Monetising Sindh's forest cover by earning carbon credits
Sindh is the pioneer among all provinces in the country which has sold carbon credits worth $40 million while leveraging the emerging global carbon credit market.
The Sindh government sold around three million TCO2e credits and received approximately $40 million through a public-private partnership project called Delta Blue Carbon-1. As per an agreement between the Sindh Forest Department and Merlin's Wood Private Limited, the government received a 40% share worth $14.747 million (Rs3.25 billion) while 60%, or $25.253 million, went to the private firm, which incurred all expenses till verification and monitoring from 2015 to 2020.
The firm has spent around $8 to $9 million out of the first installment on the ongoing yearly project activities to achieve the envisaged targets in the Project Design Document. Chief Conservator of Forests (Mangroves) Riaz Ahmed Wagan said, "We have grown plants on more than 100,000 hectares from 2015 to 2024 and we will have to grow 125,000 hectares more in the next five to six years. Last time we got an average price of $13 per credit; now we hope to get an average of $20 per credit – being high-quality credits of Blue Carbon Origin."
Sindh will hopefully receive this year the second installment of the carbon credit sale made from 2022 to 2024. "We ran this bankable Delta Blue Carbon (DBC) project, monetising mangroves, for which carbon credits were sold in 2022 and payments came in 2023, and this project should be replicated throughout the country. We want to introduce this mechanism in the riverine forest and private land of people."
"We intend to first monetise all the existing forests of Sindh and we must be given rates of the stored carbon emissions in the forest ecosystem. If we let forests be cut down, they will generate more emissions and enhance CO2 contribution to the atmosphere."
Those countries which have less per capita income and less contribution to the air pollution must be provided funding as this is not taking place due to cumbersome procedures for international grants under the Global Climate Fund (GCF). To avoid deforestation and the degradation of forest ecosystems, it is imperative that the developed countries must pay the developing countries to avoid such practices for the overall good of global society.
Developed countries keep introducing new programmes and laws but they continue heavy emissions because of mass production. They must reduce the production levels for the decrease in emissions.
"The stocked forest area in Pakistan spreads to at least 2 million hectares; one hectare on an average sequesters 200 tonnes of carbon and 700 TCO2e over the life time. Protecting one hectare is valued at around $7,000 at a minimum price of $10/TCO2e. Safeguarding the total forest of Pakistan is valued at around $14 billion," Wagan said. "Developed countries must write off the government's debt of $14 billion or pay such an amount to channel it for the progress and welfare of society and biodiversity. We must continue the development process and safeguard this forest cover. The estimated annual growth of trees per hectare is called annual increment, which helps remove more carbon from the atmosphere."
Developed countries must pay at least $300 to $500 million annually for avoiding deforestation and degradation of the existing forests and this formula can be applied to private land as well by paying them for environmental services to avoid cutting trees and grow more.
The Indus Delta area of Sindh's mangrove forests is spread over 660,000 hectares, as per the latest report, while forests exist over an area of 260,000 hectares. Sindh has a total 3.40 million acres (1.40 million hectares) of forests. Five per cent area of Pakistan's total land (5.2 million hectares out of a total area of 87.98 million hectares) is designated for forests.
The draft of the recent UN climate change conference in Baku, known as COP29, proposes $300 billion in climate finance by 2035 to replace the current contribution of $100 billion from rich countries, which was set in 2010.
That sum should come from a wide variety of sources, public and private, bilateral and multilateral, including alternative sources, and would include the direct provision of finance such as grants and private sector investment. "If payments are ensured as per the pledge, we will be able to protect the existing forests and support the local community by paying for environmental services," the chief conservator said.
"We must be paid at least $1.4 billion by the United Nations Framework Convention on Climate Change (UNFCCC) out of the Global Climate Fund. UNFCCC officials must collect money from the developed world and data from the developing world.
"We expect that from the DBC-1 project, we will get $10 to $15 million per annum. We have to develop new forests and rehabilitate the de-vegetated forests over an area of 225,000 hectares in the delta."
He stressed that the UNFCCC must provide facilities to developing countries in pursuit of buyers. "UNFCCC must ensure payments for the existing forests and growing new forests over empty land through public-private partnership."
Meanwhile, the United Nations Conference on Trade and Development (Unctad) released a report titled "The Least Developed Countries Report 2024 – Leveraging Carbon Markets for Development." It delves into the potential of carbon markets as a catalyst for economic development in the least developed or developing countries.
The world confronts an intertwined climate and finance crisis while seeking to advance the Sustainable Development Goals (SDGs). Carbon markets are increasingly being seen as the key drivers of climate ambition and capital flow.
They enable countries to trade carbon credits – permits to offset a specific amount of emissions – allowing sellers to earn revenue and contribute to climate action.
The writer is a staff correspondent