CANCUN, Mexico (Reuters) - International projects generating voluntary carbon credits by protecting forests are slowly moving forward despite blocked U.N. climate talks, emissions markets developers said.
Many delegates at the 190 nation talks that go on until December 10 at a resort in Mexico are trying to push forward a program called reduced emissions from deforestation and degradation, or REDD, because forest destruction releases up to 17 percent of mankind’s carbon emissions.
Norway and other rich countries have pledged nearly $4 billion since last year to help set up the program. It would bring forestry deals to national carbon markets allowing investors to reward developing countries like Brazil, Indonesia and the Democratic Republic of Congo for protecting tropical forests from development.
David Antonioli, the chief executive of the Voluntary Carbon Standard, which develops quality standards for emissions markets, said at a business meeting near the U.N. talks that projects covering hundreds of thousands of acres of global forests are already generating voluntary carbon credits.
That is nowhere near the amount of forest land lost from development including palm oil farms, unsustainable logging and mining.
Some 32 million acres (13 million hectares) of forests were lost or destroyed each year of the last decade, according to the U.N. Food and Agriculture Organization’s Forest Resources Assessment 2010.
The climate negotiators this year are not expected to agree a pact to succeed the Kyoto Protocol, which expires in 2012, that would lock in a future for existing national mandatory carbon markets in the European Union and New Zealand and give hope to other countries trying to form them.
In addition, prices for voluntary carbon credits in forestry have fallen from a high of about $7 a ton to less than $1 a ton after the failure of a U.S. climate bill in July. The legislation had been expected to set up emissions offsets in which polluters like energy companies could have invested in clean projects like forestry to reduce the impact of their own emissions.
Despite the hurdles, Antonioli said, tens of big forestry projects are nearly ready to issue credits for sale to polluters, many of which may face carbon limits sometime in the future.
Todd Lemons, the chief executive of Infinite Earth, which is trying to save a peat forest in Indonesia, said an advantage of forest carbon offsets is that the projects go beyond saving just carbon.
His project aims to save a forest that borders an orangutan protection zone. Investors are saving the forest at risk from palm oil developers, but they are also saving orangutans and land for traditional villagers.
“It’s a tough sell,” said Lemons on the sidelines of the World Climate Summit, a business meeting near the climate talks. “Hopefully if we get a footing in these more charismatic projects, then we have a fighting chance at saving equally valuable bio-diverse forests.”
Lemons has sold forward credits to Russia’s natural gas giant Gazprom and Nippon Telegraph and Telephone. He said European companies will shortly reveal investments in the project.
Jeffrey Horowitz, a founding partner of the nongovernmental group Avoided Deforestation Partners, said U.S. power companies interested in hedging their future emissions risks are among entities that have shown the most interest in international forestry offsets and that oil companies would likely also become buyers.
Some of that demand could come from California, which will place emissions limits on companies in 2012, though offsets will not play a big role in that market for years.
If negotiators at the climate talks push REDD and set the path for an extension of the Kyoto Protocol, forestry could become a more common way for companies to cut the impact of their carbon emissions.
Editing by Mohammad Zargham