Natural Carbon Capture: Business Models for Sustainable Development
A Project within the Framework of the e5 Initiative „Climate Justice as a Business Case“
The world community has agreed that the global warming of our earth’s atmosphere should be kept below a limit of 2 degrees Celsius, in order to stem dramatic consequences of the climate change that is already in progress. Using the most recent analyses of the highest scientific authority in the area of climate change – the International Panel on Climate Change (IPCC) – the OECD countries must reduce their emissions by between 25% and 40% by the year 2020 (based on the year 1990) and decrease them by the year 2050 by as much as between 80% and 95%, based on the year 2000. Accordingly, in October 2009, the Heads of State of the members of the EU Council decided to lower the emission of greenhouse gases in Europe by 80% to 95% by 2050. Voices are even being heard from within the scientific community and civil society that call for even higher reduction targets on the part of the industrial countries, which can be interpreted as an active contribution to the extraction of CO2 from the atmosphere.
Stakeholders and advocates from the rapidly developing economies and developing countries take the position that it is not their countries, but mainly the industrialized nations who have caused climate change. Yet it is their countries that will suffer most from the negative consequences of climate change. The rich societies of the Global North have used fossil fuels to overcome poverty and create prosperity through economic development. Representatives of the countries in the Global South therefore point out that their people also have the right to overcome poverty and misery and that environmental protection is subordinate to this goal. Fears are widespread that the climate protection measures that are asked of them will divert financial resources from the fight against poverty and limit their economic development.
Climate Justice means acknowledging both the right to develop and the historical responsibility of industrialised countries for climate change. It refers to a fair distribution of the costs that arise if the developing and emerging countries have to protect themselves against the negative consequences of climate change and at the same time wish to take an environmentally friendly developmental path themselves.
The Importance of Forest Conservation for Climate Protection and Climate Justice
In recent years, the fact that deforestation is the second largest contributor, after the energy sector, to greenhouse gas emissions has received renewed attention at the international climate negotiations. At the same time, it has become clear that forest projects must be a main cornerstone of a farsighted climate protection and sustainability strategy. By now, several studies, methods and initiatives show the importance of the conservation of forests and the reforestation of degraded areas for climate protection and the protection of other natural resources, as well as biodiversity. Regarding the commitment by the industrialised countries to reduce their annual greenhouse gases emissions in 2050 by even more than 100%, the natural carbon capture by forests is the method of choice.
The destruction of forests in emerging and developing countries has to do with complex economic, political and social processes, in which the need to overcome poverty and increase the local population’s prosperity plays an important role. The elimination of the socio-economic causes that play a role in the deforestation, as does the disregard for the rights to life, property and rights of use of local inhabitants and neighbors of forests, is a task that must be dealt with urgently. If the right to overcome poverty is to be taken seriously, the industrialized countries must consider, also in regards to forests, how they can provide financial compensation for the efforts of the people who act as stewards of the natural reservoirs and sheltered environments on earth.
The industrialised countries therefore have a responsibility to contribute to a sustainable development in emerging economies and developing countries, not only in regards to technological projects, but also in regards to forest projects. Sustainable development should not only include technical progress (renewable energies, products and processes that are energy and resource efficient), but must also develop and promote economic cycles that include the protection and care of ecosystems and their benefits (water and nutrient cycles, erosion protection and soil conservation, resource and food supply) for the good of humanity and nature. Forests should, however, be regarded not only from an ecological point of view. Also important are their economic, social and cultural dimensions, for forests have been used by humans for generations, providing food, building material and places of refuge, and they are important in cultural life.
Intelligent and Sustainable Business Models for Climate-based Forest Conservation
Projects that finance forest conservation and reforestation through trading of CO2 certificates for the voluntary compensation of greenhouse gases, play an essential role as pioneers for the development of business models that serve this purpose. They have led to a refinement and expansion of the processes for calculating carbon capture by forests. Standards were created that determine and evaluate the quality of forest projects for environmental protection and the fight against poverty. Procedures were developed that helped to avoid leakage effects and ensure carbon capture on a long-term basis. The first business cycles were initiated between actors in the industrialized countries and developing countries. Such achievements have provided an important working basis also for other forest projects that promote climate protection.
At the same time, the processes for ensuring the ecological and social sustainability of forest projects must be refined and expanded further. Climate justice in forest conservation here means that the developing countries do not become suppliers of a simple and cheap commodity at the beginning of the value chain, for example by being reduced to the role of a supplier of low priced CO2 compensation certificates. This means developing economic structures that strengthen local markets, create complex value chains in their own habitat, provide new and socially fair sources of income and allow the populations concerned to successfully offer complex goods and services for the promotion of climate protection and sustainability – localy, nationally and internationally.
Here, private sector business actors have a key role to play. Business can offer pragmatic business models that provide new income perspectives in the rural and urban surroundings of forests, thereby reducing the pressure for deforestation. It can make an active contribution toward the implementation of projects that take the tenure and usage rights of the local population into account. It can get local stakeholders interested in forest conservation and enlist them for cooperation and coordination through economic cooperation. This is true both for business models that focus on the voluntary compensation of greenhouse gas emissions in industrialized countries and for business models that provide other goods or services.
e5 and Forest Conservation
The cooperation of the European business sector for the protection of forests is urgently called for. For this reason e5 has initiated a stakeholder project in order to stimulate the promotion of sustainable business models for forest projects that preserve the climate and biodiversity and at the same time improve the economic and social situation of the people concerned. The special expertise of important actors, stakeholders and experts from the fields of climate protection and sustainable development, both in the countries of the Northern and Southern hemispheres, are thereby to be applied.
Special emphasis will thereby be placed on making the market more transparent for such projects and on harmonizing measurement procedures for socio-economic sustainability and value. Great value will thereby be placed on ensuring that the standards for securing the sustainability of forest projects are not eroded and at the same time the transaction costs are lowered and the certification procedures for small projects are simplified.
- 23. May 2012 Side event at the occasion of the Bonn Climate Change Conference (SB 36) Prosperity, Politics & People. Necessary framework (environment) for sustainable forest ppp projects. For more information, see here.
- 02. December 2011 (COP 17 in Durban) Roundtable Dinner with experts from politics, business and civil society regarding the current role and future of the certification of climate protection-oriented forest projects. For more information, see here.