A decision to broadly define additional activities under Article 3.4 has the potential to profoundly influence the environmental effectiveness of the Protocol. Such changes could result from allowing Parties to claim credit for a portion of ongoing carbon stock increases expected for Annex I Parties under "business-as-usual," as well from increasing the range of options available to Parties for adopting new measures to reduce emissions or increase removals. Annex I Parties have reported net GHG removals totaling 0.5 Gt C in 1990 from the land-use change and forestry sector, based on the reporting guidelines adopted under the UNFCCC. Although available projections made by Parties indicate that the rate of removal will decline over time, substantial net removals are still projected to occur during the commitment period under a business-as-usual scenario. Subtraction of a baseline during the first commitment period would reduce the potential for Parties to obtain credit for carbon stock increases expected under business-as-usual.
A business-as-usual baseline could also protect Parties from unexpected debits. Suppose, for example, that forest management is included as an additional activity under Article 3.4, and low-impact logging is the only practice applied to a particular patch of land. With a business-as-usual baseline, credits would be earned only for the carbon stock increase resulting from low-impact logging. Suppose that in a subsequent commitment period the forest is destroyed by wildfire. Without a business-as-usual baseline, debits could be equal to the entire stock of carbon destroyed by the fire. With a business-as-usual (or 1990 activity level) baseline, however, the Party is debited only for the increment of carbon attributable to low-impact logging because the rest of the forest would have been destroyed under business-as-usual. For further discussion of business-as-usual baselines, see Section 4.6 and Chapter 5.
Article 3.4 allows a Party to apply the decision made by the COP on additional activities to the first commitment period provided that the activities have taken place since 1990. This requirement is ambiguous because some activities may have started before and continued past 1990. Not all activities have a threshold, or point in time, when the activity may be said to begin.
In general, this Special Report treats ARD as events, the occurrence of which can be specified in time. Article 3.4 activities, whether they are defined narrowly or broadly, may be more in the nature of processes, which may make determining whether they occurred before or after 1990 more difficult. For example, "management" is a continuous process. Suppose that a forest has been managed using low-impact logging since 1980. The practice is ongoing, so the activity arguably has taken place "since 1990." Yet some of the observed stock increase undoubtedly is related to the practice of low-impact logging prior to 1990. If management or management practices are adopted as activities under Article 3.4, one option for applying a "since 1990" test (which is required for the first commitment period) would be to consider the effect of changes in management since 1990. This approach could be implemented by designating land on which there has been a change in management since 1990 as land under Article 3.4. A baseline for this land could be constructed by estimating the stock change that would have taken place under a continuation of the management regime in place as of 1990.
Similarly, the requirement that additional human-induced activities be "related to changes in" emissions and removals in the agricultural soils, land-use change, and forestry categories may suggest the need for a baseline against which to measure the change. Such a baseline could be the rate of change in carbon stocks on those lands in 1990.
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