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EU: Emissions Trading Scheme

Volume 704: debated on Tuesday 7 October 2008

asked Her Majesty’s Government:

What steps they will take in the current European Union negotiations to include forest-based carbon credits from developing countries in the European Union’s Emissions Trading Scheme.

My Lords, the Government welcome the provision contained in the European Commission’s proposal for new crediting mechanisms, under an international agreement, which would give the flexibility to include credits from avoided deforestation and other land use activities in developing countries in future phases of the EU Emissions Trading Scheme from 2013.

My Lords, I thank the Minister for that encouraging reply. Given that today the Environment Committee of the European Union is meeting to vote on the inclusion of forest credits in the Emissions Trading Scheme, would a vote in favour by that committee encourage Her Majesty’s Government to respond positively to the President of Guyana, who has offered the entire rain forest of his country to the United Kingdom to help him sustain it in a manageable way?

My Lords, the right reverend Prelate is right about a vote today on the revision of the effort-sharing decision. On that matter, the UK supports the inclusion of land-use change and forestry from the non-traded sectors. I hope that I can answer him in the affirmative. On Guyana, the Eliasch review is relevant. There is a risk that conservation in one area might displace deforestation elsewhere, which is why we favour an international agreement. We remain in close touch with the Guyana Government. We have given them a grant of £100,000 to assess the cost of work on forestry conservation. We will continue to maintain relationships with them.

My Lords, bearing in mind that 18 per cent of greenhouse gas emissions are caused by deforestation and that forestry was excluded from the original Kyoto agreement because of the difficulties, I welcome the Government’s support for the EC amendment. Will the Government press further to ensure that forestry is included in all EC and international agreements? In saying that, I declare an interest as chair of the Forestry Commission.

My Lords, I very much take my noble friend’s comment on that. He is right that deforestation is a major problem in relation to the current challenge from climate change that countries of the world face. We will continue to move positively in that area. I would stress that we have to ensure that there is a robust methodology, that any scheme can be monitored effectively and that it does not have an undue impact on the stability of carbon prices.

My Lords, is it not generally accepted that deforestation in the tropics and sub-tropics contributes something between 18 per cent and 25 per cent of global carbon emissions? In those circumstances and in the light of the fact that deforestation continues apace due to the steady demand for timber, beef, soya and, now, biofuels, should we not be looking at this whole question afresh and putting a real value on forests as they stand in a format which can be traded?

My Lords, I note with great interest the comments of the noble Lord. The figure I have is that it is approximately 18 per cent of global CO2 emissions, so clearly this is a critical area. That is the importance of the agreement reached in Bali to go forward to the talks in Copenhagen next year in relation to deforestation which, it is hoped, will lead us on to a new international agreement. I am convinced that this needs to be tackled at the international level. We will do everything we can to ensure that that happens.

My Lords, the figure for CO2 emissions is in fact 25 per cent, with 18 per cent for greenhouse gases, so the issue is even more important. All sides of the House will see the importance of including forestry in the EU ETS, but is there not a risk that where forestry is used in voluntary offset schemes, there are no guarantees that the trees are ever planted or maintained? What will the Minister do to ensure that offset money is regulated and used properly to reduce greenhouse gas emissions?

My Lords, the noble Lord has asked an important question about the robustness of any methodology that is put in place. He will know that one of the reasons for deforestation not being included in previous agreements is that no such methodology was in place. As we go forward, it is essential that effective monitoring mechanisms are in place to ensure the robustness of any system that is agreed internationally.

My Lords, I congratulate the Minister on his new role—on both his portfolios and the deputy leadership of the House. I am sure that the whole House will wish him well in his roles. I hope that there will be a suitable opportunity to pay tribute to his predecessor, the noble Lord, Lord Rooker, for the remarkable role he has played in the life of the House.

Following on the Minister’s previous response, what representations have the Government made to ensure the environmental integrity of any system before it is introduced into the EU ETS scheme?

My Lords, I thank the noble Lord for his kind remarks. It is a great pleasure to move off the field of Lords reform into such an important area. My noble friend Lord Rooker is a formidable person to follow, and he has made a great contribution.

We understand that there is no point in going into an agreement to include deforestation either within the European scheme or internationally in the new global climate agreement unless we can be assured that the methodology is satisfactory and robust and can be monitored effectively.