The amount of forest conserved by carbon finance grew to 26.5 million hectares in 2012, a new report says

Carbon finance supported the management of forests spanning 26.5 million hectares worldwide as businesses in 2012 injected $216 million into projects that plant trees, avoid deforestation, improve forest management and support low-carbon agriculture, according to the 2013 State of the Forest Carbon Markets report released by non-profit researchers Forest Trends’ Ecosystem Marketplace this week in London.

All these projects (162 in 58 countries), a key defense against the ecological and socio-economic impacts of climate change, were financed by the sale of 28 million tonnes of carbon offsets. While market size grew 9%, the global average price for forestry offsets was $7.8/tonne – down from $9.2/tonne in 2011, but still higher than prices paid by voluntary buyers for other offset types ($5.9/tonne).

So, this year’s report findings illustrate growing corporate interest in incentive payments to protect forests as a climate response “This reports demonstrates that financing forests’ conservation and sustainable management is not just about license to do business, or image. It can directly benefit companies’ infrastructure, suppliers, and bottom lines”,says Forest Trends president and CEO Michael Jenkins.

Projects that reduce emissions from deforestation and degradation (“REDD”) saw heightened demand in 2012, as private companies like The Walt Disney Company and clothing brand Puma invested millions to support REDD projects in developing countries. A total of 8.6 million REDD offsets were transacted, tying with tree planting activities as 2012’s most popular project types. Projects that improve forest management climbed in popularity, while carbon finance for sustainable agriculture remained muted. However, the private sector and negotiators are increasingly attentive to agricultural carbon projects’ strong business case and benefits to avoided deforestation.

On the other hand, offset buyers strongly supported forest projects that deliver benefits beyond carbon sequestration, such as alternative local livelihoods and habitat protection for threatened species. However, even with strong growth in forestry offset demand in 2012, forest project developers reported 30 million tonnes that remained unsold at year’s end. Though developers predict strong market growth, their projects’ emissions reductions are expected to outstrip historical offset demand, with developers expecting to reduce another 1.4 billion tonnes of emissions over the next five years. And most of these reductions will come from REDD projects.

The State of the Forest Carbon Markets 2013 is freely available. You can download the report here:


China is willing to work with U.N to fight against climate change

China is willing to work with U.N to fight against climate change and it wants to establish a new global deal about this issue.  However, the country’s top climate change official, Xie Zhenhua, has said that the key to progress is getting rich nations to keep pledges to fund mitigation steps by poorer countries.

Representatives of more than 190 nations are going to meet in Warsaw from Nov 11 to 22 to push towards a new global deal to cut climate-warming greenhouse gases. It is set to take effect by 2020.

Last month, the United States’ chief climate change envoy, Todd Stern, urged a more flexible approach over a new pact to succeed the Kyoto Protocol, saying nations should be allowed to set individual timetables and commitments. And Xie Zhenhua is agreed with him.  “As long as it is fair, and accords with the principle of ‘common but differentiated responsibilities’, we have a very flexible approach,” he told.

However, Xie has insisted that funding was critical to solving the disputes, with richer countries still not having released funds promised in 2009 to help poorer nations adapt to climate change and to cut their own emissions. The measures included “fast-start” funds of $30 billion by 2015 and an annual fund of $100 billion to developing countries by 2020.

Developing nations would only be obliged to meet climate change pledges once funding from richer nations was in place, the National Development and Reform Commission (NDRC) said in a document issued ahead of the news conference. “Although the developed countries have not lived up to their commitments, developing countries have taken active measures to combat climate change, especially China,” Xie said.

Xie confirmed that three cities and provinces in China – Beijing, Guangdong and Shanghai – would launch emissions trading markets before the end of the year, adding to a carbon trading scheme introduced in Shenzhen in June.

Mexico’s Senate approves a new tax on fossil fuel use

Mexico’s Senate has approved a new tax on fossil fuel use that will allow companies to buy and surrender U.N. -backed carbon credits instead of paying the charge. The bill had already passed a vote in the lower house last week and is likely to have to return there for final approval before President Enrique Pena Nieto can pass it into law.

The bill requires companies from next year to pay around $5 per tonne of carbon dioxide they emit. It exempts crude oil and natural gas producers but it will apply to producers of byproducts including gasoline, diesel, propane, butane and coal. However, companies can surrender an equivalent amount of Certified Emission Reductions (CERs) from carbon cutting projects hosted in Mexico.

The law is expected to boost demand for carbon credits from Mexican projects registered under the U.N.’s Clean Development Mechanism (CDM). The CDM allows investors in CO2 reduction projects located in developing nations to earn carbon credits that governments and companies can use to offset their emissions.

 “If this bill is signed into law the way it is now, as seems that will be the case, a Mexican carbon market will ‘de facto’ be created,” said Eduardo Piquero, who is  developing a platform to host carbon trade for the exchange. “It will be a market with demand and offerings from private and public Mexican companies,” said Piquero.

Mario Alberto Santillan, who coordinates a CDM project at coal mines owned by Minerales Moncloya, said the firm planned to use all of the expected 300,000 CERs/year from the project to help avoid the tax. Some 210 Mexican projects currently in the CDM pipeline are expected to earn more than 200 million credits by 2020. “We have possibilities for additional CDM projects that could generate some 3.5 million credits, and now I think we should speed up those plans,” Santillan said.

So, it is clear that industrial companies likely to face the tax had lobbied for the inclusion of the offset provision to help limit cost.



Greenhouse emissions by developing countries will surpass those of rich nations this decade

China and other emerging nations are responsible for 48 per cent of cumulative emissions from 1850 to 2010, according to the study by the PBL Netherlands Environmental Assessment Agency, research group Ecofys and the European Commission’s Joint Research Centre.

Therefore, the total greenhouse gas emissions by China and other emerging nations since 1850 will surpass those of rich nations this decade. In fact, the report predicted that their share of cumulative emissions would reach 51 per cent by 2020.

China, with 1.3 billion inhabitants, argues that its per capita emissions since 1850 are still far below those of developed nations, meaning it has less responsibility to rein in emissions than rich nations.

Also, this study said that the biggest emitters since 1850, taken as the start of widespread industrial use of fossil fuels that emit greenhouse gases when burnt, were the United States, China, the European Union and Russia.

On the other hand, the PBL Netherlands Environmental Assessment Agency said that world emissions of carbon dioxide rose by just 1.1 per cent in 2012 to a record 34.5 billion tonnes, a slowdown from annual gains averaging 2.9 per cent since 2000.

“This is remarkable”, it said in a statement. “This development signals a shift towards less fossil-fuel-intensive activities, more use of renewable energy and increased energy saving.”


European Union will establish an ambitious climate policy by 2030

Thirteen European environment ministers and dozens of business leaders, such as Coca Cola Enterprises and Shell, urged the European Union on Monday to adopt “ambitious” energy and climate goals for 2030 to create a low-carbon economy in Europe to encourage investment. Therefore, they want to offer a strict emissions cut pledge at a climate summit which will take place next autumn.

“Businesses and investors are telling us that the EU needs to get its act together … only then will investors have the confidence to put the billions into low carbon that we need,” Edward Davey, Britain’s energy and climate change secretary, said in a statement.

The EU has met a target to cut 1990-level greenhouse gas emissions by 20 percent by 2020, as a result of lower energy demand following recession and a shift towards green power, such as solar and wind. Now, the EU has to establish a target by 2030. They are thinking of cutting a 40 percent in domestic emissions versus 1990 levels by that year.

A decision on the EU’s 2030 target will form the basis of the its potential emissions reduction offer as part of United Nations’ climate negotiations on a global climate deal and Governments are under pressure to offer large cuts by a September summit hosted by U.N. Secretary General Ban Ki-Moon.

On the other hand, the European Commission is also considering ways to reform the structure of the EU’s Emissions Trading System (ETS). This is because EU carbon permit prices have lost around 75 percent of their value over the past five years due to the over-supply of permits and dampened demand due to recession.

The Commission is expected to publish structural reforms by the end of this year, but it has yet to confirm details. Some observers have said the favored reform option would be to set up a mechanism to regulate the supply of EU carbon permits.

Private sector fights against climate change more than Governments

Voluntary REDD projects are actively protecting more than 14 million hectares of endangered forest.

Not only are these private-sector actors protecting millions of hectares of endangered forest, but they are doing so in a way that creates rigorous methods for measuring the amount of carbon captured in forests, methods that others can learn from and implement themselves.

And that, in fact, is exactly what’s happening, with state and regional governments around the world harvesting lessons learned in the voluntary carbon markets to develop their own home-grown programs.

So, why are these green-minded entrepreneurs risking hundreds of millions of dollars to save the forest and develop new methods that the rest of us can use? Partly because governments told them to. Governments reward entrepreneurs for taking action on climate change by saving endangered forest, but how these same governments are now leaving some of the most productive projects in limbo.

the private sector began stepping up as early as 2007, when the United Nations Framework Convention on Climate Change (UNFCCC) formally recognized the idea of creating a REDD mechanism. Three big projects have been developed: Kasigau in Kenia, Alto Mayo in Peru and Pdar Meanchey in Cambodia. 14 millions of hectares have been protected, 70.000 millions of local people have been directly benefiting from project activities and 4 million of carbon emissions have been reduced since 2009. And, in 2011, a 67% of the investment came from private sector.

Beyond the three big projects highlighted above, the paper points to a review of 41 projects that created thousands of jobs, built schools, and funded scholarships. It points, in other words, to a mechanism that is working, and is delivering results with limited resources from voluntary buyers.

Voluntary carbon projects have already earned the trust of US companies like Microsoft and Disney and developing country companies like Brazil’s Natura Cosmetics, which are more than willing to voluntarily buy REDD offsets that conform to standards that they know and trust.

But these voluntary buyers are the minority, and private-sector funding won’t begin to flow on the kind of scale needed to slow climate change until governments impose global caps on greenhouse gas emissions, enacting policies that reward conservation with an adequate price on carbon. Until that happens, governments that choose to support REDD need to make sure that they are not leaving the good projects already underway in the lurch. Otherwise, not only will we lose the progress made to date, but we will dampen the enthusiasm of green entrepreneurs to take on risk to do the right thing.

Merkel gives optimism to carbon traders as UK embraces new nuclear

It’s been one month since the German election, yet all eyes are still on Europe’s biggest economy as it seeks to form a government. And clean energy investors and carbon traders both feel they have a stake in the outcome of coalition negotiations between Chancellor Angela Merkel’s Christian Democratic Union and the Social Democratic Party.

Carbon permit prices spiked 8.5% last Wednesday – the biggest jump in more than three months – after Chancellor Merkel voiced her support for a European Union plan to strengthen the region’s emissions trading market. Her comments, in a speech to a labour group in Hanover, were her most explicit yet in support of the proposal to temporarily delay sales of permits, an emergency solution known as backloading, to address an oversupply in the market. “We need a certain degree of backloading of CO2 emissions so certificate prices return to a sensible level,” she said. It is still unclear how quickly Germany could announce its official support of the plan – whether before or after the new coalition takes power.

As well as playing a key role in the future of EU emissions-trading system, Merkel’s government will need to take on big challenges at home. Somewhere near the top of the chancellor’s list is likely the country’s future energy landscape.

The reform of the Erneuerbare-Energien-Gesetz (EEG) will become a priority once a coalition is formed. Under the EEG, the government guarantees above-market prices for wind, biomass and solar power generators. The difference between the rate paid to clean-energy producers, which get priority access to the grid, and the market price, is offset by a charge added to every household bill. The overall cost to consumers will increase from EUR 20.4bn this year to EUR 23.6bn in 2014.

Merkel is looking for ways to reduce the rising cost of renewable subsidies without stunting the growth of clean energy capacity after Germany decided to close its nuclear power plants in the wake of the Fukushima disaster in Japan.

However, other European countries have not acted so hastily against nuclear. Indeed, on Monday it was announced that Electricite de France, together with partners Areva and two Chinese nuclear companies, will build the UK’s first nuclear reactors since 1995 after reaching a deal with the government on guaranteed prices for the power they’ll generate. The project will cost about GBP 16bn (USD 26bn) and take 10 years to build. “This marks the next generation of nuclear power in Britain, which has an important part to play in contributing to our future energy needs”, said UK Prime Minister David Cameron.


New Study Reveals Timeframe for Climate Change

The seesaw variability of global temperatures often engenders debate over how seriously we should take climate change.

But within 35 years, even the lowest monthly dips in temperatures will be hotter than we’ve experienced in the past 150 years, according to a new and massive analysis of all climate models.

Ecological and societal disruptions by modern climate change are critically determined by the time frame over which climates shift. Camilo Mora and colleagues in the College of Social Sciences’ Department of Geography at the University of Hawai’i at Mānoa have developed one such time frame. The study, titled “The projected timing of climate departure from recent variability” provides an index of the year when the mean climate of any given location on Earth will shift continuously outside the most extreme records experienced in the past 150 years.

The new index shows a surprising result.  Areas in the tropics are projected to experience unprecedented climates first – within the next decade. Under a business-as-usual scenario, the index shows the average location on Earth will experience a radically different climate by 2047. Under an alternate scenario with greenhouse gas emissions stabilization, the global mean climate departure will be 2069.

So, tropical species are unaccustomed to climate variability and are therefore more vulnerable to relatively small changes. The tropics hold the world’s greatest diversity of marine and terrestrial species and will experience unprecedented climates some 10 years earlier than anywhere else on Earth. Rapid change will tamper with the functioning of Earth’s biological systems, forcing species to either move in an attempt to track suitable climates, stay and try to adapt to the new climate, or go extinct.

These changes will affect our social systems as well.  In predominately developing countries, over one billion people under an optimistic scenario, and five billion under a business-as-usual-scenario, live in areas that will experience extreme climates before 2050. This raises concerns for changes in the supply of food and water, human health, wider spread of infectious diseases, heat stress, conflicts, and challenges to economies.

While the study describes global averages, the authors have visualized their data on an interactive map displaying when climate will exceed historical precedents for locations around the world. The index used the minimum and maximum temperatures from 1860-2005 to define the bounds of historical climate variability at any given location.

The scientists then took projections for the next 100 years to identify the year in which the future temperature at any given location on Earth will shift completely outside the limits of historical precedents, defining that year as the year of climate departure.

The data came from 39 Earth System Models developed independently by 21 climate centers in 12 different countries.  The models have been effective at reproducing current climate conditions and varied in their projected departure times by no more than five years.

 “Scientists have repeatedly warned about climate change and its likely effects on biodiversity and people,” said Mora. “Our study shows that such changes are already upon us. These results should not be reason to give up. Rather, they should encourage us to reduce emissions and slow the rate of climate change. This can buy time for species, ecosystems, and ourselves to adapt to the coming changes.”

Commission’s EU ETS proposals for international aviation

The European Commission has proposed amending the EU emissions trading system (EU ETS) so that aviation emissions would be covered for the part of flights that takes place in European regional airspace.

The adjustment in the legislation would apply from 1 January 2014 and until a global market-based mechanism (MBM) becomes applicable to international aviation emissions by 2020, as planned by the International Civil Aviation Organization (ICAO).

Connie Hedegaard, European Commissioner for Climate Action, said: “In the light of the recent progress made at ICAO the European Commission has proposed to adjust the EU ETS so that emissions from the aviation sector would be covered for the part of flights that takes place in European regional airspace. The European Union has reduced greenhouse gas emissions considerably. The aviation sector also has to contribute, as aviation emission are increasing fast – doubling since 1990.  She added: “I am confident that the European Parliament and the Council will move swiftly and approve this proposal without delay”.

The key features of the revised ETS system resulting from this proposal would be as follows:

-All emissions from flights between airports in the European Economic Area (EEA, covering the 28 EU Member States plus Norway and Iceland) would continue to be covered.

-From 2014 to 2020, flights to and from countries outside the EEA would benefit from a general exemption for those emissions that take place outside EEA airspace. Only emissions from the part of flights taking place within EEA airspace would be covered. 

-To accommodate the special circumstances of developing countries, flights to and from third countries which are not developed countries and which emit less than 1% of global aviation emissions would benefit from a full exemption.

The Commission would like to see the proposal agreed by the European Parliament and Council by March 2014 to provide clarity for aircraft operators, who would otherwise have to surrender allowances for their all emissions on flights in 2013 to and from third countries by 30 April 2014.


Reprogramming Existing City Infrastructure for Sustainability

Across the world, innovative solutions to urban needs are emerging from new uses for existing structures and systems. Scott Burnham, who has created and directed design and urban initiatives in major cities worldwide, has written a recent article explaining some of the best projects that have been made lastly.  

One of them has been developed by engineers at the local University of Engineering and Technology (UTEC) in Lima. For those living on the edges of Peru’s capital, access to clean drinking water is a problem. So, they decided to tackle the issue by making innovative use of two of the city’s more abundant resources: its humid air (which can reach 98 percent humidity), and the billboards that reach into it. They installed a humidity collector and water purifier into the top of one advertising structure in the village of Bujama, creating the UTEC Water Billboard. It can produce 96 liters of clean drinking water a day for local residents, which flows down a pipe to a tap at the base of the structure.

Seven thousand miles away, the residents of Umea, a city 300 miles north of Stockholm in Sweden, spend six months each year with little access to another  natural resource: sunlight. What the city does have, however, is plenty of buses and bus stops.  Local energy company, Umea Energi, saw an opportunity in the intersection of the need for sunlight and for shelter. It replaced the lights in the shells of 30 bus stops around the city with UV light therapy tubes powered by solar energy, transforming the bus stops into “therapy saloons…to give the people of Umea an extra energy boost when they needed it the most,” as the company says.  After the installation of the light therapy bulbs, the use of public buses in Umea increased by 50 percent.

Also, Burnham explains that time is a great decider of what stays and what disappears from the urban landscape. As technology and social behavior changes, so do the physical elements of the city. Phone booths and emergency call sites have given way to the mobile phone in which everyday objects are embedded with sensors and wifi-enabled.

In New York, a partnership between the City and two telecommunications companies, Cisco and City 24/7, has seen 250 phone boxes repurposed as information point touchscreens. The business model replaces advertising for coins: a person might tap on the screen to find the way to the nearest park, and also be alerted to a few offers from local shops and restaurants, which can be stored on their smartphone. The information points can also act as communication tools during emergencies. If this pilot is successful, all of the city’s 12,500 pay phones could be replaced.

 In Vienna, Telekom Austria has found another use for hundreds of its disused phone booths: converting them into electric car charging stations. Drivers have the option to pay from their phone via SMS text messaging.

Back in New York, numerous scaffolding structures can be left standing for years. Brooklyn designers Bland Hoke and Howard Chambers saw an opportunity to rethink these structures. The result was Softwalks, a kit of seats, benches, counter tops and planters that bolt onto existing scaffolding structures to transform them into spaces for social gatherings or personal relaxation.

 So, according to Burnham, cities are celebrated as terrains of infinite. But cities also face tough challenges: from population growth and congestion, to emissions targets and economic competition. As existing resources come under pressure, there will be rewards for innovators who can stretch their applications in new directions.