1 Introduction: new LULUCF rules agreed in Durban

In the United Nations climate negotiations urgent action was called for to limit global warming below 2 °C above pre-industrial levels. 42 Annex I Parties (developed countries) have submitted quantified economy-wide emission targets for the year 2020.Footnote 1 These pledges have subsequently been included in the 2010 Cancún Agreements (UNFCCC 2010). While most Parties acknowledged that the Land Use, Land Use Change and Forestry (LULUCF) sector may have significant implications for the ambition level of their target, a consistent set of estimates on the possible contribution of LULUCF to achieving the pledges is still lacking (UNFCCC 2012b). This paper focuses on the role of the LULUCF sector in achieving the pledges made the Annex I Parties likely joining the second commitment period of the Kyoto Protocol (CP2), and CP1 Parties.Footnote 2

The LULUCF sector comprises different activities which may remove or add greenhouse gas (GHG) from/to the atmosphere. During the first commitment period of the Kyoto Protocol (CP1), a series of complex accounting rules determine the amount of credits or debits from LULUCF activities. Credits contribute to achieving individual reduction targets, while debits increase the reduction required outside the LULUCF sector in order to meet commitments. Under these rules, the accounting is mandatory for afforestation/reforestation (AR) and deforestation (D) since 1990 and is voluntary (though mandatory if elected) for forest management (FM), cropland and grazing land management, and revegetation. Given the consensus on the need to improve the current rules, new LULUCF accounting rules for Annex I Parties in the second commitment period (CP2) were finally agreed on December 2011, at CMP7Footnote 3 in Durban (UNFCCC 2012a). The main features of the new LULUCF rules include:

  • Accounting of FM becomes mandatory. Credits and debits during the CP2 will be calculated by subtracting a ‘reference level’ (FM-RL) from the reported, actual emissions or removals. There is a cap on credits equal to 3.5 % of base year emissionsFootnote 4 excluding LULUCF;

  • New rules for harvested wood products and natural disturbances;

  • Fluxes from wetland drainage and rewetting may be accounted if elected;

  • Accounting of AR, D and the other activities remains essentially the same.

An analysis of the new LULUCF rules may be found elsewhere (e.g. Macintosh 2011; Grassi 2012a). In this paper, we briefly explore the possible quantitative contribution of the forest-related LULUCF activities (AR, D and FM) to achieving reduction pledges by Annex I Parties during the CP2 (assumed 2013–2020). In order to explore a wide range of potential contribution, two scenarios are analysed: a minimum level, assuming no additional LULUCF mitigation actions beyond business-as-usual (BAU), and a potential level, estimated through expert-based assumptions on the impact of feasible additional actions. The estimates in this paper represent a refinement, and update with the new LULUCF rules, of the estimates included in den Elzen et al. (2011). Given the complexity and the uncertainty of the LULUCF sector, the aim of the paper is not to estimate accurately the expected credits for each Party, but rather to highlight the likely major differences in the contribution of LULUCF to achieving reduction pledges among Annex I Parties.

2 Methodology: calculating LULUCF credits

The calculations of the LULUCF credits for Annex I Parties during the CP2 are based on the JRC LULUCF tool (Grassi 2012b). The tool contains: 1) historical data from GHG inventories (1990–2010), updated to data available as of May 2012; 2) additional GHG data submitted by Parties during the UNFCCC negotiations, up to December 2011; 3) elaboration of country data using transparent assumptions (e.g., extrapolation). In this paper we present estimates for the minimum (without additional actions) and the potential (with additional actions) level of credits/debits for AR, D and FM. Other LULUCF activities are not assessed, due to lack of reliable data. However, it is likely that their overall contribution will be smaller than that of AR, D and FM.Footnote 5

Credits for afforestation/reforestation (AR) and deforestation (D)

The minimum estimates for AR and D are based on Parties’ projections, when available, or alternatively on the average of 2008–2010 data under the Kyoto Protocol. The potential estimates are based on: (i) Parties’ projections, when available,Footnote 6 multiplied by a correcting factor (1.1 for AR and 0.8 for D) to estimate the additional mitigation potential, or alternatively on (ii) elaborations of historical data from the GHG inventories. In the latter approach, a linear extrapolation of the 1990–2010 data is used for AR (assuming this approach already incorporates additional mitigation activities) and the average of 2008–2010 data, multiplied by 0.8, is used for D. The assumptions made for AR are based on the analysis of trends from GHG inventories in relation to the range of harvesting ages in most Annex I countries.Footnote 7 The choice of different correcting factors for AR and D is based on the empirical evidence that additional AR actions (e.g. higher planting rate, longer rotations) have a modest impact on the short-term sink (i.e. up to 2020), while a relatively higher short-term impact may be assumed for additional policies aimed at reducing emissions from D. The above assumptions on feasible additional actions appear consistent with the information available from the countries and with the scenarios explored in the existing literature.Footnote 8

Credits or debits from forest management (FM)

The JRC LULUCF tool calculates the minimum FM credits using Parties’ projections and the forest management reference levels (FM-RLs) submitted by Parties in 2011 and agreed in Durban (UNFCCC 2012a). For Norway, Russia and Belarus, the FM-RL is based on 1990 FM sink. For Japan, FM-RL is set to zero. For the majority of Annex I Parties (i.e. Australia, Canada, Croatia, EU, New Zealand, Switzerland and Ukraine), the FM-RL is based on BAU projected emissions and removals for the period 2013–2020: therefore, in theory, there will be no FM credits for these Parties without changing current FM practices. However, due its relative cost-effectiveness, it seems likely that countries will undertake additional FM mitigation practices. Estimating the full FM mitigation potential in these cases would be a complex and uncertain exercise, because this depends on both (a) the enhancement of carbon sink within the forest and in harvested wood products, and (b) the carbon substitution of energy and of other materials. In this paper, we provide estimates on the potential FM credits linked to a feasible enhancement of carbon sink within the forest (as compared to the FM-RLs), without considering trade-offs between the various options (e.g. Böttcher et al. 2012). To this aim, we estimated the possible impact of a 10 % reduction of harvest as compared to the level indicated in Parties’ projections. This approach builds on a number of key assumptions: (i) in the short term, the harvest level is the main driver of the net forest sinkFootnote 9; (ii) while significant fluctuations in harvest may occur for several reasons, we believe than a 10 % reduction of harvest over 8 years (e.g. implemented by longer rotation lengths) may realistically simulate for most countries policies to promote short-term carbon stock increases in forestsFootnote 10; (iii) the reduction of harvest does not affect the harvested wood products (i.e. it occurs at the expense of bioenergy); (iv) the harvest included in the FM-RLs agreed in Durban in general represents a BAU scenarioFootnote 11; and (v) the FM reporting during the CP2 will be methodologically consistent with the FM-RL.Footnote 12

The impact of a 10 % reduction of harvest on forest sink was derived using two approaches:

  1. (a)

    Existing studies: for the EU, Böttcher et al. (2012) provided model estimates of the FM sink up to 2020, showing that a 10 % reduction of harvest would increase the sink by approximately 20 % (average of two models). For Australia, Macintosh (2011) provided estimates on the potential FM credits from native forests under various assumptions of future harvest rates; in this case, we scaled the results to a reduction of 10 % harvest.

  2. (b)

    Empirical and crude estimation of the expected credits as a result of a 10 % reduction of future harvest: in this case, we estimated the impact of a 10 % reduction of future harvest (as provided by the Parties in their FM-RL submissions) using the appropriate default biomass conversion and expansion factors (IPCC 2006). This approach assumes no substantial short-term impact on forest growth.

3 Results: impact of the LULUCF accounting rules

Table 1 gives the minimum credits or debits (without additional actions) estimated for ARD and FM in the 2013–2020 period. Annex I Parties that joined the CP1 as a whole would receive credits from FM, essentially due to Russia and Japan (likely not CP2 Parties), and debits from ARD, mostly due to D emissions in Australia.

Table 1 Estimated minimum credits (−) or debits (+) from afforestation/reforestation (AR), deforestation (D) and forest management (FM) by Annex I Parties in the period 2013–2020
Full size table

The potential amount of credits (i.e. assuming additional feasible actions) estimated for ARD and FM in the 2013–2020 period are shown in Table 2. For all CP1 Parties combined, the potential credits from AR are compensated by debits from D. However, this is not the case for individual Parties: relative to base year emissions, large AR credits are expected for New Zealand and quite substantial D debits will likely arise for Australia and Canada. With regard to FM, the following groups of Parties can be distinguished: (i) Parties which will very likely reach the FM cap equal to 3.5 % of base year emissions, independently from any reduction of harvest (Russia, Norway, Japan); (ii) Parties which would reach the cap on the assumption of a 10 % reduction in harvest (e.g. Canada, New Zealand); and (iii) Parties for which it is unlikely that the FM cap will be reached, unless more substantial actions are implemented (e.g. EU, Ukraine, Australia). The third group of countries have a relatively small FM sink and harvest level as compared to base year emissions.Footnote 13 The potential FM credits from Parties with FM-RL either based on 1990 or set to zero (Japan), although limited by the cap, is about twice the level of Parties which use projected FM-RLs (see Table SI-1).

Table 2 Estimated potential credits (−) and debits (+) from afforestation/reforestation (AR), deforestation (D) and forest management (FM) by Annex I Parties in the period 2013–2020
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Overall, the contribution of LULUCF credits ranges from 1.1 % to 2.1 % of base year emission levels for all CP1 Parties and from 0.1 % to 1.5 % of base year emission levels for the likely CP2 Parties. When assessing these estimates, high uncertainties should be considered (see SI).

Table 3 presents the potential contribution of LULUCF to achieving emission targets (relative to base year emissions, excluding LULUCF unless otherwise specified) for Annex I Parties by 2020. For the EU, the LULUCF contribution may range from 0.5 % to 1.8 % of its base year emissions. For New Zealand, the contribution could be up to 33 % of its base year emissions. For Australia the situation is complex, due to the fact that its targets (−5 % for the low pledge and −25 % for the high pledge) are relative to 2000, and include AR and D emissions (140 Mt CO2eq in 1990, 71 Mt CO2eq in 2000 and 34 Mt CO2eq in 2020Footnote 14). In Table 3, targets are expressed both relative to 1990 and 2000 emission levels; in both cases, AR and D emissions are included. Therefore, the contribution of LULUCF to the 2020 pledges can be expressed in terms of: (i) expected minimum contribution (due to the foreseen decreasing trend of net LULUCF emissions): 19.0 % and 6.6 % relative to 1990 and 2000, respectively; and (ii) potential additional contribution (i.e. the difference between Table 2 and Table 1): about 3 % more than the minimum.Footnote 15 For Canada, LULUCF may contribute up to about 1.6 % of 1990 emissions. For this Party, significant uncertainties are linked to possible natural disturbances,Footnote 16 whose impact on FM may be excluded with the rules agreed in Durban.

Table 3 Potential contribution of LULUCF to achieve the emission targets (based on the pledges submitted in the Cancún Agreement) for Annex I Parties in 2020
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When comparing the potential LULUCF credits for the 2013–2020 period with the expected credits during the CP1 (using the JRC LULUCF tool), the order of magnitude is similar for the Annex I Parties as a whole (i.e. credits up to about 2 % of base year emissions), for the likely CP2 Parties, and for most individual Parties.

4 Conclusions: LULUCF makes the difference for some parties

This paper presents some key differences among Parties in the minimum (assuming no additional action) and potential (assuming additional actions) contribution by the main LULUCF activities (AR, D and FM) to achieving the pledges submitted by the Parties in the Cancún Agreements. Despite this analysis being based on a number of, in some cases, quite crude and uncertain assumptions, we believe that the main differences highlighted are robust and reflect different characteristics of the LULUCF sectors (i.e. the relative importance of forest emissions or removals compared to each Party’s base year emissions).

On FM where the reference levels are based on 1990 emissions (e.g. Russia, Norway) or are equal to zero (Japan), substantial credits are expected even without additional actions. At the same time, a cap limits the FM credits to 3.5 % of base year emissions (without LULUCF, unless otherwise specified). Given the lack of a cap on AR or D, the contribution from these activities is fully reflected in the accounting. For New Zealand this implies that LULUCF credits, mainly from AR, may contribute by up to 33 % of its base year emissions. For Australia, when the foreseen (based on Australia’s projections) and potential future emissions from LULUCF are compared to the AR and D emissions included in 1990 and 2000 emissions levels, the role of LULUCF to meet the pledges appears to range from a minimum of about 19 % and 7 % (relative to 1990 and 2000, respectively) to a potential of about 22 % and 10 % (relative to 1990 and 2000, respectively). For the EU, the overall contribution of LULUCF credits is expected to be relatively modest compared to its pledges (0.5 % to 1.8 % of its 1990 emissions).

Overall, this analysis clearly indicates that, whereas the overall contribution of LULUCF in the period 2013–2020 seems to be relatively modest for CP1 Parties (credits up to about 2 % of base year emissions, comparable to what is expected during the CP1), and also for the likely CP2 Parties (credits up to 1.5 % relative to 1990 emissions), for specific Parties LULUCF credits or debits can make a substantial difference in the reduction pledges.