MARKETING DEFORESTATION?

This is the law of unintended consequences at work. The vaunted free-market solution to climate change, like all free markets, requires rational regulation. Otherwise, creating incentives for the developed world to reduce emissions winds up incentivizing the destruction of precious resources.

Carbon market encourages chopping forests – study
August 14, 2007 (Reuters via Yahoo Asia News)

WHO
Scientists Gustavo A. B. da Fonseca, Carlos Manuel Rodriguez, Guy Midgley, Jonah Busch, Lee Hannah and Russell A. Mittermeier

The best intentions can produce the worst results in the world. (click to enlarge)

WHAT
In a report entitled No Forest Left Behind, the scientists describe how the global trade in emissions credits encourages devastating deforestation. They call for “preventive credits” to reward developing nations for protecting their tropical forests. This idea is appealing but lends itself to scheming.

WHEN
The report was published August 13.

WHERE
- The report was published in Public Library of Science Biology.
- 20% of Earth’s remaining intact tropical forests are in 10 countries and 1 French territory: Panama, Colombia, Democratic Republic of Congo, Peru, Belize, Gabon, Guyana, Suriname, Bhutan, Zambia and the territory of French Guiana.

WHY
- Aside from the sheer beauty and rare treasures in these disappearing forests, they are carbon sinks, absorbing climate change-inducing greenhouse gas emissions. They also protect watersheds, encourage pollination and preserve biodiversity.
- Countries who have not cut away their forests, they are caught in an ironic situation: Under Kyoto Clean Development Mechanism (CDM) rules, they can sell no credits to EU or other emissions trading nations for preventing deforestation. They also get no credit for REforestation. The only way they can profit from emissions trading is to begin cutting away the forests in anticipation of becoming part of a cap-and-trade system. When that happens, their deforestation will be capped and they can sell credits for not continuing the devastation.
- The scientists recommend establishing an average amount of deforestation going on in all the tropical forest-holding nations in the world and then giving the nations who are protecting their forests credits to sell now for how much under the average they remain.

This chart identifies the particular "carbon credit" circumstances that lead to deforestation. (click to enlarge)

QUOTES
- Gustavo Fonseca, study co-author: "The countries that haven't really been the target of deforestation have nothing to sell because they haven't deforested anything…So that creates a perverse incentive for them to actually start deforesting, so that in the future, they might be allowed to actually cap-and-trade, as they call it: you put a cap on your deforestation and you trade that piece that hasn't been deforested…"
- Russell Mittermeier, study co-author/ president, Conservation International: "People are talking a lot about vehicle emissions, industrial emissions, biofuels and recycling…Forests were barely in there and yet forests are ... perhaps the major contributor [to global climate change].”