1. 1 Forest Accounting Rules and Guidelines West Coast Regional Carbon Sequestration Partnership Kick Off Meeting September 30, 2003 California Energy Commission Sacramento, Ca. Presented by: Department Staff California Department of Forestry and Fire Protection

2. 2 The predicted impacts of Global Warming of most concern to California include:  larger extreme precipitation events more frequent floods  rising sea levels salt water intrusion  warmer winter temps earlier runoff  longer dryer summer periods more fire Warmer temperatures will affect water demand in all sectors (urban, agriculture, environmental). A growing population will add to this demand.

3. 3 The predicted impacts of Global Warming of most concern to California include: Reduced summer runoff of fresh water Reduced summer runoff of fresh water Increased winter rains intensify flooding and landslides Increased winter rains intensify flooding and landslides Reduced coastal fog Reduced coastal fog Longer, hotter summers Longer, hotter summers Invasive species out compete natives for critical resources Invasive species out compete natives for critical resources Climate changes increase the number of endangered species Climate changes increase the number of endangered species Pest species become more prominent or destructive Pest species become more prominent or destructive Longer dry periods will decrease forest fuel moisture Longer dry periods will decrease forest fuel moisture Fisheries negatively impacted Fisheries negatively impacted Cycles of beach and cliff erosion from wave damage Cycles of beach and cliff erosion from wave damage

4. 4 California Climate Action Registry State was one of the early actors in establishing a Greenhouse Gas Registry The California Climate Action Registry first focused on entity wide GHG inventories (SB 1771 in 2000, SB 527 in 2001). The California Climate Action Registry first focused on entity wide GHG inventories (SB 1771 in 2000, SB 527 in 2001). Registry amended in 2001 to require industry-specific procedures and protocols for recording forestry emissions and emission reductions. (SB 812) Registry amended in 2001 to require industry-specific procedures and protocols for recording forestry emissions and emission reductions. (SB 812) In 2002 State Air Resources Board to develop protocols for mobile emission sources and authority to grant credits. (AB 1493) In 2002 State Air Resources Board to develop protocols for mobile emission sources and authority to grant credits. (AB 1493)

5. 5 California Climate Action Registry Registry components Registry components  Enable the voluntary recording of GHG  Third-party organizations to certify baseline emissions  Maintain a record of GHG baselines and emissions results  Adopt industry-specific reporting metrics  Encourage voluntary actions to increase energy efficiency and reduce GHG emissions  Recognize, publicize, and promote participants  Recruit participation from all economic sectors/regions  Report to the Governor and Legislature on successes and challenges

6. 6 California Climate Action Registry Registry participants will voluntarily submit their GHG emissions to the Registry each year for the following emission source categories: Direct emissions mobile source combustion Direct emissions mobile source combustion Direct emissions from stationary combustion Direct emissions from stationary combustion Direct process emissions Direct process emissions Direct fugitive emissions Direct fugitive emissions Indirect emissions from electricity, steam imports and district heating and cooling Indirect emissions from electricity, steam imports and district heating and cooling

7. 7 California Climate Action Registry Emission Reduction Credits the establishment and trading of credits is currently a private market option the establishment and trading of credits is currently a private market option AB 1493 provides the State Air Resources Board the authority to establish emission reduction credits against their future GHG standards AB 1493 provides the State Air Resources Board the authority to establish emission reduction credits against their future GHG standards Winrock International 2003 5 Principles  Relevance  Completeness  Consistency  Transparency  Accuracy

8. 8 California Climate Action Registry Forest Carbon Component requirements: To adopt procedures and protocols for the reporting and certification of greenhouse gas emission reductions resulting from a forestry project. To adopt procedures and protocols for the reporting and certification of greenhouse gas emission reductions resulting from a forestry project. CDF has primary responsibility for protocol development. CDF has primary responsibility for protocol development. must include monitoring, estimating, calculating, reporting, and certifying of carbon stores and emissions resulting from conservation activities. must include monitoring, estimating, calculating, reporting, and certifying of carbon stores and emissions resulting from conservation activities.

9. 9 California Climate Action Registry Baseline CO2 baseline for year 1 Other GHGs for year four Direct Stationary Mobile Process Fugitive Indirect Electricity District heating/cooling Steam Cultural Practices Thinning, Prescribed Fire, Harvest, Slash disposal, Pest Management, Reforestation, Fertilization, Conversion

10. 10 California’s Forest Carbon Registry Key concepts Provides for managed forests, not just preservation. Provides for managed forests, not just preservation. Requires Additionality: Above Business as Usual. Requires Additionality: Above Business as Usual. Natural Forest – not plantations. Natural Forest – not plantations. Permanence – Requires conservation easement. Permanence – Requires conservation easement. Third party verification. Third party verification. Entity-wide, with optional project-based reporting Entity-wide, with optional project-based reporting

11. 11 California’s Forest Carbon Registry Next Steps: The guidelines must be practical so they will be used The guidelines must be practical so they will be used Develop a legitimate and professionally respected process Develop a legitimate and professionally respected process Work with stakeholders and take advantage of their experience Work with stakeholders and take advantage of their experience

12. 12 California Specific Efforts Partnership to Implement SB 812 Partnership to Implement SB 812 California Energy Commission California Energy Commission California Climate Action Registry California Climate Action Registry Ca Dept. of Forestry and Fire Prot. Ca Dept. of Forestry and Fire Prot. Winrock International Winrock International Ca. Resources Agency Ca. Resources Agency Industry Specific Protocols & Guidelines Industry Specific Protocols & Guidelines Climate Action Registry Climate Action Registry Task Group Established under Technical Advisory Committee Task Group Established under Technical Advisory Committee Gov. role is to register emissions and emission reductions Gov. role is to register emissions and emission reductions Registration will meet the five principles and the State will stand behind the third party certified emissions or emission reduction Registration will meet the five principles and the State will stand behind the third party certified emissions or emission reduction Trading/ Carbon Credits a function of the market. Trading/ Carbon Credits a function of the market.

13. 13 Basic Approach Provide Statewide Baseline Provide Statewide Baseline Relative Values for Policy Overview Relative Values for Policy Overview Provide Statewide Supply Curves Provide Statewide Supply Curves Key in on areas where gains in Sequestration are likely and prioritize efforts. Key in on areas where gains in Sequestration are likely and prioritize efforts. Case Studies / Demonstration Projects Case Studies / Demonstration Projects Forest Management – Alternate Silviculture Forest Management – Alternate Silviculture Riparian Zones – Wider Zones/Large Old Trees Riparian Zones – Wider Zones/Large Old Trees Monitoring – Frequency/Expense/Accuracy Monitoring – Frequency/Expense/Accuracy

14. 14 California Carbon Establish High Value Carbon in California that is available to market Establish High Value Carbon in California that is available to market Increase Carbon Stocks over Time Increase Carbon Stocks over Time Achieve indirect environmental improvements Achieve indirect environmental improvements Provide incentive for Landowners that Practice Good Stewardship for total resource values. Provide incentive for Landowners that Practice Good Stewardship for total resource values. Maintain a Viable Timber Industry in California. (Industry Harvest from 5bil to 2bil annual harvest) Maintain a Viable Timber Industry in California. (Industry Harvest from 5bil to 2bil annual harvest)

15. 15 California’s Forest Carbon Registry Conclusion: Encourage your efforts on the 1605 (b) registry program Encourage your efforts on the 1605 (b) registry program The international community will be buying and selling carbon The international community will be buying and selling carbon CA to develop a rigorous set of reporting and registry standards CA to develop a rigorous set of reporting and registry standards High quality forest sequestration credits will be a “multiple win” High quality forest sequestration credits will be a “multiple win”

16. 16 CHARISMATIC CARBON Imagine an insert in your airline ticket that says, “Your GHG emissions are being offset by protecting forests and salmon in California”.