Commentary RESEARCH

Nature-based emissions reduction

Aria

2024-03-27 12:00

LIU CHANGYU and ZHOU TAIDONG
China Daily

Innovative solutions are required to protect, restore and sustainably manage carbon sinks and reservoirs

In 2023, COP28 reached the UAE Consensus that encourages the use of nature-based solutions and other methods to mitigate the impact of climate change on ecosystems and biodiversity. Nature-based solutions are considered to be an effective means of offsetting carbon emissions through protection, restoration and sustainable management of carbon sinks and reservoirs. It is estimated that by 2030, the implementation of nature-based solutions in all ecosystems could remove at least 5 billion to 11.7 billion tons of carbon dioxide equivalent per year.

Major countries and regions are taking action to include nature-based solutions in their national climate strategies and policy tools, including establishing a variety of voluntary emissions reduction trading mechanisms to promote the quantitative certification and trading of carbon sinks. By estimation, the global voluntary carbon market, a tool of mobilizing private sector finance toward nature-based solutions, will provide trading allowances of 2.6 billion tons of CO2 equivalent per year, as more and more multinational corporations take part in nature-based solutions programs and investment. In 2022, the total annual funds flowing to nature-based solutions reached $200 billion, a year-on-year increase of 11 percent, of which public finance accounted for 82 percent and private financing accounted for 18 percent. At the same time, every $1 million invested in nature-based solutions will create up to 40 jobs, which is almost 10 times the employment opportunities provided by an equal amount invested in fossil fuels.

China has made positive progress in improving the function of carbon sinks for decarbonization. Consolidating and enhancing the carbon sink capacity of ecosystems is listed as one of the top 10 actions for carbon peaking. Currently, the total volume of carbon reserves in China exceeds 10 billion tons. China has kept improving the national greenhouse gas voluntary market with the China Certified Emission Reduction program as the main body. Given the advantage of forest resources in promoting the ecological carbon sink function, China has focused on improving its forest carbon sink through increasing areas, reducing losses, and improving the quality. With "double growth" in both forest area and forest stock volume for 30 consecutive years, China has become the country with the fastest and largest growth in forest resources in the world.

China has also promoted the integrated protection and restoration of mountains, rivers, forests, farmlands, lakes, grass and sand, and has created a large number of integral practices with ecological, economic and social benefits. The Saihanba Forest Farm, the world's largest artificial forest, releases 598,400 tons of oxygen and absorbs 860,300 tons of CO2, serving as an important ecological barrier. At the same time, the Saihanba National Forest Park receives 500,000 tourists every year, directly provides about 15,000 temporary jobs, drives the development of local tourism and generates a gross community income. On the international front, China has actively cooperated with the global community to create demonstration cases for the world and jointly promote the mainstreaming of nature-based solutions. In 2023, the Ministry of Natural Resources of China and the International Union for Conservation of Nature signed an agreement to co-establish the nature-based solutions Asian Hub, aiming to pursue sustainable development and ecological civilization through nature-based solutions research, practices and cooperation.

Nevertheless, China faces many challenges in developing carbon sinks. These include limited land area and high cost for afforestation, insufficient standards and monitoring methods, and inadequate institutional regulations and financial inputs. Going forward, China can consolidate and improve its carbon sink capacity in three aspects to better achieve its carbon peaking and net-zero goals.

First, China can optimize natural resource management policies and motivate business entities with regard to their production and operations related to natural resources. Priority can be accorded to the carbon sink value of State-owned forests by improving the management system of State-owned forest farms, and promote the effective protection and scientific utilization of forests. China can deepen the reform of the collective forest rights system, clarify the ownership relationship between forest property rights and forestry carbon sink property rights, and set up a reasonable benefit-sharing mechanism for carbon sink trading. China can also optimize forest and grassland resource development policies, improve the management of forest harvesting, promote the moderate-scale management of forest land, improve the value realization mechanism of ecological products in the forest and grass industry, and improve sustainable operations. As part of the incentive mechanism, China can comprehensively increase scientific and technological support for the forest and grass industry, enhance forestry and grass industry mechanization, promote the development of large-diameter timber and high-quality grass, develop wood and bamboo processing, forestry biomass energy and other industries, and explore greater space for the diversified development of the forestry industry.

Second, China can improve the design of the carbon offset mechanism and create an internationally leading voluntary emissions reduction market. The first is to accelerate the standardization of ecosystem measuring, reporting and verification, apply satellite and other information technologies, improve regional-scale ground surveys, gradually align national ecological carbon sink accounting with international standards, and improve the credibility of the voluntary carbon credit market. The second is to strengthen the supervision and information disclosure of carbon sink projects, improve the disclosure standards for enterprises to participate in carbon offsets, strengthen the informatization of carbon sink projects, and introduce third-party assessment agencies to improve the transparency of the voluntary carbon market. The third is to encourage Belt and Road countries to jointly build a large-scale voluntary carbon market with high transparency and high liquidity, and to form a stable price mechanism and avoid potential market risks.

Third, China can fully mobilize non-governmental capital to support the investment and financing of ecological carbon sink projects. First, it can introduce fiscal and financial support policies by developing bonds, insurances and other green financial products and financial instruments related to forest and grass, and explore other models such as public-private partnerships. Second, the government can guide enterprises and financial institutions to improve relevant rules and standards by considering incorporating carbon credits into the net-zero goals of institutions, enriching the environmental, social and governance evaluation system, and reducing the financing for activities with a negative impact on nature. Third, international cooperation in green finance can be promoted to include more nature-based solutions projects in the green finance catalog, encourage developing countries to explore nature-based solutions paths and practices suited to their respective national conditions, and clarify the relationship between the participation of developed countries in nature-based solutions project investments and their responsibility to finance climate change mitigation.

Liu Changyu is an associate researcher at the Center for International Knowledge on Development. Zhou Taidong is vice-president of the Center for International Knowledge on Development. The authors contributed this article to China Watch, a think tank powered by China Daily.

 


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