1. The Climate Change Challenge for Agriculture and Forestry: Policy Update
At issue is how the world will manage its carbon and nitrogen stocks sustainably
Presentation to GHG Modeling Forum
Shepherdstown, WV, October 8-11, 2002

2. Canadian policy has followed a two-track public process over the last five years ...
Since Kyoto Canada has been working towards a decision on ratification, now expected by year’s end
A Federal/Provincial/Stakeholder process has been underway to determine how Canada could meet its Kyoto obligations
Significant resources have been invested in getting started
Realization action is required regardless of outcome of ratification process
Getting started early will reduce the costs in the long run
Investing in science, awareness, and mitigation actions at home and abroad

3. …where addressing climate change is about contributing to environmental solutions that are economically sustainable
Climate change is all about managing the carbon and nitrogen cycles
Agriculture and forestry are based on using energy from the sun for photosynthesis to transform carbon and nitrogen into food, fiber and bio-products consumed by humans
The challenge is to learn to profitably recycle rather than extract carbon and nitrogen

4. Atmospheric C to store in soils and perennial crops & trees
Agriculture and forestry have many unique opportunities to manage greenhouse gases...
Reduce
Greenhouse gas
emissions
Adapt
Use science, innovation & business risk management to adapt to climate change
Agricultural and Forestry
GHG Management
Status:
Agriculture Table: Identified economically viable technologies/practices to reduce emissions and enhance sinks. Better soil, nutrient and livestock management were seen as main opportunities. Stressed need for more science to develop better mitigation of biological sources.
Action Plan 2000: 3 Mt sinks & reductions likely to be direct result of program. Information/demonstration are main tools to increase adoption. Offered no incentives. Minimal steps towards integrated innovation agenda on bio-energy & bio-products innovation. Lays foundation for industry coordination. APF lays foundation for fed/prov cooperation.
International: negotiations in Bonn secured recognition of soil sinks
Discussion Paper: Proposals for mix of DET offsets & targeted measures to deliver incentives to increase adoption rates gain support.
Remove
Atmospheric C to store in soils and perennial crops & trees
Replace
Innovate to replace fossil fuels with bio-based energy, chemicals and materials

5. Annual impact of mitigative strategies (relative to business-as-usual)
… and our strategy must be built on the fact that many Kyotos are required ...
2000
2010
2020
2030
2040
2050
Remove for Agriculture
Replace by Agriculture
Reduce by Agriculture
Annual impact of mitigative strategies
(relative to business-as-usual)
We have short and long term opportunities. Our opportunities to reduce, remove and replace GHGs will change over time with investments in science, environmental standards and economic change. Sinks are our biggest opportunity now and for the next couple of decades. Key points are as follows:
1. remove (mostly C sequestration): The benefits are relatively short term (perhaps a few decades). Thereafter, soil C reaches a platueau so that removal of CO2 approaches zero (and may even drop below zero if some practices are anadoned or if global changes (e.g., warming) results in the loss of some previously-stored C).
2. for 'reduce and replace': the benefits can continue almost indefinitely, as long as the practices are maintained. Presumably there is some lag phase during adoption. We might envision three phases: in adoption: a. intial adoption: slow increase in benefits (e.g, current status of bio-fuels); b. exponential growth: as the practices 'catches on' (e.g., increase in availability of bio-fuel and infra-structure); c. a plateau: as the technlogy/practice matures and further adoption slows (e.g., bio-fuel reaches maximum use - say, 10% of gasoline).
3. A very important point, particularly relevant to 'reduce', is that these benefits are relative to BAU scenarios. For example, suppose a new feed additive reduces CH4 emision by 10% in all beef cattle, but the number of beef cattle increase by 30%, then you may have a 10% benefit from the practice, but overall CH4 emissions have increased by 20%. Many of these scenarios are driven as much (or more) by level of activity (say, number of livestock) than by the adoption of mitigaiton practices and their success.

6. Accounting for Forest Management
… and that a lot of effort is still required to fully understand the role of these sectors ...
Accounting for Forest Management
Source
Sink
Debit in
from ARD
Credit from management
Additional credit from management
33 Mt CO2/year
limit to offset
44 Mt CO2/year
cap

7. …because biological processes make us different from energy users
Gas % of Emissions
CO %
CH %
N2O %
Our primary energy source is the sun, not fossil fuels.

8. And Forestry with an estimated additional 20 Mt Sink
For the first commitment period, we know we can contribute, agriculture with up to 30 Mt ...
Gap (6.5 Mt)
Potential reductions
from BAU (5 to 20 Mt)
[with incentives]
MT CO2e
Government public policy signals: Coordinated federal-provincial action via the APF to define best practices and integrate them into farm environmental planning systems nation-wide and provincial farm policies/regulations; resolve policy uncertainty re sinks ownership, leasing, etc.
And Forestry with an estimated additional 20 Mt Sink

9. For agriculture we have an integrated science-policy approach ...
Canadian Economic and Emissions Model for Agriculture (CEEMA)
- economic component
- GHG component
IPCC Guidelines
Systematic Approach
(direct and indirect
emissions of CO2, CH4 and N2O)
Development of Mitigation Scenarios
Scientific Research
Expert Opinion
- F/P/T gov’t
- Industry
- Academics
Changes in GHG sources and sinks
Economic
Impacts
Farm Management Data (e.g. Census, FEMS)

10. … where we continue to build a strong scientific foundation ...
Model Farms ($ 5 M)
Scaling up initiatives ($2 M)
Biological Greenhouse Gas Sources and Sinks in Agriculture ($1 M)
Program on Energy Research ($4.2 M)
Enhancement of Greenhouse Gas Sinks on Ecosystems ($2.1 M)
Environmental indicators
Research networks : BIOCAP (gov’t, industry, NGOs, universities) ($1 M)
Climate Change Funding Initiative on Agriculture ($4 M)

11. … with the National Carbon and Greenhouse Gas Emission Accounting and Verification System (NCGAVS) as a key component ...
country
“Situations” defined by:
Soil
Climate
Land use
Management
province
“Model”
region
SLC polygon
SOC & GHG
Emissions for each
“situation”

12. … and we are taking action directly in the agricultural sector to get started
AP2000 Mitigation Program ($21 M)
Increase farmer’s awareness of CC ($1.3 M)
Shelterbelts ($4 M)
Biofuels ($3 M)
Agriculture Policy Framework has explicit goal to reduce sector emissions of GHG

13. Food Safety and Food Quality
The Agriculture Policy Framework (APF) is all about motivating long-term change …
The APF elements:
Food Safety and Food Quality
Environment
Science and Innovation
Renewal
Agriculture is a shared jurisdiction. Intergovernmental cooperation is essential.
Agriculture Policy Framework provides focus for coordinated action on policy signals, tools and incentives.
Environmental Farm Planning will improve “whole farm” management of how the basic resources of a farm (water, inputs, livestock, land and cropping choices) affect the environment, including greenhouse gases..
Environmental Farm Planning will also be a platform for delivering the knowledge and information gleaned through the AP2000 programs. This will increase awareness among farmers of the practical things they can do to reduce GHG emissions and enhance sinks.
This will establish an infrastructure of knowledge, institutions and relationships which will help to position sector to work through new incentives via DET or a new fund as government policy evolves.
Business Risk Management
International
Trade & Development
… and so is climate change policy

14. We need to develop a National Forest Carbon Measuring and Monitoring Framework ...
What do we have at present?
Current systems not sufficient for forest carbon monitoring and reporting purposes
What does Canada need?
Internationally accepted forest carbon monitoring systems and accounting tools to report on forest carbon stock changes
Why does Canada need these tools?
To improve UNFCCC reporting and be in compliance (ARD) with the Protocol
To claim forest management credits
To have better information and forecasting ability on sink/source status of Canada’s managed forests
To assist forest managers in evaluating impacts of management decisions on carbon stocks

15. ... that will account for all forest carbon activities ...
Development of Forest C accounting tools that:
employ standard accounting methods for C stock change reporting
are compliant with international guidelines for accounting, transparency and verifiability
incorporate best available science and data
are consistent across a range of spatial scales
will be user-friendly and publicly available, and
whose results are consistent with national analyses

16. … based on the following elements
Volume to Biomass Conversion
Detailed
Forest Inventory
Volume / Age Curves
C Accounting Model
CBM-CFS2
Harvesting
Planting
Disturbances
Land-use change
Model parameters
Litterfall
Decomposition
Various inputs needed to analyse the stocks
Results database
AP2000 gets us started, but much more will be required

17. But we know we will need the tools to incent the required change
The sectors are excited about the potential to create carbon credits using market mechanisms within a DET system
Existing and evolving programs and institutions could play valuable roles in a carbon credit trading system
Traditional tools will continue to be needed, but we need to give the credit trading system room to develop
We can do this through innovation in providing incentives for producers
Carbon credit markets, in combination with the partnership mechanism ,are a new approach to incentives. We need to involve industry in the design.
We can learn from these social innovations to assess needs for refining policies or developing traditional programs to fill gaps that may emerge.
The Agriculture Policy Framework provides a framework for future targeted measures or nontraditional incentives for environmental performance
APF will create some reduction and removal credits, maybe as much as AP2000. But incentives are needed to realize sector’s potential.
We need to start now to lay the foundation for future generations by pushing the frontier on R&D
We need to motivate change to develop and promote the use today’s best technology & practices. This will make us more efficient.
Programs and policies can motivate change. They also need to assist with the adjustments needed to make them economically and politically tolerable.
Sector roles and policy tools will be determined as we move toward the ratification decision.

18. But 2008–2012 is only the start of an on-going world challenge...
Farmers’ control 68 Mha of Canada’s land and millions of livestock. The forest sector manages 100’s Mha. We need them to understand their impact on climate and to adapt to climate as it changes.
Industrial countries like Canada need to pave the way for action by other developed and developing countries.
We need developing countries to join the effort because their decisions will determine how much climate change affects our farm lands and forests.
These countries are our emerging international partners and our future trading partners.
It is in our self interest to act with and to cooperate with other nations.
Every citizen, consumer and industry needs to think about how their activities affect the climate.
Industrialized countries are leading so the developing world can come on board for the second commitment period. We need developing countries to join the effort because their decisions will affect our farm lands and forests. These countries are also our future trading partners. Leading on climate change action is in our self interest.
The success of agriculture across the world in adapting as climate changes will affect food security. It is fundamental to human survival.
Canadian agriculture is a global resource and we make it available through trade. The lessons we learn in Canada in addressing agriculture’s emissions and adaptation will have world-wide benefits.
Ensure Canadian agriculture remains productive rather than vulnerable to a changing climate contributes to world food security and will be important to our continuing success as a trading nation.

19. (2050 under business as usual)
…and we need to adapt because we can’t move fast enough to avoid some impacts
Expected changes
Warmer temperatures, drier or wetter conditions, more extreme events, enhanced, atmospheric CO2, will affect:
resource management/conservation
water supply & infrastructure
financial risk management
food safety, disease management/eradication
environmental and climate change mitigation
Assess impacts & plan to manage risks.
Build knowledge base, networks & planning systems.
Assess impacts and adaptation strategies for key policies e.g. water infrastructure & drought management
Doubling of CO2
(2050 under business as usual)
Climate affects agriculture. It will affect agriculture production. It will also affect how farmers manage land. Farmers manage Canada’s arable land, 7% of its land base. The decisions of farmers also affect forest lands and all the resources such as water which flow over or near farm lands.
We will need to manage risks: drought, animal/plant disease, growing conditions/variability, risks that some of our sinks capacity may erode. These have implications for safety nets and other major government expenditures in the sector. Changing stewardship of natural resources, cropping regimes and investing in critical water infrastructure may be one of the ways to mitigate such financial risks.
Planned adaptation will likely be cheaper than reacting in that we can change practices and technology to attenuate impacts.
Climate change will also affect world food production. This in terms will affect food and fibre markets, prices, the need for foreign aid aimed at sustainable agriculture development and adaptation. Failure to address this will have repercussions far beyond the sector, with potential to affect world political stability and population movements.

20. To summarize, some of the key elements in terms of next steps
Science
Reduce uncertainties
Measurement, monitoring and verification
Technology development
Understand processes of C sequestration and GHG emissions (IPCC)
Permanence
Hosting OECD carbon workshop
Climate change impacts and adaptation
Policy Development
Enhance data, modeling and analysis capacity
Follow up on stakeholder consultations
Assess impacts of Domestic Emissions Trading and design workable offset market
Assess need for and impacts of Targeted Measures
Continue to work in international fora
Climate change impacts and adaptation
Land use change - interaction between agr. and forestry