the first batch of credits had been issued this week and placed in the VCS registry.

London-based The CarbonNeutral Company, which helps firms cut their carbon emissions, is marketing the credits.

The project in the southern highlands of Tanzania involves converting degraded grassland into sustainably harvested eucalypt and pine forests that soak up carbon dioxide from the air as they grow, earning CO2 offsets.

The forests cover 7,250 hectares (18,125 acres) in Uchindile district and 3,560 hectares at Mapanda district, the VCS and The CarbonNeutral Company said in a statement.

To protect investors, 40 percent of the initial batch of 232,264 credits would be placed in a special buffer account, they said. This is to guarantee delivery of the credits going forward in case the trees are destroyed by fire or other reasons.

Pricing of the nearly 140,000 credits varied depending on sales volume and other factors, Jonathan Shopley, managing director of The CarbonNeutral Company, told Reuters, without giving a range.

He said the flow of credits is expected to increase as the project reaches full development.

The VCS sets strict carbon accounting criteria that aims to assure investors that offset projects are properly designed and transparent. They were created to try to address investors' fears about forestry projects that might be poorly managed or where the trees are later cut down, for example, through illegal logging.

The Tanzania project also met the standards of the Climate, Community and Biodiversity Alliance, the statement said.

Ten per cent of the carbon credit revenues would be returned to the local communities to build classrooms, teachers' houses, dispensaries and roads, while 200 local people were employed in the forests.

Oil palm plantations on peatlands won't get carbon credits under CDM

mongabay.com
September 19, 2010

Plantations on peatlands will no longer be supported by the Clean Development Mechanism (CDM), a framework for industrialized countries to reduce their emissions via projects in developing countries, reports Wetlands International.

The decision, which came last Friday during the executive board meeting, will bar biofuel plantations established on peatlands from earning carbon credits that could then be sold to industrialized countries to "offset" emissions. The concern is that under the CDM, carbon finance is used to perversely subsidize conversion of carbon-dense peatlands for oil palm plantations, a process that generates substantial greenhouse gas emissions, thereby undermining any potential carbon dioxide savings from use of palm oil-based biodiesel.

“We are very relieved that within a year, the CDM Board has decided to revise the existing methodology," said Marcel Silvius of Wetlands International in a statement. "This decision now ends a perverse incentive for development of plantations on peatlands.”

A Wetlands International statement explains:
Last year, the CDM Executive Board approved a methodology that now gave till last week CDM credits to biodiesel plantations on so-called ‘degraded lands’ in developing countries. The CDM allows industrialized countries under the Kyoto Protocol (Annex B Party) to reduce their emissions via projects in developing countries. Such projects can earn saleable certified emission reduction (CER) credits, which can be counted towards meeting Kyoto targets. This methodology was meant to stimulate sequestration of carbon via replanting of degraded, devegetated land areas with renewable energy crops as alternative for conventional diesel.

In practice, this methodology gave an additional financial boast to new palm oil plantations on the logged peatswamps in Southeast Asia. These ‘degraded’ lands however still contain large amounts of carbon in the case of water logged organic peat soils. This carbon will be rapidly released upon drainage for plantations.

Draining and clearing of peat forest in Central Kalimantan, Indonesia. Photo by Rhett A. Butler. Research led by Dr. Susan Page University of Leicester found that producing one ton of palm oil on peatland generates 15 to 70 tons of CO2 over 25 years as a result of forest conversion, peat decomposition and emission from fires associated with land clearance. In other words, biodiesel produced under such conditions has a greater climate impact than conventional fossil fuels.

As such, environmental groups are calling for a moratorium on the conversion of peatlands for biofuel production. Already about 33% of all oil palm is on peat, according to Wetlands International.

The decision by the CDM Executive Board now removes one incentive from peatland conversion, although developers—especially in Indonesia—are still targeting peat swamps for expansion. Peat lands tend to be cheaper and more available than other soil types suitable for oil palm cultivation.

BNP Paribas and Wildlife Works Ink $50 million REDD Deal

21 September 2010 | LONDON | BNP Paribas Corporate & Investment Banking (BNP Paribas) has announced an agreement between its Commodity Derivatives business and Wildlife Works Carbon LLC, in which BNP Paribas will provide up to US$50 million in finance to combat tropical deforestation and climate change.

The bank’s Carbon Finance business and Wildlife Works will develop a portfolio of large scale Reduced Emissions from Deforestation and Degradation (REDD) carbon projects in Africa. BNP Paribas will have the option to purchase avoided emission credits created from the portfolio.

The facility provides funding for Wildlife Works’ efforts to source, develop, implement and manage REDD projects in Africa. With BNP Paribas’ backing, Wildlife Works now has the financial resources to support its efforts to protect endangered forests in the region and reinforces its ability to manage large-scale preservation projects.

In addition BNP Paribas has the right to purchase 1.25 million tonnes of avoided emissions credits over the next five years from Wildlife Works’ Kasigau Corridor REDD project in Kenya. This project is East Africa’s first avoided deforestation project to receive validation under the Climate Community and Biodiversity Alliance standards, and is designed to bring substantial benefits to local communities in education and job creation, while protecting biodiversity at the same time.

“We intend to develop a portfolio of valuable REDD+ projects, known as much for an uncompromising approach to biodiversity protection and community development as for strong financial returns,” said Mike Korchinsky, Founder and President of Wildlife Works. “Through this agreement, African communities will benefit financially while safeguarding their environment for future generations.”

Christian de Valle, Director, Environmental Markets in Commodity Derivatives at BNP Paribas, said: “We believe that REDD+ projects will have an important role in efforts to mitigate climate change as well as in the post-2012 carbon markets. We are very pleased to form a partnership with Wildlife Works and view the agreement as an important milestone in managing forest carbon.”

Forest Fund to Invest in New Zealand

Monday, 20 September 2010 - 7:48pm
Wellington, Sept 20 NZPA - A new fund in Australia has raised hundreds of millions of dollars to invest in forests in New Zealand and Australia.

New Forests Pty has closed the approximate $A500 million ($NZ648m) Australia New Zealand Forest Fund, which will invest in timberland properties and forestry-related assets in Australia and New Zealand.

The fund's investors include international and regional institutional investors who have identified Australian and New Zealand timberland as an attractive component of their alternative asset portfolio allocation.

"Now is the right time for investors to be weighting toward the timberland asset class because of its low volatility and positive correlation to inflation," David Brand, managing director of New Forests, said.

"Australia and New Zealand's timberland sectors are restructuring as a result of the failure of several forestry Managed Investment Scheme businesses in Australia and the flow on effects of the global financial crisis. This has created a once-in-a-generation change of ownership of the forestry and land asset base -- which may be worth $A3 billion-$A4 billion -- but the strong underlying market fundamentals of the sector remain, driven by growth in Asia."

The fund's establishment comes after Harvard Management Company (HMC), the manager of Harvard University's endowment and owner of plantation forest assets in New Zealand, recently highlighted natural resources as an area of investment.

HMC is the majority owner of Kaingaroa Timberlands, the second largest owner of plantation forest assets in New Zealand behind US fund manager Hancock Natural Resources Group. NZ Superannuation Fund owns 40 percent of Kaingaroa Timberlands and it is its largest single investment.

"We believe natural resources is a core strength in our portfolio, offering inflation protection, cash flow and long-term growth," HMC said.

Port of Tauranga has said a 24 percent rise in log exports helped lift its full-year underlying earnings.

Forestry-related exports through the port rose 19 percent to 6.04m tonnes in the year to June 30. This includes pulp, paper and timber products. Log exports rose 24 percent from the previous year.

Chief executive Mark Cairns said log exports were back at 2003 levels. Log exports in July were up 7 percent on the same month last year.

China has been a big market but in July the port handled more logs destined for Korea than China.

Mr Cairns said the Indian market was also emerging strongly and the Japanese market was bouncing back. "We are seeing a firming of other markets," he said.

NZPA WGT pjg g

EU re-examines forestry's climate role

Carbon Positive
Being shut out of the EU Emissions Trading Scheme has been a big negative
for the forestry and forest carbon project industries, denying them access
to ...

DOMTAR AND THE NATURE CONSERVANCY TEAM UP ON PILOT PROGRAM FOR WORKING WOODLANDS

The Nature Conservancy's Model Forest Conservation Program Will Help Enroll Private Landowners Near Domtar'sJohnsonburg, Pa., Mill

MONTREAL, Sept. 13 /PRNewswire-FirstCall/ - Domtar Corporation (NYSE/TSX: UFS) and The Nature Conservancy today announced that they have partnered to help private landowners maintain and sustainably manage their forested land through a program called Working Woodlands.

The Nature Conservancy will cooperate with Working Woodlands landowners to develop sustainable forest management plans that are certified by the Forest Stewardship Council(TM), a nonprofit group devoted to ensuring the highest standards of responsible forest management. In addition to generating FSC(R) certified forest products, the certified lands are also managed to help reduce greenhouse gas emissions and ensure that more carbon is stored in the forest.

The Conservancy then works with Blue Source, one of the world's leading greenhouse gas offset developers, to market and sell the landowners' forest carbon credits. In return, landowners agree to manage the forest sustainably for at least 60 years.

"Working Woodlands is an innovative approach to help forest owners manage their properties for ecological health, productivity and better economic return," said Lewis Fix, Domtar Vice-President, Brand Management and Sustainable Product Development. "The program marks the first time private landowners can gain access to markets that will help them sustain healthy, diverse, rich forests. We are excited to team with The Nature Conservancy and help show how proper forestry practices lead to sustainable and renewable paper and wood products that consumers can feel good about using."

This marks the latest effort by Domtar, a global leader in paper manufacturing, to help better manage forests. As a founding member of the Canadian Boreal Leadership Council, Domtar joined forces in 2003 with First Nations communities, environmental groups and other resource companies to help sustain the Canadian boreal forest region. A few years later, Domtar transferred 15 square miles of land in the Eastern Townships region of Quebec and sold 20,000 acres in New York'sAdirondack Mountains to The Nature Conservancy. This year, Domtar contributed to preserving an additional 2,011 acres of wetlands in the Eastern Townships region with a land transfer to Ducks Unlimited Canada, a non-profit organization dedicated the conservation of wetlands.

The Nature Conservancy and Blue Source launched Working Woodlands in December 2009, and the program has already attracted interest from landowners whose total holdings exceed 10,000 acres. Additionally, the Conservancy has certified its own Pennsylvania forest properties under FSC(R), and has led efforts globally to promote forest certification and carbon trading as incentives for conservation.

Under the pilot program with The Nature Conservancy, Domtar will donate US$30,000 over the next two years to help enroll a total of 20,000 acres in Working Woodlands. At least 4,000 acres are expected to be from owners of small plots of forested land near Domtar's Johnsonburg paper mill in Central Pennsylvania, but the impact could be far more extensive. Domtar and The Nature Conservancy said the pilot program may also expand to areas surrounding Domtar's mills in the Southeast United States.

"Well-managed forests can help both the environment and the economy," said Dylan Jenkins, Director of Forest Conservation for The Nature Conservancy's Pennsylvania chapter. "We want to encourage well-managed forests to remain forests. Working Woodlands is a win for our forests, our wildlife, our landowners, our economy and our planet," he said. "We're pleased to work with Domtar to help protect Pennsylvania's forests."

    For more information:     Working Woodlands http://www.nature.org/paforests     Sustainable Forestry http://www.domtar.com/fr/croissance-durable/index.asp

Loggers, Environmentalists Co-Manage Canadian Boreal Forest

The Canadian Boreal Forest Agreement was signed a few months ago by 21 forest companies and 9 leading environmental organizations. Components of the three-year agreement include the suspension of logging on parts of Boreal Forest equal to the size of Nevada and representing almost all Boreal caribou habitat within company tenures, to allow for intensive caribou protection planning while maintaining uninterrupted mill operations, and the suspension, by participating environmental organizations, of divestment and "do not buy" campaigns targeting the Boreal operations and products of companies participating in the Boreal Agreement.

Nat Geo News Watch invited Avrim Lazar, President and CEO, Forest Product Association of Canada, and Richard Brooks, Forest Campaign Coordinator, Greenpeace Canada, to write the accompanying op-ed article about the groundbreaking collaboration.

By Avrim Lazar and Richard Brooks

On May 18, 2010, the Canadian Boreal Forest Agreement was announced. It is one of the world's largest conservation agreements, setting forward a roadmap for achieving greater community, industry and forest sustainability and conservation in one of the world's last remaining and most important wilderness forests.

Our organizations plus eight other leading environmental organizations and 21 forest products companies signed the Agreement because it is ambitious and solutions-orientated and because we believe it will deliver results.

"It is what some have called one of the world's most astonishing partnerships."

It is what some have called one of the world's most astonishing partnerships.

Paradigm Shift

The Agreement is a paradigm shift and is a testament to leadership, courage and creativity. It creates the space to do conservation planning in an area twice the size of Germany at 72 million hectares [278,000 square miles]. If we are successful, and after a lot of hard work, it will lead to the creation of vast new protected areas, the application of new world-leading forest practices, a revitalization of the companies who are participants and support for the renewal of the communities which depend on the forest industry for jobs.

This revolutionary understanding between environmentalists and the forest industry did not come about over night. The negotiation process for the Agreement itself took close to two years in an environment fraught with tension and mistrust, targeted campaigns and marketplace uncertainty.

Click on the image to enlarge the map.

Map courtesy of Canadian Boreal Forest Agreement

It started as a conversation in which each party was speaking nearly a different language. With the aid of a translator, our facilitator, many long meetings, and a lot of good will and desire for change, we achieved the Agreement.

"This is the game-changer and the start of doing it differently."

In Canada, we had been butting heads and battling it out with a few notable but much smaller partnerships for nearly twenty years. This is the game-changer and the start of doing it differently.

The Canadian Boreal Forest is one of the world's most important forests. It is one of the largest storehouses of carbon on the planet--banking more than 200 billion tonnes in its soils and trees.

It is home to more than 600 First Nations and Aboriginal communities. It is the source of billions of dollars in forest products sold globally.

It is home to one billion migratory birds and is the source of fresh water for half of Canada. It is one of the few remaining, truly vast wilderness spaces left in the world.

Caribou a central driver

One of the central drivers of the creation of the Agreement was the state of woodlandcaribou, an iconic and umbrella species in the Boreal Forest.

The woodland caribou are threatened or endangered through much of their range and in recent years have become the poster child of environmental campaigns in regards to the Boreal Forest in Canada and internationally.

The plight of this animal has been dire and one of the Agreement's main goals is to have the trend towards extinction reversed though the achievement of conservation plans and new protected areas.

From the outset, the Agreement restricts logging and forestry on more than 26 million hectares of prime caribou habitat in order to create the space for our work to be done.

NGS stock photo of caribou bull by George F. Mobley

The Agreement also encompasses other main goals including the establishment of the world leading sustainable forest management practices, collaboration on life-cycle forest carbon projects, and support for communities.

Another important goal of the Agreement is the marketplace recognition for signatory companies in relation to progress on the goals of the Agreement.

Rewarding companies for leadership

Organizations such as Greenpeace, Canopy and ForestEthics, who have traditionally run "do not buy" and flashy boycott campaigns against the companies, will work with the companies to garner support in the marketplace for the achievements under the Agreement. In essence, rewarding the companies financially for their leadership work.

We have put important mechanisms in place to help us achieve our goals--a series of milestones to direct and track our progress in all aspects of our work, for example, designing conservation plans for caribou in a set period of time.

The milestones will be reported on regularly by an independent auditor who will not hold back in noting missed milestones and laggards. Leading customers and investors are also being convened to review and support progress.

Permanent change has not yet been achieved, but through our work over the coming months and years and much-needed trust-building, we hope to see radical change become long-lasting.

VIDEO: The Canadian Boreal Forest Agreement--a conversation hosted by the Pew Environment Group, between the Forest Products Association of Canada and Greenpeace on what the Agreement means to Canada and the world.

Through the Agreement, we will be able to come to the table with government as partners offering win-win solutions, rather than zero-sum choices between competing visions for how to manage our precious forestry resources. We tried the old way for a long time; now we are trying it a new way on the grandest scale possible.

"Companies of the Forest Product Association of Canada (FPAC) understand that the marketplace is changing, and that their customers care about where their products come from."

The member companies of the Forest Product Association of Canada (FPAC) understand that the marketplace is changing, and that their customers care about where their products come from. The environmental credentials of the products customers are buying is of key concern, and a prime condition in purchasing decisions.

When implemented, the Canadian Boreal Forest Agreement will provide FPAC members with a competitive market edge as it shows the marketplace the dedicated leadership the industry has to the environment, conservation efforts, and the importance of building lasting partnerships that commits them to secure the world's best sustainable forest management practices now and into the future.

In short, the Agreement recognizes that winning in today's global market for forestry products requires a focus on going green and working smart. FPAC's members get it, and the Agreement reflects this.

The Agreement and its signatories will not impose obligations on anyone other than the signatories. It recognizes the authority of governments and the role other stakeholders will need to play in the years ahead.

Aboriginal Peoples recognized

Importantly, the participants recognize that Canada's Aboriginal peoples, its First Nations, are governments as well, equal but different from provincial and national governments. These First Nations have say over their traditional territories on which the participant companies operate. We believe these governments and their communities will be decision-makers just like provincial governments and we hope they will support the outcomes of our planning work.

The collaborative leadership approach to the Agreement indicates that the values of 21st-century leadership must include the interwoven aspects of the environment and the economy. Without one supporting the other the feasibility of a sustainable future is virtually impossible.

It is this leadership that spurs innovative thinking, collaborative partnerships and successful future endeavours in both business and in resource management.

The Canadian Boreal Forest Agreement is the backbone to the idea that more can be done and that boundaries should never be drawn on environmental progress. This Agreement is the new environmental and business model for the world.

--Avrim Lazar, President and CEO, Forest Product Association of Canada
--Richard Brooks, Forest Campaign Coordinator, Greenpeace Canada

Richard Brooks (left), Steve Kallick of the Pew Environment Group (center), and Avrim Lazar shake hands on the deal.

Photo courtesy of Canadian Boreal Forest Agreement

Environmental Organizations Participating in the Agreement:

Canadian Boreal Initiative, Canadian Parks and Wilderness Society, Canopy, David Suzuki Foundation, ForestEthics, Greenpeace, The Nature Conservancy, Pew Environment Group International Boreal Conservation Campaign, and Ivey Foundation

Forestry Companies Participating in the Agreement:

AbitibiBowater Inc., Alberta-Pacific Forest Industries Inc., AV Group, Canfor Corporation, Canfor Pulp Limited Partnership, Cariboo Pulp & Paper Company, Cascades inc., Daishowa-Marubeni International Ltd., F.F. Soucy Inc., Howe Sound Pulp and Paper Limited Partnership, Kruger Inc., Louisiana-Pacific Canada Ltd., Mercer International, Mill & Timber Products Ltd., NewPage Corporation, Papier Masson Ltée, SFK Pâte, Tembec, Tolko Industries Ltd., West FraserTimber Co. Ltd., and Weyerhaeuser Company Limited -- all represented by the Forest Products Association of Canada

Full text of the Agreement (1.08MB pdf)