Outline of Presentation

1. CLEAN DEVELOPMENT MECHANISM (CDM ) PROSPECTS IN LAND USE, LAND USE CHANGE AND FORESTRY (LULUCF) IN THE PHILIPPINES Florencia B. Pulhin and Rodel D. Lasco College of Forestry and Natural Resources University of the Philippines Los Baños CD4CDM Climate Change Information Center Ateneo de Manila University Quezon City, Philippines 04 November 2003

2. Outline of Presentation • Introduction • Potential Benefits of CDM • Candidate Forest Lands for CDM • Potential CDM Projects • Relevant Researches in the Philippines • Current Status and Examples of CDM Projects Globally • Issues and Concerns • Recommendations

3. Philippine Forests • 30 M ha total area – 15.8 M ha classified as “forest lands” • < 6 M ha covered with natural tropical forest vegetation • the rest are in various stages of degradation and are primarily covered with grasses, bushes and agricultural crops • 1990 national GHG inventory – forest lands are the largest contributor to GHG emissions among all sources in the Philippines

4. The Global Carbon Cycle Atmosphere 750 60 5.5 Global net primary production and respiration 1.6 Fossil fuels and cement production Changing land use 61.9 90 0.5 Vegetation 610 Soils and detritus 1580 2190 92 Surface ocean 1020 50 100 40 91.6 Marine biota 3 4 6 6 Dissolved organic carbon < 700 Intermediate and deep ocean 38,100 0.2 Surface sediment 150

5. CO2 Photosynthesis Burning

6. ABOVE-GROUND BIOMASS TREES UNDERSTOREY NECROMASS LITTER LITTER LITTER ROOTS SOIL CARBON Carbon pools in forest ecosystems Carbon pools in forest ecosystems

7. TOTAL CARBON = ABOVE GROUND CARBON (TREE/UNDERSTOREY) + NECROMASS CARBON + ROOT CARBON + SOIL ORGANIC CARBON

8. Philippine Forests and Climate Change • In terms of climate mitigation: • Studies indicate that total C in the biomass of all forest land use types is equal to 750 – 884 M tons • Annual sequestration estimated at about 28.4 M tons C (excluding C contained in understorey vegetation, litter and soil which could comprise 25% of total aboveground biomass) • Annual Philippine CO2 emissions is equivalent to 128.6 M tons • Forest lands are able to sequester an equivalent of about 104 M tons to CO2 or 81% of total CO2 emitted by the whole country

9. Potential Benefits of CDM • Ecological • Deforestation and land degradation leading ecological problems in the Philippines • 2-9 M ha. of degraded lands • > 100 years to reforest • Government with very limited resources • US $ 1 billion needed to reforest 2 M ha • CDM: source of new financing and technology for forest development • CDM will advance sustainable development goals

10. Potential Benefits of CDM • Promote long-term environmental security • Philippines as an archipelagic country very vulnerable to climate change • Upland population among the more vulnerable sector • By participating in CDM, country is acting on its interest • Link with biodiversity conservation • Philippines one of the biological hotspots in the world • CDM projects can help conserve biodiversity

11. Potential Areas for CDM • Degraded land areas/grasslands: 3.5 M ha. • Could easily meet requirements for additionality • Those that need to be permanently forested: 4.6 M ha. • Critical watersheds • Forest reserves • IPAs sites • Example: Setting aside 100,000 ha. for CDM • Savings of US $ 62.5 M – equal to one year of reforestation • Generate livelihood to upland communities

12. Potential CDM Projects • Reforestation and tree plantations • Could easily meet requirements for additionality • Agroforestry and community forestry • Greatest socio-economic benefits • Risks may be greater • Dendrothermal power plants • Less C released to the atmosphere by substituting renewable biomass to fossil fuel

13. Relevant Researches in the Philippines • Carbon stocks assessment of various land uses in the Philippines -1998 – used default values -1999 to present – generated local data using plot and point- centered methods • Impacts of land use change on carbon stocks • Improving GHG inventory in the LUCF sector • Carbon stored in wood products

14. Carbon content, biomass density and biomass accumulation for LUCF in the Philippines (Lasco and Pulhin, 2000)

18. Table 17. Comparison of results of GHG inventories conducted in the Philippines

19. Current Status and Examples of CDM Projects Globally • Many organizations are interested in financing forestry projects that sequester carbon • 30-35 forestry projects existing with commitment of US$ 350 M (IPCC, 2000) • At least 19 countries (e.g. Malaysia, Indonesia, Costa Rica)

20. Examples: • 1. Scolel Te Pilot Project for Community Forestry and Carbon Sequestration, Chiapas, Mexico • Objectives and Activities: Tropical forest and highland forest reforestation and community agroforestry on individual farmers’ small plots • Land Area and Type: 2,000 ha within 13,200 ha (project size depends on funding received) • Partners –various (credit unions, research institute, University of Edinburgh, International Automobile Federation, etc)

21. Description of Activities: Consulted local village farmers re: candidate reforestation project, forest management, and agroforestry practices. The project designed a system of technical assistance to farmers by producing plans for each parcel, calculating carbon benefits, and developing a monitoring protocol. International Automobile Federation funded the first management plans. Project is designed to reduce degradation and conversion of remnant forest, and to enhance village land use sustainability and financial returns • GHG Estimated Benefits and Methods: Cumulative net sequestration of 15,000-333,000 tC total over lifetime, using CO2 Fix model. Average carbon benefit is 26 tC/ha at 0.9 tC/ha/yr • Projected Socioeconomic Benefits: Build local economy through sustainable agroforestry; improve welfare of women and villagers

22. Projected Environmental Impacts: Conserve and increase forest biodiversity, reduce forest fragmentation and soil erosion, serve as buffer zone by slowing in-migration to the forest. • Status of Project: 50 ha funded for initial implementation. Detailed studies at community and regional scale completed. Management, research, and financial institutions established. • Cost Estimate and Efficiency: US$3.4 M projected total cost, with initial phase at US$0.5 million, and public and private financing. Efficiency calculated to be US$10 per tC. • Source: EPA/USIJI (1998), Tipper and de Jong (1998), Witthoeft-Muehlmann (1998) as cited IPCC, 2000

23. Examples: 2.INFAPRO: Innoprise-FACE Foundation Project, Sabah, Malaysia • Objectives and Type: 25,000 ha of selectively logged dipterocarp lowland tropical forest concession lands. • Partners: Innoprise Corporation (forestry arm of Sabah Foundation, Sabah, Malaysia) and FACE (Forests Absorbing CO2 Emissions) Foundation of Dutch Electricity Board, The Netherlands. • Description of Activities: Estimates it will sequester approx. 4.3 Mt C over 60 years, largely using literature data for the estimate. Permanent sample plots to measure stem growth are established; necromass, understory, and soil data collected. • GHG Estimated Benefits and Methods: 707,000 tC over lifetime, using CO2 Fix model. Average carbon benefit is 26 t C/ha,a t 0.9 tC/ha/yr.

24. Projected Socioeconomic Benefits: Generate US$800 M in timber, which will revert to the social programs of the Sabah Foundation. Build capacity through technical training, at all levels of project staff, and with local, regional and international organizations. Direct employment of more than 150 people. Projected Environmental Impacts: Improve at least 25,000 ha of degraded logged forests. Status of Project: The project is in the 7th year of its implementation phase, planned to last 25 years; project lifetime is 99 years. If CDM guidelines and crediting are not in place soon, implementation of this project may be halted.

25. Cost Estimate and Efficiency: US$15 M total cost, with private financing. Efficiency calculated to be US3.50 per tC. Source: FACE Foundation (1998), Stuart and Moura-Costa (1998), Witthoeft-Muehlmann (1998) as cited by IPCC (2000).

26. Issues and Concerns • Overemphasis on plantations using exotics over indigenous species • Lack of technical expertise • Failure to capture co-benefits due to: • Lack of integrated area planning • Graft and corruption • Inadequate implementation guidelines • Lack of community participation

27. Issues and Concerns • Loss of opportunity to develop forests • Forests not available for other uses • Ensuring appropriate design, monitoring and evaluation • Forest carbon hard to measure • IPCC (1995): high level of confidence on measurements of net C conserved • IPCC GPG (2003): will provide guidance for projects

28. Issues and Concerns • Baselines and additionality • Article 12.5 of the Kyoto Protocol: “Reductions in emissions that are additional to any that would occur in the absence of the certified project activity” • “additional” implies a baseline or without project scenario • To demonstrate that GHG benefits due to the project not incidental factors • No standard method of determining baselines and additionality • Data on carbon stocks will facilitate estimation and verification of baselines

29. Recommendations • Philippines must develop implementation mechanism and guidelines in preparation for CDM implementation • Philippines must participate in CDM considering its current budget for rehabilitation is not enough

30. Thank You!