The Punta Leona private reserve on Costa Rica’s Pacific coast, where the owners voluntarily protect biological diversity and use a small part of the property for ecotourism. Credit: Fabíola Ortiz/IPS

By Fabíola Ortiz
PUNTA LEONA, Costa Rica , Nov 20 2015 (IPS)

Private voluntary nature reserves in Latin America should be seen as allies in policies on the environment, climate change mitigation and the preservation of biological diversity in rainforests, say experts.

“Private reserves in Latin America are not included in conservation policies; they should be integrated in our national strategies,” said Carlos Manuel Rodríguez, vice-president of conservation policies in Conservation International (CI) in Costa Rica.

Rodríguez, a former Costa Rican minister of environment, energy and mines (2002–2006), was addressing 150 environmentalists, promoters of voluntary conservation agreements, and ecotourism business owners, during the 11th Latin American Congress of Networks of Private Reserves, held Nov. 9-13 in the Punta Leona private nature reserve and tourism destination.

In his view, the private sector should play a more central role and governments and the owners of private nature reserves should work together to achieve compliance with the Aichi Biodiversity Targets adopted in Nagoya, Japan in 2010.

During the 10th Conference of the Parties to the Convention on Biological Diversity in Nagoya, 193 United Nations members established 20 targets to fight the loss of biodiversity, with a 2020 deadline.

“We are losing our natural capital due to climate change and the big gap between private and public conservation,” said Rodríguez. “The owners of private reserves should become political actors, to help meet the Aichi Targets.”

The global cost of financing efforts towards the targets is estimated at 150 to 440 billion dollars a year, according to figures from the Convention itself. But currently, CI says, the world is only channeling 45 billion dollars towards that end.

Rodríguez says private conservation efforts could help mitigate the shortfall in funds.

With that aim, the Latin American Alliance of Private Reserves was formally created Nov. 6 – the first of its kind in the world. It groups 4,345 private reserves in 15 countries, with a combined total of 5,648,000 hectares of green areas.

The 11th Latin American Congress of Networks of Private Reserves held No. 9-13 in the Punta Leona nature reserve on Costa Rica’s Pacific coast. Credit: Fabíola Ortiz/IPS

“The idea is to form a conservation chain,” Martin Keller of Guatemala, the president of the new alliance, told IPS. “Private areas can form a chain with national parks and expand national conservation systems. They are also a mechanism to absorb drastic climate changes.”

He argues that there should be no borders for private reserves in the region. “We are joining together in something magnificent, and formalising associations with international institutions so that they include us in environmental projects,” he said.

During the congress in Costa Rica, a pilot programme to encourage the sale of carbon credits was announced, with the donation of 200 hectares of land by a member of the Alliance. The programme will have an estimated 3,600 tonnes of carbon.

Keller hopes Latin America will begin to sell carbon as a bloc, starting in 2017.

“We have dreams and a passion for conserving nature,” the president of the Costa Rican Network of Nature Reserves, Rafael Gallo, who is donating the 200 hectares for the pilot plan, told IPS. “We want the sale of carbon to be a mechanism for private conservation at a global level.”

Gallo has an 800-hectare property on the Banks of the Pacuare River along Costa Rica’s Caribbean coast. Of that total, 700 hectares are a forest reserve. It is located in Siquirres, 85 km east of San José, near the Barbilla National Park, which forms part of the La Amistad Biosphere Reserve.

“The market is still just getting off the ground, a ton of carbon is worth three dollars,” said Gallo, who believes the mechanism will become viable when the price of a ton reaches 10 dollars.

The countries in the Alliance are Argentina, Belize, Brasil, Chile, Colombia, Costa Rica, Ecuador, El Salvador, Guatemala, Honduras, Mexico, Nicaragua, Panama, Paraguay and Peru. Uruguay and Venezuela also have private reserves, but they have not yet set up local networks – a necessary step before they can join.

Keller said he hopes the initiative will expand to the entire hemisphere, including the Caribbean island nations, Canada and the United States.

Private reserves in the northern Costa Rican province of Heredia. A pilot project for carbon credits will be carried out on one such reserve, thanks to a donation of 200 hectares of land by its owner. Credit: Fabíola Ortiz/IPS

Private reserves would like to benefit from multilateral institution programmes, and with that in mind they have made contact with U.N. partners involved in one way or another with conservation issues, such as the World Bank and the Inter-American Development Bank.

“We want to be a regional bloc, we want to be heard at an international level, and we want incentives for property owners to continue joining forces to support conservation – because we would have a massive impact as a bloc,” Claudia García de Bonilla, executive director of the Association of Private Natural Reserves of Guatemala, told IPS.

Voluntary conservation areas are set up by ecotourism businesses, academic institutions, research bodies, or organic agricultural producers, and their advocates see them as green shields against climate extremes and the loss of biodiversity.

“Forests are a sponge, absorbing storms and hurricanes. We have to keep expanding our ecological corridors,” Bonilla said.

The representative of private green areas in Chile, Mauricio Moreno, underscored benefits that nature reserves belonging to individuals or private bodies can offer a global vision of conservation.

“These areas are refuges protected with a great deal of goodwill and effort,” he told IPS. “They complement the public networks. There are reserves that border natural parks and thus create much bigger areas that make it possible to conserve species of animals. With a public and private effort, integral conservation is possible.”

According to Ariane Claussen, an engineer in renewable natural resources at the University of Chile, the budget assigned to public protected areas in the region is insufficient, which makes it difficult for countries to have the capacity to act on their own in the preservation of biodiversity.

“Rather than seeing private reserves as independent, they should be seen in an integrated manner,” she told IPS. “If these people didn’t decide to practice conservation, they would be using that land in different ways, for unsustainable monoculture or stockbreeding.”

She said “the property owners dedicate a small portion of this land to (economic) development like tourism, because they need an income.”

Claussen, along with another Chilean colleague, Tomás González, stressed the Latin American initiative Huella, aimed at voluntary cooperation in technical planning for conservation, environmental education and ecological activism in the region.

Private reserves cover gaps left by the state, she said. “The idea is that they take part in conservation as buffer zones and link up the ecosystems of public protected areas that are isolated and fragmented,” she explained.

Edited by Estrella Gutiérrez/Translated by Stephanie Wildes

Dawn on the border of the Juma Reserve in the Brazilian Amazon. Activists say some new conservation policies are undermining traditional approaches to forest management and alienating forest-dwellers from their traditional activities. Credit: Neil Palmer (CIAT)/cc by 2.0

By Jeff Conant
BERKELEY, California, Dec 18 2014 (IPS)

Dercy Teles de Carvalho Cunha is a rubber-tapper and union organiser from the state of Acre in the heart of the Brazilian Amazon, with a lifelong love of the forest from which she earns her livelihood – and she is deeply confounded by what her government and policymakers around the world call “the green economy.”

“The primary impact of green economy projects is the loss of all rights that people have as citizens,” says Teles de Carvalho Cunha in a report released last week by a group of Brazilian NGOs. “They lose all control of their lands, they can no longer practice traditional agriculture, and they can no longer engage in their everyday activities.”The whole concept fails to appreciate that it is industrial polluters in rich countries, not peasant farmers in poor countries, who most need to reduce their climate impacts.

Referring to a state-run programme called the “Bolsa Verde” that pays forest dwellers a small monthly stipend in exchange for a commitment not to damage the forest through subsistence activities, Teles de Carvalho Cunha says, “Now people just receive small grants to watch the forest, unable to do anything. This essentially strips their lives of meaning. ”

Her words are especially chilling because Teles de Carvalho Cunha is not just any rubber tapper – she is the president of the Rural Workers Union of Xapuri – the union made famous in Brazil when its founder, Chico Mendes, was murdered in 1988 for defending the forest against loggers and ranchers.

Mendes’ gains have been consolidated in tens of thousands of hectares of ‘extractive reserves,’ where communities earn a living from harvesting natural rubber from the forest while keeping the trees standing. But new policies and programmes being established to conserve forests in Acre seem to be having perverse results that the iconic leader’s union is none too happy about.

Conflicting views on the green economy

As Brazil has become a leader in fighting deforestation through a mix of  public and private sector actions, Acre has become known for market-based climate policies such as Payment for Environmental Services (PES) and Reducing Emissions from Deforestation and Forest Degradation (REDD) schemes, that seek to harmonise economic development and environmental preservation.

Over the past decade, Acre has put into place policies favouring sustainable rural production and taxes and credits to support rural livelihoods. In 2010, the state began implementing a system of forest conservation incentives that proponents say have “begun to pay off abundantly”.

Especially as the United Nations Framework Convention on Climate Change continues to fail in its mission of bringing nations together around a binding emissions reduction target – the latest failure being COP20 in Lima earlier this month – REDD proponents highlight the value of “subnational” approaches to REDD based on agreements between states and provinces, rather than nations.

The approach is best represented by an agreement between the states of California, Chiapas (Mexico), and Acre (Brazil).

In 2010, California – the world’s eighth largest economy – signed an agreement with Acre, and Chiapas, whereby REDD and PES projects in the two tropical forest provinces would supply carbon offset credits to California to help the state’s polluters meet emission reduction targets.

California policymakers have been meeting with officials from Acre, and from Chiapas, for several years, with hopes of making a partnership work, but the agreement has yet to attain the status of law.

Attempts by the government of Chiapas to implement a version of REDD in 2011, shortly after the agreement with California was signed, met strong resistance in that famously rebellious Mexican state, leading organisations there to send a series of letters to CARB and California Governor Jerry Brown asking them to cease and desist.

Groups in Acre, too, sent an open letter to California officials in 2013, denouncing the effort as “neocolonial,”:  “Once again,” the letter read, “the former colonial powers are seeking to invest in an activity that represents the ‘theft’ of yet another ‘raw material’ from the territories of the peoples of the South: the ‘carbon reserves’ in their forests.”

This view appears to be backed up now by a  new report on the Green Economy  from the Brazilian Platform for Human, Economic, Social, Cultural and Environmental Rights. The 26-page summary of a much larger set of findings to be published in 2015 describes Acre as a state suffering extreme inequality, deepened by a lack of information about green economy projects, which results in communities being coerced to accept “top-down” proposals as substitutes for a lack of public policies to address basic needs.

Numerous testimonies taken in indigenous, peasant farmer and rubber-tapper communities show how private REDD projects and public PES projects have deepened territorial conflicts, affected communities’ ability to sustain their livelihoods, and violated international human rights conventions.

The Earth Innovation Institute, a strong backer of REDD generally and of the Acre-Chiapas-California agreement specifically, has thoroughly documented Brazil’s deforestation success, and argues that existing incentives – farmers’ fear of losing access to markets or public finance or of being punished by green public policies – have been powerful motivators, but need to be accompanied by economic incentives that reward sustainable land-use.

But the testimonies from Acre raise concerns that such economic incentives can deepen existing inequalities. The Bolsa Verde programme is a case in point: according to Teles de Carvalho Cunha, the payments are paltry, the enforcement criminalises already-impoverished peasants, and the whole concept fails to appreciate that it is industrial polluters in rich countries, not peasant farmers in poor countries, who most need to reduce their climate impacts.

A related impact of purely economic incentives is to undermine traditional approaches to forest management and to alienate forest-dwellers from their traditional activities.

“We don’t see land as income,” one anonymous indigenous informant to the Acre report said. “Our bond with the land is sacred because it is where we come from and where we will return.”

Another indigenous leader from Acre, Ninawa Huni Kui of the Huni Kui Federation, appeared at the United Nations climate summit in Lima, Peru this month to explain his people’s opposition to REDD for having divided and co-opted indigenous leaders; preventing communities from practicing traditional livelihood activities; and violating the Huni Kui’s right to Free, Prior and Informed Consents as guaranteed by Convention 169 of the International Labor Organization.

One of the REDD projects the report documents (also documented here) is the Purus Project, the first private environmental services incentive project registered with Acre’s Institute on Climate Change (Instituto de Mudanças Climáticas, IMC), in June 2012.

The project, designed to conserve 35,000 hectares of forest, is jointly run by the U.S.-based Carbonfund.org Foundation and a Brazilian company called Carbon Securities. The project is certified by the two leading REDD certifiers, the Verified Carbon Standard (VCS) and the Climate, Community, Biodiversity Standard (CCBS).

But despite meeting apparently high standards for social and environmental credibility, field research detected “the community’s lack of understanding of the project, as well as divisions in the community and an escalation of conflicts.”

One rubber tapper who makes his living within the project area told researchers, “I want someone to explain to me what carbon is, because all I know is that this carbon isn’t any good to us. It’s no use to us. They’re removing it from here to take it to the U.S… They will sell it there and walk all over us. And us? What are we going to do? They’re going to make money, but we won’t?”

A second project called the Russas/Valparaiso project, seems to suffer similar discrepancies between what proponents describe and what local communities experience, characterised by researchers as “fears regarding land use, uncertainty about the future, suspicion about land ownership issues, and threats of expulsion.”

The company’s apparent failure to leave a copy of the project contract with the community did not help to build trust. Like the Purus Project – and like many REDD projects in other parts of the world whose track record of social engagement is severely lacking – this project is also on the road to certification by VCS and CCB.

Concerns like criminalising subsistence livelihoods and asserting private control over community forest resources, whether these resources be timber or CO2, is more than a misstep of a poorly implemented policy – it violates human rights conventions that Brazil has ratified, as well as national policies such as Brazil’s National Policy for the Sustainable Development of Traditional Peoples and Communities.

The report’s conclusion sums up its findings: “In the territories they have historically occupied, forest peoples are excluded from decisions about their own future or—of even greater concern – they are considered obstacles to development and progress. As such, green economy policies can also be described as a way of integrating them into the dominant system of production and consumption.

“Yet, perhaps what is needed is the exact opposite – sociocultural diversity and guaranteeing the rights of the peoples are, by far, the best and most sustainable way of slowing down and confronting not only climate change, but also the entire crisis of civilization that is threatening the human life on the planet.”

Edited by Kitty Stapp

Excerpt:

“The darker side of green” – plantation at Bukaleba, Uganda. Credit: Kristen Lyons

By Kristen Lyons
BRISBANE, Dec 8 2014 (IPS)

Norwegians know something of life in a climate change world. Migratory birds arrive earlier in spring, trees come into leaf before previously expected, and palsa mires (wetlands) are being lost as permafrost thaws.

Norwegians are currently waiting while geologists try to predict if, and when, Mount Mannen might collapse, destroying homes in its path, after torrential rain in the region.

Kristen Lyons

According to the Intergovernmental Panel on Climate Change (IPCC), this will be just the beginning for Norway – and the rest of the world – unless urgent and immediate action is taken to substantially reduce greenhouse gas emissions.

While reducing our dependence on the dirty fossil fuel industries is widely lauded as representing the fastest and most effective strategy to reduce our global emissions, much of the world’s attention – including that of many governments and industry – has been captured by the promise of carbon trade markets.

There are hopes that pricing and selling carbon just might be the magic bullet to solve the crisis, while at the same time generating lucrative returns for investors.

Carbon markets are being established on the assumption that if the ‘right’ price is placed on carbon, private companies and their financial backers will be driven to invest in so-called ‘green’ projects that capture and store carbon, thereby reducing greenhouse gas emissions in the world’s atmosphere.“Expecting some of the poorest of the poor to carry the social and ecological burdens of monoculture plantation forestry projects for carbon offset is both socially unjust, and ecologically just does not add up”

Carbon markets are championed by those who believe that carbon emissions taking place in one part of the world can be offset by their capture or sequestration in another. Plantation forestry is a key sector in the carbon market, with many projects established in some of the poorest parts of the world, based on the assumption that they will confer benefits to the environment and the local people.

But does all the hype about carbon markets really stack up?

Research on the Norwegian company Green Resources – engaged in plantation forestry and carbon offset on the African continent – raises many questions about who benefits from the carbon market projects. In-depth research over two years in Uganda, where Green Resources has licence to over 11,000 hectares of land, demonstrates how local communities are the losers of such projects.

A recent report, The Darker Side of Green: Plantation Forestry and Carbon Violence in Uganda,  published by the Oakland Institute, contributes to the critical conversation about the role of carbon markets in addressing climate change.

The report identifies profound adverse livelihood impacts associated with Green Resources’ activities, including loss of land and heightened food insecurity, as well as destruction of sites of cultural significance. It also demonstrates the failure of Green Resources to engage in meaningful community engagement with affected villages, so as to deliver positive community development outcomes.

Yet this REDD [Reducing Emissions from Deforestation and Forest Degradation] type project (referring to any project that involves forestry carbon credits), and the audit mechanisms to which it must comply, fail to detect and/or challenge the impacts of Green Resources’ activities.

Nor do they detect the extent to which environmental problems – including land clearing for animal grazing and crop cultivation – may simply be relocated from inside licence areas to other, often ecologically sensitive landscapes.

Importantly too, carbon market audits fail to consider the carbon capture enabled by local agro-ecological and organic farming systems, on which most subsistence and peasant farmers rely.

We are faced with a number of options in reducing global greenhouse gas emissions, something we all know is urgently needed. Despite the promise by many that the magic of climate markets will solve the current climate crisis, the findings presented in the report discard this fairy dust, shining a light on the structural violence and inequities on which carbon markets are built.

Expecting some of the poorest of the poor to carry the social and ecological burdens of monoculture plantation forestry projects for carbon offset is both socially unjust, and ecologically just does not add up. (END/IPS COLUMNIST SERVICE)

(Edited by Phil Harris)

The views expressed in this article are those of the author and do not necessarily represent the views of, and should not be attributed to, IPS – Inter Press Service. 

Excerpt:

“The big picture is that the CDM is at a crossroads. The markets have collapsed” – Hugh Sealy, CDM Executive Board Chair. Credit: Wambi Michael/IPS

By Wambi Michael
LIMA, Dec 4 2014 (IPS)

The U.N. mechanism for supporting carbon emissions projects in developing countries – the Clean Development Mechanism (CDM) – is in crisis as a result of a dramatic slump in the prices being paid for carbon credits.

The CDM, which deals in Certified Emission Reductions (CERs), is faced with possible collapse because demand in recent years from the principal buyers – countries tasked with emission reduction obligations under the Kyoto Protocol – has dropped, because emission reduction targets have not risen significantly and because economic growth has slowed. “The mechanism [Clean Development Mechanism] has so far led to the registration of 7,800 projects and programmes across 107 developing countries with hundreds of billions of dollars in investment, resulting in 1.5 billion fewer tonnes of greenhouse gases entering the atmosphere” – Hugh Sealy, CDM Executive Board Chair

The CDM Executive Board and its members at the ongoing (Dec. 1-12) U.N. Climate Change Conference in Lima, Peru, have been trying to convince negotiators there to renew their commitment to the mechanism, which has existed for the last ten years. Hugh Sealy, Chair of the CDM, answered questions from IPS on what has gone wrong and what needs to be done.

Q:  Can you give us the big picture of the Clean Development Mechanism today?

A:  The big picture is that the CDM is at a crossroads. The markets have collapsed. The price of CERs has fallen to about 0.30 a dollar compared with over 30 dollars five years ago.

Q:  What has been achieved so far?

A:  The mechanism has so far led to the registration of 7,800 projects and programmes across 107 developing countries with hundreds of billions of dollars in investment, resulting in 1.5 billion fewer tonnes of greenhouse  gases entering the atmosphere.

Q:  Where was the problem for the CDM?

A:  The beginning of the trouble for the CDM – and this is my personal feeling – was the European Union’s 2009 directive [to strictly limit the permissibility of international credits and ban them altogether from 2020] which came into effect on Jan. 1, 2013. You have a situation where you have one buyer – the European Union. Japan has decided to create its own system, the JCR, Australia has gone its own way, Canada has gone its own way, and the United States has never bothered either. So if you have system where the European Union as our major buyer is going to exclude all other units, then the market is not going to take a lot of them. And that is when the prices begin to drop.

Q:  So you think you should have had a regulated market for CERs?

A:  A market for CERs, which are not like any other commodity, should have had a floor. While others had a floor for theirs, we never had a floor on ours.  Yet now the World Bank is saying that we should create some sort of market reserve fund that can suck all this excess credit. They say about three billion dollars may be required to suck up this excess. And I don’t see it as a problem of excess CERs. I see it as lack of demand for CERs. I mean, look at all the CERs that we have generated. We have 1.5 gigatonnes of emission reductions. The emissions gap is 10 gigatonnes per year. So to me, the essential and radical demand remains for a market system.

Q:  The CDM Executive board has been fronting voluntary cancelling as a possible option for creating demand for CERS. What is the idea behind that?

A:  The idea is that anyone. Even you as the media, me as an individual, a company, a government can purchase and cancel CERs immediately. But we have no idea what demand we will have for voluntary cancellation. So I cannot tell you that as a result of voluntary cancellation we will see an immediate upsurge in the price of CERs. But we as a board think this is the right thing to do. To make CERs available to anyone who wants to reduce their carbon footprint.

The other thing that we are looking at is what services we provide. And we believe we have a very robust Monitoring, Reporting and Verification (MRV) system for determining actual emission reductions.

And what we see is that a number of financial institutions like the World Bank, the Global Environmental Facility and the Green Climate Fund are allocating quite a bit of their portfolios to what they call performance-based finance or result-based finance. And we are in dialogue with these institutions asking them to use the CDM, use the MRV that we provide, to ensure that the CERs that you put your loans out for are actually achieved.

Q:  That may not take off and possibly is not sustainable. What would be the lasting solution?

A:  We need a clear decision here in Lima, and Paris [in 2015] in particular, as to what the role of an international offset mechanism will be in a new climate regime. We need parties, particularly the developed countries, to raise their level of ambition and to create more demand for CERs. And outside that, we are searching for non-traditional markets through voluntary cancellation.

Q:  What are the implications of this development for least developing countries and least developed small island states?

A:  If I was a developer, and I’m from one of those countries, I would hold on to my CERs. I would not seek to enter a purchase agreement at this time. Not at thirty cents. I’m an optimist. I believe the price of CERs must go up.

There is a fundamental arithmetic that I’m working with and that is that the emissions gap is about ten gigatonnes per year and is only getting wider at this point.  So if countries decide that markets will be vital component of the Paris agreement, then I cannot see how the price of CERs can remain at thirty cents. It can only go up. It is absolutely frustrating for small island states like Jamaica that already have registered CER projects. It is extremely frustrating for countries in Africa.

Q:  If the CDM was to collapse today, what would we lose?

A:  We would lose ten years of experience, ten years of learning by doing. Those who think that they can abandon the CDM and create a new market mechanism in the interim are not facing reality.

It took a very long time to create the CDM and to get it to the stage we are at now.  So my answer to your question is that we will lose quite a lot. I cannot give you a monetary number or a dollar value of what we will all lose in investment. There are over 4,500 organisations in the world that deal with the CDM.

Q:  What can be done by countries at the negotiations going on here in Peru if, in the past, such negotiations have produced a pioneering model like CDM that has to some extent worked as you seem to indicate?

A: They can increase their demand for CERs before 2020, recognise the value that the CDM can add to emerging emissions trading systems, and recognise the mechanism’s obvious value to the international response to climate change after the new agreement takes force in 2020.

This is one of the most effective instruments governments have created under the U.N. Climate Change Convention. It drives and encourages emission reductions, climate finance, technology transfer, capacity-building, sustainable development, and adaptation – everything that countries themselves are asking for from the new Paris agreement.

(Edited by Phil Harris)

Carbon credits can be used to protect forestlands. About 80 percent of Guyana’s forests, some 15 million hectares, have remained untouched over time. Credit: Desmond Brown/IPS

By Carey L. Biron
WASHINGTON, Apr 10 2013 (IPS)

Nascent carbon emissions-trading exchanges in several countries are increasingly looking at options to interlink with one another, which advocates say would offer investors long-term stability, increase revenues for the development of renewable energy and strengthen corporate support for climate policy.

Yet critics warn that so-called cap-and-trade systems are inefficient and create incentives for polluting industries to continue with business as usual. They also warn that the new systems in the United States are dependent on mechanisms that adversely impact on poor and indigenous communities in developing countries.The law is supposed to be creating incentives for innovations, whereas cap and trade merely allows the fossil fuel industry to keep polluting at historical levels.

“I’ve been incredibly struck at the recent groundswell of interest by countries – including China and Korea – looking to develop carbon markets,” Harinder Sidhu, an Australian civil servant, said Wednesday at a panel discussion here.

“It’s very apparent that the pace is picking up in terms of both interest and action on the part of countries thinking about how to develop carbon markets. This really moves the conversation away from how acting on climate change creates costs to how doing so creates opportunity and economic benefit.”

Carbon trading allows countries to meet emissions reduction mandates under the Kyoto Protocol, which came into force in 2005, offering a certain number of tradable emissions-related “allowances” to polluting companies or governments. Further, as representatives try to negotiate a post-Kyoto agreement, many suggest that such exchanges will likely play a key role.

In part, the idea is controversial because it allows certain countries to maintain high pollution levels while shifting the burden for greater cuts to other countries. Yet proponents point out that revenues from these markets are being ploughed back into research on renewable energy, increased electricity transmission inefficiency and, in some cases, low-income housing.

They also suggest that the cost differentials between markets could motivate business interests to push politicians to institute uniform carbon markets – a key consideration in the new discussion over linking various emissions exchanges.

State action

Sidhu was in Washington to talk about Australia’s carbon market, which began operating last year and is planned to be fully operational within the next three years. In August, Australian officials arrived at an initial agreement to link their market with that of the European Union, which since 2005 has operated the world’s first and largest emissions exchange, the E.U. Emissions Trading System (ETS).

The United States, which is not a party to the Kyoto Protocol, already has a nine-state carbon market operating in the country’s northeast. For the past six years, the Regional Greenhouse Gas Initiative (RGGI) has operated as an emissions exchange aimed at capping greenhouse gases from within the power sector.

Now, the world’s second-largest carbon market is starting to function in the western U.S. state of California, covering around 85 percent of the state’s emissions. By itself California is the world’s ninth-largest economy, and the value of its cap-and-trade programme is forecast to top two billion dollars by the end of this year.

This week, California and the Canadian province of Quebec arrived at an agreement to link their carbon markets. In recent years, California officials have held similar discussions with E.U. and Australian counterparts.

Advocates say such moves are highlighting the increasingly important climate actions being taken by sub-national governments, even as Washington politicians have remained unable to pass comprehensive legislation limiting greenhouse gases.

“While it’s easy to get depressed about the national-level discussion on action on climate change here in the U.S., we’re seeing some incredible progress being made at the state level,” Tom Perriello, president of the Center for American Progress Action Fund, a Washington think tank, told an audience Wednesday.

“In 2009, the U.S. committed to reducing its emissions by 17 percent below 2005 levels, and there had been ample reason to believe that we couldn’t reach that level without national legislation. Now, however, this appears to be within reach, and state action is a cornerstone of that progress thus far.”

Forests impact

Experts here suggest that linking the world’s two largest carbon markets is unlikely in the near future, largely for political reasons. Yet there is also a significant difference of opinion between the U.S and E.U. that may stymie future attempts at interlinking these markets: the use of forest “offset credits”.

Under a mechanism commonly known as REDD – an international tool set up after the signing of the Kyoto Protocol and which stands for “Reducing emissions from deforestation and forest degradation” – entities in developed countries are able to purchase or trade credits to offset their greenhouse gas emissions in return for agreements from developing countries to protect forestlands.

While both the E.U. trading scheme and the Kyoto Protocol have expressed scepticism about the efficacy of forest credits, the U.S.’s RGGI has decided to use this approach. Further, some groups are now reportedly pushing California to incorporate REDD offsets in its new carbon market, while related agreements have already been struck with communities in Mexico and Brazil.

“One of the primary concerns about REDD is that it encloses forests from access to local communities,” Jeff Conant, an international forests campaigner with Friends of the Earth U.S., an advocacy group, told IPS.

“In numerous cases it has been shown to exacerbate social conflict and to increase incentives for the displacement of indigenous communities from the forests they use or live in. A major concern for California is that state authorities here have no way to deal with these types of injustices, and all just to provide cheap offsets for markets.”

Indeed, Conant says the cap-and-trade system in general is flawed, and that California’s system in particular appears to have already been significantly watered down.

“The state gave away 90 percent of its allowances in the first year, and over half of mandated emissions reductions will be produced by offsets, which are notoriously prone to gaming and displace rather than actually reducing emissions,” he notes.

“After you take these factors into account, they could make up more than 100 percent of the reductions in California – meaning that the cap and trade will result in zero emissions reductions in the state. The law is supposed to be creating incentives for innovations, whereas cap and trade merely allows the fossil fuel industry to keep polluting at historical levels.”

Conant says this is a “roundabout” way of putting money into these technologies. More effective, he suggests, would be to impose a carbon fee on polluting industries, and to use that money to directly stimulate clean energy investment.

Less than 45 years ago, the Paiter-Suruí, an indigenous people living deep inside the Amazon rainforest in Brazil, had never been in contact with the outside world. Today they hope to ensure their survival through the complex mechanisms of the carbon market.

Inhabitants of the Sete de Setembro territory, an area of around 250,000 hectares stretching between the states of Rondônia and Mato Grosso near the border with Bolivia, the Paiter-Suruí have experienced a tumultuous history over the past few decades.

Chief Almir Suruí (left) in his village. Credit:Paiter-Suruí Indigenous People press photo

Just three years after their first contact with outsiders in 1969, they came close to total extinction: their population of 5,000 was reduced to a mere 300 by the diseases brought by the invaders of their territory. Today they number 1,350 and are determined to survive.

Suruí is the name the anthropologists gave them. Paiter is what they call themselves: it means “we, the true people” in the Tupí-Mondé language that they speak.

The Suruí Forest Carbon Project, established by the Paiter-Suruí community four years ago and officially certified in April, involves mechanisms to offset carbon dioxide emissions such as preventing deforestation, to keep carbon stored in the trees, and reforestation, to absorb carbon from the atmosphere.

These mechanisms form part of the Reducing Emissions from Deforestation and Forest Degradation scheme, or REDD+, promoted by the United Nations as a means to mitigate climate change.

The buying and selling of certified emissions reductions or carbon credits allows countries or companies that are net producers of greenhouse gas emissions to offset their emissions, and thus meet their climate change mitigation commitments, by paying others to implement emissions-reducing initiatives.

After decades of struggling to protect the rainforest from incursions by loggers, miners, poachers and settlers, since 2005 the Paiter-Suruí have planted 14,000 trees from 17 native species, including cocoa and coffee trees, precious hardwood trees like mahogany, and fruit trees such as açaí palms.

“We want to benefit our people and develop in accordance with our needs in the region, placing value on what the forest produces. A green economy policy essentially means planning for sustainable use,” Chief Almir Suruí, the leader of the Paiter-Suruí people and a member of the Coordination of Indigenous Organizations of the Brazilian Amazon, told Tierramérica.

Chief Almir, 38, always wears body paint and necklaces of native seeds made by the women of his community. Although he wears Western clothing for meetings outside his village, the body paint is never fully hidden.

Before becoming known in Brazil, he had earned international recognition for denouncing illegal logging on his people’s land to the Organisation of American States (OAS) and for defending the rights and integrity of peoples living in voluntary isolation, as well as fighting against the construction of hydroelectric dams on the rivers of Rondônia.

To achieve their sustainability goals, the Paiter-Suruí work in partnership with various non-governmental organisations and government institutions, such as the Brazilian Biodiversity Fund (Funbio), a state agency that facilitates the creation of financial mechanisms and tools to guarantee income for the community.

The Suruí Carbon Project involves the conservation of more than 12,000 hectares of forest for a period of 30 years, Angelo Dos Santos, a Funbio coordinator, told Tierramérica.

“For every year of the project, the Suruí guarantee that a certain volume of carbon will not be emitted, and it will be offered on the carbon market,” he explained.

“Over the next 30 years, the Suruí people will accumulate eight million tons of carbon dioxide through avoided deforestation.” By selling these avoided emissions on the carbon market, “they will be paid for not deforesting,” said Dos Santos.

It is estimated that the community will collect a total of 40 million dollars over the course of the project, based on the current market price of five dollars per ton of carbon.

According to Dos Santos, there are various ways the resulting carbon credits can be marketed. They could, for example, be purchased by companies seeking to offset their own emissions of this greenhouse gas. “This is a great innovation,” he said.

The money earned through the sale of carbon credits will go into the Paiter-Suruí Carbon Fund, created for the implementation of a development plan based on means of generating income without destroying the forest.

The Paiter-Suruí already produce more than 4,000 tons of organic coffee and 10,000 tons of cashew nuts, reported Chief Almir, with business plans created for both production lines.

In the meantime, “the Paiter-Suruí Fund will collect resources from donations, multilateral banks, companies and the sale of carbon credits,” said Dos Santos.

The immediate goal is to gather six million dollars in the next three years. In six years, the Fund will be fully managed by the Paiter-Suruí, who are already being trained by Funbio, the current fund administrators, to take over.

This is clearly an exceptional case: the first financial mechanism created by an indigenous community to ensure its survival and safeguard its way of life.

Initiatives like these earned Chief Almir 53rd place on the list of the 100 Most Creative People in Business in 2011, compiled by the U.S. magazine Fast Company.

Earlier this month, he was invited to talk to business leaders and researchers about innovation at a conference organised by the British magazine, The Economist.

*The writer is an IPS correspondent. This story was originally published by Latin American newspapers that are part of the Tierramérica network. Tierramérica is a specialised news service produced by IPS with the backing of the United Nations Development Programme, United Nations Environment Programme and the World Bank.