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The boundaries that are set in defining LULUCF activities and projects can greatly influence the credit attributed to an activity and its true value in avoiding dangerous levels of GHGs in the atmosphere. Boundaries and other aspects of carbon accounting can affect decisions on allocating global warming mitigation funds between the energy and LULUCF sectors, as well as among different types of activities within the LULUCF sector.
One issue is defining which system components are included in the analyses. If system boundaries were defined to exclude some pools, there would be a risk of outcomes in which activities receive carbon credit when they actually result in net emissions. If one considers only the soil component, for example, converting forests or poorly managed pastures to well-managed pastures could increase carbon storage in Amazonian soils (e.g., Cerri et al., 1996; Batjes and Sombroek, 1997). Forest conversions, however, lead to losses of carbon from biomass that much more than offset any potential gains in the soil. The same consideration applies to the question of whether conversion of natural savannas to improved pastures increases carbon stocks (Fisher et al., 1994) or decreases them (Nepstad et al., 1995).
Even within the soil sphere, the predominant pasture management system in Amazonia today results in substantial losses of soil carbon (Fearnside and Barbosa, 1998). In addition, if deep soil (below 1-m depth) is included in analyses and a long time horizon is considered, pasture can result in large emissions of soil carbon even if the stock in the surface soil has increased because trees have much deeper roots than pasture grasses: Some tree roots penetrate more than 8 m (Nepstad et al., 1994). Roots supply carbon to the soil through exudates and root death (turnover); when deep-rooted trees are removed, the soil-carbon equilibrium in the deep soil shifts to a lower level over a period of decades (Trumbore et al., 1995).
The question of whether subsidizing improved pasture management in Amazonia would result in carbon benefits is very important. Although some observers maintain that ranchers switching to improved pasture management will slow their rates of forest clearance (Faminow, 1998), evidence reviewed by Fearnside (1999a) indicates that increased capital supply to ranchers (from subsidies and from more profitable pastures) would have the opposite effect on deforestation. Although the impetus for the expansion of cattle ranching in Brazilian Amazonia currently comes largely from profit sources other than sale of beef (Fearnside, 2000a), saturation of the beef market will eventually reduce beef prices and contribute to limiting further deforestation for pasture. The possibility that this effect could form the basis of a cost-effective strategy for global warming mitigation has been questioned, however (Fearnside, 2000a).
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