April 2010

For thousands of years, we have been planting and growing trees without difficulty. It’s simple, and forest carbon business strategy can be, too. In fact, it’s core to what I’m trying to teach the MBA/MS students in my course at the Erb Institute this semester: If the world’s best available technology for removing carbon dioxide from the atmosphere is employing the natural photosynthetic capacity of natural forest management, we can too.

But in many ways, we are all unable to see the forests for the trees.

How does carbon trading work? Does it really help tackle climate change? Isn’t it all just smoke and mirrors? Is the Kyoto Protocol doing any good?

These and similar questions are increasingly being asked as the evidence for global warming mounts, scientists tell us more of dramatic climatic impacts we can expect, and pressure for measures to rein in greenhouse gas emissions heightens. At the same time, there are warnings from industry over the costs in jobs, profits and consumer prices that will stem from mandatory carbon trading regulation.

Time is now short for forestry projects to deliver any worthwhile volume of carbon credits to the CER market by 2012. While the bottlenecks that have held back the afforestation and reforestation (A/R) sector in Kyoto’s Clean Development Mechanism (CDM) are now mostly resolved, it may be too late to help developed nations in their efforts to meet Kyoto emissions reduction targets.

The European Commission will tomorrow state that it is opposed to the inclusion of forest-based carbon credits in the ETS, in a wide-ranging Communication on deforestation and how the European community plans to deal with it. The Communication will say that the aim should be to reduce deforestation by 2020 and halt it by 2030.