July 07, 2003

Carbon Management

Like it or not we are going to manage the carbon systems of our planet. In fact I would argue, we already do; albeit in a completely haphazard way.

The figure above shows one rendition of the various elements of the carbon system. There are many interacting and intersecting processes. These interactions make it difficult to characterize the time scale of the system, but the IPCC places an upper bound at about 200 years. Thus the impact of carbon that was emitted from the first coal fired industries at the beginning of the Industrial Revolution has only recently passed. Of course we have pumped plenty of CO2 into the atmosphere in its place.

There are a number of elements in the figure that are anthropogenic. Among them are various modes of transportation, energy production, and livestock production. Not shown as clearly are the effects of changes in landuse. Up to 25% of the anthropogenic influence on the carbon cycle is attributed to changes in land use and land cover.

Think about what happens when Amazonian farmers move into a new region of the forest. Leaving out the details, much of the carbon that was stored in the biomass of the plants is released into the atmosphere. In addition, as the ecosystem that the soils support changes so to does the amount and character of the carbon in the soils (I don't know which way the sign goes in the rainforest case. Part of the problem there is that the soils are pretty poor.)

I suppose one could take issue with my assertion that we are already "managing" the carbon system. "Just because we are changing it dramatically, does not necessarily mean we are managing it". My response would be something like "Fine, then we are simply mucking with it, with no idea of what we are up to. If anything this amplifies our need to take more conscious action." Wally Broecker sometimes makes the analogy of poking a beast with a sharp stick.

The Kyoto Protocol, as flawed as it may be, is an attempt to begin to purposefully address the changes that humans are making in how carbon moves through the various natural and anthropogenic systems of our planet. There are many questions around the Kyoto Protocol and whether it will ever come into force and if it does how well it will work.

I believe that, with respect to carbon management, a more likely scenario is one that relies heavily on private sector leadership. Most people that I have talked to think that it is quite possible that the private sector will lead in the development of at least carbon trading infrastructures. In fact such infrastructures are already being developed by companies and groups that are looking for first mover advantages. Many put the time frame of the emergence of carbon trading at less than a decade.

There are many details to be worked out; not the least of which is "how much is a ton of carbon equivalent (what ever that is) worth?" At the moment, my best range is about an order of magnitude between US$3 and US$30. Some people that I have talked to think the price range is much narrower than that and centered around US$5 per ton.

One of the features of the Kyoto protocol which will likely emerge either within that frame or in some other context is the idea of carbon offsets. In this an industry balances its emissions of CO2 by removing equal or greater amounts through carbon sequestration activities somewhere else. The simplest image is that of reforestation (although there are tricky accounting details having to do with why the forest is gone to begin with...). As trees grow they take carbon from the atmosphere an store it in their wood and leaves. As long as the tree lives it at least stores that carbon and the amount of carbon can be thought of as offsetting and emission somewhere else. Another detail to be worked out is an accounting mechanism between the emissions and the storage.