[Senate Hearing 107-1019]
[From the U.S. Government Publishing Office]
S. Hrg. 107-1019
CARBON SEQUESTRATION: MEASUREMENTS AND BENEFITS
=======================================================================
HEARING
before the
SUBCOMMITTEE ON SCIENCE, TECHNOLOGY, AND SPACE
OF THE
COMMITTEE ON COMMERCE,
SCIENCE, AND TRANSPORTATION
UNITED STATES SENATE
ONE HUNDRED SEVENTH CONGRESS
FIRST SESSION
__________
MAY 23, 2001
__________
Printed for the use of the Committee on Commerce, Science, and
Transportation
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SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
ONE HUNDRED SEVENTH CONGRESS
FIRST SESSION
JOHN McCAIN, Arizona, Chairman
TED STEVENS, Alaska ERNEST F. HOLLINGS, South Carolina
CONRAD BURNS, Montana DANIEL K. INOUYE, Hawaii
TRENT LOTT, Mississippi JOHN D. ROCKEFELLER IV, West
KAY BAILEY HUTCHISON, Texas Virginia
OLYMPIA J. SNOWE, Maine JOHN F. KERRY, Massachusetts
SAM BROWNBACK, Kansas JOHN B. BREAUX, Louisiana
GORDON SMITH, Oregon BYRON L. DORGAN, North Dakota
PETER G. FITZGERALD, Illinois RON WYDEN, Oregon
JOHN ENSIGN, Nevada MAX CLELAND, Georgia
GEORGE ALLEN, Virginia BARBARA BOXER, California
JOHN EDWARDS, North Carolina
JEAN CARNAHAN, Missouri
Mark Buse, Republican Staff Director
Kevin D. Kayes, Democratic Staff Director
------
SUBCOMMITTEE ON SCIENCE, TECHNOLOGY, AND SPACE
GEORGE ALLEN, Virginia, Chairman
TED STEVENS, Alaska JOHN B. BREAUX, Louisiana
CONRAD BURNS, Montana JOHN D. ROCKEFELLER IV, West
TRENT LOTT, Mississippi Virginia
KAY BAILEY HUTCHISON, Texas JOHN F. KERRY, Massachusetts
SAM BROWNBACK, Kansas BYRON L. DORGAN, North Dakota
PETER G. FITZGERALD, Illinois MAX CLELAND, Georgia
JOHN EDWARDS, North Carolina
JEAN CARNAHAN, Missouri
C O N T E N T S
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Page
Hearing held on May 23, 2001..................................... 1
Statement of Senator Brownback................................... 1
Statement of Senator Wyden....................................... 33
Witnesses
Bonnie, Robert, Economist, Environmental Defense................. 24
Prepared statement........................................... 26
Coda, Mike, Director, Climate Change Program, the Nature
Conservancy.................................................... 18
Prepared statement........................................... 22
Heydlauff, Dale E., Senior Vice President for Environmental
Affairs, American Electric Power Company....................... 2
Prepared statement........................................... 5
Kadyszewski, John, Winrock International Institute for
Agricultural Development....................................... 11
Prepared statement........................................... 15
Kimble, John, Ph.D., Soil Scientist Researcher, U.S. Department
of Agriculture................................................. 8
Prepared statement........................................... 9
CARBON SEQUESTRATION: MEASUREMENTS AND BENEFITS
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WEDNESDAY, MAY 23, 2001
U.S. Senate,
Subcommittee on Science, Technology, and Space,
Committee on Commerce, Science, and Transportation,
Washington, DC.
The Subcommittee met, pursuant to notice, at 2:08 p.m. in
room SR-253, Russell Senate Office Building, Hon. Sam
Brownback, presiding.
OPENING STATEMENT OF HON. SAM BROWNBACK,
U.S. SENATOR FROM KANSAS
Senator Brownback. I call this hearing to order. I want to
thank the official Chairman of this Subcommittee, who is
currently Senator Allen--we will see what ends up taking
place--for allowing me to investigate further the science
behind an important environmental process that is called carbon
sequestration.
As many of you know, I have offered legislation to
encourage conservation practices in agricultural lands and
forests that convert atmospheric carbon dioxide into carbon
trapped in soils and trees. This is a very positive process
that not only helps reduce the threat of global climate change,
but also improves the quality of our soil, water, air, and
wildlife habitat. In that sense, it is a no-regrets policy. We
can do this regardless of what people may think about the issue
of global climate change and this will have a positive impact
on the overall society, certainly on the soils and the
environment.
Scientists estimate that carbon sequestration, biofuel
production, and better land and animal management in the U.S.
could reduce between 123 and 295 million metric tons of carbon
per year from the atmosphere. To put this number in some
context, EPA reports that from 1990 to 1997 carbon dioxide
emissions grew by 11 percent or 138 million metric tons of
carbon dioxide.
If we aggressively implement carbon sequestration, we can
not only level off U.S. emissions, we can actually begin to
reduce current concentrations, all by simply using well-
established conservation practices.
With all there is to gain from carbon sequestration, the
question becomes why have we not embarked on a course of action
to encourage this approach both here and abroad? Part of the
answer comes from the fact that the issue of climate change has
become a very polarizing force here in Washington, with the
focus almost exclusively aimed at the Kyoto treaty, which many
of us do object to.
I believe there is a more positive approach. Instead of
focusing on that on which we cannot agree, we should pursue
areas where agreement is possible. This is especially true when
you consider the co-benefits that can be achieved by pursuing
these alternatives. It is irresponsible for both the political
left and right to abandon taking steps on the issue of global
climate change simply because we cannot completely agree.
In this spirit, I have asked you all here today to share
your knowledge and expertise on the scientific validity and
benefits of carbon sequestration. There are those who are still
unsure as to how significant carbon sinks can be. There are
those who are just not familiar with the issue of carbon
sequestration or all the science that has already been done on
this topic. I hope that you will be able to shed some light on
these concerns and I certainly thank you for coming forward and
being willing to testify here today.
We have a series of votes that we are still on in the U.S.
Senate and another one was just called, a 10-minute roll call
vote. I think what I will do is introduce the panel and then go
and do this vote and come back. I tell you what, if I could get
somebody to tell me when there are 3 minutes left in the vote,
then we will proceed, and then we will go into recess for a
short period of time and then I will come back to resume the
hearing.
I had to do this yesterday and I think I was back and forth
three times. So I apologize to the panel, I apologize to the
people watching, but that is just where we are in trying to get
this tax cut on legislation passed.
The panel consists of: Mr. Dale Heydlauff, Vice President
of Environmental Affairs, American Electric Power; Dr. John
Kimble, a soils scientist researcher, U.S. Department of
Agriculture, Lincoln, Nebraska; Mr. John Kadyszewski--help me;
is that right?
Mr. Kadyszewski. That is right.
Senator Brownback. Boy, I am good.
--Advisor to the President of Winrock International
Institute for Agricultural Development, out of Arlington,
Virginia; Mr. Mike Coda, Director of Climate Change Program for
The Nature Conservancy out of Arlington, Virginia; and Mr.
Robert Bonnie, economist with the Environmental Defense and
Washington, D.C.
Mr. Heydlauff, let us go ahead and start with your
testimony. Give us a couple of minutes of that and then I will
probably have to slip out and we will go into a recess. Or if
you can even summarize in a very short period of time and we
will take your full testimony into the record.
STATEMENT OF DALE E. HEYDLAUFF, SENIOR VICE
PRESIDENT FOR ENVIRONMENTAL AFFAIRS, AMERICAN ELECTRIC POWER
COMPANY
Mr. Heydlauff. I would be happy to do that, Mr. Chairman,
and thank you very much for inviting me to be a part of this
hearing.
First of all, I should say at the outset that I am sure
those trips between here and the Capitol have kept you nice and
trim. We completely subscribe to the statement that you just
made in your opening comments about the value of carbon
sequestration investments both internationally and
domestically, for purposes not only of addressing the concerns
about global climate change, but also because of all the
ancillary economic and environmental benefits that are
associated with them.
My name is Dale Heydlauff. I am Senior Vice President for
Environmental Affairs at American Electric Power Company. We
are headquartered in Columbus, Ohio. We are today the largest
investor-owned electric utility in the country. We serve 9
million people around the world. We are the largest consumer of
coal and the third largest consumer of natural gas in the
United States. If you add that together, that also makes us the
largest emitter of carbon dioxide.
It is a result of that fact that we have been following the
global climate change issue for quite some time. I have
actively monitored the debates myself, both internationally and
domestically, for over 13 years. Our chairman has been
personally involved in both the study of this topic from a
scientific and economic and technological standpoint, as well
as engaged in discussions with policymakers about the right
kind of policy responses.
It was in that vein in 1995 that we signed a participation
accord with the U.S. Department of Energy under the Climate
Challenge Program to undertake a wide range of activities to
reduce, avoid, or sequester greenhouse gas emissions. After
that initial commitment, we continued to look for cost-
effective ways to mitigate greenhouse gas emissions and it was
in 1996 that The Nature Conservancy came to us and said: We
have a couple of wonderful opportunities we would like to talk
to you about, a project in Panama and one in Bolivia. We
evaluated them, decided to do the project in Bolivia, which is
today the largest carbon sequestration project of its kind in
the world.
It is that project that I wanted to talk about today and in
doing so try to answer the questions that you posed to the
panel, or at least to me specifically. The first is what
motivated us. I have already touched on that. To a certain
extent, it is simply a way in which we could on a proactive
basis begin to address the concerns about climate change.
But also, importantly, as we were monitoring the debates
about climate change, we knew that the concept of joint
implementation, or the ability of firms or developed country
nations to undertake projects in developing countries and
transfer the carbon credit or benefit of that back to meet any
future compliance obligations the nation or the individual firm
might have, was very controversial, but yet one that we have
been a very strong proponent of, simply because of the economic
efficiencies involved in being able to identify and undertake
carbon mitigation wherever you can do so at the least possible
cost.
Ironically, at the time we did not realize how
controversial carbon sequestration or sink enhancement projects
were. But since we had been arguing pretty strongly for the
inclusion of joint implementation in similar kinds of contexts,
our chairman and the board said: let us do this project, and
let us do it primarily to prove a policy point. Let us make it
a showcase to the world so that they can see if, structured
properly, how projects like this can be included in the broad
portfolio of global responses to the climate change issue.
I am very proud of what we have done in Bolivia and what we
have subsequently done as an extension of that in Brazil, the
project that we are very pleased you were able to see this last
December, Senator.
Senator Brownback. It was a very impressive project, very
impressive.
Mr. Heydlauff. Thank you very much.
We learned a lot from Bolivia. We expanded on it in Brazil.
Senator Brownback. Mr. Heydlauff, I am going to put the
Committee into recess while I go and vote, and then the people
that are here to testify can stand down for a period of time
and then I will be back as soon as I can to continue with the
hearing. Thank you.
[Recess from 2:17 p.m. to 2:42 p.m.]
Senator Brownback. The hearing will come back to order.
Thank you for waiting for me. We just passed the biggest tax
cut in 20 years, so I had to take a minute or two.
[Applause.]
A few applauses anyway. It is a lot going on, a lot
happening.
Mr. Heydlauff, go ahead and finish your presentation. Then
we will go on through the rest of the panel.
Mr. Heydlauff. Thank you very much, Mr. Chairman. I think I
left off talking about how we had done this showcase project to
prove to the world its viability as a climate change mitigation
option. We did it by building into the project several critical
components that we thought were necessary and important for it
to be viewed as a legitimate project.
We then asked the world to come and scrutinize it. So one
of the first things we did is we tried to identify with The
Nature Conservancy the very best experts in the field of
monitoring and verification for terrestrial ecosystems, and we
found Winrock International. I will not preempt their
testimony, but I would tell you that I do not think there is
anyone better at coming up with accurate quantification of
carbon benefits projects like this.
The second thing we did is we realized that it had to be
sustainable over a long term, addressing the issue of
permanence. Permanence is both an accounting issue, to make
sure if you have any change in the carbon stock over time you
account for that in the amount of credit that accrues to those
who are the investors, but it also in this context is a
financial sustainability aspect, to make sure that the
government in this case, which owns the property, has the means
by which to continue to protect it for the long term.
So one of the things we did in that regard is establish a
permanent endowment fund that will continue to provide revenue
to cover, we hope, the ongoing protection activities of the
project.
We also realized that it was critical that we replace the
revenue and jobs that had gone to--that local communities had
relied on with other alternative forms of economic assistance
and, frankly, assistance that is more sustainable over time. So
we have provided things such as revolving loans to these local
communities for agrobusinesses, hearts of palm plantations,
animal husbandry, other kinds of more sustainable activities
for these local communities to replace the jobs and the tax
revenue that would have come as a result of the destruction of
the forest through the logging activities.
Now, in addition, about a half of the rangers that we hired
to patrol the park and protect it came from these local
communities.
We think on balance--and I want to summarize very quickly
and allow my colleagues to speak--that we have a project here
that was developed with great care, a project that we believe
can withstand the scrutiny of the world and will be viewed as a
very cost effective, but legitimate as well, response to the
climate change issue.
But more importantly, and I think Mike Coda in his
testimony will touch on this, the ancillary economic and
environmental benefits associated with this project in all
honesty probably overwhelm the carbon benefits. It is in that
context that I hope the world will look at these when they
judge them and not be too narrow about it, recognize that there
are lots of other benefits that can accrue to the world
literally in terms of preserving biodiversity and helping to
inspire sustainable development of investments in developing
countries.
I did want to conclude also by commending you, Mr.
Chairman, for your leadership in developing both the
international and the domestic carbon conservation acts. These
pieces of legislation, should they be enacted, which we
certainly hope they will be, will serve as highly effective
incentives to see additional kinds of investments like ours
around the world and domestically.
Thank you very much.
[The prepared statement of Mr. Heydlauff follows:]
Prepared Statement of Dale E. Heydlauff, Senior Vice President for
Environmental Affairs, American Electric Power Company
Mr. Chairman and Members of the Committee, my name is Dale
Heydlauff. I am the Senior Vice President for Environmental Affairs at
American Electric Power Company. AEP is a multinational energy company
based in Columbus, Ohio. AEP owns and operates more than 38,000
megawatts of generating capacity, making it one of America's largest
generators of electricity. We are the largest consumer of coal and the
third largest consumer of natural gas in the U.S. AEP provides retail
electricity to more than 9 million customers worldwide and has more
than $55 billion in assets, primarily in the U.S. with holdings in
select international markets.
Given AEP's reliance on coal and natural gas to produce reliable
and affordable electricity for our customers, we are one of the largest
emitters of carbon dioxide emissions in the country. This recognition
led us to be a proactive participant in several industry-government
programs over the past several years that are designed to reduce, avoid
or sequester greenhouse gas emissions. The most significant of these
actions is the Climate Challenge Program, a voluntary partnership
between the electric utility industry and the Department of Energy. The
Climate Challenge Program caused us to conduct a comprehensive
assessment of all the available, cost-effective steps that we could
take as a company to mitigate greenhouse gas emissions. After
consummating our Participation Accord with the U.S. Department of
Energy in February 1995, AEP continued to search for opportunities to
go beyond our initial commitments.
In the spring of 1996, The Nature Conservancy presented to us a
proposal to invest in a carbon sequestration project in Bolivia that
could be submitted to the United States Initiative on Joint
Implementation for approval. The USIJI program is a collaboration
between several federal agencies to foster greenhouse gas mitigation
projects around the world. The Nature Conservancy had partnered with a
conservation organization in Bolivia, the Friends of Nature Foundation,
in the development of the Noel Kempff Mercado Climate Action Project.
This project doubled the size of an existing national park, the Noel
Kempff Mercado National Park, thus preserving one of the most
biologically diverse areas in the world. The project components include
the following:
Park Expansion and Short-term Protection: The project began
with the indemnification and retirement of logging concessions
sold by the Government of Bolivia to timber companies who were
actively engaged in harvesting trees in a 2 million acre area
adjacent to the western and southern boundaries of the Park,
thus halting the greenhouse gas emissions resulting from this
activity. Following this action, the Government of Bolivia
formally expanded the boundaries of the Noel Kempff Mercado
National Park to encompass this area. The project then called
for the establishment of the necessary infrastructure (e.g.,
guard houses, boats, trucks, etc.) and trained personnel to
effectively patrol the Park.
Community Assistance: Funding of sustainable development
activities in local communities adversely affected by the
cessation in logging activities through the loss of jobs and
tax revenue. Over half of the Park rangers were hired from
local communities. The project established revolving loan funds
for micro enterprises, such as heart-of-palm plantings, agro
forestry projects, animal husbandry and bee keeping for honey
production. In addition, the project has provided funding to:
enhance health care programs with a dedicated physician,
emergency medical air service, purchase of an ambulance and
radio system, and stocking of pharmacies with needed medicines;
and install potable water supplies and sanitation systems;
improve schools; repair roads and bridges; and establish better
communications systems.
Monitoring & Verification: Retention of Winrock
International, the foremost expert in carbon monitoring and
verification of terrestrial ecosystems, to accurately measure
and report on the level of carbon dioxide captured as a result
of the project. Using thorough field measurement procedures at
625 established carbon plots in the Park and an advanced dual
camera aerial videography technology developed by the
University of Massachusetts, the monitoring and verification
program has quantified with a high degree of precision how much
carbon existed in the project area prior to commencement of the
project and how much carbon is captured as a result of the
project. The project is projected to capture over 14 million
metric tons of carbon over its 30-year life.
Long-term Protection: The project created a permanent $1.5
million endowment fund to ensure the long-term financial
sustainability of the project. In addition, the project has
invested in a few income-generating ventures to augment the
returns from the endowment fund. These include establishing an
ecotourism destination in the Park, complete with lodging
facilities and a visitors center, as well as investments in
for-profit Bolivian companies that produce and sell organic,
sustainably produced coffee and chocolate candies, and
mushrooms. The project also made investments to enhance the
scientific research capabilities of the Friends of Nature
Foundation to assist the income generating enterprises and
improve their ability to discover and genetically reproduce new
species of flora and fauna in Bolivia.
Leakage Prevention: The project has also invested in
sustainable forest management practices for timber companies
and has worked with the Government of Bolivia to make certain
that the logging activities that were being undertaken within
the control area were not relocated to another area in Bolivia
and that existing logging activities were not expanded as a
result of the retirement of the logging concessions in the
project area.
Biodiversity Benefits of the Project
The Noel Kempff Mercado Climate Action project protects 4 million
acres in one of the most biologically diverse areas in the world. A
remote wilderness rising from Amazon rainforests to spectacular cliffs
and waterfalls, the Park harbors several hundred species of rare and
endangered wildlife. Bridging dry and wet ecological communities, the
Park is home to more than 130 species of mammals (including rare river
otters, river dolphins, tapirs, spider and howler monkeys, giant
anteaters and endangered jaguars, including a population of rare black
jaguars), 620 bird species (including 9 species of macaw, possibly the
highest number of species in any one protected area), and 70 species of
reptiles (including black caiman and giant armadillos). The area
encompasses five important ecosystems ranging from Amazonian
rainforest, gallery forest and semi-deciduous tropical forest to
flooded savanna and cerrado. A rich variety of grasses, orchids (110
different species), and tree species bloom throughout the year. The
diversity of the park's flora and fauna make it an ideal natural area
for biological research and an outstanding attraction for ecotourism
activities.
AEP's Motivation to Invest in Project
The project represents an extension of AEP's ongoing efforts to
find innovative, cost-effective ways to mitigate greenhouse gas
emission increases. The company was motivated to invest in the project
by a desire to demonstrate to policymakers around the world that joint
implementation projects in general and carbon sequestration projects in
particular should be included in the broad portfolio of global
responses developed to address concerns about global climate change.
Actions like the Noel Kempff Mercado Climate Change Action project have
enormous potential for proactively addressing existing environmental
and economic challenges in developing countries, while also arresting
the growth in global greenhouse gas emissions. We believe we have
proven with this project that avoided deforestation is a legitimate and
verifiable climate change mitigation option that can return
considerable ancillary environmental and economic benefits to the host
country.
After undertaking this project, AEP invested in the Guaraquecaba
Climate Action Project with The Nature Conservation and the Society for
Research of Wildlife and Environmental Education, a Brazilian
conservation organization, which will restore and protect approximately
20,000 acres of partially degraded and/or deforested Atlantic coastal
rainforests in Brazil. Like the Noel Kempff project, the Guaraquecaba
project will produce significant net carbon benefits that are
scientifically quantifiable and long lasting; protect biodiversity and
ecosystems and improve local environmental quality; and promote
sustainable development by creating economic opportunities for local
people. We were delighted that Senator Brownback, his son and staff,
and staff officials from this committee, were able to visit this
project site and see its natural beautiful and potential as a carbon
action project last December.
Scientific Support for Carbon Sequestration
The Intergovernmental Panel on Climate Change in its Third
Assessment Report found that forest protection and restoration can play
an important role in combating global climate change. According to the
report, ``Forests, agricultural lands, and other terrestrial ecosystems
offer significant carbon mitigation potential.'' The conservation of
threatened forests, like the lands protected by the Noel Kempff Mercado
Climate Action project, can help avoid greenhouse gas emissions that
would have otherwise resulted from deforestation. The report also notes
that forest projects, if implemented properly, ``can have social,
economic and environmental benefits beyond reductions in atmospheric
carbon dioxide.'' These ``ancillary benefits,'' also known as co-
benefits, include the provision of employment opportunities and the
protection of vital plant and animal habitats. In short, the most
recent scientific assessment validates the results of the Noel Kempff
Mercado Climate Action Project.
Conclusion
AEP accepts the views of most scientists that enough is known about
the science and environmental impacts of global climate change for us
to take actions to address its consequences. We were a leader in the
development of the Climate Challenge program, and have augmented our
early commitments under this program with the largest carbon
sequestration project in the world in Bolivia and another similar
project in Brazil. Collaborative efforts such as these should serve as
a catalyst for similar initiatives to protect diverse and rich
ecosystems, and demonstrate the cost-effective mitigation of greenhouse
gas emissions.
According to the IPCC, the destruction of tropical forests around
the world results in approximately 22 percent of annual global carbon
dioxide emissions caused by human activities. The U.S. Department of
State has estimated that for the past twenty years, an average of 38
million acres of tropical forests have been destroyed each year.
Combining concerns about climate change with the critical need to
preserve the incredibly rich biodiversity present in these forests
makes policies that provide financial incentives for the protection of
tropical forests very important.
Mr. Chairman, AEP commends you for your insight and leadership in
introducing legislation to do just this. The International Carbon
Conservation Act and the Domestic Carbon Conservation Act are precisely
the kind of policy tools that are needed to encourage actions to offset
greenhouse gas emissions through improved land management and
conservation. We also need international negotiators to provide full
crediting for avoided deforestation activities in any international
climate change agreement designed to address rising atmospheric
concentrations of greenhouse gases.
Thank you for the opportunity to testify today on this important
issue.
Senator Brownback. Thank you very much, and I look forward
to discussion with you on some of these issues as we go through
the panel.
Dr. Kimble, a soil scientist researcher, USDA. Dr. Kimble,
thank you for joining us today. Pull that microphone close to
you, if you would.
STATEMENT OF JOHN KIMBLE, PH.D., SOIL SCIENTIST RESEARCHER,
U.S. DEPARTMENT OF AGRICULTURE
Dr. Kimble. Yes, sir. Mr. Chairman, thank you for the
opportunity to appear today to discuss soil carbon and research
related to such measurements. The work on soil carbon has been
going on for many years. In fact, much of the early work in
soils dealt with soil organic matter, which is primarily made
up of soil organic carbon.
The importance of soil carbon to the farming community has
been long recognized. In the 1938 Yearbook of Agriculture,
Soils and Men, William Albrech wrote a chapter entitled ``Loss
of Soil Organic Matter and Its Restoration.'' The opening to
the chapter says: ``This article tells why soil organic matter
in the soil may be considered our most important natural
resource.''
The discouraging thing is that for years, even though many
understood the importance of soil carbon, management practices
continued to delete the carbon. We have now renewed our
appreciation of soil organic carbon and are looking at ways to
reverse its decline. A group of us has produced ten books
related to the issues of soils, greenhouse gases, and carbon
sequestration. A recent one is directly related to the topic of
this hearing, ``Assessment Methods for Soil Carbon,'' this book
that is laying here. I am not hawking books; I am just holding
it up. No royalties.
Soils vary widely over the landscape. Their spatial
variability has led to the critique that it is too costly to
accurately measure its properties. In fact, we have well-
developed tools, including models, soil survey maps, to measure
properties at points and to scale from these point measurements
to large areas. Soil survey maps delineate soils in the
landscape into describable units.
It should be remembered that all biological systems vary.
If we want to know the amount of carbon in the people in this
room, we could weigh everyone, calculate the total carbon in
the room assuming the amount of carbohydrates, bone, protein,
and everything was the same, knowing that it is not. So we take
an estimate.
Variability exists and we have to develop tools to deal
with it effectively. We need to describe similarities and not
always focus on variability in soils. Carbon measurements are
made on a regular basis as part of soil fertility sampling,
over two million samples a year. The carbon measurements are
used to determine the amount of herbicides and pesticides that
we can apply to the land, so we do apply and accept the values
that we are measuring.
Data acquired from long-term no-till fields clearly shows
that the level of carbon in soils has increased over time. One
long-term no-till farmer in Illinois has doubled his soil
organic carbon in a period of about 15 years. Last week I was
in southern Virginia talking to several farmers and they have
shown dramatic increases in carbon there. All of this is not
research plots, but agriculture fields using good conservation
practices.
A special publication of the Soil Scientist Society of
America, ``Soil Carbon Sequestration and the Greenhouse
Effect'' provides numerous examples of measurable rates of
change of soil organic compound. Dr. Ron Follett and several
co-authors reports an average rate of change of 910 kilograms
carbon per hectare per year in the top 20 centimeters of land
in the CRP program. In the same publication, Keith Paustan and
his co-authors describe how carbon cycle models, in their case
Century, can be used to make regional assessments of soil
carbon. CQESTR, a model under development and tested by ARS,
NRCS, and others, will allow farmers and land managers to
estimate the effects of alternate management systems and
practices on rates of carbon sequestration.
The use of remote sensing coupled with modeling has a great
potential to improve our measurements and estimate capacity.
Therefore, it is important to integrate mapping and monitoring
techniques with predictive models for different soils and eco-
regions. Soil surveys provide essential information for
sampling and could be refined to improve their use for this
purpose. Scientists from ARS and DOE are working with NRCS and
others to develop simple field testing equipment that we can
use for rapid measurement of soil organic matter in the field.
In conclusion, the bottom line is that we know how to
measure soil carbon changes over time, the scientific processes
of measurement is now verifiable, and point data can be scaled
to larger areas with models. We can also couple remote sensing
data with the models to improve their output. we can measure,
estimate, and predict changes in carbon with the tools at hand,
which include field sampling, models, and statistics.
Our focus should be to get the conservation practices on
the ground that will lead to increases in soil carbon. This
will simultaneously advance our goals of sustainable farming
systems and improved water and air quality.
That completes my statement, Mr. Chairman. Thank you.
[The prepared statement of Dr. Kimble follows:]
Prepared Statement of John Kimble, Ph.D., Soil Scientist Researcher,
U.S. Department of Agriculture
Mr. Chairman and Members of the Subcommittee. Thank you for the
opportunity to appear today to discuss soil carbon measurement
processes, methods used to measure soil carbon changes, and the
research related to such measurements. I am a research soil scientist
with the Natural Resources Conservation Service in Lincoln, NE. The
work on soil carbon has been going on for many years. In fact, much of
the early work in soils dealt with soil organic matter, which is
primarily made up of soil organic carbon. The importance of soil carbon
to the farming community has long been recognized. In the 1938 USDA
Yearbook of Agriculture Soil and Men, William Albrech wrote a chapter
entitled ``Loss of Soil Organic Matter and its Restoration.''. The
opening to the chapter says, ``This article tells why organic matter in
the soil may be considered our most important natural resource.'' Other
questions raised in this chapter included whether levels of soil
organic matter should be maintained or raised to maintain fertility.
The answer even then was that the levels, at a minimum, should to be
maintained. The discouraging thing is that for years, even though many
understood the importance of maintaining soil carbon, management
practices continue to deplete soil carbon. We have now renewed our
appreciation for soil organic carbon and are looking at ways to reverse
its decline. Increasing soil carbon has many farm benefits (improved
productivity and sustainability) and off-farm benefits (improved water
and air quality).
I have been working with colleagues for the last 12 years on issues
related to soil carbon changes and its measurement and verification.
NRCS has been investigating the role that agriculture can play in the
sequestration of carbon in the soil both as soil organic carbon (SOC)
and soil inorganic carbon (SIC). We have published 10 books related to
the issue of soils, greenhouse gasses, and carbon sequestration. A
recent one is directly related to the topic of this hearing: Assessment
Methods for Soil Carbon edited by R. Lal, J. M. Kimble, R. F. Follett,
and B.A. Stewart.
Soils vary widely over the landscape. Their spatial variability has
led to the critique that it is too costly to accurately measure its
properties. In fact, we have well-developed tools (including models and
soil survey maps) to measure properties at points and to scale up from
those point measurements to large areas. Our National Soil Survey
Program inventories soils in the landscape into described units. This
inventory is pivotal in this scaling.
Data acquired from long-term (5+ years) no-till fields clearly
shows that the level of carbon in soil has increased over time. One
long-term no-till farmer in Illinois has doubled his SOC in a period of
about 15 years. He did this not on research plots but on agriculture
fields using good conservation practices. A special publication of the
Soil Science Society of America Soil Carbon Sequestration and the
Greenhouse Effect provides numerous examples of measurable rates of
change of soil organic carbon.
Based on sampled data, ARS senior scientist Dr. R. Follett and
several co-authors reported an average rate of change of 910 kg SOC
-1 in the top 20 cm of soil that was taken out of production
and put in the Conservation Reserve Program (CRP). This land was in the
13 state-region of the historic grasslands. Using soil maps we can
estimate the amount of carbon in the entire region. A total of 5.14
million metric tons carbon per year was accumulating in the top 20
centimeters of CRP land in this region. The rates would vary along the
temperature gradient form the south to the north and along the moisture
gradient from the east to the west. This variability can be explained
and understood when such data is scaled to larger areas. In the same
publication Keith Paustain and his co-authors describe how carbon cycle
models can be used to make regional assessments of soil carbon. They
have completed assessments in Iowa using the Century model and are
working on similar projects in several other states.
The book Assessment Methods for Soil Carbon provides papers from
United States and international scientists on all aspects of soil
carbon measurement and estimation. The areas of sampling, sample
preparation, spatial variability, the use of soil surveys, methods to
determine carbon in the laboratory, (carbon) pool sizes and turn over
rates, effects of soil erosion, procedures to model and scale data as
well as numerous other related topics are addressed. These papers along
with numerous others in the scientific literature provide a large
database of information to develop rates of soil carbon accumulation
and change associated with site-specific agricultural management
practices.
There remain a number of research areas that need continued work.
We need to continue to improve our analytical methodology both in the
laboratory and in our field sampling techniques. We need to develop
better statistical techniques to scale data from single point data to
larger areas. Scaling can be improved as we increase the use of remote
sensing and other techniques. We need to develop and improve sampling
protocols to reduce variability. We need to build on the data needed to
understand soil carbon conditions at the site, regional, and national
levels. Soil surveys provide essential information for sampling and
could be refined to improve their use for this purpose.
The Century model has been used to take point data and scale it up
to make regional assessments. Other models, named CQESTR (pronounced
sequester), are under development and being testing by the USDA
Agricultural Research Service, the Natural Resources Conservation
Service, and others. CQESTR will allow farmers and land managers to
estimate the effects of alternative management systems and practices on
rates of carbon sequestration. These models also help us look at
changes and make predictions about rates of fluxes of greenhouse gases.
The various models need to be validated against ground plots where
actual measurements are made. This validation has been done in a major
project in Canada called the ``Prairie Soil Carbon Balance Project.''
In this study a large group of farmers got together and showed that
with a combination of models and field trials, changes can be
predicted. The study found that carbon gains in the 0-30 cm soil layer
averaged 1.21 tons/ha with direct seeding. The carbon gains ranged from
1.56 tons C/hectare in the humid direct seeded fields to 0.82 tons C/
hectare in the semiarid areas. The gains were also found to vary with
clay content. The rates were measured on actual plots in fields that
were farmed as a part of normal farming operations. The study showed
that the amount of both above- and below-ground biomass increases with
direct seeding (no-till). As we continue to increase the amount of
above-ground biomass, we can expect more carbon to be returned to the
field and converted to soil organic carbon. The system will build upon
itself.
The use of remote sensing coupled with modeling has great potential
to improve our measurement and estimation capacity. We know that soil
carbon is not randomly distributed over the landscape. It is highly
correlated with clay content and other soil properties that we can map.
Therefore, it is important to integrate mapping and monitoring
techniques with predictive models for different soils and ecoregions.
The understanding of soil carbon dynamics is advancing. We now know
we must look at more than the total carbon pool in the soil. We need to
look at each of three carbon pools that are found in soil. These are
the labile pool, which has a turn over rate of less than a year; the
intermediate pool, which has a turn over rate of 10 to 100 years; and
the stable pool, which has a turn over rate of 100 to 1000+ years. If
we are to create and maintain a sustainable environment, our goal for
soil carbon should be to increase the intermediate and stable pools.
Management strategies need to be developed and applied to reach this
goal. Farm policy that encourages conservation and no-till systems,
crop rotations, particularly with grass or small grains, cover crops,
and appropriate use of organic amendments such as manure and compost
will help. Plant breeding may also help with varieties that will put
more carbon into plant root systems and in forms that are more
resistant to microbial breakdown.
In conclusion, the bottom line is that we know how to measure soil
carbon changes over time. We have been measuring it as part of our
research for a long time. The scientific process of measurement is now
verifiable, and the point data can now be scaled to larger areas with
models. We can also couple remote sensing data with the models to
improve their output. We can measure, estimate, and predict changes in
carbon with the tools at hand, which include field sampling, models,
and statistics. Our focus should be to get the conservation practices
on the ground that will lead to increases in soil carbon. This will
simultaneously advance our goals of sustainable farming systems and
improved water and air quality.
Mr. Chairman, that completes my statement. I would be happy to
answer any questions.
Senator Brownback. Thank you, Dr. Kimble, and I look
forward to talking with you about measuring carbon for a
potential carbon market and how we might do that.
Mr. Kadyszewski with Winrock International. Thank you for
joining us and I look forward to your testimony.
STATEMENT OF JOHN KADYSZEWSKI, WINROCK
INTERNATIONAL INSTITUTE FOR AGRICULTURAL
DEVELOPMENT
Mr. Kadyszewski. Mr. Chairman, thank you for the invitation
to explain our measurement methods. It is a privilege to be
asked to make a contribution to your deliberations.
Winrock International is a nonprofit organization with its
headquarters in Arkansas and offices in more than 40 countries.
We use good science and economics to increase economic
development opportunities, sustain natural resources, and
protect the environment in the United States and around the
world.
Today I want to describe our experience with the
measurement and verification of carbon. Our experience clearly
demonstrates that forestry and agroforestry projects can be
measured accurately, to known levels of precision, at costs
well below the expected value of the emissions reduction
credits. I will focus my comments today on carbon
sequestration, although I have included additional information
in my written testimony on biofuels and other clean energy
options.
About one-third of the total atmospheric loading of carbon
dioxide over the past century and 20 to 25 percent of current
annual global emissions are a result of the loss of carbon in
forests and soils. New approaches to the management of
vegetation, cover and soils across the landscape could store
substantial amounts of carbon and provide other environmental
benefits.
Winrock began its carbon measurement work in 1992 with the
development of peer-reviewed methods and procedures for
forestry and agroforestry systems. These methods and procedures
have been field-tested on a variety of projects at multiple
locations in the United States and around the world and can be
downloaded free from our web site. We are now measuring and
monitoring carbon storage in private projects covering a total
of more than a million acres, including those developed by
environmental organizations such as The Nature Conservancy and
private companies like American Electric Power and Sinergy.
We are continuously seeking and reviewing comments on our
methods and procedures, and we make modifications whenever
better approaches are identified. We plan to issue a revised
version later this year that reflects our practical experience
and the improvements that have been made over the past few
years in the methods. It will be jointly produced with the
Center for International Forest Research in Bogor, Indonesia,
and again will be available free through our web site.
Why do we submit our methods for peer review? Why do we
cooperate with other research institutions? Why are our methods
free? We believe that transparent and replicable measurement
methods and procedures are key elements of any trading system.
Ultimately, the integrity of the trading system depends on
there being agreement about what to measure and how to measure
it. The sooner we can define broadly accepted methods and
procedures for measurement and verification and ultimately
certification, the sooner markets can begin to help reduce
emissions.
I thought it might be helpful to describe what Winrock does
when we design a measurement and monitoring plan for a specific
land use change or forestry project. The amount of carbon
stored by a project is the difference between what would happen
with the project and what would happen without the project.
First we meet with the landowner or the project developer to
review past land uses and projections of likely future land
uses if the project is not developed.
Then we discuss how the project plans to store carbon or
reduce carbon emissions. We use the information collected from
these discussions to help set the baseline and to estimate what
effects the project will likely have on carbon stocks in each
carbon pool. For example, the carbon pools for a forest system
include trees, under story, litter, dead wood, soil, and roots.
Based on the expected carbon credits and the cost to
measure these carbon benefits, we discuss with the project
proponent which pools to measure. You are not required to
measure all pools where you expect to gain carbon, but you must
measure pools where you are unsure or where you expect to lose
carbon. We also discuss the frequency of monitoring, quality
control of measurement, and how data will be stored. These
projects are going to last for 50 to 100 years. Data storage is
important.
The next step is to design a statistical sampling regime
that will achieve accurate measurements at a level of precision
set by the project proponent. This step requires that we
classify the land where the project will be implemented and
determine the variability within each class. We can then
determine the number of plots needed to achieve our target
precision level. There is a tradeoff between precision and the
number of sample plots.
We then describe the exact procedure to be used for making
each measurement. This step is critical so that measurements
can be verified. I believe we have some pictures here of some
of the methods. For each plot, we georeference that plot. So
for example, in the 634,000 hectare Bolivian project we have
put out 625 permanent plots. These plots are satellite-located
so we can go back to them in future years, 100 years in the
future if we want to.
Senator Brownback. Would you put them up on that stand
there, if you could, for other people to be able to see, too.
Mr. Kadyszewski. This picture that is now on the stand is
showing one of the field people taking a measurement of the
mean breast height diameter of the tree. So once we have
established a permanent plot, we actually go in and measure the
trees in that plot.
For under story, we put down a ring that is a predetermined
size so that we can clip all the vegetation within that ring,
collect it, and measure it.
This photo shows the georeferencing part of the exercise.
That would be the center of the plot. We use nested plots so
that we can measure trees of different diameters at different
distances from that center point. We also use that center plot
for a line intersect technique for looking at deadwood. We
basically run a cord along the ground and look at all the
pieces of wood that intersect with that cord, weigh them, and
use that to determine a deadwood pool.
For soil samples, we dig four individual pits at different
locations in the plot. We blend the soils, we take density
readings out of the side of the holes that have been dug. These
methods are all specified: how you dig, how you pound, exactly
the procedures you follow are defined of each one of these
measurements, so that we can have replicable results. Again,
our target is somebody else has to be able to come in there
besides us, use the same procedure, and come up with the same
number.
In our methods, we also address project duration questions
and the risk of loss. For loss risk, for example fires, storms,
droughts, we have been working with some of the insurance
companies to estimate how much is lost in your average 20-year
fire or your 50-year flood, so that it will be possible for
insurance programs to be set up for buyers to insure based on
the measurements of what is actually happening.
For example, in Mexico we just finished some measurements
on fire damage in what were supposedly the worst fires in
Mexican history in 1998. We found that even on the worst sites
it was only 70 percent loss of carbon.
The process is sound, complicated, and expensive, and but
in practice the cost of measurement is not a significant burden
on project sponsors. For forestry projects measurement costs
achieved to date have been less than 25 cents per ton of carbon
for precision levels of about plus or minus 6 to 8 percent of
the mean, with a 95 percent confidence interval.
In the United States, existing forest and soil inventory
data collected by USDA in programs mentioned by Dr. Kimble
allows us to estimate variability within each stratum and
minimize the number of plots we need to measure in order to
achieve our target level of precision.
Fact sheets that describe representative projects that we
are measuring besides the Bolivia project can be downloaded
from our web site at www.winrock.org.
Projects can also be done on crop and pasture lands. For
example, planting trees along rivers and streams can produce
substantial carbon benefits and reduce nutrient loadings.
Farmers and ranchers facing regulatory action to reduce runoff
may find that carbon credits can make it cost-effective to
plant trees along waterways and reduce runoff.
It is also possible to increase carbon stocks in soils by
changing tillage practices and cropping systems. The challenges
of monitoring are different when the primary increase in carbon
stocks will be in soils rather than above-ground biomass and,
although there is general agreement that crop and pastureland
can be managed to increase carbon storage in soil and there is
much practical evidence, there is less agreement on how best to
measure those changes and what the costs will be.
We have been developing and field testing methods and
procedures for agricultural systems and we know it is feasible
to accurately measure carbon storage to known levels of
precision at predictable costs for ag soils projects as well as
forestry projects. However, in the practical world there are
only a handful of non-forestry projects being voluntarily
reported at this time in the U.S. under the 1605[b] program.
Practical experience under real field conditions is limited for
measurement in soils.
The fixed costs involved in design and implementation of a
measurement plan for forestry or ag systems mean measurement
costs per ton of carbon will be higher for smaller projects.
One way to push down measurement costs is to cooperate. For
example, we have been talking with RC&D councils in various
parts of the country. They can design a project for a region in
which members can voluntarily participate and share the costs
of monitoring. Each participant can then have accurate
measurements at lower individual costs, spreading the benefits
to smaller farmers and landholders.
Winrock is also working to push down the costs of
measurement. With our own funds and support from the Electric
Power Research Institute and its member utilities, we have been
developing lower cost monitoring methods using aerial digital
photography and videography. Part of the expense of this type
of measurement is getting people on the ground out in the
field, and when you are working in a large rain forest and you
design your scopes of work for taking those samples you have
fishermen, hunters, and people to carry the soil samples out of
your sites. If we can do this remotely, we can push the cost
down.
Digital imagery allows us to do more than just cut the
monitoring costs. It also helps us to measure the other
environmental benefits from projects that store carbon.
Quantification of these other ecosystem services could provide
additional sources of revenue for farmers and landowners.
What are the benefits? Overall, emissions trading for
carbon could yield there positive outcomes. The primary
objective is to reduce levels of carbon dioxide in the
atmosphere, but a second benefit is the potential mitigation of
impacts on people and agricultural production systems. The
third benefit is the environmental and social co-benefits.
The mitigation benefits I am talking about result because
landowners can use revenues from emissions trading to implement
new management practices. Higher carbon content in soils and
vegetation usually will help agricultural production systems
adjust to changes in climate, can reduce the impact of changes
in rainfall patterns and severe weather events. We believe
carbon credits are likely to lead to changes in land management
practices at relatively low values for carbon credits, $20 per
ton of carbon or less.
By environmental co-benefits, I mean such things as
watershed protection, wetlands and habitat restoration,
reductions in runoff and non-point pollution, biodiversity
protection, things that Dale mentioned in his comments as the
other benefits that have been produced in Bolivia beyond what
is being measured and reported.
By social benefits, we mean the new sources of income for
rural landowners and the potential to strengthen rural
communities. These are also benefits built into the Bolivia
project.
In closing, Winrock's experience with measuring carbon
storage across a range of projects shows it can be measured
accurately, to known levels of precision, at costs well below
the expected value of the resulting emissions reduction
credits.
Thank you.
[The prepared statement of Mr. Kadyszewski follows:]
Prepared Statement of John Kadyszewski, Winrock International Institute
for Agricultural Development
Mr. Chairman, thank you for the invitation to describe the peer-
reviewed methods and procedures we have developed and field tested for
measurement and verification of carbon stored in agricultural and
forest systems and the work we have done on measurement of emissions
avoided through the use of clean energy sources. It is a privilege to
be asked to make a contribution to your deliberations
Winrock International is a non-profit organization with its
headquarters in Arkansas and offices in more than 40 countries. We use
good science and economics to increase economic opportunities, sustain
natural resources and protect the environment in the United States and
around the world.
Today, I want to describe our experience with the measurement and
verification of carbon. Our experience clearly demonstrates that
forestry and agroforestry projects can be measured accurately to known
levels of precision at costs well below the expected value of the
emissions reduction credits. Similarly, emissions avoided through the
use of clean energy sources can be measured and calculated although
clear rules will be needed for how to set and measure baselines.
Overall, emissions trading for carbon could yield three positive
outcomes: (1) reduced levels of carbon dioxide in the atmosphere, (2)
potential mitigation of climate change impacts on people, agricultural
production systems, and ecosystems, and (3) environmental and social
co-benefits. By environmental co-benefits, I mean such things as
watershed protection, wetlands and habitat restoration, reductions in
run-off and non-point pollution, and biodiversity protection. By social
benefits, I mean new sources of income for rural landowners and the
potential to strengthen rural communities.
In the case of land use change and forestry projects, we believe
carbon credits are likely to lead to changes in land management
practices at relatively low prices for carbon credits. In the case of
clean energy systems, the value for carbon credits would have to be
higher to bring about significant changes in the attractiveness of
private investment.
Approximately one third of the total atmospheric loading of carbon
dioxide over the past century and 20 to 25 percent of current annual
global emissions results from the loss of carbon in forests and soils.
New approaches to the management of vegetation cover and soils across
the landscape could store substantial amounts of carbon and provide
other environmental benefits. Landowners can use revenues from
emissions trading to implement new management practices. Higher carbon
content in soils and vegetation usually will help agricultural
production systems adjust to changes in climate and can reduce the
impact of changes in rainfall patterns and severe weather events.
Winrock began its carbon measurement work in 1992 with the
development of peer-reviewed methods and procedures for forestry and
agroforestry systems. These methods and procedures have been field-
tested on a variety of projects at multiple locations in the United
States and around the world and can be downloaded for free from our
website. We are now measuring and monitoring carbon storage in a number
of private projects covering a total of more than a million acres,
including those developed by environmental organizations such as the
Nature Conservancy and private companies like American Electric Power
and Cinergy. Also, we are aware of other companies in Asia and around
the world that have independently adopted our methods and procedures.
We continuously seek and review comments on our methods and
procedures and make modifications when better approaches are
identified. We plan to issue a revised version later this year that
reflects our practical experience and the improvements that have been
made over the past few years. It will be jointly produced with the
Center for International Forest Research (CIFOR) in Bogor, Indonesia
(part of the CGIAR network) and again available free through our
website.
Why do we submit our methods for peer review and why do we
cooperate with other research institutions? Transparent and replicable
measurement methods and procedures are key elements of any trading
system. Ultimately, the integrity of the trading system depends on
there being agreement about what to measure and how to measure it.
Multiple approaches to emissions trading have been discussed at
international negotiating sessions over the past few years and several
countries have announced domestic trading systems. Similarly, some
private companies have acted early and have created internal trading
systems for emissions, including carbon dioxide. The sooner we can
define broadly accepted methods and procedures for measurement,
verification and certification, the sooner markets can begin to help
reduce emissions.
I thought it might be helpful to describe what Winrock does when we
design a measurement and monitoring plan for a specific land use change
or forestry project. The amount of carbon stored by a project is the
difference between what would have happened with the project and what
would have happened without the project. First, we meet with the
landowner or project developer to review past land uses and projections
of likely future uses if the project is not developed. Then we discuss
how the project will store carbon or reduce carbon emissions. We use
the information collected from these discussions to help set the
baseline and to estimate what affects the project will likely have on
carbon stocks in each carbon pool. We divide carbon stocks into pools.
For example, the carbon pools for a forest system could include trees,
under story, litter, dead wood, soil, and roots, although the actual
pools selected depend on the project.
Based on the expected carbon credits and the cost to measure carbon
benefits, we discuss with the project proponent which pools to measure.
You are not required to measure all pools where you expect to gain
carbon but you must measure pools where you are unsure or where you
expect to lose carbon. We also discuss the frequency of monitoring, the
way we propose to assure quality control, and how data will be stored.
The next step is to design a statistical sampling regime that will
achieve accurate measurements at a level of precision set by the
project proponent. This step requires that we classify the land where
the project will be implemented and determine the variability within
each class. We can then determine the number of plots needed to achieve
the target precision. There is a tradeoff between precision and the
number of sample plots. We describe the exact procedure to be used for
making each measurement. We also address project duration and risk of
loss.
The process sounds complicated and expensive but in practive the
cost of measurement is not a significant burden on project sponsors.
For forestry projects, measurement costs achieved to date have been
less than $0.25 per ton of carbon for precision levels of about 6-8
percent of the mean with 95 percent confidence. In the United States,
existing forest and soil inventory data collected by USDA allows us to
estimate variability within each stratum and minimize the number of
plots we need to measure to achieve target levels of accuracy and
precision.
Fact sheets that describe representative projects we are measuring
can be downloaded from our website at www.winrock.org.
Projects can also be done on crop and pasture lands. For example,
planting trees along rivers and streams can produce substantial carbon
benefits and reduce nutrient loadings. Farmers and ranchers facing
regulatory action to reduce run-off may find that carbon credits can
make it cost-effective to plant trees along waterways.
It is also possible to increase carbon stocks in soils by changing
tillage practices and cropping systems. The challenges of monitoring
are different when the primary increase in carbon stocks will be in
soils rather than above-ground biomass. While it has been relatively
easy to obtain consensus around standard methods and procedures for
measuring carbon stored in forestry and agroforestry projects, the same
has not been true for agricultural soils. Although there is general
agreement that crop and pastureland can be managed to increase carbon
storage in soil, there is less agreement on how best to measure changes
and whether measurement will be cost effective.
We have been developing and field testing methods and procedures
for agricultural projects and have determined that it is feasible to
accurately measure carbon storage to known levels of precision at
predictable costs. However, there are only a handful of non-forestry
projects being voluntarily reported, and practical experience under
real project conditions is limited. We estimate the costs of
measurement for soil sequestration projects to be higher per ton of
carbon, although still below the expected value of the emissions
reduction credits they can produce.
The fixed costs involved in the design and implementation of a
measurement plan for forestry or agricultural systems mean measurement
costs per ton of carbon will be higher for smaller projects. One way to
push down measurement costs is to cooperate with your neighbors. For
example, we have been talking with RC&D Councils in various parts of
the country. They can design a project for a region in which members
can voluntarily participate and share the costs of monitoring. Each
participant can then achieve high levels of accuracy and precision at
lower individual cost.
Winrock is also working to push down the costs of measurement. With
our own funds and support from the Electric Power Research Institute
and its member utilities, we have been developing lower cost monitoring
methods using aerial digital photography and videography. Digital
imagery allows us to do more than just cut monitoring costs. It helps
us to measure the other environmental benefits from projects that store
carbon such as habitat protection and restoration, watershed
improvement, and reductions in non-point pollution. Quantification of
these other ``ecosystem services'' could provide additional sources of
revenue for farmers and landowners.
Since the early 1990's, companies have been encouraged to take
voluntary actions to reduce emissions of greenhouse gases. Companies
can report voluntary actions to the Energy Information Administration
within the Department of Energy. So far, land use change and forestry
projects have accounted for only about 5 percent of the reported
credits achieved through voluntary projects, mostly for afforestation
and reforestation projects. Most projects being reported are energy
projects.
We have been particularly interested in the measurement and
monitoring of emissions avoided through the use of biofuels or smaller,
distributed clean energy systems. By small, we mean projects with power
capacity of a few watts per system (as with photovoltaic panels) to as
much as 100 MW. Expanded use of biomass fuels for energy production
could produce substantial carbon benefits and new sources of revenues
for farmers and landowners. Monitoring of emissions avoided through the
use of biofuels is relatively straightforward. Determining the energy
required to produce the biofuel is somewhat more challenging. Because
solar and wind resources are intermittent sources of supply, they
present special measurement challenges, especially when connected to a
power grid.
For many categories of forestry projects, the Energy Information
Administration provides tables with estimated carbon storage values
that forest project sponsors can use if they do not wish to make actual
measurements. One question we are frequently asked by landowners and
project sponsors is whether the tables provided are accurate indicators
of expected carbon storage. We explain that the tables are based on
forest inventory data collected to produce a national inventory. As
such, an individual project may do better or worse than the average. It
has been our experience that most projects that people want to measure
do better than the tables because they are usually managing the
resource for such a ``product''.
Another frequently asked question concerns how much carbon could be
potentially stored in forestry and land use change projects in the
United States. The U.S. government has produced several reports that
describe carbon storage potential. In general, these estimates do not
include economic valuations of current land use and we believe
overestimate the economically viable carbon storage options.
In closing, Winrock's experience with measuring carbon storage
across a range of projects shows it can be measured to known levels of
accuracy and precision at costs well below the expected value of the
resulting emissions reduction credits.
I would be happy to answer any questions.
Senator Brownback. Thank you very much. That was excellent
and I look forward to questioning you further about that.
Mr. Mike Coda, Climate Change Program with The Nature
Conservancy. Mr. Coda.
STATEMENT OF MIKE CODA, DIRECTOR, CLIMATE CHANGE PROGRAM, THE
NATURE CONSERVANCY
Mr. Coda. Thank you very much, Senator Brownback. I want to
thank you for chairing this hearing at a very important time in
this debate and I think it will help us move the issue of
carbon sequestration forward. I really want to commend you for
that and for the time you have spent in learning about this
issue and in visiting our project in Brazil.
Our organization, The Nature Conservancy, is a biodiversity
conservation organization. We are the largest conservation
organization in the United States. We have considerable
experience in the area of carbon sequestration. We have been
involved in pilot projects, some of which have already been
referred to, in Brazil, Belize, Bolivia, and the United States,
and on these projects we have worked with other leading
conservation organizations, groups that specialize in carbon
measurement such as Winrock, governmental entities, and major
corporations such as General Motors, British Petroleum, and
American Electric Power. We have participated actively in the
international discussions over these issues and our comments
are based on real world experience as well as academic
analysis.
My discussion of carbon sequestration and its benefits for
the environment will focus on two areas: first, the impact on
the buildup of greenhouse gases in the atmosphere; and second,
the impact on biodiversity conservation and other key
environmental imperatives. In each of these two areas, we
believe that carbon sequestration can make an important
contribution.
First I would like to talk about the benefits to the
climate. Approximately 22 percent of the annual output of
greenhouse gases comes from the land use sector. This is a fact
that is not often focused upon in the climate change debate,
but it is something that has been verified by the IPCC in their
reports and by others. So this area is very important in terms
of developing a program to address potential climate change.
In addition, there is not only the potential to reduce
current emissions from forestry and agriculture, but also to
sequester through reforestation some greenhouse gases already
in the atmosphere.
Carbon sequestration aimed at improving land use also has
many other attractive aspects for climate change policy. It can
be implemented rapidly and begin to have an impact on annual
emissions almost immediately. While additional research and
development in the cost of measurement of climate benefits of
carbon sequestration is necessary, current techniques are
certainly accurate enough to support the types of legislation
currently being considered.
Carbon sequestration also holds the promise of noticeably
reducing the cost to the economy of addressing potential
climate change, which is something that has to be on all of our
minds as we discuss this issue.
In addition to the positives related to climate change
policy, a properly structured carbon sequestration program can
also provide a major boost to biodiversity conservation, as
well as leading to other potential environmental benefits like
watershed protection and the prevention of soil erosion. You
have heard a description of two projects involving The
Conservancy and American Electric Power, in which funding from
corporations looking to reduce their impact on the climate was
used to protect globally significant natural areas that would
otherwise have been deforested. Without climate change as a
motivation for these donors, The Conservancy would never have
been able to raise the funds necessary for these projects.
To raise almost $10 million for a conservation of a single
threatened forest in Bolivia is virtually unheard of in the
conservation movement. You have some photos of this area here.
You can see the natural beauty of the area, and then also from
a biodiversity standpoint the blue and yellow macaw is down to
less than a thousand in terms of its numbers in the world and
this is one of the few places of remaining habitat. This is the
kind of thing that, with this mechanism, we can make some
progress on protecting.
Senator Brownback. Mr. Coda, how big is this project? This
is the Bolivian project, I believe?
Mr. Coda. I think it is about 300,000 hectares in total.
Mr. Heydlauff. It is 4 million acres. It is roughly the
size of the State of Massachusetts.
Senator Brownback. That is impressive. Is most of it of
this nature, of the type that we have got up here in the
pictures? First of all, it is forested region?
Mr. Coda. Yes.
Mr. Heydlauff. Largely. One of the things that The Nature
Conservancy was really attracted to with this project as part
of its Parks in Peril program was actually the diversity of the
area. Some of it is Amazonian rain forest, but it actually goes
to what is known as a dry chaca area that is quite a different
type of ecosystem altogether. It is a fairly wide variety, but
much of it is--it is all tropical forest, which experiences a
high degree of rainfall and a deep foliage, with a very
substantial variety of species: 620 different bird species, for
example; 120 different mammal species; 70 different reptile
species; 4,000 different plant species, many of which are
endangered species; 110 different orchids in this park.
The biological diversity is actually stunning. When I first
went there, I guess I had somewhat of a spiritual experience,
because I thought this is probably what the Garden of Eden must
have looked like before man started tampering with the Earth,
because it was just so teeming with life in all of its
dimensions.
It affects in a very unique way all of your senses. You
hear things you have never heard before, you see things you
have never seen before, you feel things you have never felt
before. It is probably not uncommon to what you experienced in
the Guaraquecaba project in Brazil, except this is on a much
larger scale and it is far, far more remote than the
Guaraquecaba project is down in Brazil.
Senator Brownback. Mr. Coda, not to interrupt your
testimony too much more, but how much did you raise resources-
wise to do this project in Bolivia?
Mr. Coda. The total cost of the project was about $9.5
million.
Senator Brownback. And you were able to raise that, where
you would not have and could not do that sort of fundraising
for a project for this scale before?
Mr. Coda. There is no way we could have put this together.
Senator Brownback. What did those resources entitle you or
enable you to be able to do?
Mr. Coda. We were able to retire the forest concessions
that the government of Bolivia had let on the land, which the
government wanted to do but did not have the funds to do. Then
we were able to set up an endowment for the long-term
management of the project. Then finally, as Mr. Heydlauff
referred to earlier, we were able to provide some additional
assistance to the local community, grants for microenterprises,
heart of palm plantations, agroforestry kinds of activities,
because we wanted to make sure that this was also a benefit to
the community. We were able to refurbish the school, to build a
medical center for the community--do all this while having a
very cost-effective carbon project.
Senator Brownback. What were the forest concessions? How
many acres or hectares had there been given to concessions that
you were able to buy back?
Mr. Coda. I do not remember exactly. Dale, do you?
Mr. Heydlauff. It was two million acres.
Senator Brownback. Two million acres.
Mr. Heydlauff. Approximately two million. There was an
existing national park of two million acres and then an
adjacent property area of about equivalent size. One of the
nice things about the project is it gave the park a natural
boundary that they did not have before, which is critical for
helping to protect the park. There is a river boundary now to
the west and the southern end of the property that did not
exist before.
But there was two million acres of logging concessions that
had been sold by the government to timber companies for
harvesting. Senator, it is kind of tragic when you first saw--
when we first got involved, it was before we had retired all
the concessions. We saw some of the ongoing logging activities
and they did not have a clue about sustainable forestry. They
literally were clearcutting the forest to harvest essentially
three species of trees, red oak, mahogany, and hearts of palm
trees, and just leaving the debris to decay on the ground.
Senator Brownback. So you were able to basically do two
million acres in addition to the current national project that
was there for $7.5 million?
Mr. Coda. Yes, yes. It is amazing.
Senator Brownback. That is. Please go on.
Mr. Coda. That is what really got us excited about this
mechanism as a potential way to help conservation, because
deforestation throughout the tropics is a terrible
environmental problem and it really does not have a lot of
economic value to it. So it only takes a small effort to give
value to the forests, such as American Electric Power
recognized, to turn that around and we can protect these areas.
Senator Brownback. So you did that for under four dollars
an acre?
Mr. Coda. Yes.
Senator Brownback. Please go on.
Mr. Coda. I should emphasize, most of the activities that
conservationists have encouraged for years to protect
biodiversity also have a significant carbon benefit. We have
been talking about the protection of tropical forests for a
long time. These forests are the focus of the world's
biological diversity and are under pressure everywhere. At the
same time, they are also particularly carbon-rich and the
burning and destruction of these forests is responsible for a
good deal of the percentage, the 22 percent of CO2 emissions
the come from land use. So protecting them will not only help
the atmosphere, but they will also further biodiversity
conservation.
There is also, there is a possibility at some point down
the line that the happy coincidence between what is good for
biodiversity and other environmental objectives and what is
good for the atmosphere will end. You can foresee the day of
genetically engineered, fast growing tree plantations designed
simply to sequester carbon. That is why The Nature Conservancy
and other groups feel it is very important that support for
carbon sequestration be targeted at the protection and
restoration of natural forests and improved agricultural
practices and that incentives not be provided to projects that
would involve the replacement of natural systems, no matter
what their carbon impact. I should note that the bill you have
introduced is structured in precisely that manner.
In addition to this principle, we also believe it is
important that any incentive program for carbon sequestration
be focused on projects that truly have a benefit to the
atmosphere. This means the projects promoted should meet the
following tests: they need to be additional to what would have
happened anyway; they need to avoid displacing a carbon-
reducing activity to another area, thus with no net benefit to
the atmosphere; we need to make sure the climate impact is
measurable, and, as John said, that is becoming easier and
easier; and we need to make sure the project has a long-term
impact.
Our hope is that the benefits from the incentives created
in your legislation can also be focused on projects that
effectively address this issue and I believe they will be.
For years, just in summing up, for years conservationists
have argued that the environment provides services to the
economy that are not valued by our market system. A forest
often protects a watershed for a major city, prevents soil
erosion from steep hillsides in a storm-prone area, provides an
attractive area for ecotourism that benefits the economy of
local communities, and, particularly in tropical rainforests.,
harbors unusual plant and animal life that may help in the
development of medicinal drugs.
These forests are also critical to the functioning of the
climate on our planet. Through legislation such as that that
you have sponsored, we in the conservation community see the
potential for the first time to recognize the economic
contribution that comes from these forests, and our hope is
that once this value begins to be recognized society will come
to see these forests differently. It is for this reason that
The Nature Conservancy applauds your efforts to shape a carbon
sequestration program and we look forward to working with you
as these efforts move forward. Thank you.
[The prepared statement of Mr. Coda follows:]
Prepared Statement of Mike Coda, Director, Climate Change Program,
the Nature Conservancy
My name is Mike Coda. I am Vice President and Director of the
Climate Change Program at The Nature Conservancy. The Nature
Conservancy is a non-profit conservation organization founded in 1951.
The Conservancy's mission is to protect rare and endangered plants,
animals, and natural communities that represent the diversity of life
on earth by protecting the lands and waters they need to survive. The
Nature Conservancy is the largest conservation organization based in
the United States. Throughout its history, the Conservancy has
protected more than 12 million acres of land in North America and
millions more in Latin America, Asia, and the Pacific. The Nature
Conservancy owns or manages approximately I million acres of land in
the United States, comprising the largest system of private nature
preserves in the world. Although it is known primarily in the U.S. as
organization that buys land to create nature preserves, the Conservancy
also engages in working with private landowners to improve land
management practices, and works with local communities to help them
determine their environmental future. Outside the United States, we
work with in-country conservation partners, local governments,
multilateral institutions, U.S. government agencies, and private sector
firms to foster support for conservation and develop additional sources
of funding. The Conservancy has more than 1.2 million members and has
at least one office in every state and in many other countries.
I am happy to be here today to discuss the potential environmental
benefits of carbon sequestration. Our organization has considerable
experience in this area. We have been involved in pilot projects of
this type in Brazil, Belize, Bolivia, and the United States. On these
projects we have worked with other leading conservation organizations,
groups that specialize in carbon management, governmental entities, and
major corporations such as General Motors, British Petroleum and AEP.
We have participated actively in the international discussions over
these issues. Our comments are based on real world experience as well
as academic analysis.
My discussion of carbon sequestration will focus on two aspects--
(1) the impact on the build-up of greenhouse gases in the atmosphere
and (2) the impact on biodiversity conservation and other key
environmental imperatives. In each of these two areas, carbon
sequestration can make an important contribution.
Let me first talk about the benefits to the climate. Fossil fuels
are responsible for the bulk of emissions from human activity and will
need to be addressed in order for society to have a chance to avoid
significant climate change. However, approximately 22 percent of the
annual output of greenhouse gases come from the land use sector,
primarily the result of deforestation in tropical areas and emissions
from agricultural activity. Thus, solutions addressing the land use
sector are also needed. Making this area even more important, there is
not only the potential to reduce current emissions from forestry and
agriculture but also to sequester through reforestation some greenhouse
gases already in the atmosphere. The IPCC estimates that as much as 10
percent of projected worldwide emissions between the years 1995 and
2050 could be offset by reforestation. This represents as much as 65
gigatons of carbon.
Serious analysis of the magnitude of the effort required to
stabilize atmospheric concentrations of carbon dioxide also supports
the need for policies promoting carbon sequestration. If the U.S. were
to try to reduce its carbon dioxide emissions to 1990 levels, this
would require a reduction of almost 11 percent from emission levels in
the year 1998. Taking into account that fossil fuel emissions are
growing because of rising demand for energy, we will need an even more
significant reduction if we are to reach the levels that we emitted in
1990. We will certainly need all the tools available, including carbon
sequestration, to achieve this objective.
Carbon sequestration aimed at improving land use also has many
attractive attributes for climate change policy. Unlike some proposed
solutions, it can be implemented rapidly and begin to have an impact on
annual emissions almost immediately, depending on the scale of the
program. While additional research and development to lower the cost of
measurement of the climate benefits of carbon sequestration projects is
necessary, current techniques are certainly accurate enough to support
the types of legislation currently being considered. You will hear more
on this subject from Winrock. Finally, carbon sequestration holds the
promise of noticeably reducing the cost to the economy of addressing
potential climate change. For example, cost estimates for compliance
with the Kyoto Protocol typically range between $25 and $200 per ton
carbon. Several pilot forest carbon sequestration projects, including
ones in which The Nature Conservancy is involved, are already being
implemented with costs typically less than $10 per ton carbon.
In addition to positives related to climate change policy, a
properly structured carbon sequestration program can provide a major
boost for biodiversity conservation as well as leading to other
potential environmental benefits like watershed protection and the
prevention of soil erosion. You have heard a description of two
projects involving The Nature Conservancy and American Electric Power
in which funding from corporations looking to reduce their impact on
the climate was used to protect globally significant natural areas that
would otherwise have been deforested. Without climate change as a
motivation for these donors, The Nature Conservancy would never have
been able to raise the funds necessary for these projects. To raise
almost $10 million for the conservation of a single threatened forest
in a far-off country like Bolivia is virtually unheard of within the
conservation movement. In fact, it is an amount almost equal to what
Congress appropriated in the last fiscal year for the Tropical Forest
Conservation Act, the principal U.S. government program designed to
protect tropical forests throughout the world.
Most of the activities that conservationists have encouraged for
years to protect biodiversity also have a significant carbon benefit.
The protection of tropical forests has long been a priority because
these forests are the focus of much of the world's biological diversity
and are under pressure everywhere. At the same time, tropical forests
are particularly carbon-rich and the burning and destruction of these
forests around the world is a major source of carbon dioxide emissions.
Protecting them will help the atmosphere and further biodiversity
conservation. In the U.S., protection of the old growth forests of the
Northwest has been a major priority for conservationists. Again, these
forests are, in general, some of the most carbon-rich on the planet.
Protecting them avoids an enormous release of carbon dioxide.
Conservationists have also encouraged forestland owners to use more
sustainable forestry practices such as longer rotations and selective
harvesting that will maintain the integrity of the relevant ecological
system while allowing the forest owner to receive some economic
benefit. In almost every case, these practices yield carbon benefits as
well. In agriculture, conservationists have worked with farmers to
adopt low-till or no-till techniques in order to control soil erosion.
It turns out that these practices, too, also yield an important climate
benefit.
There is the possibility that the happy coincidence between what is
good for biodiversity and other environmental objectives and what is
good for the atmosphere will end in the future. One can foresee the day
of genetically engineered fast growing tree plantations designed simply
to sequester carbon. That is why The Nature Conservancy and other
groups believe it is extremely important that support for carbon
sequestration be targeted at the protection and restoration of natural
forests and improved agricultural practices and that no incentives be
provided to projects that would involve the replacement of natural
systems, no matter what the carbon impact.
In addition to this principle, we also believe that any incentive
program for carbon sequestration must be focused on projects that truly
have a benefit to the atmosphere. This means the projects promoted must
meet the following tests:
1) LAre they additional to what would have happened anyway?
There is no benefit to the atmosphere from subsidizing projects
that are already likely to happen for other reasons.
2) LDo they displace the carbon-reducing activity to another
area? If stopping the cutting of one forest merely leads to
another forest being cut, there is no gain to the atmosphere.
3) LIs the climate impact of the project measurable?
4) LDoes the project make a long-term impact? A project that
merely delays the release of carbon for a short time period has
little value to the atmosphere.
Our hope is that the benefits from the incentives created in your
legislation can also be focused on projects that effectively address
these issues.
For years, conservationists have correctly argued that the
environment provides services to the economy that are not valued by our
market system. A forest often protects a watershed for a major city,
prevents soil erosion from steep hillsides in a storm-prone area,
provides an attractive area for ecotourism that benefits the economy of
local communities, and, particularly in tropical rainforests, harbors
unusual plant and animal life that may help in the development of
medicinal drugs. These forests are also critical to the functioning of
the climate on our planet. Through legislation such as that sponsored
by Senator Brownback and that sponsored by Senator Wyden, we see the
potential for the first time to recognize the economic contribution
that comes from these forests. Our hope is that, once this value begins
to be recognized, society will come to see these forests differently.
It will not be necessary to clear the trees or convert to residential
development in order for landowners to obtain some value from these
lands. It is for this reason that The Nature Conservancy applauds your
efforts to shape a carbon sequestration program. We look forward to
working with you as these efforts move forward.
Thank you for the opportunity to address this important issue.
Senator Brownback. Thank you, Mr. Coda.
Mr. Bonnie, thank you for joining us.
STATEMENT OF ROBERT BONNIE, ECONOMIST, ENVIRONMENTAL DEFENSE
Mr. Bonnie. Like others on the panel, I want to thank you
for the opportunity to be here today as well and thank you for
your continued leadership on this important issue.
Over the last several years and particularly over the last
several months, the debate surrounding global warming has
changed. There is growing recognition on all sides that a near-
consensus has emerged within the scientific community that
climate change is already occurring as a result of human
activities and that unless action to reduce emissions begins in
the very near future it will be very difficult and perhaps very
expensive to avoid dangerous interference with the world's
climate system.
Many businesses recognize the threat of climate change,
with leading companies like BP-Amoco, Dupont, Entergy, and
others voluntarily capping and reducing their greenhouse gas
emissions in anticipation of future regulation.
My testimony today focuses on what to do about climate
change and in particular the role that carbon sequestration
activities can have in confronting climate change. To be
effective, any comprehensive strategy addressing climate change
will ultimately require a cap on greenhouse gas emissions.
However, often lost from the debate as Mike noted earlier, is
the fact that land use activities, particularly tropical
deforestation, account for about one-fifth of global,
anthropogenic greenhouse gas emissions.
What we do on the land is part of the problem, but it can
also be part of the solution. Environmental Defense has long
advocated cap and trade programs, also called emissions
trading, that harness the power of market forces to meet air
pollution targets in a cost-effective manner. Under a
prospective greenhouse gas cap and trade program, industrial
sources of greenhouse gas emissions would be subject to a cap
on their emissions, but would be allowed to trade emissions
reductions credits in a market system.
By pursuing a market-based approach to climate change, one
that incorporates carbon sequestration activities, the United
States can take meaningful steps to curb emissions of
greenhouse gases in a cost-effective manner while producing
substantial ancillary environmental benefits from improved
forestry and agricultural practices.
Projects are already under way, as we have heard, to reduce
greenhouse gas emissions caused by the destruction of tropical
rainforests. Approximately 35 million acres of tropical forests
are lost annually, an area larger than the size of New York
State. The attendant emissions of greenhouse gases and the loss
of biodiversity are enormous. A greenhouse gas emissions
trading market, however, has the potential to place significant
value on the atmospheric benefits of preserving tropical
forests, making it potentially profitable for developing
countries to conserve biodiversity.
Environmental Defense has been pleased to work with you,
Senator Brownback, on legislation designed to deal with this
problem and to jump-start projects aimed at reducing
deforestation. Your International Carbon Sequestration
Incentive Act would provide U.S. companies with an economic
incentive to invest in projects that slow rates of
deforestation in developing countries and that thereby reduce
emissions of greenhouse gases.
There is also significant potential for greenhouse gas
emissions trading markets to promote better land management and
to provide an alternative source of revenue to farmers and
forest landowners here at home. Through reforestation of
agricultural lands, conservation tillage, and other actions,
landowners could earn and sell greenhouse gas emissions
reduction credits while producing a variety of other
environmental benefits.
A key to making this market work is to ensure accurate
measurement of carbon stocks on participating lands and to
develop a carbon accounting system that is transparent,
verifiable, and that ensures the atmospheric benefits of
sequestration activities. Since carbon sequestered by trees,
plants, and soils can later be released, crediting systems must
account for the potential reversibility of carbon stocks. A
carbon accounting system must also ensure that carbon
sequestration activities do not simply shift greenhouse gas-
emitting activities to other land parcels. We should also
ensure that crediting of land use activities does not encourage
the conversion of natural ecosystems.
Many companies are already making investments in
sequestration projects, as we heard from Dale and AEP, but they
are doing so in an uncertain regulatory environment, where the
future rules by which these projects will be judged are
unclear. Thus, government can play a role, a valuable role, in
creating incentives to craft measurement and carbon accounting
protocols for carbon sequestration activities.
The International Carbon Sequestration Incentive Act does
exactly that, by creating a collaborative and transparent
process to develop guidelines to ensure that carbon measurement
and accounting issues are properly addressed.
Similar efforts should be developed for domestic
sequestration activities on American farm land and forest land.
I note that Senator Wyden has a bill, for example, which
proposes to do this for forests.
In conclusion, carbon sequestration projects in conjunction
with a greenhouse gas cap and trade market have the potential
to provide a cost-effective strategy for addressing climate
change while at the same time producing significant
environmental benefits.
Thank you very much.
[The prepared statement of Mr. Bonnie follows:]
Prepared Statement of Robert Bonnie,
Economist, Environmental Defense
Over the last several years and particularly over the last several
months, the debate surrounding global warming has changed. There is
growing recognition on all sides that a near consensus has emerged
within the scientific community that climate change is already
occurring, that anthropogenic activities are a significant contributor
to this climate change, and that unless action to reduce emissions
begins in the very near future, it will be extremely difficult--and
very expensive--to avoid dangerous interference with the world's
climate system. Many businesses recognize the threat of climate change,
with leading companies like BP Amoco, Dupont, and Entergy voluntarily
capping and reducing their greenhouse gas emissions in anticipation of
future regulation. The question is no longer whether anthropogenic
emissions of greenhouse gases are causing global warming, but what we
should do about it.
My testimony today focuses on what to do about climate change and
in particular the role that carbon sequestration activities can have in
confronting climate change. To be effective, any comprehensive strategy
addressing climate change will require a cap on greenhouse gas
emissions. However, often lost from the debate is the fact that land
use activities, particularly tropical deforestation, account for about
one fifth of global anthropogenic greenhouse gas emissions. What we do
on the land is part of the problem, and it should also be part of the
solution.
Environmental Defense has long advocated ``cap and trade''
programs, also called emissions trading, that harness the power of
market forces to meet air pollution targets in a cost-effective manner.
The United States already has ample experience using cap and trade
programs. In 1990, then-President George Bush proposed and later signed
legislation to amend the Clean Air Act by capping sulfur dioxide
emissions, the precursors to acid rain, from electric utility plants.
This legislation gave utilities flexibility in how to meet this new
mandate, allowing them to buy and sell sulfur dioxide emissions
allowances and to save allowances for use in the future. Utilities
could choose to meet their obligations by reducing pollution at their
own plants or they could purchase emissions allowances from other
plants who were able to more easily make steeper reductions. The
program has been an overwhelming success. Utilities have reduced acid
rain emissions at a fraction of the cost of even the most optimistic
forecasts. Moreover, emissions have been reduced over 20 percent below
the levels mandated by the law.
Similarly, under a prospective greenhouse gas cap and trade
program, industrial sources of greenhouse gas emissions would be
subject to a cap on their emissions but would be allowed to trade
emissions reductions credits in a market. This market would provide
companies with a variety of options for meeting their climate change
obligations; they could reduce emissions from their own plants,
purchase emissions credits from other plants, or, alternatively,
purchase emissions credits from farmers and/or forest landowners who
sequester carbon on their lands through improved land management
practices.
By pursuing a market-based approach to climate change, one that
incorporates carbon sequestration activities, the United States can
take meaningful steps to curb emissions of greenhouse gases cost-
effectively while producing substantial ancillary environmental
benefits from improved forestry and agricultural practices. Such an
approach can also enable farmers and forestland owners to earn a return
on their investment for growing a new crop: carbon.
For example, projects are already underway to reduce greenhouse gas
emissions caused by the destruction of tropical rainforests.
Approximately 35 million acres of tropical forests are lost annually--
an area larger than New York State. The attendant emissions of
greenhouse gas and loss of biodiversity are enormous. Destruction of
tropical rainforests has many causes, but at the root of all of them is
the fact that those who liquidate those forests place higher value on
them as agricultural land or sources of wood products than as forest
ecosystems. A greenhouse gas emissions trading market, however, has the
potential to place significant value on the atmospheric benefits of
preserving tropical forests, making it potentially profitable for
developing countries to conserve biodiversity.
Environmental Defense has been pleased to work with Senator
Brownback on legislation designed to jumpstart projects aimed at
reducing deforestation. The International Carbon Sequestration
Incentive Act would provide US companies with an economic incentive to
invest in projects that slow rates of deforestation in developing
countries and thereby reduce emissions of greenhouse gases.
There is also significant potential for greenhouse gas emissions
trading markets to promote better land management and provide an
alternative source of revenue to farmers and forest landowners here at
home. Through reforestation of agricultural lands, conservation
tillage, more effective fertilizer application, and other actions,
landowners could earn and sell greenhouse gas emissions reduction
credits while improving crop productivity and water quality, protecting
habitat for wildlife and reducing soil erosion.
A key to making this market work is to ensure accurate measurement
of carbon stocks on participating lands and to develop a carbon
accounting system that is transparent, verifiable, and ensures the
atmospheric benefits of sequestration activities. In some respects
measurement is the easy part. We clearly have the technical expertise
to accurately measure changes in carbon stocks. We do, however, have to
develop verification techniques through direct measurements, computer
models, and remote sensing that allow us to monitor carbon stocks
across multiple ownerships at a reasonable cost.
More challenging, though clearly doable, is to develop a carbon
accounting system for carbon sequestration activities. After all, for
the market to work, a carbon accounting system must ensure that a ton
of carbon sequestered in the soil or in forests is equivalent to a ton
of carbon emitted from a power plant or some other source.
A carbon accounting system must ensure that sequestration
activities provide real, verifiable and long-lasting atmospheric
benefits. For example, carbon sequestration is reversible, meaning that
carbon stored in soils and plants can later be released as a result of
altered land management practices or natural disturbances. While this
issue is often cited as the most difficult obstacle confronting carbon
sequestration markets, it should be relatively easy to develop
crediting systems that account for the potential reversibility of
carbon stocks. One proposal to deal with this issue is to issue credits
that expire after a fixed term. Upon expiration of the credits, the
purchaser of the credits can either renew the contract with the
landowner or replace the expired credits from some other source.
A carbon accounting system must also prevent leakage; that is, it
must ensure that carbon sequestration activities that result in reduced
yields of wood-products or agricultural goods don't simply shift
greenhouse gas emitting activities to other properties. Crediting for
carbon sequestration activities should also not simply reward
``business-as-usual'' activities. That is, a sequestration market
should encourage landowners to alter their land management practices so
as to produce real, additional greenhouse gas reductions for the
atmosphere.
We should also ensure that crediting of land use activities doesn't
lead to perverse environmental outcomes such as encouraging the
conversion of natural ecosystems. Perverse incentives for ecosystem
conversions can be avoided by setting carbon stock baselines that
account for any land clearing activities prior to initiation of the
sequestration activities.
We still have a great deal to learn as to how sequestration
projects and the greenhouse gas market will function in practice. Many
companies are already making investments in sequestration projects, but
they are doing so in an uncertain regulatory environment where the
future rules by which these projects will be judged are unclear. Thus,
government can play a valuable role in creating incentives for
companies, landowners, developing countries, conservation groups,
agencies, and academics to work together to craft measurement and
carbon accounting protocols for carbon sequestration activities.
The International Carbon Sequestration Incentive Act does exactly
that by creating a collaborative and transparent process to develop
guidelines to ensure that carbon measurement and accounting issues are
properly addressed. Similar efforts should be developed for domestic
sequestration activities on American farmland and forestland.
I would also encourage this committee to think more broadly about
legislative efforts to spur a greenhouse gas emissions trading market.
President Bush's reversal with respect to capping carbon dioxide
emissions from power plants and his abandonment of the Kyoto Process
has put the establishment of such an emissions trading market on hold.
Ultimately, there can be no market without a cap on greenhouse gas
emissions. Environmental Defense will continue to advocate for such a
cap domestically and internationally.
In the meantime, however, in anticipation of regulation of
greenhouse gas emissions, the Congress can take steps to encourage
voluntary greenhouse gas emissions reductions right away. For example,
Congress should consider establishing an inter-agency process to
establish criteria for accrediting private, third party greenhouse gas
registries. These registries could, in turn, certify greenhouse gas
reductions undertaken voluntarily by companies. With respect to carbon
sequestration activities, such an approach would promote the
development of robust carbon accounting systems.
In conclusion, carbon sequestration projects in conjunction with a
greenhouse gas cap and trade market have the potential to provide a
cost-effective strategy for addressing climate change while at the same
time producing significant ancillary environmental benefits.
Senator Brownback. Thank you, Mr. Bonnie.
I have a series of questions. First I would like to know--
Mr. Coda, you have got several of these projects under way
right now. Are there others that are in the planning or drawing
board stages?
Mr. Coda. Yes, we have about seven projects that we have
done feasibility studies on and that we have got ready to go
and that we are hoping to find investors for.
Senator Brownback. Are all of these in tropical forest
regions?
Mr. Coda. Those seven I referred to are. I should also
mention that we are putting the same kinds of feasibility
studies together for projects in the United States as well.
Senator Brownback. Are they of the same scale as your
Bolivia project, the two million additional acres?
Mr. Coda. I am afraid we are never going to find that scale
again. But they are going to be large-scale projects, on the
order of 30, 40,000 acres in the tropics, less so in the U.S.
where land is more expensive.
Senator Brownback. The one I visited in Brazil, I believe
you were at--I thought it was like 75,000 hectares that you
were at, which would be, this was up near 200,000 acres.
Mr. Coda. I think that is a little high. I think it was
about 35.
Mr. Heydlauff. 20,000 hectares.
Senator Brownback. 20,000 hectares. Well, that would be
several hundred thousand acres.
Mr. Coda. We have been able to expand the project. There
are other investors who have come in with additional funding in
the same general area, so we are now going to be able to expand
the project, I hope, to around 75,000 acres when that is done.
Senator Brownback. How much can you do these on a per-acre
basis? This is an incredible project in Bolivia, that you were
able to save that much land for that kind of price. But taking
it from what your statement is here, that was an unusual
project.
Mr. Coda. Yes. I do not know. I am going to have to get
back. I normally think in terms of dollars per ton of carbon. I
do not know that I think in terms of dollars per acre.
Senator Brownback. How much can you do it on a dollars per
ton of carbon?
Mr. Coda. We can do all these projects in the less than ten
dollars range and some significantly less than that, which is--
when people modeled the Kyoto Protocol, for example, and said
what would carbon trade at under that, they typically came up
with estimates between 25 and $200 a ton. If you ever had a cap
and trading system and included carbon sequestration, it would
substantially reduce the cost of the program in my opinion.
Senator Brownback. Because you are currently doing it for,
you are saying, about ten dollars a ton?
Mr. Coda. Yes.
Senator Brownback. Dr. Kimble, what would your projections
be of adjusting cropping practices in the U.S. and the cost per
ton of being able to do that, or the value per ton if you did
changes in cropping practices in the U.S. for a carbon type of
cap and trade market? Get the microphone if you could there.
Dr. Kimble. I do not think there would be a lot of cost
involved, because most of what they are doing in agriculture is
actually better farming practices for them: going to no-till,
is at present, a cost but as they are reducing their inputs
this will offset the cost. So it is just building on what is
ongoing. The cost per ton, if you talk to farmers, they talk in
the range of $10 to $20 an acre before they will start looking
at it. We pay not that much more than that for CRP land that
has gone out of production. I do not know what the average is,
$40, $50 a ton--I mean, an acre.
So in the range of $10 to $20 a ton, I think farmers would
come on board, because they see it as a co-benefit to what they
are going to do anyway because it is beneficial to them to
switch to no-till because they save fuel and energy.
Senator Brownback. So you think a market would be activated
in the U.S. for farmers to fix and to do cropping practices
that fix carbon at the $10 to $20 per ton?
Dr. Kimble. That is, when you talk to farmers, what they
say. As you said, people estimate much higher values, but that
is the number you hear when you are out with farm groups
talking with them and they would start looking at it. They have
been doing some--GEMCO, the Canadian consortium, has been
working in Iowa and trying to get there, and they are talking
three or four dollars a ton and not many farmers look at that
range.
Senator Brownback. There is measurement cost with doing
this. How much would be the measurement cost to be certain that
if somebody is buying a ton of carbon that they are getting a
ton of carbon?
Dr. Kimble. I think John covered the measurement cost. It
is going out and sampling in soils. To me again, a lot of
that--we do two million samples a year for fertility
measurements, where they spend several billion dollars putting
fertilizer on the land. We build into that--on the larger
scales, we can build into that carbon measurements and use them
without doing extra sampling.
So you are paying a couple dollars a sample. If you have
got a lot of fields, you are paying quite a bit. Again, it is
tied into ongoing programs that they are doing because they
want to know how much fertilizer to put on, so you just measure
carbon with it.
Senator Brownback. So you do not anticipate a high
measurement cost, then, on soils in the U.S. if they went into
carbon farming type systems, farmers here?
Dr. Kimble. No. It is a little more complicated than
measuring a tree, where you can go out and measure, because you
have to go out and actually do field samples and send it back
to a lab, or with some of the equipment that they are working
on which allows you to go out and do direct measurements in the
field, which would reduce the cost to pennies really for making
a carbon measurement, when this new equipment DOE and others
are working on comes on line.
Senator Brownback. Mr. Heydlauff, American Electric Power
is the largest user of coal domestically, the third largest, I
think you said, of natural gas. We are looking here in the
Congress at a major energy strategy and the need to build
additional electric power generating units. Nuclear is a
possibility, expensive in construction and there are a lot of
questions.
Coal is the most likely source for additional power
generating, a major carbon emitter. There may be different
technologies coming along. Maybe biomass can be burned. I am
hearing about some carbon storing systems right out the pipe at
the plant. But absent those--or maybe you should talk a little
bit about those--will AEP look at additional coal-fired plants
in the United States if we go on a major building program of
electric power generating units, and what would be the company
and-or the industry's philosophy about a cap and trade type of
system if we build, encourage additional building of electric
power generating plants, particularly coal-fired ones, in the
United States?
Mr. Heydlauff. First of all, I think you can rest assured
that if we do build new generation some of it will likely be
coal in the future, and it may not be too long before you hear
an announcement of that type from us. We have 250 years' coal
supply in the ground. It is the most valuable energy source
that we have in this country today, and it would be foolhardy
for any of us to suggest that we should not continue to use it.
We have to use it in an environmentally friendly and
acceptable manner, however. A couple of things that we think
are important. One is that we have got to develop this new
generation of clean coal technologies that the President is
hoping to stimulate with his $2 billion development program, so
that we will have technologies to replace the current
generation of coal-fired power plants that are a lot more
efficient and less carbon-intensive as a result in converting
coal to kilowatt hours.
One of the other things that we are looking at, we have
been one of the leaders in the industry at doing research on
what we call carbon capture and storage or use, where you
literally are going to try to capture the carbon dioxide
emissions from the flue gas stream post-combustion and then
either use it for enhanced oil and gas recovery if there is a
market for it--and there is a fair amount of that being done
today, but it is relatively limited--or permanently dispose of
it in an ecologically sound manner, probably deep underground,
either in abandoned oil and gas wells and old coal mines or
probably in saline aquifers deep under the ground, where it can
be permanently stored without any ecological impacts.
In terms of cap and trade, the acceptability of cap and
trade programs to us will rest entirely on how you design the
system. If you give us complete flexibility to offset emissions
from new generation, literally the ability to go anywhere in
the world, wherever it is legitimate and verifiable, to reduce
emissions wherever we can do so at the lowest possible cost,
then it is not as objectionable. If you try to require us to
live within a cap within the sector, within the company, you
are going to force energy policy changes that you are not going
to like.
There is really only one way we can significantly reduce
carbon dioxide emissions on system and that is the conversion
of coal-fired generation to natural gas, either directly at the
existing plants or the forced retirement of those plants and
replace it with natural gas generation or renewables, and that
would substantially drive up the cost of complying with a cap
and trade regime.
We would hope--what we are talking about today in terms of
carbon sequestration is just a policy we ought to have in our
tool kit. But please understand, while I think there is a lot
of potential there, it is not going to solve the problem of
ultimately stabilizing atmospheric concentrations of greenhouse
gas emissions. There is no silver bullet.
It is truly the greatest challenge I think the world has
ever faced and it will only be solved ultimately through new
technology, a literal change in the energy infrastructure of
the world. That is going to take time and a lot of it. It is
time we get about it. I do not think we can wait a long time to
begin making the necessary investments in the new generation of
energy technologies.
But the sensible path is to await the economic retirement
of existing generation and replacement of that generation with
revolutionary new technologies that are far more efficient and
less carbon-intensive than what we currently have available
today.
Senator Brownback. So Dale, if we do expand electric
generating near-term, you would anticipate that coal would be a
major part of that? You from your company would look at that.
But you do not have a particular objection to a cap and trade
if you are given flexibility on where you can derive or locate
those carbon credits. Am I understanding you correctly?
Mr. Heydlauff. Yes, you are.
Senator Brownback. Good.
Mr. Bonnie, does your organization have any thoughts on, if
there's expanded electric generating using coal, requirements
on cap and trade, that type of system?
Mr. Bonnie. I think ultimately our biggest concern is
Environmental Defense believes we need a cap on greenhouse gas
emissions and we need it very soon. In order to stabilize the
greenhouse gas concentrations at appropriate levels and at safe
levels, we need to get started sooner rather than later.
Ultimately, if we have a cap and we have flexibility, we
can allow the market to choose coal versus gas versus other
appropriate technologies, and we can begin to create the market
incentives for the development of the technology that Dale is
talking about, and the price signal that is generated through
the market for tons of greenhouse gas emissions credit will
drive that technology.
Now, like most environmental groups, to us clean coal is a
bit of an oxymoron. But we recognize that if we can set the
standards appropriately for greenhouse gas emissions credits
and we can begin the transformation through the market of these
new types of technology and new ways of providing electricity
and do it cost-effectively--and cost-effectively is not--cost
matters not just for utilities. It also matters to the
environment, because if you believe, like we do, that the
amount of greenhouse gas emissions reductions that we have to
make are significant, then the more expensive it is the harder
it is going to be for us to be able to make those reductions.
So cost matters and it matters for society at large, but it
also very much matters to the environment. So ultimately, when
we look at the problem and we think about development of new
power plants and those types of things, our greatest interest
is in capping greenhouse gas emissions and getting a handle on
that problem and allowing the market--a properly structured
market, I should say--to really drive the type of innovation
and technology that we need to stabilize the climate.
Senator Brownback. To anybody on the panel: What
legislative or regulatory change would you most desire that you
think is most necessary at this point in time for us to move
forward in encouraging these sorts of carbon sequestration,
carbon trading type of programs, to try to reduce carbon on a
least cost basis? What would you advocate from the Congress for
us to do?
[No response.]
Senator Brownback. It is either a great question or a
terrible question.
Mr. Heydlauff. I will take the first crack with a very
simple response, and that is: Pass your bill, pass the
legislation of Senator Wyden.
Senator Brownback. Great answer, great answer.
Mr. Heydlauff. Truthfully, as you know, the world is mired
in a great debate today about the extent to which we ought to
credit carbon sequestration activities under the Kyoto Protocol
or whatever. I am sure even if the Kyoto Protocol should be
replaced with some other instrument they are still going to
have this debate about how much of the expansion in the
terrestrial ecosystem we ought to get credit for.
My answer to that is every bit of it that is legitimate and
verifiable. It does not matter where in the atmosphere the
emission reduction occurs. The atmosphere will realize that
benefit through whatever activity actually reduces emissions or
absorbs it.
But in terms of what you could do, one of the things--Mike
does not like to hear this; I have told him this before. We
spend a lot of money between the two projects. We have spent
probably $6 million now with some of the additional money we
have invested in the Bolivia project. We have $5.5 million in
the Brazil project. We have got probably $2.5 to $3 million at
least in domestic reforestation and enhanced carbon management
in existing forest lands that we own. We are about to announce
another project which was another $6 million.
But there comes a point in time when the board of directors
says: Enough is enough; there is only so much capital we are
going to put at risk here on speculative ventures until we know
that we are actually going to get credit for it.
In the previous Congress, Senator Chafee and Senator
Leiberman had introduced legislation that would have given
credit for early action before you had any legal obligation to
control emissions, but if you took things and it was verified
you could bank it, in essence, and apply it toward any future
compliance obligation you might have. We still think that
concept has a lot of merit.
Mr. Coda. If I could add, if I could add just to that one
thing in particular. It is a small thing, but it is something
that could be done very quickly, and it is referenced in
Senator Wyden's bill as well as your own, is to really
strengthen these voluntary programs that are currently on the
books, the 1605[b] program and the international joint
implementation program, both of which are very weak and have
virtually no standards currently.
It would at least provide some guidance to organizations
like our own that are trying to move forward with projects in
this area to have those programs be a little more substantial.
Senator Brownback. Good. Anybody else? Mr. Bonnie?
Mr. Bonnie. I guess in a perfect world we would like to see
ratification of the Kyoto Protocol with good rules and flexible
mechanisms, but recognize that that is certainly off the table,
at least for the moment. The four pollutant bill, we would like
to see that as well, with a cap on CO2 emissions from
utilities. That appears to be off the table at the moment as
well.
But I think, following up with what both Dale and Mike have
said, I think there are ways through the type of legislation
that the two of you are examining, through promoting carbon
sequestration both internationally and domestically, I think
that this is an important step. I think it is vital that we
begin developing the accounting mechanisms now. We need to
learn by doing. So I think that is one part of what we need to
do.
In addition, I think we need to think more broadly beyond
carbon sequestration and look to ways to begin to normalize
carbon accounting or create some guidelines for carbon
accounting, so that the AEP's of the world and others have some
certainty with respect to when they make investments in
greenhouse gas emissions reduction activities that they have
some certainty that the rules they are playing by will be
honored, they will be honored by subsequent regulatory
frameworks.
So I think that is another area, sort of backing up what
Dale has said and what Mike has said is an area that we really
should look at.
Senator Brownback. Good.
Senator Wyden.
STATEMENT OF HON. RON WYDEN,
U.S. SENATOR FROM OREGON
Senator Wyden. Thank you, Mr. Chairman. Mr. Chairman, I
want to commend you both for your very excellent bills and for
holding this hearing. I think it is very timely, and I really
look forward, as we have on a variety of occasions and
subjects, to working closely with you.
Senator Brownback. Thank you.
Senator Wyden. I think we can get this done.
Gentlemen, I am sorry I missed your testimony. I just have
a couple of questions at this point. I think what has
interested the Chairman and I is that sensible forestry might
be a quarter of the solution to this problem. It is certainly
not going to be the entire solution. You cannot walk around and
say because you manage the forests well you are going to have
no more problems with respect to global climate change. But to
be able to handle a quarter of the problem, perhaps in a way
that brings together industry and the environment, in a way
that is cost-effective, costing between $2 and $20 per ton to
store carbon in trees and soil, with alternative strategies
involving emissions reductions costing up to $100 per ton,
certainly is the kind of thing, in my view, that ought to be
pursued.
I think it is fair to say that there is no plausible
scientific deniability about the human contribution to climate
change and it seems to me that with carbon sequestration what
the Chairman and I are trying to do of get beyond this blame
game in this discussion and come up with a science-based,
credible, economically-balanced and bipartisan approach.
So, I just have a couple of questions, in hopes that we can
continue to move in that vein. May I start with you, Mr.
Bonnie. In your view, what effects do you believe that
crediting of carbon sequestration activities would have with
respect to ongoing forest activities in States like Oregon
where forests are obviously an important resource?
Mr. Bonnie. Well, I think certainly Mike referred to this
in his testimony, but by creating a value for carbon you have
given forest landowners another asset which they have, which
when they examine what they want to do with their land they
will essentially have something else they can sell. If they
have marginal agricultural land, that means there is a value to
reforesting that land.
One of the problems with reforestation is that if you
reforest your land often there is not a payback for many, many
years. That is certainly true with douglas fir in Oregon and it
is true with other species, even faster growing species in the
Southeast. Carbon crediting potentially gives you the ability
to pay for reforestation almost immediately and begin to get
some return on your investment.
So from a landowner's standpoint that is very appealing. It
also is going to potentially create value for conservation, for
improved forest management, for protection of wider streamside
buffers--all types of things that from a sustainability
standpoint we would like to do, and it is just by giving carbon
sequestration a value in the market.
This all, of course, depends on us developing a crediting
system which assures not only the environmental co-benefits,
but atmospheric benefits as well. That is something that I
think we really need to push forward to do.
Senator Wyden. Dr. Kimble, maybe a question for you and Mr.
Bonnie. In your view, what is the role of government in
normalizing carbon sequestration standards?
Dr. Kimble. What was the last?
Senator Wyden. What is the role of government in
normalizing carbon sequestration standards?
Dr. Kimble. I do not think we can--our agency, just
speaking for my own opinion there, we cannot go out and do all
the measuring. I think we can set the standards, the
techniques, the methodology that can be used for people to go
out and measure carbon changes, and then the private industry
will pick it up.
In other words, you set the standards, how to use soil
maps, how to use these different techniques that we have,
remote sensing, and put it together and develop the standards.
I think our role is to provide guidance to people and companies
who want to go into it and trade so it becomes a free market
thing, but we give them the guidance on how to do it.
Senator Wyden. Mr. Bonnie, do you want to add anything to
that?
Mr. Bonnie. I think there is a parallel with, on the forest
side, with the Forest Stewardship Council. The Forest
Stewardship Council is an organization which accredits
certifiers of sustainable forestry. I use that because I think
there is potentially a role for government doing the same
thing. It is not clear to me that if we were to have--that
government should have the sole role of actually verifying and
making sure that all carbon credits are indeed legitimate. But
perhaps government can create the standards whereby third party
verification groups--and we are beginning to see a lot of
private firms getting interested in acting as third party
verifiers of greenhouse gas emissions credits.
Government may have a role in creating some guidelines
whereby those firms can begin to work with project proponents
to verify greenhouse gas emissions reductions, and do it in a
transparent way. I think government can help make that happen.
Senator Wyden. One other question for you, Dr. Kimble. With
respect to your published works, it is very clear that you have
a lot of experience in this. You have written on it and been
out in the field looking at measuring and monitoring systems
for carbon in soils and crops. Do you have any questions about
whether this is just theory or is this on the level?
Our sense is that there is now a growing body of evidence
that shows that sequestration can make a very real difference.
I would be interested in having, for the record, your
assessment of how much of this is really capable of getting
done with respect to sequestration and how much of it is just
theory, in your view?
Dr. Kimble. I think we have gone by the theory. That is
what we spent the last 8 or 10 years developing books to get
the science base down. We know we can sequester carbon. We
mined it like we mine coal. The difference between it and coal
and gas is it is a renewable resource. We have lost large
amounts of carbon through different farming practices over the
years, clearing forests, whatever. So maybe 50 percent of our
cropland carbon has been lost, so we can put it back. So it is
a very large pool that can be replaced, which has many
environmental benefits.
Farmers are seeing this themselves. The no-tillers are
seeing that they use less fertilizers, they use less energy in
their fields, so it has got all these benefits there. So to me
it is well beyond science and it is something we can do and
probably need to do.
Senator Wyden. I thank all of you. As you know, Senator
Craig and I on the Forestry Subcommittee on the Energy
Committee have spent a lot of time on this issue. I think the
Chairman has some very good bills. If you will help us and keep
pushing, I think the opportunity is now. I think the Congress
wants to work in a bipartisan way and really get something done
here.
So I appreciate all the work that you have done. I think a
lot of you have camped out with Senator Craig and I in trying
to write our bill. I think Sam's bills are very helpful. We
look forward to working with you and sending something to the
President.
Senator Brownback. Good. Thank you very much, Senator
Wyden.
I thank the panel members. Is there anything anybody
additional wanted to add? John?
Mr. Kadyszewski. I wanted to comment on an important role
that the government has played in the measurement systems, and
I think it is going to be an important role in the future. Part
of the--and it is not so much on the definition of what method
to use as it is in the background data collection that takes
place as part of the Forest Service and the NRCS ongoing
measurement and monitoring of soils and forests.
For us, the ability to achieve low measurement costs is a
function of how well-measured and how classified the existing
land system is in the U.S. So I can produce accurate
measurements at a lower cost in the United States than I can in
other countries because of the existence of this very excellent
set of background data. I think that there has been changes now
announced both by the Forest Service and the NRCS in terms of
how they are going--they are going to regularize, they are
putting on a 5-year rotation basis the surveys that are going
to be done in the United States and they are going to allow
easier access to that data so that you can interpolate and make
these measurements.
This will push costs down on measurement. But I think an
extension of this is most other countries do not have such
measurement systems. So when we go in to do measurements in a
country like Bolivia, we have to create more of that from
scratch and it raises measurement costs. So I think there is a
role by example of the way that the systems are run in the
United States to create leadership in terms of that arena and
method.
I also think here in the United States we have a much
stronger digital data set. The methods that I talked about
today focused on ground-based measurements, but what has
happened in the last 2 years in our work, there has been a
revolution in the availability of digital data. So we see the,
whereas there are concerns today within the environmental
community about things like leakage and the spillover effects
from these projects, I believe that within the next 10 to 20
years we will have such well-done inventories on a global basis
that we will be able to measure those effects without great
cost and reduce the concerns.
So I think in this area, because we are the technical
leaders on many of these technologies, there is a role for the
government to play in making sure this gets worked out. This
goes to the point of the integrity to me of the measurement and
accounting system is a very critical element in making this
work tradable.
The question you asked on costs: We have been under 25
cents a ton. This is carbon that we are talking about being
sold at $10 a ton for forestry systems. For agricultural soil
systems, our estimates are that it will probably be closer to a
dollar a ton. But we could push those soil costs down, one,
with the new inventory data that is going to be available from
the NRCS within 10 years. I say within 10 years; they are going
to introduce it now, but it will take them a cycle or two of
data collection to make it as valuable as it will be.
But then second, the technique that Dr. Kimble mentioned
for new precision farming now, where on your tractor you have
got a sampler that does a nutrient analysis, and some of the
work being done that he referred to at Los Alamos where you
could mount a carbon sampler on that same tractor and take
hundreds of measurements. This is going to narrow the bands and
make carbon soil measurements come down into the same area as
forest soil measurements.
So I think that the sort of pioneering work there is
important, and maybe from my perspective more important than
trying to specify the methods and procedures. Markets, if you
look at the stock market, say, they create ways to value
commodities and sell futures and arbitrage and insure and re-
insure, and they will do better on the certification,
verification, when it is tied to the money and sales. They do
not do so well at creating the environment, which is why you
have other people involved.
Senator Brownback. Good thoughts. Excellent thoughts.
This is an exciting panel, an exciting topic, from the
standpoint that for years we have looked at it, with a kind of
hand-wringing: What will we do? We are getting all this
destruction of forests? We need to have more investment, in
some cases from the Northern Hemisphere to the Southern
Hemisphere. Here is a way, a project, a means of being able to
do this in an exciting way and, Mr. Coda and your organization,
being able to do things that you have dreamed of before, but
have not had the wherewithal to do it. And other groups are
saying, this is a good project.
It values a forest for being a forest, not just for what
you can extract out of the forest, which is another exciting
part of the project, and to me as well, coming from an
agricultural community and background, the idea that we could
buildup the soils and that this is not only good for the
atmosphere, it is good for the soils, has a sort of overall
positive atmosphere to the whole thing that I think should make
for a doable project. Hopefully we will be able to move this
legislation on forward.
One thing I might note at the end of this, too, is that if
we look at more electric power generating in this country--and
we need to--I think the business community is going to need to
have certainty as to what is going to be the cost of dealing
with CO2 emissions from this. My guess is if you are looking at
more plants, the financial community is going to be asking: OK,
how are you going to deal with the carbon issue here? You may
not be regulated now, but we would anticipate you are going to
have some sort of capped regime in the future, and therefore
how are you going to deal with this? So that the business
community needs some form of certainty as to how this is going
to be dealt with, and we can help, I think in a great way, to
accommodate that.
I look forward to working with you more, hopefully, on
moving this legislation and project on forward. Thank you all
very much for coming.
The hearing is adjourned.
[Whereupon, at 3:55 p.m., the Subcommittee was adjourned.]