Issues in Forestry Carbon Crediting
IEA Bioenergy Task 38 Workshop
Canberra, Australia
March 28-30, 2001
Doug Bradley
Domtar Inc.
1
Issues in Forestry Carbon Trading
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New Zealand workshop
What is in/not in Kyoto
Who is buying what credits
Trading Issues
Amortization
Example projects
Harvested Wood products
What need to move forward
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To Tai Toko Workshop- Feb 16-18
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To Tai Toko Workshop
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A sunny day in indigenous forest
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Dinner at “Lodge Ford-Robertson”
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Accommodation in “Garage Villa”
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Delegates watch river rise
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Raging To Tai Toko River
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A minor “slip”
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Escape to Freedom
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Kyoto- In vs Not yet in
IN KYOTO
NOT YET IN KYOTO
_________Fossil Fuel Reduction_ ____Carbon Sequestration_____________
Energy Efficiency
Reduce fossil fuel
Fuel Switching
Afforest., Reforest
(Biomass for fossil fuel)
Deforestation
Reduces fossil fuel
Sequesters carbon
(defn. - Article 3.3)
Other Forestry, Agricultural
Activities
Sequesters carbon
(negotiated- Article 3.4)
Examples:
-Fuel efficient motors -Wood waste cogen -Planting on poor agric. land
-Waste heat capture -Black liquor
-Reducing deforestation
-Prod’n enhancemt integrated gasific.
-Improved Maint.
and combined cycle cogen
Forestry:
-Pest and disease control
-Fire control
-Commercial thinning
-Juvenile Spacing
-Tree Improvment
- Reduc. impact logging
Agricultural:
-Reduced tillage
-Manure management
-Shelterbelts
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Who is buying what?
• Ontario Power Gen
• BC Hydro
• Seattle City Light
• TransAlta
• Gemco
• All sinks- if thru PERT
• No sequestration, no
business as usual
• Sequestration- Kyoto only
• Sequestration- Kyoto- no
conservation or forest mgt
(1.Can 2.Aus, 3.NZ 4.US…)
• Sinks including agriculture
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Trading Issues
Lack of clear guidelines is holding up action
• In Kyoto vs not
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“Business as Usual”
Discounting
Harvested wood products
First commitment period
14
Implications of Commitment Period
400
Kyoto Period
350
300
250
Plantation 1
Plantation 2
Plantation 3
200
150
100
2014
2012
2010
2008
2006
2004
2002
2000
1998
1996
1994
1992
0
1990
50
15
Possible Accounting Method
Hypothetical
Managed Forest Stand
Use of Amortization
Cumulative carbon stock changes (tons C/ha)
120
Carbon in trees
100
80
60
40
Cumulative credits
20
0
0
10
20
30
40
50
60
70
80
90
100
Time (years)
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Carbon Impacts of Sequestration Activities
Initial
Long Term
sequestr.
sequestr.
sequestr.
emission
emission
emission
sequestr
sequestr.
sequestr.
sequestr.
sequestr.
sequestr.
emission
sequestr.
Forestry:
Afforestation
Pest spray
Tree Improvement
Juvenile spacing
Commercial thinning
Fertilization
Other:
Landfill Incineration
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Pre-commercial Thinning
(Juvenile Spacing)
Unthinned
Thinned
18
Yield Curve
Natural vs Spaced
Sewell
Biomass (t/ha)
250
200
150
Spaced Msmt
100
Spaced - Curve
Control - Actual
50
Control - Curve
0
0
20
40
60
80
100
120
19
Impact of forest management
20
Natural Jack Pine Forest
(Baseline)
Forest and Products Carbon Pools
Gorcam model
21
Juvenile Spaced Stand
Forest and Products Carbon Pools
Gorcam Model
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Net Emissions
Control vs Spaced
Gorcam Model
Stand-level Net Biomass
500
Landfill
400
LLP
Net Biomass
(t CO2e/ ha)
300
SLP
200
Other Veg.
100
0
-1002000 2020 2040 2060 2080 2100 2120 2140 2160 2180 2200
-200
Trees
Litter
Roots
Soil
-300
Total (w ith landfill)
-400
Ye a r
Total (no landfill)
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Stand Sequestration
Annual Crediting
Gorcam Model
Stand Net Sequestration- Tonnes CO2/ha
250
200
150
100
50
0
-502000 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100 2110 2120 2130
-100
-150
Net Biomass
Net All Pools
Amortized Sequestration
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Actual vs Amortized Sequestration
Cumulative
(tonnes CO2e/ha)
90
80
70
60
Kyoto Period
50
40
30
20
Amortized
Actual
Actual 2
Amort 2
10
0
19
90
19
92
19
94
19
96
19
98
20
00
20
02
20
04
20
06
20
08
20
10
20
12
20
14
20
16
20
18
-10
-20
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New Concept- Phases of Acceptance
Concept- “Give credit for long term benefit
even if short term emission”
• Utterly ridiculous!
• Violently opposed!
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Accepted and felt to be always selfevident
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Jack Pine Bud Worm Spray Program
• Epidemics cycle 5-7 years
• Result in tree mortality, growth loss
• Assumptions
– 17% outright mortality- years 2-4
– 10% less growth p.a. – years 2-6
– 10% mortality due to top kill- year 7
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Bud Worm Spray Program
Stand Level Biomass
Gorcam Model
Yield Curves
180
160
Biomass (t/ha)
140
120
100
80
60
Treated
Infected
40
20
0
0
10
20
30
40
50
60
70
80
Year
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Biomass with JPBW Attack
Baseline
450
400
350
Landfill
LLP
SLP
Other Veg.
Trees
Litter
Roots
Soil
Biomass (t/ha)
300
250
200
150
100
50
0
0
10
20
30
40
50
60
70
80
90
100
110
Year
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Biomass with JPBW Suppression
Project
450
400
350
Landfill
LLP
SLP
Other Veg
Trees
Litter
Roots
Soil
Biomass (t/ha)
300
250
200
150
100
50
0
0
10
20
30
40
50
60
70
80
90
100
110
Year
30
Bud Worm Spray Program
Gorcam Model
Stand Level
Stand-level Net Biomass
100
80
60
Net Biomass
(t CO2e/ ha)
40
20
0
2000
2010
2020
2030
2040
2050
2060
-20
-40
2070
2080
2090
2100
2110
Landfill
LLP
SLP
Other Veg.
Trees
Litter
Roots
Soil
Total (with landfill)
Total (no landfill)
-60
-80
-100
Year
31
Bud Worm Spray Program
Gorcam Model
Forest-level Net Biomass
100
80
60
Landfill
LLP
40
SLP
Biomass
(t CO2e)
20
0
2000
Other Veg
Trees
2010
2020
2030
2040
2050
2060
2070
2080
2090
2100
2110
Litter
Roots
-20
Soil
-40
Total (without Landfill)
Total (with Landfill)
-60
-80
-100
Year
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Pest Control Carbon Balance
Kyoto Period
1400
1200
1000
800
Actual
Amort
600
400
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
0
1993
200
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Combined Spray-Spacing in Carbon “Pool”
2000000
Kyoto Period
1500000
1000000
Pest
Space
New Net
Amortized
500000
0
1993
1998
2003
2008
-500000
-1000000
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Domtar Wood Products Parameters
• Harvest (Domtar operations)
– Biofuel 26%, short-lived 19%, long-lived 30%, landfill
<1%, on-site waste 25%
• Wood Products
– Short-lived
• Avg lifetime 5 years
• Biofuel 25%, compost 15%, landfill 10%, recycled 50%
– Long-lived
• Avg lifetime 30 years
• Biofuels 25%, landfill 10%, recycled 65%
• Landfill
– Average lifetime- 42 years
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Wood Products Carbon
5 yr decay
35
30
25
20
15
10
5
0
2
3
4
5
6
7
8
9 10 11 12 13 14 15 16 17 18 19 20
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Wood Products Carbon
10 yr decay
60
50
40
30
20
10
0
2
3
4
5
6
7
8
9 10 11 12 13 14 15 16 17 18 19 20
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Wood Products-
Ken Skog- USDA Forestry- decay estimates
100
90
80
70
60
50
40
30
20
10
0
2
3
4
5
6
7
8
9 10 11 12 13 14 15 16 17 18 19 20
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European Forest Institute
Carbon Balance Implications of ….Wood Products
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Life Cycle- NZ Plantation Forest
350
300
250
Energy
Avoided
Products
Forest
200
150
100
50
150
140
130
120
110
100
90
80
70
60
50
40
30
20
10
0
0
40
Existing Forest Intensively Managed
500
New Energy
Energy
Avoided
Products
Incr Mgt
Forest
450
400
350
300
250
200
150
100
50
0
0
10 20 30 40 50 60 70 80 90 100 110 120 130 140 150
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Carbon Credit Market
800
750
700
650
600
Need reductions or credits
First
Commitment
Period
550
500
450
Emissions
Reductions
Presumed Target
19
90
19
92
19
94
19
96
19
98
20
00
20
02
20
04
20
06
20
08
20
10
20
12
400
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Current Pricing
Low
High
Cantor Fitzgerald $0.77
$3.09
Gemco
$1.50
SaskPower
$1.00
Deal
$0.83
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What do we want to happen?
• Increase use of biomass
– biofuel, biochemicals….
• Increase amount of biomass
– Eg. through intensive forest management
• Increase demand for wood
How can this happen?
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Incentives to promote forest carbon
sequestration
• Forest management in Kyoto
• Standard accounting system
• Acceptance of forest measurement
methods (periodic sample plots)
• Amortization methodologies
• Include all carbon pools
• Recognition of 1991-2007 activities
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