Carbon Pricing Can Help Save Forests––and the Climate––Analysis Says

While some caution a tax on carbon won't fix everything, new research shows it can significantly slow deforestation.

Aug 27, 2015
Deforestation, particularly in the tropics, is a huge climate problem.

Deforestation, particularly in the tropics, is a major climate change issue. Credit: Rainforest Action Network, via Flickr

Deforestation will cost the Earth an India-sized patch of forest by mid-century––a crippling blow to the climate––but carbon pricing could halve the loss, according to a new study.

A comprehensive new analysis of satellite imagery and land use practices across 101 countries shows that one-seventh of the world's tropical forests will be lost over the next 35 years, an area equal to roughly one-third of the United States.

Such a tremendous loss of forests and the burning of the carbon they contain would hasten global warming significantly. The loss, however, could be cut nearly in half by placing a price on carbon that pays landowners to keep their forests intact.

"Stopping deforestation won't on its own stop climate change," said the study's lead author, Jonah Busch, a research fellow at the Center for Global Development. "But if you try to stop climate change without stopping deforestation, it's going to be much more expensive and harder to get there than if you take advantage of this big and cheap source."

Busch and colleague Jens Engelmann analyzed detailed satellite imagery of recent deforestation across the tropics. They then considered factors that might affect the rate of loss, such as how remote the land is, whether it is inside a national park, or  how valuable the land is for agriculture.

"When agricultural prices are high, people clear more forest and when they are low they clear less forest," Busch said. "We took that and inferred if there were carbon prices, if there was a value on standing forests and not on clearing forest for soy or cattle, how would those carbon prices affect deforestation."

Busch and Engelman conclude that without a global price on carbon, current trends will produce 169 billion metric tons of carbon dioxide emitted into the atmosphere in the next 35 years through the burning and clearing of forests. The figure is equal to the continuous emissions of 1,268 coal-fired power plants over the same period, or one-sixth of the remaining carbon that we can emit to keep the Earth's temperature from increasing by more than 2 degrees C.

A carbon pricing scheme in which countries or corporations could pay landowners in the tropics to keep their forests intact could significantly reduce deforestation. At $50 per metric ton of CO2, the rate would be cut nearly in half, eliminating 77 billion metric tons of the anticipated 169 billion metric tons of C02 emissions.

Busch says the cost of carbon reductions through such a carbon-trading scheme would be roughly one-fifth the cost of reducing emissions from things like smokestacks and automobile tailpipes. He hopes this will be considered at the United Nations Climate Change Conference that aims to produce a global climate treaty later this year.

"Going into Paris in 2015, the countries of the world are coming together trying to find solutions and we confirm that the tropical forests offer a large and cheap climate solution," Busch said.

Michael Wolosin, a managing director of Climate Advisers, a Washington D.C.-based consulting firm specializing in climate change policy, is friends with Busch and provided feedback on the paper prior to publication. He praised many of the study's findings but said carbon pricing is not the best way to stop deforestation.

"Most countries are implementing low-emission development strategies through national policies, through land use planning, through spatial planning, through better enforcement and mapping, through indigenous rights and through other mechanisms, not through carbon pricing," Wolosin said. "The actual cost of reducing emissions by stopping deforestation will be much lower because national governments have many tools at their disposal other than simply paying landowners to keep forests standing."

Pipa Elias, a senior policy advisor at The Nature Conservancy agrees that additional measures need to be taken but adds that carbon pricing can bring large amounts of money from foreign countries and corporations for forest conservation in the tropics. A price on carbon would allow forest protection to occur on a much larger scale and play an important and rapid role in climate change mitigation, Elias said.

"There is almost no way and probably no economically feasible way that we can address climate change if we don't stop those emissions from happening," she said. "[And] it's something that we can do immediately. It's not something that needs a long transition like changing our transportation system or putting in new sources of power."

If deforestation can be stopped and reforestation can occur, forests can be a "double solution" in combating climate change, Elias said. The Nature Conservancy estimates that reforestation could contribute an additional 1.4 billion metric tons of C02 per year in climate change mitigation by sequestering carbon. Over a 35-year period, that would equal 49 billion metric tons of  CO2, approximately two-thirds of the amount that could be saved through a $50 per metric ton price on carbon over the same time period.

"Right now forests are globally contributing to climate change," Elias said. "We envision a world where they stop contributing and even start sequestering."

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