Peatlands; Peat, UNFCCC and the Kyoto Protocol

by John Couwenberg

The United Nations Framework Convention on Climate Change (UNFCCC)[1] was adopted along with the UN Convention on Biological Diversity (CBD) and the Convention on Combating Desertification (CCD) at the United Nations Conference on Environment and Development (UNCED), also known as the Earth Summit, held in Rio de Janeiro in 1992. Its main objective is formulated in article 2 of the convention:

“The ultimate objective of this Convention [...] is to achieve [...] stabilization of greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system. Such a level should be achieved within a time-frame sufficient to allow ecosystems to adapt naturally to climate change, to ensure that food production is not threatened and to enable economic development to proceed in a sustainable manner.”

This objective shall be achieved by reducing emissions of greenhouse gases (GHGs) to the atmosphere and sequestering carbon in terrestrial ecosystems. Currently, the Convention has been signed by 189 countries, divided into two groups: i) industrialised or developed countries and countries with economies in transition, referred to as Annex I countries, and ii) developing countries (Non-Annex I countries).

The UNFCCC treaty urged countries to take measures, but set no mandatory limits on greenhouse gas emissions for individual nations and contained no enforcement provisions. Such binding emission limits were later agreed in an extension to the original treaty: the Kyoto Protocol. More than 160 countries have ratified the Kyoto Protocol, representing over 60% of emissions from Annex I countries[2]. By ratifying the Protocol, Annex I countries accept emission reduction obligations. Non-Annex I countries have no GHG emission reduction obligations but can transfer emission reductions to Annex I countries.

In the first commitment period (2008-2012), Annex I countries have to reduce their collective emissions of greenhouse gases by 5.2% compared to the year 1990. The goal is to lower overall emissions of six GHGs – CO₂, CH₄, N₂O, SF₆, HFCs, and PFCs. National limitations range from 8% reductions for the European Union and some others to 6% for Japan, 0% for Russia, and permitted increases of 8% for Australia and 10% for Iceland.

The Kyoto agreement offers flexibility in how countries may meet their targets. Although the majority of emission reductions has to be achieved on the national level, Annex I countries can use emission allowances of other Annex I countries through Emissions Trading (ET). Furthermore, they can acquire foreign GHG emission reductions by carrying out projects in other Annex I countries (Joint Implementation, JI) or non Annex I countries (Clean Development Mechanism, CDM). By increasing biological sinks, which remove carbon dioxide from the atmosphere, in the Land Use, Land Use Change and Forestry (LULUCF) sector, emissions partially can be compensated. Up to 3% of the total 5.2% of emission reductions may be offset by LULUCF activities.

The Convention requires precise and regularly updated inventories of GHG emissions from industrialized countries (Annex-I). These are presented as two figures, one without LULUCF and one with LULUCF. Under the Kyoto Protocol countries are obliged to account for all emissions from the so called Annex A sectors (energy, industry, solvents, agriculture and waste), but the accounting of the LULUCF sector is partly voluntary and restricted to emissions and removals from specific activities (see below). In contrast, the Convention reports include all emissions and removals from LULUCF activities. In other words, reporting to the Convention is not the same as reporting to the Kyoto Protocol. As countries are penalised if they do not meet their reduction target, accounting to the Kyoto Protocol is far more interesting from a political and economic point of view. There are some ways to account reduced emissions under the Kyoto protocol without actually reducing them.

Under the Kyoto Protocol there are two main groups of LULUCF activities. Article 3.3 of the Protocol addresses afforestation, reforestation and deforestation (ARD) since 1990; accounting of ARD activities is mandatory. Article 3.4 of the Protocol identifies four additional land use activities (Forest Management, Cropland Management, Grassland Management and Revegetation); accounting of these activities is elective, which means that countries may choose whether or not to account for these. Of course countries are unlikely to select activities that constitute a net source of GHGs. With net emissions from Cropland Management and Grassland Management, Finland, for example, has chosen only Forest Management as additional LULUCF activity (Fig. 1).

Fig. 1: GHG removals and emissions in the LULUCF sector in Finland in 1990 and 2003. The Forest Land category includes ARD activities (obligatory) and Forest Management (voluntary). ARD activities constitute a net-emission of ~3.5 Tg CO2 eq, Forest Management activities a net-sink of ~28 Tg. (from: unfccc.int/resource/docs/natc/finnc4.pdf)

Emissions and removals from agricultural activities are included in Annex A of the Kyoto Protocol, which means that accounting is mandatory. However, when reporting rules for the LULUCF sector were set up, CO₂ emissions and removals from agricultural soils were included here as well (Cropland and Grassland Management). Reporting these emissions both under Annex A and LULUCF would result in double counting. Instead of removing this inconsistency from the reporting rules it was decided that parties may again choose whether to report these emissions and removals under the Agriculture sector (Annex A) or the LULUCF sector. Because accounting on LULUCF management activities is facultative under the Kyoto Protocol, many countries have of course opted to report CO₂ emissions from agricultural soils under this sector and not select them for accounting[3].

In article 2 of the Kyoto Protocol countries are urged to promote sustainable development and to protect and enhance sinks and reservoirs and take into account commitments to other environmental agreements. Furthermore, countries are requested to phase out fiscal incentives, tax and duty exemptions as well as subsidies that run counter to the objective of the Convention. Incentives to follow this request are only weak. There are no serious consequences with respect to LULUCF activities like drainage of peatlands for agriculture as these need not necessarily be accounted under the Protocol.

Apart from deforestation the Kyoto Protocol fails to address adequately land use related losses in carbon stores (reservoirs). Even accounting of GHG emissions related to deforestation (reduction of the forest carbon store) is mandatory only for Annex I countries, whereas the major deforestation and degradation problems are found in non-Annex I countries. Currently, LULUCF activities other than afforestation are not liable for credit under the Clean Development Mechanism (CDM). Under negotiation is an avoided emissions mechanism to provide technological and financial support for developing countries (REDD: Reducing Emissions from Deforestation in Developing Countries). Besides deforestation, there is focus on protecting biodiversity and avoiding further degradation of soils. At the moment the proposals only aim at voluntary reporting, capacity building and other ‘soft’ incentives.

REDD discussions also address such perverse situations as the deforestation and degradation of tropical (peat swamp) forest for the production of palm oil, which is used in Annex I countries instead of fossil fuels. Although the emission of GHGs from forest and peat degradation surpasses the savings from the substitution of fossil fuels and GHG emissions actually increase as a result, these emissions are not accounted. Annex I countries will in fact account reduced emissions from use of bio- instead of fossil fuels.

Public pressure partly has been successful in changing German and Dutch government positions with respect to palm oil, but only more binding obligations can help avoid this and similar so called leakage problems.

Peatlands and peat

The drainage of peatlands and subsequent GHG releases to the atmosphere is insufficiently addressed in the framework of the Kyoto Protocol. Following the sectoral approach of the Protocol, accounting of peatland related emissions is presented below.

The Convention only addresses antropogenic GHG emissions, which means that emissions from pristine peatlands are excluded from reporting. Consequently, reduction of naturally occurring CH₄ emissions through drainage may not be accounted as emission reduction. Drainage as a CH₄ emissions reduction measure would furthermore disagree with the Kyoto Protocol objectives i) to protect carbon reservoirs and ii) to honour other international conventions like CBD and Ramsar.

If a peatland is drained for afforestation, GHG emissions from peat degradation must be reported under ARD activities. Accounting of these emissions is mandatory. Emissions associated with maintenance of drainage ditches fall under Forestry Management and their accounting is facultative. On an annual basis these emissions are usually much smaller than biomass increase of tree stands and Forestry Management as a rule constitutes a net-sink. Therefore countries are likely to include it in their accounting under the Kyoto Protocol.

With respect to emissions from peatlands drained for agriculture a difference needs to be made between CO₂ and other GHGs. CO₂ emissions from agricultural activities can be accounted either under Annex A or under LULUCF. Accounting under LULUCF (cropland or grazing land) is facultative and thus the preferred way of most countries (i.e. not accounting these emissions). Emissions from other GHGs (notably N₂O and CH₄ from ditches) must be accounted under Annex A emissions (mandatory).

Emissions from peat used ex-situ as horticultural substrate are treated like other emissions from agriculture. The Kyoto Protocol does not cover the emissions caused by ‘production’ of horticultural peat though, or those caused by ‘production’ of energy peat. Emissions from burning peat for energy are included under the energy sector of Annex A (mandatory accounting). Classification of peat as a biomass fuel would only leave GHG emissions other than CO₂ in this sector, whereas CO₂ emissions would be under facultative LULUCF accounting and could thus be left out of the picture.

Obviously only a full accounting and full coverage of emissions and activities can prevent all the trickery.

Peat used for energy

The Finnish and Swedish peat industry has been trying to convince the public by life cycle analyses designed to show that using peat for energy results in less GHG emissions than using coal. As combustion of peat results in more GHG emissions than combustion of coal – a fact that can hardly be influenced (see elsewhere in this Newsletter) – the crux is in the ‘before’ and ‘after’ part of the life cycle analyses. Already the UNFCCC and Kyoto Protocol offer the framework to include the complete life cycle of peat used for energy.

Emissions from the combustion itself are covered as stationary emissions, those related to peat transport as fugitive emissions under energy sector reporting (Annex A). The GHG emission factor for combustion of peat can be adjusted to meet national or regional circumstances (see elsewhere in this Newsletter). In contrast to other fossil fuels, peripheral emissions for example from peatland preparation and extraction (incl. storage) are not covered under the energy sector, but under the land use sector (LULUCF).

Under LULUCF, it is also possible to account for the ‘before’ and ‘after’ components of the life cycle. If peat is extracted from pristine areas, emissions/removals occurring before drainage (including CH₄!) are excluded from accounting, as these are not anthropogenic and therefore not covered by UNFCCC. If peat is extracted from areas drained for forestry, previous emissions from the forest should have been included under LULUCF. The area given up for peat extraction can simply be deducted from the total area of forest (deforestation). Removal of additional biomass and soil should be accounted as clearance activity under LULUCF. If peat is extracted from peatlands already drained for agriculture, previous emissions would have been included under LULUCF and/or Annex A. Emissions from clearance should again be accounted under LULUCF.

As for after use, the UNFCCC/Kyoto framework again offers all the possibilities for accounting. If the area is simply ‘given back to nature’, transitional emissions should be accounted under the LULUCF sector; ensuing emissions/removals cannot be accounted as they are not anthropogenic. Conversion to forest is accounted as afforestation and conversion to agricultural land should be accounted under LULUCF. Ensuing emissions/removals from the after use can also be accounted under LULUCF.

Of course accounting on many if not most of the before and after use components of the life cycle is facultative. If a country selects to account for emissions/removals from one of the facultative LULUCF categories, then all emissions/removals from this category must be included. To include only those specific activities related to fuel peat extraction and leave out other emissions/removals from the same LULUCF sectors is not possible as it would invite selective inclusion of low emission activities and exclusion of high emission activities. This would result in a picture that looks good on paper, but is much worse in reality; it would leave the impression that the interest is not in saving the planet, but in using GHG emissions as merely another business tactic to make money.

The life cycle analyses of peat fuel combustion presented by the Swedish and Finnish peat industry are selective and unfair. They focus on worst case scenarios with respect to the ‘before’ and best case scenarios with respect to the ‘after’ components (see elsewhere in this Newsletter). Accounting under UNFCCC/Kyoto levels the playground, draws the larger, national picture and puts emissions from peatlands in the right perspective. As a result, the use of peat for energy becomes much less attractive.

The future of peatlands is in conservation

Even without full accounting of LULUCF activities and even without inclusion of avoided emissions, conservation of peatlands in Annex I countries can be a profitable business during the first commitment period (2008-2012). Simply ‘giving back to nature’ peatlands drained for agriculture decreases the area of crop- and grasslands in comparison to 1990, which means a decrease in total emissions from crop- and grasslands compared to 1990 as well. Of course this would be a mere ‘bookkeeping’ trick if nothing is undertaken to restore these peatlands and really reduce emissions. Besides, really reducing emissions through restoration is even more lucrative.

Controlled rewetting of degraded peatlands drained for agriculture will drastically reduce emissions. These avoided emissions can only be accounted if they are combined with some form of land use, either under Annex A (agriculture) or LULUCF (cropland or grassland management). Crops grown on rewetted peatlands like reed (Phragmites, Typha, Phalaris) grown for thatching, biomass fuel or industrial raw material (cellulose), alder (Alnus) grown for timber or fuel, or peatmoss (Sphagnum) grown for horticultural purposes, not only bring employment and revenue as such, but also reduce emissions (possibly to the point of net sequestration). These reductions can be accounted under Annex A or LULUCF cropland / grassland management. This is not as straightforward as one might hope, however.

The guidelines for reporting on GHG emissions and removals distinguish three tier levels. The basic approach (tier 1) is to multiply activity data (e.g. area of cropland on organic soil) and multiply with an emission factor. Emission factors are based on (very) broad climate and management classes. For tier 2, country-specific emission factors are applied as well as more detailed classes of management systems. At tier 3, higher order methods are used including models and inventories adapted to national circumstances, repeated over time, and at sub-national to fine grid scales. For tiers 2 and 3 countries will need to provide additional documentation to support their methods and parameters. Obviously, higher tiers involve additional resources and institutional and technical capacity.

In order to include GHG emission reductions through ‘paludiculture’ on rewetted peatlands, countries will need to provide detailed information, enabling them to report at a higher tier level. With respect to rewetted peatlands this means reliable figures are needed that relate changes in peat stocks and GHG emissions to peat types, water levels and land use activities. Eddy covariance techniques as well as long term time series estimating peat volumes and subsidence combined with modelling approaches can be used to arrive at better estimates for emission parameters. Recently, country and land use specific emission factors with respect to peatland use were determined in a Finnish project in order to be able to apply for higher tier reporting.

Glossary