Carbon traders call for land-use offsets in climate deal

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Reducing emissions from land use should play a key role in the post-Kyoto climate agreement, the International Emissions Trading Association (IETA) said yesterday (27 April).

The business organisation outlined a set of principles on how offsets from the land-use sector could bring down emissions and mitigation costs. Including credits in the international carbon market for emission reduction and sequestration activities in the sector could in the long-term "substantially reduce the societal costs of emission reduction," it argues.

The United Nations Framework Convention on Climate Change (UNFCCC) negotiations have been concentrating on offsets from reducing deforestation-related emissions in developing countries. The UN's so-called 'REDD' programme, designed to reduce emissions from deforestation and forest degradation, is expected to form part of the global agreement to be struck in Copenhagen in December. 

Nevertheless, carbon-trading companies are arguing that deforestation should be treated as part of the wider land-use sector. The credits should be equivalent to other UN compliance credits, they added.

"Limiting international offset credits from the land-use sector to only deforestation reduction activities at the national level precludes many projects that could generate verifiable emission reductions and lower overall compliance cost," the organisation stated. It said emissions could be cut by at least an additional 5%, should agricultural and other land use qualify for offsets.

Forest credits alone have proven to be a controversial issue, as they might have a significant impact on carbon markets (EurActiv 20/04/09). 

Greenpeace last month published a report which demonstrated that carbon prices would crash by up to 75% by 2020 if forest offset credits were included in carbon markets without limitations (EurActiv 31/03/09). They argued that this would hamper investment in clean and renewable technologies, delaying the overall infrastructural changes required to halt global warming.

An IETA representative told EurActiv that this would be a concern in the short term. In the longer term, however, it is important to use all the available options to abate emissions, and land-use offsets are part of the mix, she added.

Politically-speaking, she said that lowering the price of emissions trading could help push climate legislation through the US Congress and the Senate. "There is a great concern of the cost of a cap-and trade system in the US. These offsets could help cushion the cost," she pointed out.

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