Incentives for the use of forest biomass: a comparative analysis of Kyoto Protocol accounting pre- and post-2012

This article focuses on differences between incentives of current and post-2012 Kyoto Protocol land use, land-use change and forestry (LULUCF) accounting rules. Three changes to the LULUCF accounting rules were agreed to in Durban. These changes alter national-level incentives for retaining wood in forests, using wood for products or using it for energy. Post-2012, accounting for emissions from managed forests will be mandatory rather than voluntary, as is currently the case. Reference levels, rather than historical carbon stock levels, will be used to measure these emissions. Finally, increases and decreases in harvested wood products (HWP) pools will be reported. These changes provide national-level incentives to increase forest carbon stocks and to use nationally harvested wood for products. However, the rule that no emissions are counted at the point of combustion of biomass remains unaltered. This gives entities with greenhouse gas (GHG) obligations under the EU Emissions Trading Scheme (EU ETS) an incentive to use wood for energy, counteracting the national-level incentives. Use of additionally harvested wood for energy may increase national emissions within commitment period time-frames because combustion of biomass, in most cases, results in higher carbon dioxide emissions per unit of energy supplied than combustion of the fossil fuels it replaces. In contrast, retention of wood in forests or use of domestic wood for products, will, particularly under the post-2012 rules, tend to result in lower national-level emissions being accounted. However, neither retention of wood in forests nor increases in the HWP pool results in benefits to individual entities, as currently there is no EU scheme under which the entities involved face GHG obligations.