Feast and famine as food prices soar
Getting microfinance to the farmers
With land-use activities contributing up to one-third of global greenhouse gas emissions, the potential for emission reduction and carbon credit generating projects from agriculture is significant. Development of many potential projects, however, is being held back by technical problems and by their exclusion from the European Environmental Trading Scheme and the Clean Development Mechanism of the Kyoto Protocol, leaving only limited demand from the much smaller voluntary market.
Out of a total of 974 projects currently registered by UNFCCC, 339 registered projects – over a third of the total – are either undertaken in agriculture and forestry sectors directly or focus on a renewable energy process in agro-industry. These 339 projects, mainly methane capture from animal waste, are expected to generate annually 16,240,000 CERs, or slightly more than 8% of the 197,113,607 CERs generated annually by all CDM projects until 2012.
Methane capture from animal waste projects, which involves collecting manure and putting it into a biodigestor to release methane gas that is then either filtered and burnt or used to generate electricity, have, however, not performed as well as project developers had hoped. One developer, Agcert, even went bankrupt after its projects failed to produce as many credits as expected.
There are, however, other types of agricultural projects that have significant greenhouse gas reduction potential and that could benefit farmers in less-developed countries that are not being explored because of their exclusion from the main sources of demand for carbon credits, the ETS and CDM.
New rice field irrigation techniques, for example, have the potential to significantly reduce methane emissions from rice farming, while simply switching from chemical to organic fertilizers could also make a big impact, as the nitrous oxide released from chemical fertilizers has a global warming effect 400 times greater than that of carbon dioxide. Methane released from organic fertilizers, by contrast, has a global warming effect “just” 21 times greater.
“The CDM hasn’t really been designed to incorporate emission reductions from agriculture,” says William Greene, senior analyst at carbon markets consultancy Point Carbon in Oslo. “This is partly because of the wide project boundaries but also due to technical and methodological issues. There is also a lack of demand for credits from land use change and forestry because the EU ETS, the biggest importer of credits, doesn’t allow any forestry or land-use change credits whatsoever. Organizations such as the FAO, however, would like to see such projects included in the CDM scheme in any successor to Kyoto.”
