1. Views on harvested wood products estimation, reporting and accounting Presentation by Canada SBSTA Workshop on Harvested Wood Products Lillehammer, 30 August, 2004

2. 2 Outline of presentation 1.Introduction 2.Lessons from Canadian experience 3.General perspective of Canada 4.Ideas for SBSTA guidance to IPCC (2006 Guidelines) 5.Attachments

3. 3 Introduction Canada has applied the 4 existing approaches to estimate its harvest-related emissions in LULUCF sector Harvest emissions are delayed when carbon storage in HWP is taken into account Year 2000 estimates are presented in Canada’s May 2004 submission to SBSTA (FCCC/SBSTA/2004/MISC.9)

4. 4 Lessons from Canadian Experience: Importance of Terminology (1) A common understanding of concepts is fundamentally important Reporting = Submission to the FCCC of a national inventory of emissions/removals as per guidelines For reporting, Attribution is important = Source, timing and cause of emissions/removals are clearly identified (usually where and when they occur) Accounting = Applying rules for counting emissions / removals against an emission limitation commitment Accounting means Allocation = Designation of responsibility for emissions/removals

5. 5 Allocation versus attribution Allocation differs from attribution when the accounting approach changes system boundaries such that responsibility is not necessarily based on national boundaries Accounting of CO 2 emissions from HWP may differ from simply reporting them within the annual national inventory Lessons from Canadian Experience: Importance of Terminology (2)

6. 6 Approach = conceptual framework for estimating HWP whereby system boundaries are set e.g. IPCC Default / Stock-Change / Production / Atmospheric Flow / Other? Method = calculation framework for estimating HWP emissions within an approach Any method can be used regardless of the approach (may depend on data) e.g. inflow-outflow method (looking at inputs and outputs or flux quantities) e.g. stock change or stock data method (difference in C inventory of a pool between time t1 and t2) Lessons from Canadian Experience: Importance of Terminology (3)

7. C pool ΔC = Sum of inflows and outflows (See GPG 2003 equation 3.1.1) Inflow-Outflow Method Stock change or Stock data Method C pool C stock at t1C stock at t2 ΔC = C t2 – C t1 (See GPG 2003 equation 3.1.2) Harvest 7

8. 8 Key terms need to be carefully defined: –E.g. “wood production”: Does it mean harvested volume? roundwood production? Or commodities produced? –“Harvest” and “wood consumption” also have to be carefully defined Comprehensive and consistent system –Cannot do C stock change accounting for HWP without linkage to the managed forest (other pools), unless harvest is zero –Forest pools, products pools and landfill pools cannot be disconnected –Amount of C entering to the HWP calculations should equal amount of C removed from the forest Lessons from Canadian Experience: System Representation is Key

9. 9 Complexity is not a major issue HWP estimation is no more complex (especially for lower tiers) than other GHG inventory sources Good Practice Guidance philosophy: lack of complete and detailed data is not an obstacle to reporting HWP emissions (tiered structure) Basic data requirements are the same for all approaches Although the approaches differ, the basic data requirements are fundamentally the same Lessons from Canadian Experience: Other Issues

10. 10 Focus of UNFCCC is the atmosphere Art. 2: “stabilize GHG concentrations in the atmosphere” Art. 4: “limiting emissions of GHG” and “protecting and enhancing, as appropriate, GHG reservoirs and sinks” “Stock changes” versus “emissions and removals” 1996 GL and GPG 2003 both assume that changes in stocks are a valid approach to estimating emissions from HWP Stock change approaches allocate emissions to a place and time that are different from what the atmosphere sees Carbon stock changes in the forest or the HWP (or SWDS) pool are not necessarily an emission or removal In what circumstances are stock changes an unbiased representation of emissions or removals? General Perspective of Canada

11. Exchange with atmosphere Biomass C Flow HWP in use (incl. fuels) ATMOSPHERE NATIONAL BOUNDARY CO2 flow from HWP in use Imports HWP to SWDS Harvested biomass from forest Exports Adapted from Pingoud et al. (2004) 11

12. 12 It is premature to rule out any approach at this time. Discussions should make distinction between accounting and reporting. Discussion on HWP accounting approach is fundamentally linked to the future treatment of LULUCF. SBSTA could develop a set of criteria against which approaches may be assessed. IPCC will work on methods and guidance for reporting HWP information. General Perspective of Canada: The Forward-Looking Process

13. 13 SBSTA should provide timely, practical and realistic guidance to IPCC for IPCC 2006 Guidelines Any SBSTA guidance to IPCC must be provided at SBSTA 21 2006 Guidelines should facilitate annual reporting of comprehensive, transparent and comparable information to support the implementation of any future HWP accounting approach agreed by COP IPCC 2006 Guidelines should not prejudge the outcome of the UNFCCC negotiations on accounting approach. Ideas for SBSTA Guidance to IPCC (1)

14. 14 Technical guidance should be: –Approach or accounting neutral Reported quantities could be later combined depending on the approach agreed to –Focused on HWP quantities relevant to HWP estimating and accounting –Focused on categorization / definitions of products methods (tiered structure) Ideas for SBSTA Guidance to IPCC (2)

15. Attachments

16. 16 Categorization/definition of products –Guidance on identification, definition and detailed description of quantities relevant to HWP estimation Notably harvest, imports, exports, and decay formulas for carbon in HWP and SWDS –Guidance on distinctions between main product categories, primary vs. secondary commodities –Guidance on use of existing data sources More Ideas for SBSTA Guidance to IPCC (1)

17. 17 Methodological tiered structure –Increasingly refined HWP-related quantities –For Tiers 2 and 3 Include distinctions such as trade of roundwood, market pulp, secondary commodities, emissions from decay of domestically produced and traded products, and proportion of non-wood fibres entering commodities –For Tier 3 Guidance on quantities relevant to estimating fraction of HWP-C recycled or stored for long periods in solid waste disposal sites More Ideas for SBSTA Guidance to IPCC (2)