This thesis investigates the question how emissions from land‐use displacement can be assessed and accounted for, using the example of carbon‐leakage accounting in the planned UNFCCC mechanism on ‘Reducing Emissions from Deforestation and Forest Degradation’ (REDD). REDD serves here as example of an international forest conservation policy that might be effective locally but could lead to displacement of deforestation to other countries. Although leakage processes within countries are initially considered, the focus of the thesis is on international displacement effects. The first part of the thesis reviews existing accounting methods for land‐use displacement from different research fields and assesses their usefulness to quantify carbon leakage from REDD. Results show that it is very difficult to assess policy‐induced (or strong) carbon leakage due to the requirement to demonstrate causal links between the policy in question and the observed land‐use changes, especially at international scale. Other accounting methods focus on demand‐driven (or weak) carbon leakage, by establishing a link between international demand and consumption patterns and land‐use changes as their  distant effects. Methods to quantify such teleconnections commonly combine land‐use accounting with tradeflow assessments to link international trade streams and consumption with environmental impacts such as land use or land‐use changes arising in the production of traded commodities. A methodological challenge is currently the quantification of emissions from land‐use change generated by distant linkages between production and consumption locations. Responding to this shortcoming, in the second part of the thesis a new method to assess these teleconnections is developed. The ‘land‐use change carbon footprint’ allows quantifying the extent to which landuse changes and associated emissions in a given country are promoted by the production of export goods, and thus are due to international demand for ‐ and consumption of ‐ forest‐risk commodities. The understanding of such distant deforestation drivers can be useful in several contexts, such as the design of conservation policies like REDD, which risk being less effective as globalized deforestation drivers pose a high risk for international leakages; or the planning of demand‐side measures that could complement supply‐side action in decreasing global deforestation levels. Demand‐side measures, such as zero‐deforestation embargos, regulations or certification schemes, could eventually contribute to decrease the risk for international land‐use displacement by addressing global consumption levels and commodity demand as one of the underlying driving forces of land‐use change and deforestation.

International agricultural trade flows are increasingly important as distant drivers in global land-use changes, creating teleconnections between geographically separated locations of consumption and production. Land-use displacement and associated carbon emissions can undermine the effectiveness of land-use and climate policies, such as activities to reduce emissions from deforestation and forest degradation (REDD). Nevertheless, few accounting methods exist for international emissions leakage from land-use change, due to methodological and policy challenges. In this paper we review methods to quantify international land-use displacement and teleconnections through international trade. Weaknesses and strengths of those methods are assessed as well as the conclusiveness of results. We identify limitations and potential ways forward for the quantification of land-related leakage in general, while highlighting implications for REDD-leakage accounting in particular. Results show that land-related leakage assessments are facilitated by applying a weak leakage definition, without the requirement to demonstrate causal leakage effects. Suitable quantification approaches combine method elements such as economic modeling, trade-flow analysis, biophysical accounting and life-cycle assessments. Depending on the use of monetary or physical input data the results can change considerably. All reviewed methods face limitations such as uncertainties and data gaps in emission factors

This paper assesses quantification methods for carbon leakage from forestry activities for their suitability in leakage accounting in a future Reducing Emissions from Deforestation and Forest Degradation (REDD) mechanism. To that end, we first conducted a literature review to identify specific pre-requisites for leakage assessment in REDD. We then analyzed a total of 34 quantification methods for leakage emissions from the Clean Development Mechanism (CDM), the Verified Carbon Standard (VCS), the Climate Action Reserve (CAR), the CarbonFix Standard (CFS), and from scientific literature sources. We screened these methods for the leakage aspects they address in terms of leakage type, tools used for quantification and the geographical scale covered. Results show that leakage methods can be grouped into nine main methodological approaches, six of which could fulfill the recommended REDD leakage requirements if approaches for primary and secondary leakage are combined. The majority of methods assessed, address either primary or secondary leakage; the former mostly on a local or regional and the latter on national scale. The VCS is found to be the only carbon accounting standard at present to fulfill all leakage quantification requisites in REDD. However, a lack of accounting methods was identified for international leakage, which was addressed by only two methods, both from scientific literature.

The second audit of Guyana’s progress under the Norway-Guyana REDD+ agreement was completed in December 2012. It found that seven out of ten verification indicators were not or only partially met. Nevertheless, the Norwegian government allocated additional funds of 45 million USD to Guyana due to “continued improvements”. Focali has written about the debated bilateral agreement between Norway and Guyana earlier (Focali Brief 2010:01 & 2011:01) and is now revisiting the process. 

Commercial agriculture producing for international markets is increasingly important in driving tropical deforestation and global land‐use change. The geographic separation of consumption and production locations through international trade creates distant links and feedback effects that can induce land clearing in some locations. Such indirect linkages, or teleconnections, are difficult to quantify in general, and particularly in the case of emissions from land‐use change. In this paper we quantify carbon emissions from land‐use changes arising from the expansion of agricultural production of soy and beef in Brazil and oil palm plantations in Indonesia, and trace export flows of these commodities to the consumer countries. We find a steady increase of emissions embodied in exports of both countries since 1990, indicating that export production is gaining importance as a driver of land clearing. In 2010, total emissions embodied in exports reached 89 MtCO2 for Brazil and 118 MtCO2 for Indonesia. The main consuming countries included the EU as main importer of all three commodities since the 1990s, and since the 2000s exports to emerging economies have been rising; mainly of soy to China; beef to Russia and China; and palm oil to India and Malaysia. Results advance the understanding of deforestation teleconnections and can contribute to the design of forest conservation policies or demand‐side policies that address global demand and consumption levels of forest‐risk commodities.

Production of commercial agricultural commodities for domestic and foreign markets is increasingly driving land clearing in tropical regions, creating links and feedback effects between geographically separated consumption and production locations. Such teleconnections are commonly studied through calculating consumption footprints and quantifying environmental impacts embodied in trade flows, e.g., virtual water and land, biomass, or greenhouse gas emissions. The extent to which land-use change (LUC) and associated carbon emissions are embodied in the production and export of agricultural commodities has been less studied. Here we quantify tropical deforestation area and carbon emissions from LUC induced by the production and the export of four commodities (beef, soybeans, palm oil, and wood products) in seven countries with high deforestation rates (Argentina, Bolivia, Brazil, Paraguay, Indonesia, Malaysia, and Papua New Guinea). We show that in the period 2000-2011, the production of the four analyzed commodities in our seven case countries was responsible for 40% of total tropical deforestation and resulting carbon losses. Over a third of these impacts was embodied in exports in 2011, up from a fifth in 2000. This trend highlights the growing influence of global markets in deforestation dynamics. Main flows of embodied LUC are Latin American beef and soybean exports to markets in Europe, China, the former Soviet bloc, the Middle East and Northern Africa, whereas embodied emission flows are dominated by Southeast Asian exports of palm oil and wood products to consumers in China, India and the rest of Asia, as well as to the European Union. Our findings illustrate the growing role that global consumers play in tropical LUC trajectories and highlight the need for demand-side policies covering whole supply chains. We also discuss the limitations of such demand-side measures and call for a combination of supply- and demand-side policies to effectively limit tropical deforestation, along with research into the interactions of different types of policy interventions.

P R E FACE

This CSPR briefing is a compilation of seven course papers written in an advanced level university course called "Climate science and policy" led by the Centre for Climate Science and Policy Research (CSPR) in Norrköping. Madelene Ostwald, assistant professor at the centre, was the course leader. The students are all from different backgrounds and took the course as a Single Subject Course.

The main examination in the course was to write a paper, assessing sustainable development and climate impacts for different Clean Development Mechanism (CDM) projects as well as to discuss this in relation to the methodological parameters in a CDM project; baseline, additionality, permanence, leakage and monitoring. The students chose themselves which project to assess as well as which aspects to focus on. Out of the seven assessed CDM projects, five are Afforestation/Reforestation projects, one of which is large-scale and the rest small-scale projects. Two biomass projects are also assessed, one small-scale and one large- scale.

The editor for this CSPR briefing has been Lina Lundgren with assistance from Sabine Henders and Madelene Ostwald.

IN T R O DU CT IO N

The United Nations Framework Convention on Climate Change (UNFCCC) was created in 1992 in order to address the threats of climate change. The main aim of the convention is to stabilize the concentration of greenhouse gases (GHG) in the atmosphere on a level where no dangerous interference with the climate system should occur. The Kyoto Protocol 4, created in 1997 during a UNFCCC parties meeting, sets binding targets for the identified Annex I 5 parties to reduce GHG emissions. Although emission targets are set in the Kyoto Protocol, it is up to each individual country to decide how the reduction should occur. As a supplement to national measures in reducing emissions three market-based mechanisms were established: Emissions Trading, The Clean Development Mechanism (CDM) and Joint Implementation (JI). The CDM focuses on projects in developing countries (see below for more details). These so-called flexible mechanisms were created to allow reducing emissions of GHGs in a cost efficient way, based on the assumption that one ton of emissions reduction has a global effect regardless of where it occurs - so it can be implemented where it is least expensive to reach the reduction (UNFCCC, 2008).

Several land-based policy options are discussed within the current quest for feasible climate change mit-igation options, among them the creation and conservation of forest carbon sinks through mechanismssuch as Reducing Emissions from Deforestation and Forest Degradation also called REDD+ and the substi-tution of fossil fuels through biofuels, as legislated in the EU Renewable Energy Directive. While those twopolicy processes face several methodological challenges, there is one issue that both processes encounter:the displacement of land use and the related emissions, which is referred to as carbon leakage in the con-text of emissions accounting, and indirect land-use change also called ILUC within the bioenergy realm.The debates surrounding carbon leakage and indirect land-use change issues run in parallel but are ratherisolated from each other, without much interaction. This paper analyzes the similarities and differences aswell as common challenges within these parallel debates by the use of peer-reviewed articles and reports,with a focus on approaches to address and methods to quantify emissions at national and internationalscale. The aim is to assess the potential to use synergies and learn from the two debates to optimizeclimate benefits. The results show that the similarities are many, while the differences between carbonleakage and ILUC are found in the actual commodity at stake and to some degree in the policy forumin which the debate is taken. The geographical scale, actors and parties involved also play a role. Bothprocesses operate under the same theoretical assumption and face the same problem of lacking methodsto quantify the emissions caused by international displacement. The approach to international displace-ment is one of the main differences; while US and EU biofuel policymakers acknowledge uncertainties inILUC accounting but strive to reduce them, the United Nations Framework Convention on Climate Changeexcludes accounting for international carbon leakage. Potential explanations behind these differences liein the liability issue and the underlying accounting principles of producer responsibility for carbon leak-age and consumer responsibility for ILUC. This is also reflected on the level of lobby activities, where ILUChas reached greater public and policy interest than carbon leakage. Finally, a possible way forward forinternational leakage accounting in future climate treaties could be the adoption of accounting methodstaking a consumer perspective, to be used alongside the existing set-up, which could improve climateintegrity of land-based policies.

This paper aims to improve our understanding of how and where global supply-chains linkconsumers of agricultural and forest commodities across the world to forest destruction in tropicalcountries. A better understanding of these linkages can help inform and support the design ofdemand-side interventions to reduce tropical deforestation. To that end, we map the link betweendeforestation for four commodities (beef, soybeans, palm oil, and wood products) in eight casecountries (Argentina, Bolivia, Brazil, Paraguay, Democratic Republic of the Congo, Indonesia,Malaysia, and Papua New Guinea) to consumption, through international trade. Although few,the studied countries comprise a large share of the internationally traded volumes of the analyzedcommodities: 83% of beef and 99% of soybean exports from Latin America, 97% of global palmoil exports, and roughly half of (official) tropical wood products trade. The analysis covers theperiod 2000-2009. We find that roughly a third of tropical deforestation and associated carbonemissions (3.9 Mha and 1.7 GtCO2) in 2009 can be attributed to our four case commodities in oureight case countries. On average a third of analyzed deforestation was embodied in agriculturalexports, mainly to the EU and China. However, in all countries but Bolivia and Brazil, exportmarkets are dominant drivers of forest clearing for our case commodities. If one excludes Brazilianbeef on average 57% of deforestation attributed to our case commodities was embodied in exports.The share of emissions that was embodied in exported commodities increased between 2000 and2009 for every country in our study except Bolivia and Malaysia.

The world’s agricultural system has come under increasing scrutiny recently as an important driver of global climate change, creating a demand for indicators that estimate the climatic impacts of agricultural commodities. Such carbon footprints (CFPs), however, have in most cases excluded emissions from land‐use change (LUC) and the proposed methodologies for including this significant emissions source suffer from different shortcomings. Here we propose a new methodology for calculating land‐use change carbon footprints (LUC‐CFPs) for agricultural commodities and illustrate this methodology by applying it to three of the most prominent agricultural commodities driving tropical deforestation: Brazilian beef and soybeans, and Indonesian palm oil. We estimate LUCCFPs in 2010 to be 66 tCO2/tCW for Brazilian beef, 0.9 tCO2/t for Brazilian soybeans, and 8.6 tCO2/t for Indonesian palm oil. The main advantage of the proposed methodology is its flexibility: it can be applied in a tiered approach, using detailed data where it is available while still allowing for estimation of LUC‐CFPs for a broad set of countries and agricultural commodities; it can be applied at different scales, estimating both national and sub‐national LUC‐CFPs; it can be adopted to account both for direct (proximate) and indirect drivers of LUC. It is argued that with an increasing commercialization and globalization of the drivers of land‐use change, LUC‐CFPs could help leverage the power needed to alter environmentally destructive land‐use practices within the global agricultural system by providing a tool for assessing the environmental impacts of production, thereby informing consumers about the impacts of consumption and incentivizing producers to become more environmentally responsible.