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Issues in Forestry Carbon Crediting
IEA Bioenergy Task 38 WorkshopCanberra, AustraliaMarch 28-30, 2001
Doug BradleyDomtar Inc.
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Issues in Forestry Carbon Trading
• New Zealand workshop• What is in/not in Kyoto• Who is buying what credits• Trading Issues • Amortization• Example projects• Harvested Wood products• What need to move forward
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To Tai Toko Workshop- Feb 16-18
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To Tai Toko Workshop
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A sunny day in indigenous forest
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Dinner at “Lodge Ford-Robertson”
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Accommodation in “Garage Villa”
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Delegates watch river rise
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Raging To Tai Toko River
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A minor “slip”
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Escape to Freedom
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Kyoto- In vs Not yet in
IN KYOTO NOT YET IN KYOTO
_________Fossil Fuel Reduction_ ____Carbon Sequestration_____________Energy Efficiency Fuel Switching Afforest., Reforest Other Forestry, Agricultural
(Biomass for fossil fuel) Deforestation ActivitiesReduce fossil fuel Reduces fossil fuel Sequesters carbon Sequesters carbon
(defn. - Article 3.3) (negotiated- Article 3.4)Examples:-Fuel efficient motors -Wood waste cogen -Planting on poor agric. land Forestry: -Waste heat capture -Black liquor -Reducing deforestation -Pest and disease control-Prod’n enhancemt integrated gasific. -Fire control-Improved Maint. and combined cycle cogen -Commercial thinning
-Juvenile Spacing-Tree Improvment- Reduc. impact loggingAgricultural:-Reduced tillage-Manure management-Shelterbelts
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Who is buying what?
• Ontario Power Gen• BC Hydro
• Seattle City Light• TransAlta
• Gemco
• All sinks- if thru PERT• No sequestration, no
business as usual• Sequestration- Kyoto only• Sequestration- Kyoto- no
conservation or forest mgt (1.Can 2.Aus, 3.NZ 4.US…)
• Sinks including agriculture
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Trading Issues
Lack of clear guidelines is holding up action
• In Kyoto vs not• “Business as Usual”• Discounting• Harvested wood products • First commitment period
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Implications of Commitment Period
0
50
100
150
200
250
300
350
400
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
Plantation 1Plantation 2Plantation 3
Kyoto Period
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100
0
20
40
60
80
100
120
0 10 20 30 40 50 60 70 80 90
Time (years)
Cum
ula
tive c
arb
on s
tock
changes
(ton
s C
/ha)
Carbon in trees
Cumulative credits
Hypothetical Managed Forest StandPossible Accounting Method
Use of Amortization
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Carbon Impacts of Sequestration Activities
Initial Long TermForestry:
Afforestation sequestr. sequestrPest spray sequestr. sequestr.Tree Improvement sequestr. sequestr. Juvenile spacing emission sequestr. Commercial thinning emission sequestr.Fertilization emission sequestr.
Other:Landfill Incineration emission sequestr.
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Pre-commercial Thinning(Juvenile Spacing)
Unthinned Thinned
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Yield Curve Natural vs Spaced
Sewell
0
50
100
150
200
250
0 20 40 60 80 100 120
Bio
mas
s (t/
ha)
Spaced Msmt
Spaced - Curve
Control - Actual
Control - Curve
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Impact of forest management
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Natural Jack Pine Forest (Baseline)Forest and Products Carbon Pools
Gorcam model
Baseline
0
50
100
150
200
250
300
350
400
450
500
2000 2020 2040 2060 2080 2100 2120 2140 2160 2180 2200
Year
Landfi ll
LLP
SLP
Other Veg.
Trees
Litter
Roots
Soil
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Juvenile Spaced Stand Forest and Products Carbon Pools
Gorcam Model
Project
0
100
200
300
400
500
600
2000 2020 2040 2060 2080 2100 2120 2140 2160 2180 2200
Year
Landfill
LLP
SLP
Other Veg
Trees
Litter
Roots
Soil
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Net Emissions Control vs Spaced Gorcam Model
Stand-level Net Biomass
-400
-300
-200
-100
0
100
200
300
400
500
2000 2020 2040 2060 2080 2100 2120 2140 2160 2180 2200
Year
Net
Bio
mas
s(t
CO
2e/ h
a)
Landfill
LLP
SLP
Other Veg.
Trees
Litter
Roots
Soil
Total (w ith landfill)
Total (no landfill)
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Stand SequestrationAnnual CreditingGorcam Model
Stand Net Sequestration- Tonnes CO2/ha
-150-100-50
050
100150200250
2000 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100 2110 2120 2130
Net Biomass Net All Pools Amortized Sequestration
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Actual vs Amortized Sequestration Cumulative (tonnes CO2e/ha)
-20
-10
0
10
20
30
40
50
60
70
80
90
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
AmortizedActualActual 2Amort 2
Kyoto Period
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New Concept- Phases of Acceptance
Concept- “Give credit for long term benefit even if short term emission”
• Utterly ridiculous!• Violently opposed! • Accepted and felt to be always self-
evident
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Jack Pine Bud Worm Spray Program
• Epidemics cycle 5-7 years• Result in tree mortality, growth loss• Assumptions
– 17% outright mortality- years 2-4– 10% less growth p.a. – years 2-6– 10% mortality due to top kill- year 7
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Bud Worm Spray Program Stand Level Biomass
Yield Curves
0
20
40
60
80
100
120
140
160
180
0 10 20 30 40 50 60 70 80
Year
Bio
mas
s (t
/ha)
Treated
Infected
Gorcam Model
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Biomass with JPBW Attack
Baseline
0
50
100
150
200
250
300
350
400
450
0 10 20 30 40 50 60 70 80 90 100 110
Year
Bio
mas
s (t
/ha)
Landfill
LLP
SLP
Other Veg.
Trees
Litter
Roots
Soil
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Biomass with JPBW Suppression
Project
0
50
100
150
200
250
300
350
400
450
0 10 20 30 40 50 60 70 80 90 100 110
Year
Bio
mas
s (t
/ha)
Landfill
LLP
SLP
Other Veg
Trees
Litter
Roots
Soil
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Bud Worm Spray Program Gorcam ModelStand Level
Stand-level Net Biomass
-100
-80
-60
-40
-20
0
20
40
60
80
100
2000 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100 2110
Year
Net
Bio
mas
s(t
CO
2e/ h
a)
Landfill
LLP
SLP
Other Veg.
Trees
Litter
Roots
Soil
Total (with landfill)
Total (no landfill)
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Bud Worm Spray ProgramGorcam Model
Forest-level Net Biomass
-100
-80
-60
-40
-20
0
20
40
60
80
100
2000 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100 2110
Year
Bio
mas
s(t
CO
2e)
Landfill
LLP
SLP
Other Veg
Trees
Litter
Roots
Soil
Total (without Landfill)
Total (with Landfill)
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Pest Control Carbon Balance
0
200
400
600
800
1000
1200
1400
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
ActualAmort
Kyoto Period
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Combined Spray-Spacing in Carbon “Pool”
-1000000
-500000
0
500000
1000000
1500000
2000000
1993 1998 2003 2008
PestSpaceNew NetAmortized
Kyoto Period
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Domtar Wood Products Parameters
• Harvest (Domtar operations)– Biofuel 26%, short-lived 19%, long-lived 30%,
landfill <1%, on-site waste 25%
• Wood Products– Short-lived
• Avg lifetime 5 years• Biofuel 25%, compost 15%, landfill 10%, recycled
50%
– Long-lived• Avg lifetime 30 years• Biofuels 25%, landfill 10%, recycled 65%
• Landfill– Average lifetime- 42 years
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Wood Products Carbon5 yr decay
0
5
10
15
20
25
30
35
2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
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Wood Products Carbon10 yr decay
0
10
20
30
40
50
60
2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
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Wood Products- Ken Skog- USDA Forestry- decay estimates
0102030405060708090
100
2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
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European Forest InstituteCarbon Balance Implications of ….Wood Products
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Life Cycle- NZ Plantation Forest
0
50
100
150
200
250
300
350
0
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
EnergyAvoidedProductsForest
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Existing Forest Intensively Managed
0
50
100
150
200
250
300
350
400
450
500
0 10 20 30 40 50 60 70 80 90 100 110 120 130 140 150
New Energy
Energy
Avoided
Products
Incr Mgt
Forest
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Carbon Credit Market
400
450
500
550
600
650
700
750
800
EmissionsReductionsPresumed Target
Need reductions or creditsFirst Commitment Period
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Current Pricing
Low High Deal
Cantor Fitzgerald
$0.77 $3.09
Gemco $1.00 $1.50
SaskPower $0.83
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What do we want to happen?
• Increase use of biomass – biofuel, biochemicals….
• Increase amount of biomass– Eg. through intensive forest management
• Increase demand for wood
How can this happen?
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Incentives to promote forest carbon sequestration
• Forest management in Kyoto• Standard accounting system• Acceptance of forest measurement
methods (periodic sample plots)• Amortization methodologies• Include all carbon pools• Recognition of 1991-2007 activities
