Cancun's REDD Agreement Seen as Land Grab by Big Polluters
Seeing REDD on climate change
As the Cancun summit closes, some environmentalists say the REDD scheme is a boon for financers, not forests
Aljazeera.net, Dec. 12, 2010
As climate change negotiations come to a close in Cancun, Birginia Suarez-Pinlac is seeing red. The environmental lawyer from the Philippines is worried that a plan for Reducing Emissions from Deforestation and Degradation (REDD) constitutes a land grab, transferring natural wealth from the poor to the rich under the auspices of saving the planet.
Last year, she says, an Australian coal company tried to forge an agreement with an indigenous tribe on Mindanao Island in the Philippines, a poverty stricken area known for its high mountains and lush green rainforest. "The company offered poor tribes people money in exchange for their atmospheric space. They don't want to cut their own emissions domestically. They want to find a way to profit from the carbon they produce."
Forests help take climate changing carbon dioxide out of the atmosphere, reducing global warming - a human induced process linked to wild weather patterns including this year's deadly flooding in Pakistan and crop destroying wild fires in Russia.
The world is losing about six million hectares of forests each year - an area roughly the size of Greece - due to human activities like logging. REDD is supposed to be designed to allow companies to buy clean air credits from people who live in forests to encourage them to protect the trees. But some environmentalists say that when companies buy credits abroad through what is now a voluntary scheme, they feel entitled to pollute back at home.
"The biggest buyers of REDD credits are the worst polluters - big oil and big coal," says Bill Barclay, the research director for the Rainforest Action Network in California. "They are looking for a cheap 'get out of jail free card' - it's basically green-washing."
In the Philippines, indigenous people "didn't understand that they were giving away their atmospheric space to Australians" when they were approached by a non-governmental organisation working with the coal miners, Suarez-Pinlac says.
But REDD and similar initiatives based on trading credits in carbon dioxide are not just about companies purchasing environmental legitimacy from communities who actually take care of forests; the schemes being discussed in Cancun could increase lucrative business opportunities for hedge fund traders and financers.
"There is a lot of concern REDD will be brought into a carbon offset trading scheme," Barclay says.
Carbon trading is based on the idea that a price should be placed on emissions. Companies or countries would have a cap set on the amount of pollution they could spew. Those who curtail their emissions below targeted levels could sell atmospheric space to polluters who exceed their limits.
The European Union has such legislation; the 27-nation bloc has pledged to reduce greenhouse gas emissions to 20 per cent below 1990 levels by 2020. And carbon trading figures prominently into this plan, as the EU is by far the world's largest carbon market.
And, while Europe has done far better than other industrialised regions in reducing its emissions compared to the size of its economy, some analysts think the moves are too little, too late.
"We still aren't seeing key reductions that climate scientists say are necessary," says Rachel Cleetus, an economist with the Union of Concerned Scientists in the US.
Environmental scientists estimate that the world needs to see emissions cuts of at least 25 to 40 per cent below 1990 levels by 2020 and 80 to 90 per cent by 2050 to stop catastrophic climate change.
While Cleetus supports carbon trading as one of many policy tools for tackling global warming, she says: "The carbon market only gets at one market failure: the lack of a price on carbon. We need to get renewable energy strategies in place."
Hedge fund brokers and the speculators Barclay calls "carbon cowboys" believe the free market is the best tool for tackling climate change and better than an extension of internationally mandated emissions targets set out by the Kyoto Protocol which expires in 2012.
"The lack of a post-Kyoto agreement means that countries won't have legal responsibilities to reduce emissions. They will have voluntary ones," says Steven Sorrell, the deputy director of the Sussex energy group in the UK, a university based think-tank.
The 2009 Copenhagen Accord, an attempt to extend the Kyoto Protocol, does not include binding targets. However, rich countries responsible for most greenhouse gas emissions pledged to create a fund worth $100bn per year by 2020 to invest in clean technologies and to help mitigate the effects of climate change in the global south.
Eric Bettelheim, an author and CEO of Forest Landscape Development, a company that invests in products that "have a carbon and commodity value" believes turning nature into a tradable resource is crucial for protecting it.
"Everyone who is rational about this realises global warming will probably never be solved without the participation of businesses and markets," Bettelheim says. "Progress will be made on the recognition of forest carbon credits from developing countries as being good currency in the [carbon trading] system."
He accuses certain environmentalists and political leaders - specifically Evo Morales, the Bolivian president - of having an "anti-capitalist agenda".
Morales, whose country faces a major climate crisis resulting from pollution it did not create, wants reparations from the rich industrialised countries in the form of "climate debt".
Bettelheim's view on leaders like Morales is shared by politicians with some of the worst environmental records. The US refused to ratify the original agreement while Russia, Japan, Canada and Australia have indicated that they will not sign onto a second commitment extending the Kyoto Protocol past its 2012 expiration date.
Before becoming Canada's prime minister, Stephen Harper called Kyoto "a socialist scheme to suck money out of wealth-producing nations".
'Two faced initiative'
But good capitalists, it seems, can even make a profit from a "socialist scheme". About $64bn changed hands in the emissions trading market in 2007, according to the World Bank.
Bettelheim wants environmental regulations for the same reason that General Motors believes in stop signs and other rules for driving: he says they are good for business - and for the environment. Like grain, gold and oil, he hopes trading in carbon emissions will become a fundamental activity in the global economy.
"With oil the question is scarcity, which creates a value people pay for," he says. "In the case of greenhouse gas emissions, the problem is surplus. How do you create a market from that? Legislation."
The commodities trader does not believe an extension of Kyoto is feasible because of domestic political and economic concerns in the countries which pollute the most. On this matter he may be right on the money.
Regional carbon trading markets, similar to that practiced in the European Union, are being developed in East Asia by Japan and Korea and in the western US with California's state government taking the lead in representing a "simpler way forward than having more than 190 countries sign onto rules" as Kyoto attempted to do.
But that approach does not work for Suarez-Pinlac who believes carbon or offset schemes including REDD are a "two faced initiative" from major polluters in the developed world. Even if poor people in forests are paid by polluting companies to protect the land, she wonders "how the money [will] be managed when there is so much corruption?"
Even in Europe, which has stronger institutions than other regions, carbon trading schemes have been hit by billion dollar scandals involving corruption and speculative trading which does not take carbon out of the air.
"Negotiators talk about 'safe guards' for REDD, but really these are non-binding guidelines," says Barclay. "This has Interpol [the international law enforcement agency] alarmed about the potential for corruption."