Post COP 21 and the Paris Agreement: opportunities for the land sector

Publication | June 2016

Introduction

The land sector is uniquely positioned to contribute to climate change mitigation, being capable of reducing emissions resulting from agriculture and land use change, as well as offsetting emissions by sequestering carbon in vegetation and soils.

One of the primary goals of the Paris Agreement also know as COP21 is “to achieve a balance between anthropogenic emissions by sources and removals by sinks of greenhouse gases in the second half of this century”. The land sector is likely to play an increasingly important role in the future in both reducing emissions and providing a sink to offset those emissions which ultimately cannot be removed from the atmosphere.

Emissions from the land sector

United Nations Framework Convention on Climate Change (UNFCCC) reporting indicates that agriculture is responsible for around 8 per cent of global greenhouse gas emissions, the primary sources being agricultural soils, enteric fermentation and manure management.

Total emissions from the land sector are likely to be much higher, as the UNFCCC agriculture category does not include land use, land use change and forestry, even though most land use change (such as deforestation) is undertaken for agriculture.

The Intergovernmental Panel on Climate Change estimates that the land sector accounts for 24 per cent of global emissions, the second largest contributor after the energy sector.

Opportunities in the land sector

Almost every source of emissions in the land sector is capable of achieving significant reductions using existing techniques. Current opportunities in the land sector for emissions reductions and carbon sequestration include

  1. Methane emissions from enteric fermentation in ruminant species can be reduced by improving the quality of feed, the use of nitrate supplements, species selection, reductions in stock numbers and the capture of biogas from manure.
  2. Nitrous oxide emissions from soil can be reduced by improving the efficiency with which fertilizer is applied, including applying fertilizer on the basis of plant requirements (precision agriculture).
  3. The organic carbon content of soil can be improved with a range of techniques, including pasture-cropping (which requires no tilling) and rotational grazing systems. Although research in the last few years has shown that the sequestration potential of soil appears to be more limited than first hoped.
  4. Biochar is charcoal made by heating plant matter in an oxygendeprived chamber (a process known as pyrolysis), which can be inserted into soils to improve soil fertility and sequester carbon. The use of short rotation crops for biochar production could be used to achieve high levels of carbon sequestration.
Case study: Australia

The current centrepiece of Australia’s climate change mitigation efforts is the Emissions Reduction Fund (ERF), a voluntary offsets scheme in which participants are issued carbon credits for projects which involve emissions reductions or carbon sequestration.

Almost 75 per cent of ERF projects to date have been undertaken in the land sector. These projects are jointly responsible for around 50 per cent of the greenhouse gas abatement realised under the scheme so far, which totals almost 22 million tonnes carbon dioxide equivalent.

There are a number of methods available to landholders for sequestering carbon in vegetation. The methods prescribed vary from the implementation of management regimes under which previously-cleared land naturally regenerates to a forest state, the planting of native vegetation, to the protection of native vegetation, which would have otherwise been cleared for agricultural uses.

The vast majority of vegetation projects in the ERF are undertaken on marginal land. In western New South Wales, large tracts of land which would have been subject to broadscale clearing will be preserved in a forest state under the ERF for 100 years.

The ERF includes a number of methods for reducing emissions from ruminants. Although, the only projects to be registered thus far, relate to piggeries and cover projects which involve the capture of biogas generated by the decomposition of manure waste in anaerobic lagoons, and the combustion of the methane using flaring systems.

Australia’s experience showcases opportunities available in the land sector for realizing emissions reductions and carbon sequestration, and illustrates how market mechanisms can be used to incentivise these activities, directing investment towards the most efficient means of generating abatement.

Land use and forestry in the UNFCCC

The UNFCCC Convention itself does not refer to the land sector but states that parties should take action to conserve and enhance sinks and reservoirs of greenhouse gases. Several mechanisms have been developed under the UNFCCC (and subordinate instruments/ decisions), which are relevant to the land sector.

Reducing Emissions from Deforestation and Degradation (REDD) is a UNFCCC mechanism designed to provide financial incentives for emissions reductions resulting from the improved management of forests in developing countries. REDD has been the subject of negotiations under the UNFCCC since 2005; however, it has had mixed results, in part, due to a lack of finance.

The Kyoto Protocol included mechanisms under which parties could meet emissions reduction targets by purchasing international credits, including credits created under the Clean Development Mechanism (CDM). The inclusion of land-use projects under the CDM was controversial. Initially, only “afforestation and reforestation” projects were permitted. This was expanded to a wider range of land-use projects for the second commitment period of the Kyoto Protocol, but they were subject to more stringent rules and so far, there has been limited uptake.

Nationally determined contributions

In the leadup to Paris, parties were required to submit “intended nationally determined contributions” (INDCs) to communicate the steps they intended to take domestically in addressing climate change.

A number of INDCs make commitments concerning forests. For example, Mexico has committed to achieve 0 per cent deforestation by 2030 and China has committed to increase forest carbon stocks by 4.5 billion cubic metres.

Several INDCs commit to reducing emissions from agricultural activities, including Kenya, Costa Rica, Vietnam and Brazil. Brazil’s INDC promises to restore 15 million hectares of degraded pasturelands by 2030 and enhance 5 million hectares of integrated croplandlivestock- forestry systems by 2030.

The Rainforest Alliance published an assessment1 of the extent to which INDCs account for reducing emissions in the land sector. It found that the increasing recognition of the land sector is encouraging, but that many NDCs lack ambition and detail on clear pathways to achieving their goals.

The Paris Agreement

Although the Paris Agreement makes no specific reference to “land use” or “agriculture”, there are several provisions which point to future implications for the land sector.

REDD
The Agreement includes provisions relating to REDD. Article 5 states

“Parties are encouraged to take action to implement and support, including through results-based payments, the existing framework as set out in related guidance and decisions already agreed under the Convention for: policy approaches and positive incentives for activities relating to reducing emissions from deforestation and forest degradation, and the role of conservation, sustainable management of forests and enhancement of forest carbon stocks in developing countries; and alternative policy approaches, such as joint mitigation and adaptation approaches for the integral and sustainable management of forests, while reaffirming the importance of incentivizing, as appropriate, noncarbon benefits associated with such approaches.’

Paragraph 55 of the Decision (to adopt the Paris Agreement) provides that parties recognize the importance of providing adequate finance for programs including REDD.

The inclusion of REDD is notable in the Paris Agreement, given that the mechanism has been in development for over ten years. However, it remains to be seen how the provisions will be implemented and further details will need to be determined prior to the Paris Agreement taking effect.

International emissions trading

Article 6 of the Agreement provides that parties may use “internationally transferred mitigation outcomes” to meet emissions reduction targets. This article is intended to form the basis of an international trading scheme.

The introduction of a robust international emissions trading mechanism would likely provide opportunities for the land sector, which is well placed to deliver emissions reductions and sequestration. However, once again the details of this article remain to be determined, and stakeholders will be keen to ensure that any future arrangements do not repeat any of the difficulties that have been experienced with the CDM.

Long-term goals

As highlighted above, the Paris Agreement has several long-term goals, including that parties should aim to achieve a balance between anthropogenic emissions by sources and removals by sinks of greenhouse gases in the second half of this century.

This highlights the significant role that the land sector will need to play in offsetting emissions, as the world transitions towards carbon neutrality.

Conclusion

The land sector is well placed to contribute to climate change mitigation. It is a significant source of emissions and numerous opportunities exist for reducing these emissions, and for offsetting emissions through sequestering carbon.

A case study of Australia’s domestic climate change policy illustrates how market mechanisms can effectively incentivise these activities. On the international stage, the UNFCCC has previously included mechanisms which provided for land sector participation, but these have had limited success, due to inadequate finance and/or poor design.

The provisions of the Paris Agreement which are likely to be relevant to the land sector should be closely watched as future UNFCCC negotiations take place and the detail underlying these provisions is developed. Our global climate change team has been monitoring the UNFCCC negotiations for many years and is well placed to provide you with further information about the Paris Agreement and the emerging issues arising for the land sector as the Agreement gets closer to implementation.


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Elisa de Wit

Elisa de Wit

Melbourne