Tropical Deforestation and Climate Change

Slowing tropical deforestation, which currently accounts for about 20 percent of heat-trapping gas emissions worldwide, can make an important contribution to the global emissions reductions that are necessary to avoid dangerous climate change. An international team of eleven top forest and climate researchers, including UCS director of science and policy, Peter Frumhoff, found that cutting deforestation rates in half by mid-century would amount to 12 percent of the emissions reductions needed to keep concentrations of heat-trapping gases in the atmosphere at relatively safe levels.

The paper, published in the 18 May 2007 issue of Science, provides new evidence that tropical forests will persist in the face of climate change, especially if nations make needed cuts in both industrial and deforestation emissions.

Policymakers are weighing proposals for the design of international climate policies after the Kyoto Protocol expires in 2012. One proposal is an initiative introduced by the governments of Papua New Guinea, Costa Rica, and several other forest-rich developing countries that are seeking to limit their emissions from deforestation. These nations are seeking financing from the global carbon market to create economic incentives for tropical forest conservation.

Tropical deforestation is the largest source of emissions for many developing countries, but slowing deforestation can't solve the climate problem by itself. As forest-rich developing countries step up to take responsibility for reducing their emissions, the United States and other industrialized nations should not only support their efforts but, most importantly, reduce their own emissions and lead efforts to avert dangerous climate change.

Regional Cap-and-Trade Programs to Cut Global Warming Emissions

In the absence of federal action, Northeastern and Western states have adopted cap-and-trade programs to reduce global warming pollution in their respective regions.

The Northeast Regional Greenhouse Gas Initiative
The Regional Greenhouse Gas Initiative (RGGI) is a market-based cap-and-trade program to reduce carbon dioxide (CO2) emissions from power plants in 10 Northeast states. Participants include the six New England states (Maine, New Hampshire, Vermont, Massachusetts, Connecticut and Rhode Island), New York, New Jersey, Delaware and Maryland. RGGI will be the first mandatory cap-and-trade program in the United States to reduce global warming emissions.

RGGI began in 2003 when then-New York Governor George Pataki invited the governors of Northeastern states from Maine to Maryland to help design a mandatory cap-and-trade program to cover power plants. Representatives from state regulatory agencies met over two years to design a template for state programs, culminating with a formal agreement in 2005 to implement RGGI.

RGGI will go into effect January 1, 2009, capping emissions from all power plants in the 10 states. The annual regional cap is 188 million tons of CO2. This was the projected level of emissions from those plants in 2009, based on data available when the states set the cap in 2005. Emissions will be capped at that level through 2015, and reduced by 2.5 percent annually over the next four years, to achieve a 10 percent reduction in emissions by 2019. This emission level was projected to be 37 percent below a “business as usual” scenario. Each state receives a fraction of the cap (an “emissions budget”) roughly corresponding to the historical emissions from power plants located in that state. (For details, go to: www.rggi.org/docs/mou_faqs_12_20_05.pdf.)

RGGI has established an important policy precedent. Every state that has formally issued a proposed regulation or enacted legislation (Maine, Massachusetts, New York, Vermont and Connecticut) has decided to auction nearly 100 percent of the emissions allowances created by the program. They realized that fundamental economics dictates that once a cap is implemented, an emissions allowance is an economic asset. Giving away allowances to electricity generators would amount to granting them a windfall profit.

The policy goal of a cap-and-trade program is to trigger an increase in the price of carbon-based electricity so that energy efficiency and low-polluting electricity will be relatively less expensive. Market forces, reinforced by complimentary public policies, will spur energy efficiency and clean, renewable energy sources to supplant carbon-intensive, fossil-fuel-based electricity. Raising the price of fossil-fuel-based electricity may cause consternation in the Midwest, but there is abundant evidence that the alternatives—energy efficiency and renewable energy generation—have economic and social benefits that can more than offset the price. (For more information on the benefits of renewable energy, go to: http://www.ucsusa.org/clean_energy/clean_energy_policies/cashing-in.html.)

All 10 states are in various stages of implementing the program. Maine and Massachusetts have issued proposed rules and are expected to issue final rules early in 2008. New York and Vermont have recently proposed rules and are currently taking public comment. New Jersey lawmakers are expected to consider legislation before the end of the year allowing an auction and specifying how the revenue will be used. Maryland and Connecticut are expected to issue proposed rules before the end of the year. The New Hampshire and Delaware legislatures will take up bills in early 2008 to implement the program. And Rhode Island likely will issue its proposed rule in spring of 2008.

Officials from the participating states will meet in early December to discuss the auction’s design details and policy implications. The states have established a nonprofit, nongovernmental organization, RGGI, Inc., to handle the program’s administrative and technical functions. They want to hold the first allowance auction in June 2008. As the first mandatory cap-and-trade program for CO2 emissions in the United States, RGGI can provide a wealth of information that should inform the design of other regional, as well as federal, cap-and-trade programs.

The Western Climate Initiative
The Western Climate Initiative (WCI) is an emerging regional coalition that includes six western states (Arizona, California, New Mexico, Oregon, Utah and Washington) and two Canadian provinces (British Columbia and Manitoba).

The WCI originated as a memorandum of understanding signed by the governors of five of the six states last February. In the months that followed, the original signatories were joined by British Columbia, in April; Utah, in May; and Manitoba, in June.

The founding document outlined three tasks for the coalition members:

• Participate in a multistate greenhouse gas registry;
• Set a regional limit on global warming pollution; and
• Develop a blueprint by August 2008 for a regional, multi-sector market program, such as cap and trade, to help achieve the regional emissions cap.

The coalition already has accomplished two of the three tasks. All the participating states and provinces have joined the newly formed greenhouse gas registry. (For the registry, go to: www.theclimateregistry.org.) In August, the WCI partners announced a regional goal of reducing emissions 15 percent below 2005 levels, which is similar to California’s Global Warming Solutions Act, which requires that emissions be returned to 1990 levels. That law is predicted to cut emissions in California by about 29 percent below what would have been expected without the law in place. With the WCI agreement, the other participating states and provinces will reduce their emissions by at least that much. British Columbia, for example, must cut emissions about 46 percent and Arizona about 45 percent over their forecasted emissions growth in the absence of the WCI initiative.

The WCI’s next major objective is to establish a regional cap-and-trade program to help meet the group’s emissions limit. The coalition has published a work plan, which is available at www.westernclimateinitiative.org. State officials plan to meet to discuss how to design the program, and there will be opportunities for businesses, environmental groups and other interested parties to participate. The WCI partners plan to issue a draft blueprint for a regional market program next July and approve it in August.

A Target for U.S. Emissions Reductions

Substantial scientific evidence indicates that an increase in the global average temperature of more than two degrees Celsius
(°C) above pre-industrial levels (i.e., those that existed prior to 1860) poses severe risks to natural systems and human health and well-being. Sustained warming of this magnitude could, for example, result in the extinction of many species and extensive melting of the Greenland and West Antarctic ice sheets—causing global sea level to rise between 12 and 40 feet. In light of this evidence, policy makers in the European Union have committed their countries to a long-term goal of limiting warming to 2°C above pre-industrial levels.

The United States has agreed in principle to work with more than 180 other nations under the United Nations Framework Convention on Climate Change to bring about the “stabilization of greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic [human-caused] interference with the climate system.” Though the federal government has done little to live up to that agreement thus far, there is now growing momentum to pursue deep reductions in emissions of carbon dioxide (CO2) and other heat-trapping gases that cause global warming. California, Florida, Hawaii, Minnesota, New Jersey, Oregon, and Washington have all enacted laws or established policies setting global warming pollution reduction targets, while states in both the Northeast and West have signed agreements to achieve regional targets. Now the U.S. Congress is considering several bills that propose a variety of global warming emissions reduction targets.

FIGURE 1. Defining the U.S. Share of the Industrialized World’s Cumulative Emissions Budget (2000–2050)

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Setting a Reasonable Target

A proper evaluation of the adequacy of these bills must consider what is needed to avoid the potentially dangerous consequences of temperatures rising more than 2°C. Scientific studies indicate that, to have a reasonable chance of preventing temperatures from rising above this level, we must stabilize the concentration of heattrapping gases in the atmosphere at or below 450 parts per million CO2-equivalent (450 ppm CO2eq—a measurement that expresses the concentration of all heat-trapping gases in terms of CO2). This “stabilization target” would provide a roughly 50 percent chance of keeping the global average temperature from rising more than 2°C, or 3.6 degrees Fahrenheit, above pre-industrial levels, and a 67 percent chance of rising less than 3°C. Therefore, any policy that seeks to avoid dangerous climate change should set a maximum stabilization target of 450 ppm CO2eq.

To meet this target, worldwide cumulative emissions of heat-trapping gases must be limited to approximately 1,700 gigatons (Gt) CO2eq for the period 2000–2050—of which approximately 330 GtCO2eq has already been emitted. Staying within this 1,700 GtCO2eq “global cumulative emissions budget” will require aggressive reductions in worldwide emissions (i.e., those of industrialized and developing nations combined).

Dividing Up the Work

If we assume the world’s developing nations pursue the most aggressive reductions that can reasonably be expected of them, the world’s industrialized nations will have to reduce their emissions an average of 70 to 80 percent below 2000 levels by 2050. In addition, industrialized nations’ cumulative emissions over this period must be no more than 700 GtCO2eq (approximately 40 percent of the global budget).

This 70 to 80 percent range for reductions by 2050 assumes that industrialized nations’ emissions will peak in 2010 before starting to decline, and that those from developing nations will peak between 2020 and 2025. A delay in the peak of either group would require increasingly steep and unrealistic global reduction rates in order to stay within the cumulative emissions budget for 2000–2050.

Defining the U.S. Share of Global Emissions Reductions

There are several ways to determine the United States’ share of the industrialized nations’ emissions budget, including allocations based on the current U.S. share (among industrialized countries) of population, gross domestic product (GDP), and heattrapping emissions. Using these criteria, the U.S. cumulative emissions budget ranges from 160 to 265 GtCO2eq for the period 2000–2050, of which approximately 45 GtCO2eq has already been emitted (Figure 1).

Given our aggressive assumptions about reductions by other nations and the fact that 450 ppm CO2eq represents the upper limit needed to avoid a potentially dangerous temperature increase, the United States should reduce its emissions at least 80 percent below 2000 levels by 2050.

The costs of delay are high. To meet this minimum target, the United States must reduce its emissions an average of 4 percent per year starting in 2010.† If, however, U.S. emissions continue to increase until 2020—even on a “low-growth” path projected by the Energy Information Administration (EIA)—the United States would have to make much sharper cuts later: approximately 8 percent per year on average from 2020 to 2050, or about double the annual reductions that would be required if we started promptly. The earlier we start, the more flexibility we will have later (Figure 2).

FIGURE 2. Spending the U.S. Cumulative Emissions Budget

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Evaluating Existing Proposals

Of the current climate policy proposals before the U.S. Congress, only the Global Warming Pollution Reduction Act (S. 309) and the Safe Climate Act (H.R. 1590) would require reductions consistent with staying below the upper limit of the U.S. cumulative emissions budget (265 GtCO2eq) (Figure 3a). All of the other bills under consideration—the Lieberman-Warner proposal, the Global Warming Reduction Act (S. 485), the Climate Stewardship Act (H.R. 620), and the Low Carbon Economy Act (S. 1766)—would exceed that limit. The amounts by which these bills would go over the budget may not appear to be great, but if every nation went over its budget by a similar amount, the result would be a greatly increased risk of dangerous climate change.

FIGURE 3a. U.S. Emissions Reductions under Federal Proposals

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Furthermore, no proposal currently before Congress would come close to the proposed lower end of the U.S. emissions budget (160 GtCO2eq). Several of the proposals do provide for congressional review and periodic reports by the National Academy of Sciences to ensure U.S. targets remain consistent with the goal of preventing the global average temperature from rising 2°C above pre-industrial levels. These periodic reviews are an essential element of any robust federal climate policy.

FIGURE 3b. Cumulative U.S. Emissions in 2050 under Federal Proposals

*The lower portion of the bar indicates cumulative emissions for S. 1766 under the best-case scenario, in which the bill’s price ceiling is never triggered, all emissions reduction targets out to 2030 are met, and all of the conditions needed to achieve the 2050 target are met, including international action, a recommendation by the president to Congress, and additional congressional legislation. This scenario also assumes that the 2050 target reduces total (economy-wide) U.S. emissions 60 percent below 2006 levels,even though earlier targets reduce emissions for only 85 percent of the economy. The color gradient in the upper portion of the bar represents the uncertainty in the additional cumulative emissions that would occur if the bill’s price ceiling were triggered. (The darker the color, the more likely it is that total cumulative emissions would reach that level.) The gradient is for illustrative purposes only and does not represent explicit modeling of the price ceiling’s effect on emissions decisions. The range depicted here assumes that if the price cap is triggered, the total cumulative emissions could approach those projected by the EIA under a low-growth “business as usual” scenario.

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The Way Forward

It is clear that the United States must quickly overcome its current impasse on climate policy if we are to avoid the risks of dangerous climate change. Many solutions are already available, including greater energy efficiency, increased use of renewable energy, and reductions in deforestation. These changes can be encouraged by a wide range of market-based and complementary policies including cap-and-trade programs, renewable electricity standards, efficiency standards for electricity and vehicles, and incentives for cleaner technologies and international cooperation on emissions reductions.

For the United States to be fully engaged in the fight against global warming, however, Congress must support legislation that requires the deep reductions in heat-trapping emissions needed to stay within the emissions budget described here and preserve a climate safe for future generations.