FOREST CARBON MANAGEMENT POLICY BRIEF

Transcription

1 FOREST CARBON MANAGEMENT POLICY BRIEF FRST 523 November 16, 2014 Alycia Lavinia-Fennings Sean Fogarty Judith Cowan 1

2 POLICY ADVOCACY BRIEF November 17, 2014 Forest Carbon Management 1964 Words Background and Purpose The Council of Forest Industries (COFI) represents the forest industry operating in the interior of British Columbia. British Columbia s forest sector is a key driver of the provincial economy contributing to government revenue, community prosperity, technological innovation, value-added initiatives, and sustainable resource use. Facing uncertain international and local markets, the economic downturn of 2008, ongoing trade issues such as the Softwood Lumber Agreement, new governance structures with First Nations, and the increasing role of carbon as a forest resource to be managed sustainably in our climactically changing world; it is an industry in transition [1]. By 2008 the mountain pine beetle epidemic destroyed over 16 million hectares of interior Lodgepole pine forests. The forecasted drop in the AAC due to declining mid-term timber supplies has altered the economic and environmental operating envelope for the industry now, and well into the future [3]. British Columbia s forests have shifted from a carbon sink to a carbon source which impacts the province s ability to control its GHG emissions and highlights the need to recapture the ability of BC s forests to store and sequester carbon. COFI believes that meaningful steps to address the use of carbon as a forest resource needs to occur within the context of the full suite of natural resource industries currently operating on the province s land base [2]. Proposals for carbon management must consider existing policy frameworks and engage in consultation processes with stakeholders to ensure technological innovation, sustainable forest management and the economic viability of our member companies and the communities that depend on them. EVALUATIVE CRITERIA AND SCOPE Within British Columbia, COFI has long represented communities that are dependent on the forest sector and embraces four criteria that consider those communities when assessing policy alternatives related to carbon management. In considering carbon management policy, the impact on employment levels, 2

3 inclusiveness of all natural resource managers, effect on international competitiveness, and potential financial impact to the forest industry and associated communities are weighed for each alternative. The criteria are used as a means to find the best solution through evaluating their impact on COFI s core values of maintaining long term forest industry profitability and adaptability in the face of change. ASSESSMENT OF ALTERNATIVES FRPA The addition of carbon to the current eleven values within FRPA would reflect negatively among each of COFI s criteria. Incorporating carbon in FRPA would act as a constraint exclusively to the forest sector. Although forestry is a substantial player in carbon emissions, other natural resource sectors, such as oil and gas, should have carbon included in their associated practices act. Deforestation is a prime example of other players operating on the land base in that of the 6,200 ha that was lost in British Columbia in 2008, only 820 ha, or 13% of the total area, was due to forestry practices. The remaining 87% was the result of oil and gas, recreation, mining, agriculture, and settlement and therefore, the inclusion of carbon in FRPA would fail to account for actions independent of forestry that have an effect on carbon emissions [4]. There is a great amount of uncertainty surrounding the financial impacts of incorporating carbon as a FRPA value, but due to the current status of British Columbia s forest acting as a source of carbon, it likely would have a negative effect [5]. The current greenhouse gas emissions being released from British Columbia in 2012 was a total of 61.5 million tonnes, with 3.5 million tonnes being the result of deforestation. The projections failed to include forest operations such as harvesting, slash and burns, or forest fires which accumulate to produce a net total of 39.3 million tonnes of GHG emissions [6]. The addition of carbon as a FRPA value could force forest emissions to be offset financially and would be to the detriment to the forest industry. The lack of cost-effective offsets has been seen through companies, such as the Pacific Carbon Trust, having to pay above market rates [7]. The addition of carbon in FRPA also has the potential to hinder our competitive advantage due to the lack of carbon regulation among our international competitors. The financial risk associated with carbon also gives rise to potential job insecurity. With the current status of British Columbia s forests as a carbon source, it is likely that forest companies will be obligated to purchase offsets to retain their current harvest levels. For companies choosing to reduce GHG emissions 3

4 rather than purchasing offsets, their harvest rates will inevitably decrease which causes a reduction in employment [6]. Within British Columbia, 47 communities generate up to 48% of their income from timberbased practices and therefore the addition of carbon as a constraining value could impact their livelihood [6]. THE LAND USE PLANNING PROCESS Land use plans are the tangible expression of legislation (such as the Forest Act and FRPA), current policy frameworks, and social values. Their objective is to guide land use and natural resource management of Crown lands in BC. They were initiated in 1992 by the BC government and called Land and Resource Management Plans (LRMPs) and involved a multi-stakeholder consultation processes aiming to address varying interests in a cooperative way, define protected areas, and develop regional strategies [8]. Twenty six plans (approximately 85% of the Crown Land base) were completed before the government brought an end to the process in 2006 due to the costs of collaborative planning, limited resources, emerging relations with First Nations, and the uncertain market conditions in the local and international trade of wood products. Currently, Strategic Land Use Planning only involves consultation with First Nations and select interest groups. A more inclusive consensus based land use planning process should be re-initiated because it is essential in reducing resource conflicts, providing clarity on land use issues, and ensuring forest management is responsive to the full range of economic, environmental and social values. Political will is required to reinstitute this process, but in the meantime, an interim measure of updating the existing forest resource inventories to account for large scale events and temporal change needs to be undertaken to support decisions [9]. No effective and relevant decisions on sustainable forest management can be made until the productive capacity of the land base is known. Because land use planning and inventory information are the provincial government s responsibility it is unknown whether it would contribute to more employment within the forest industry or have a negligible effect. If more jobs in data collection and planning were created, these positions would most likely be term or contractual and therefore not contribute to permanent employment. Updated inventory and land use planning information may restrict or constrain the forested land base upon which licensees operate. Therefore, the long term effect on employment in the forest industry is undetermined. Updated inventories within land use plans could also guide the activities and priorities of all users of Crown land (such as mineral and recreational) and not be limited solely to forests and timber. Therefore if the land use planning process has the effect of producing more regulation it may have a negative impact on forest sector competitiveness. 4

5 STATUS QUO In any policy analysis it is important to consider the status quo as a valid policy alternative [10]. With respect to forest carbon management, COFI feels that this alternative deserves considerable attention. In order for a carbon offset project to be considered in BC, it cannot be required by law or regulation [11]. If full access to the economic benefits of carbon offsets is going to be realized, the current absence of regulatory requirements surrounding the management of forest carbon by forest companies should be seen as an opportunity and not a shortcoming. By allowing industry the full range of opportunities to capitalize on forest carbon projects you ensure maximum implementation of economically sound projects. Any policy alternatives which force carbon management onto industry without economic incentives will restrict their ability to find innovative ways to protect the carbon value and maintain profitability. This is vital, as COFI members operate in numerous communities throughout the interior of BC, many of which rely on the profitability of these members to support them. In considering the status quo, existing policy that supports carbon management and GHG emission reductions should be considered. COFI is supportive of recent new tenure arrangements such as the Fibre Forestry Licence To Cut and Fibre Supply Licence To Cut, which allow logging waste to be more effectively utilized [12]. As well, the more recent Supplemental Forest Licence, which allows bioenergy companies with a shortfall of necessary biomass to harvest timber from marginal stands, is an excellent way to ensure low productivity/dead stands are effectively rehabilitated and return to carbon sequestration [13]. Economically and environmentally positive policies such as these are where BC should be heading with regard to carbon management. In letting carbon management develop through enabling and not restrictive legislation, as well as through market forces, we allow all land managers, including COFI members to adopt good carbon management projects that have synergy with their core business and are thus sustainable in the long term. It also allows industry to adopt good management policies in sequence with competitors from other markets so that their global competitiveness is not negatively affected. 5

6 SUMMARY The decision matrix below provides a summary of the comparison of the policy alternatives discussed in this paper. Each alternative has been ranked with respect to the four criteria previously described: impact of policy on employment, impact on forest industry profitability, inclusiveness of all land managers and impact on global competitiveness. Alternative Criteria Carbon Objective Employment Economic Impact Inclusiveness Competitiveness Negative: likely Negative: Ultimately Negative: FRPA does not Negative: Increased reduction in more constraints equal apply to energy, mining regulation will increase employment as as more costs to industry or hydro-power costs and reduce Add to FRPA additional cost of companies company's ability to management is placed compete globally on industry Update inventory and re-open LUP process Status quo Undetermined: if inventory work was contracted to forest companies the result could be positive but the long-term effect of reopening could have either a positive or negative effect on employment Neutral-Positive: No change in legislation would mean no effect of employment however if carbon projects were undertaken more employment may be generated Negative: Someone needs to pay for gathering new inventory data and the LUP process will be a time consuming process requiring substantial industry resources Positive: Avoids legislation that could remove the ability to engage in economically attractive carbon management opportunities Positive: Good inventory means the entire forest resource is appropriately valued and LUP is a multistakeholder process Positive: Allows all users on the landbase to manage for carbon as they see appropriate Undetermined: will depend on the outcome of LUP Positive: Doesn't put BC at a competitive disadvantage by imposing legislation that doesn't exist in other jurisdictions RECOMMENDATIONS AND CONCLUSION COFI strives to ensure the long-term sustainability of all members and therefore supports the continuation of the Status Quo in addressing carbon management. The Status Quo provides risk adverse employment and economic security without limiting the potential for inclusiveness and competiveness. Through the continuation of implementing the Status Quo COFI recommends: Carbon incentives that would encourage GHG emission reduction Access to optional carbon management projects that give rise to innovation Greater support of new tenures that address logging waste 6

7 WORKS CITED [1] Council of Forest Industries, " About Us: Who We Are" [Online]. Available: [Accessed 13 November 2014]. [2] Council of Forest Industries, " Economics & Statistics: The Economic Contribution of BC Forest Industry" [Online]. Available: [Accessed 9 November 2014]. [3] Ministry of Forests, Lands and Natural Resource Operations, "Beyond the Beetle: A Mid-Term Timber Supply Action Plan," October [Online]. Available: pdf. [Accessed 4 November 2014]. [4] M. Greig & G. Bull, Carbon management in British Columbia s forests: An update on opportunities and challenges, [Online]. Available: [Accessed 15 November 2014] [5] Ministry of Forests, Lands and Natural Resource Operations, Climate mitigation potential of British Columbian forests: Growing carbon sinks, November [Online]. Available: [Accessed 15 November 2014] [6] G. Hoberg & G. Schittecatte, Forest Carbon Mitigation in British Columbia Policy Issues and Option Pacific Institute for Climate Solutions Forest Carbon Management Project, November [7] Office of the Auditor General of British Columbia, An Audit of Carbon Neutral Government, March [Online]. Available: [Accessed 15 November 2014] [8] Healthy Forests, Healthy Communities, "Status of LRMP and RLUP Implementation to meet the Forest Lands Vision," [Online]. [Accessed 9 November 2014]. [9] Council of Forest Industries COFI, "Submission to the Legislative Assembly Special Committee on Timber Supply," [Report]. [Accessed 9 November 2014]. [10] Patton C, Sawicki D.(1993). Basic Methods of Policy Analysis and Planning. Englewood Cliffs, NJ: Prentice Hall. 7

8 [11] The Government of British Columbia. (2007). The Greenhouse Gas Reduction Targets Act. Retrieved from [12] Forest Tenure Branch. (2012). Fibre Recovery Tenures Administrative Guide. Retrieved from Recovery-Tenures-Guidebook-June pdf [13] The Government of British Columbia. (2014). Province introduces innovative, flexible forest licence. Retrieved from 8