Nations living over the limit sink their hopes into emissions trading

Everybody knows that trees sequester carbon, which is why they are of such interest to countries seeking to offset their carbon…

Everybody knows that trees sequester carbon, which is why they are of such interest to countries seeking to offset their carbon-dioxide emissions from burning fossil fuels by planting more forests.

The theory is that if a tonne of carbon is stored in a tree and hence removed from the atmosphere, then a country could add a tonne of carbon to its emissions. It's a form of accounting that is permitted by the Kyoto Protocol.

Liberally using trees as "sinks" for carbon dioxide, in climate-change parlance, is one of the more contentious issues at this week's Bonn summit. The Australians, for example, want to define a tree as any plant higher than 25 centimetres.

Unfortunately, as Greenpeace has pointed out, carbon stored in trees is not permanently removed from the atmosphere. The trees could be felled or, worse still, destroyed by raging forest fires which would release their embedded carbon.

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Thus, the use of sinks would at best buy some time. And since the goal of the protocol is to reduce emissions, not to create mechanisms for avoiding reductions, environmental groups insist that "sinks" must be strictly controlled.

That's why they have strongly criticised Japan's insistence that it should be able to count domestic forests as a substantial contribution towards meeting up to half of its greenhouse-gas reduction target of 6 per cent under Kyoto.

There is also growing concern about the pressure applied by Canada, Australia and Japan to have nuclear power classified under the protocol's Clean Development Mechanism (CDM) for aiding "sustainable development" in Third World nations.

Last November's climate summit in The Hague agreed to language that would have excluded nuclear power from the CDM, but the collapse of those talks meant it was not formalised. Now, it is back on the negotiating table.

The nuclear industry has flooded the Bonn conference with glossy brochures portraying its carbon-dioxide-free product as the answer to climate change. But environmentalists insist that its inclusion would undermine the integrity of Kyoto.

Climate Action Europe pointed out yesterday that nuclear power cannot be classified as sustainable because of the radioactive waste it produces and its vulnerability to catastrophic accidents, such as Chernobyl.

Canada and Japan have nuclear energy, but Australia is promoting its use by other countries even though it has never built a nuclear power station because of the cost and public opposition. This was "pure hypocrisy", the action group said.

There are also arguments over emissions-trading, one of the "flexible mechanisms" included in the Kyoto Protocol, at the insistence of the US. Again, environmentalists insist that such trading must not become another large loophole.

Emissions-trading on international markets would allow countries to sell tonnes of carbon they have saved to other countries which for some reason cannot meet their emission reduction targets. The price might be $10 per tonne.

If savings are made through energy efficiency or cleaner technology, this would be fine. But if trading consisted of buying "hot air" from Russia or Ukraine, which have exceeded their targets due to economic collapse, it would not.

Other issues of contention include the compliance regime for implementing Kyoto; in other words, how to police progress on achieving targets.

The EU is still pressing for agreement on all outstanding issues in a manner that would protect the "environmental integrity" of the protocol. But it may have to compromise to secure the support of Japan and others.

The EU has some credibility at the conference. Figures compiled by the European Environment Agency show that its total emissions of greenhouse gases fell by 4 per cent in the 1990s, taking the EU halfway towards its 2012 target.

Contrary to US fears that complying with Kyoto could be economically suicidal, the EU estimates that the cost of meeting its own 8 per cent cut in emissions would be just 3.7 billion euros per year, or 0.6 per cent of GDP in 2010.

In the end, it's a question of biting the bullet. And while the EU's impressive record masks a mixed record by its member-states (Ireland's emissions went up by 22 per cent in the 1990s) it does at least show that cuts can be made.