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UNEP-IUCN-FAO „CDM and Forestry“ Addis, Oct 2003. Accounting for non-permanence of carbon sequestration – options as contained in FCCC/SBSTA/2003/10/Add.3. Jens Mackensen. (following presentation by Martina Jung, HWWA, Manila). UNEP-IUCN-FAO „CDM and Forestry“ Addis, Oct 2003.
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UNEP-IUCN-FAO „CDM and Forestry“ Addis, Oct 2003 Accounting for non-permanence of carbon sequestration – options as contained in FCCC/SBSTA/2003/10/Add.3 Jens Mackensen (following presentation by Martina Jung, HWWA, Manila)
UNEP-IUCN-FAO „CDM and Forestry“ Addis, Oct 2003 The negotiaton text offers three options for accounting of non-permanence: 1) rCERs (removal Certified Emission Reductions) 2) tRMUs (temporary Removal Units) 3) iCERs (insured Certified Emission Reductions)
UNEP-IUCN-FAO „CDM and Forestry“ Addis, Oct 2003 rCERs • „Temporary“ credit • Validity? • - (Only valid for CP in which it was issued) or • Expiry 5 (20) years after issuance • Not bankable • If carbon is lost upon expiry of rCER, it has to be replaced by other (temporal or permanent) credits
UNEP-IUCN-FAO „CDM and Forestry“ Addis, Oct 2003 tRMUs • „Temporary“ credit converted CER from forest CDM project (after 2% for adaptation fund subtracted) • Validity? • - Valid for actual Commitment Period, in which it was issued • - End of subsequent CP to which it was issued • Not bankable • An expired tRMU can be replaced by a valid tRMU up to 7 (x?) times / CP (total of 35 years) • Afterwards, tRMU has to be replaced by a permanent credit
UNEP-IUCN-FAO „CDM and Forestry“ Addis, Oct 2003 iCERs • (Permanent) CER, insured up to at least [Y] years after end of crediting period • In case of GHG release (during verification period), insurance has to replace the respective amount of iCERs with other credits • If insurance provider unable, Annex 1 country in possession of iCER is liable • No liability after end of insurance coverage
UNEP-IUCN-FAO „CDM and Forestry“ Addis, Oct 2003 Crediting Approaches
UNEP-IUCN-FAO „CDM and Forestry“ Addis, Oct 2003 Carbon accounting • Total stock change • Average stock change • Delayed total stock J.44. The certification report shall constitute a request to the Executive Board for issuance of [CERs] [rCERs] [or ICERs] equal to the verified amount of net anthroponic greenhouse gas removals by sinks achieved by the afforestation and reforestation project activity under the CDM [during the [verification] period] [since the start of the project].
UNEP-IUCN-FAO „CDM and Forestry“ Addis, Oct 2003 Certification and issuance carbon rCER time t0 t1 Carbon stock accounting: Total stock change, advanced crediting - t1: here end of 1st Commitment Period (could be earlier) - rCERs valid for CP in which certification has taken place - Problem: risk of carbon release afetr t1 (full amount has not neen stored for t1-t0)
UNEP-IUCN-FAO „CDM and Forestry“ Addis, Oct 2003 Certification and issuance carbon time t0 t1 rCER Carbon stock accounting: Average stock change, advanced crediting • - t1: here end of 1st Commitment Period (could be earlier) • - rCERs valid for CP in which certification has taken place • If release after t1, but amount of rCERs represent sequestration in t1-t0 • Economically unattractive
UNEP-IUCN-FAO „CDM and Forestry“ Addis, Oct 2003 Initial certification Certification and issuance carbon rCER t0 t1 t2 Carbon stock accounting: Total stock change, delayed crediting • If total stock change of t1 maintained , full issuance of rCERs at t2 • Amount of rCERs represents real storage (risk of early release avoided) • Economically unattractive, because income flow very late time
UNEP-IUCN-FAO „CDM and Forestry“ Addis, Oct 2003 Crediting period • Three options • Maximum of [Y] years, renewal of at most [X] times • If original baseline still valid, starts with project activity • Not beyond 31st December 2003 • See above OR [A maximum of] [5] [X] years • A maximum of [5] [X] years In forestry environmental and socio-economic benefits are expected to be larger for longer crediting periods Investor interests/investor security ?
UNEP-IUCN-FAO „CDM and Forestry“ Addis, Oct 2003 Definitions – Threshold date • Change to 2000 • more suitable land available • more soc.-env. benefits • documentation easier • more geographic equity • Keep 1990 • -consistency, firmness • don‘t reward deforestation • natural regeneration needs time • documentation possible • historic emissions Shifting date (10 years)