Cash in on forests to fight climate change and earn foreign exchange
Cash in on forests to fight climate change and earn foreign exchange
Published: 04:50 am Sep 17, 2009
KATHMANDU: There are immense possibilities to mitigate the impact of climate change in the nation. Perhaps, it stands to gain a lot from the Clean Development Mechanism (CDM). As of now, Nepal accounts for negligible Green House Gas (GHG) emission as compared to other developed nations. It will be a viable financial proposition if it can help other developed nations to help cut down on GHG emission. The Kyoto Protocol in 1997 had mandated developed countries to reduce the GHG emission by 5.2 percent by 2012. While, a great reduction is aimed at in the future. Consequently, the developed nations formulated a two-pronged strategy to reduce emission: First, to come up with a Domestic Mechanism to promote the renewable energy in the respective nations. Second, Flexible Mechanism, which will involve developing countries — like Nepal — to work on joint projects to reduce the carbon emission. The stakes are high for the nation to take advantage of the second strategy. It can cash in on selling reduced carbon to the biggest GHG emitters in the first world. A move, which can not only help the country to earn the much-needed foreign exchange but also help the vulnerable communities back home to overcome the impact of climate change. The Global Conference on climate change in Bali, Indonesia —held in 2007 — discussed at great length on protection of forests that are the largest storehouse of carbon and a good absorber of the gas as well. Trees have an inherent ability to sequester the carbon, which, in turn, helps lessen the concentration of the gas in atmosphere. Though the debate on carbon trade has gained momentum over the years, the modalities for the trade and distribution mechanism are yet to be arrived at. Nepal has a long way to go institutionalise the forestry sector under the CDM. The work to Reduce Emission avoiding Deforestation and Degradation (REDD) in developing countries is already in progress. The nation, too, has set up a REDD cell under the Ministry of Forest and Soil Conservation (MoFSC). The department has received $2 million from the World Bank to initiate ground work. “Nepal’s market for carbon trade is insignificant as compared to countries like Brazil and Indonesia. Both these nations boast of huge forest reserves. We’re compelled to follow the international norms, which are loaded towards those countries that have large forest areas,” said Ngamindra Dahal, an expert on climate change. The debate on sharing the spoils of carbon trade has reached a feverish pitch. There are as many opinions as stakeholders. Broadly speaking, the country’s forests can be classified into two categories: the government-owned forests and those managed by the communities. The REDD is mainly focused on the growth and development of the community-based forests, which came into existence mainly after 1990 — the base year for the Kyoto Protocol. Expectations are high that the community-based forests attract the donors’ attention to make the carbon trade a success. There is a conflict of interest between the government and the Federation of Community Forest Users’ Group, Nepal, (FECOFUN) on how to share the benefits of the lucrative trade. The FECOFUN has been persistently against the government’s intervention to mobilise the funds to carry out carbon trade. The government’s view on this matter is not yet clear. “We’ve prepared a model for sharing the benefit and proposed the government to establish a REDD Fund Trust. The latter should coordinate and route the funds to the Community Forest Users’ Groups (CFUG) directly on the basis of the latter’s conservation efforts,” said Bhola Bhattarai, general secretary, FECOFUN. As the debate rages, the international community is yet to decide on the mechanism for allocation of funds. Funds can be accessed on the basis of a) the market-based approach, which calculates the exact amount of carbon that the forest stores and is up for grabs at a competitive rate for the international community. b) Voluntary fund-based mechanism, where the payment is done on the basis of a ballpark figure. It is simpler process of transaction for the communities. Experts opined that Nepal could only pursue the voluntary fund-based mechanism due to leniency in rules and regulations. “Besides, we don’t have an updated data on forests till date. It’ll be difficult to ascertain the figure in the near future due to infrastructure inadequacies. Hence, we should opt for the voluntary fund-based mechanism, where the sum can reach easily to the needy communities,” reasoned Dr Hemanta Ojha, a researcher on forests. The estimated cost for halving emissions from deforestation will cost between $7 and 28 billion annually. While, the carbon trade is pegged at $10 per ton of the gas. As per the latest figures, Nepal has 29 per cent of forest land and 10.6 per cent shrub land. The national parks and conservation areas account for 19.7 per cent. Nepal’s carbon stock is around 890 million tons. A clear vision is the need of the hour to tap this huge resource base.