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Agriculture



13/06/2017

Enhancing Soil Carbon Sequestration and Adaptation in Europe’s Agricultural Sector: Towards a New Approach under CAP and ETS

By Jonathan Verschuuren (TLS)

Soils contain large quantities of carbon, mainly made up of decomposing plant materials and microbes. The Earth’s soils contain around 2500 Gt of carbon, four times more than vegetation.[1] Through soil degradation, much of natural soil carbon stocks has been lost. It has been estimated that the carbon sink capacity of the world’s agricultural and degraded soils is 50 to 60% of the historical carbon loss of 42 to 78 Gt of carbon.[2] With around 40% of the world’s surface being used for agriculture, it is suggested that these agricultural lands may be used as an important sink for atmospheric carbon.[3] Soil erosion control and soil restoration has an estimated carbon sequestration capacity of between 5 and 15% of global emissions.[4] After peaking, a new equilibrium will be reached and the sequestration potential goes down. It should also be noted that the carbon stored in soils can be easily emitted again with deep tillage and significant soil disturbance.[5]

(Photo: Flickr user Kai C. Schwarzer)

(Photo: Flickr user Kai C. Schwarzer)

Increasing soil carbon sequestration has a very interesting positive impact on climate change adaptation. Measures aimed at soil carbon sequestration increases the ability of soils to hold moisture and to better withstand wind and water erosion, enriches ecosystem biodiversity, helps cropping systems to better withstand droughts and floods, increases fertility for crops through restoring healthy soil microbial communities, and increases livestock efficiency (sustainable intensification).[6] Other potential positive side-effects of practices aimed at soil carbon sequestration are various environmental benefits, such as avoided use of chemical fertilizers and pesticides and improved biodiversity and wildlife.[7]

Examples of soil carbon sequestration practices relevant for Europe are the application of conventional or organic no-till and conservation tillage systems, the use of periodic green fallows, winter cover crops and crop rotations that utilize semi-perennial crops, rotational grazing, decreased grassland management intensity, perennial cropping, nutrient management consisting of compost (crop residue addition) and organic manure, and judicious use of irrigation water.

Research shows that strong top-down policies that are linked with, and fed by, bottom-up initiatives, are needed to achieve the required level of adaptation in the agricultural sector.[8] Holistic strategies have to be adopted that go beyond technical approaches aimed at stimulating autonomous farm-level risk reduction. So far, the EU did not focus much attention on agriculture in its climate change adaptation policy. The EU’s Adaptation Strategy refers to the Common Agricultural Policy (CAP) in which adaptation measures have been integrated to a limited extent.[9] An assessment of the soil carbon related adaptation potential of the current CAP, however, shows that this potential is limited. Soil carbon projects can receive funding both under the green direct payments, and under the rural development policy. Whether such projects are actually carried out with CAP funding depends entirely on initiatives by farmers (for green direct payments), or by Member States (for the rural development policy). Unfortunately, there are not many indications that Member States radically focus their Rural Development Programmes (RDP) on climate change, perhaps with the exception of Ireland. The CAP also has several inherent constraints as far as soil carbon sequestration and associated adaptation are concerned, mostly due to the fact that CAP is not linked to the EU climate policy but serves as a separate instrument with a much wider policy goal than combatting climate change. The accounting rules, for example, do not require farm level quantification of the amount of carbon sequestered linked to the payment, so it cannot be assessed whether and in how far an increase in soil carbon levels is real, additional and verifiable. Integrating the CAP more into the EU’s climate policy requires rules to be set in place to assure a reliable measuring of the carbon sequestered. Payments, to give another example, are based on the amount of hectares per year of measures under the RDP, not on the amount of CO2 sequestered. This is a consequence of the provision that payments can only cover additional costs and income forgone resulting from the commitments made.[10] Such indirect payments, therefore, do not stimulate farmers to sequester as much carbon as possible. A third example of the CAP’s shortcomings with regard to soil carbon sequestration is that projects financed under the CAP are characterized by a relatively short lifespan, 1-5 years for green direct payments, and 5-7 years for projects under a RDP. Under a climate policy, such a lifespan is almost futile, as combatting climate change requires measures that cover decades, if not the entire 21st century. That is why in Australia, carbon sequestration projects are required to run for twenty five or even a hundred years (see blog posts on Australia’s carbon farming legislation part 1 and part 2).

Towards an alternative approach: agriculture in the EU ETS

The conclusion that the current EU policy is completely inadequate to stimulate large scale soil carbon sequestration on agricultural land seems inevitable, also when taking into account the broader climate change mitigation policy. The recently presented proposal for a European Regulation on the inclusion of greenhouse gas emissions and removals from land use and forestry into the EU’s 2030 climate framework (LULUCF Regulation) is a good first, yet inadequate, step towards including agriculture’s emissions and sequestration potential into the EU’s climate policy (see for broader assessment of the climate policy instruments, the paper). That is why an alternative approach needs to be developed. A further stimulus to the adoption of soil carbon projects that currently is not being discussed but that needs to be investigated at European level soon is the inclusion of agriculture in the EU ETS through allowing regulated industries to buy offsets from the agricultural sector, following the examples set by California, Alberta, Australia, and more recently also China.[11] These states show that it is possible to stimulate soil carbon sequestration (and other climate smart agriculture practices and technologies) through the ETS, provided an elaborate regulatory regime has been put in place to ensure integrity. When in place, sectors covered by the ETS will be allowed to finance sequestration projects on farm land, thus paying farmers for their efforts.

The recent report of the Agricultural Markets Task Force, a European Commission expert group, also proposes to incentivise to farm carbon in addition to crops. The Task force, however, proposes to do this through redirecting funds under the CAP after 2020. It is debatable, though, whether this will be a successful strategy given the inherent shortcomings mentioned above. Some of the current constraints can perhaps be repaired, such as the short commitment period, or the provision that payments can only cover additional costs and income forgone. It is highly unlikely, though, that the CAP budget will be big enough to cover an EU wide adoption of carbon farming practices. An evaluation of the Australian carbon farming legislation indicated that government funds will never suffice to roll out an incentive mechanism across all farms in the country and that private funds need to come in, either through a carbon tax or an ETS.[12] The latter seems very suitable for the EU with its well-developed ETS that, hopefully, will pick up speed again after the structural reform takes effect in the fourth trading phase, which runs from 2021 until 2030. Regulation aimed at establishing a finance flow from large industrial emitters to the farming sector, with its capacity to sequester large quantities of carbon on farm land, seems a promising alternative, which is completely in line with the polluter pays principle as laid down in Article 191(2) of the Treaty on the Functioning of the EU.

 

[1] Daniel Kane, Carbon Sequestration Potential on Agricultural Lands: a Review of current Science and Available Practices (Breakthrough Strategies & Solutions, Takoma Park, Md 2015).

[2] Emanuele Lugato et al., ‘Potential carbon sequestration of European arable soils estimated by modelling a comprehensive set of management practices’, (2015) 20 Global Change Biology 3557.

[3] Pete Smith, ‘Agricultural Greenhouse Gas Mitigation Potential Globally, in Europe and in the UK: What Have We Learnt in the last 20 Years?’ (2012) 18 Global Change Biology 35.

[4] M.G. Rivera-Ferre et al., Re-framing the Climate Change Debate in the Livestock Sector: Mitigation and Adaptation Options, (2016) 7 WIREs Climate Change 869.

[5] Ibid.

[6] P. Smith et al., ‘Agriculture, Forestry and Other Land Use (AFOLU)’ in: O. Edenhofer et al. (eds.), Climate Change 2014: Mitigation of Climate Change. Contribution of Working Group III to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change (Cambridge University Press 2015), 811, 846 and 847; J.R. Porter et al., ‘Food security and food production systems’ in: C.B. Field et al. (eds.), Climate Change 2014: Impacts, Adaptation, and Vulnerability. Part A: Global and Sectoral Aspects. Contribution of Working Group II to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change (Cambridge University Press 2015), 485, 515 and 518.

[7] Annette Freibauer et al., ‘Carbon Sequestration in the Agricultural Soils of Europe’ (2004) 122 Geoderma 1.

[8] L. Bizikova et al., Climate Change Adaptation Planning in Agriculture: Processes, Experiences and Lessons Learned from Early Adapters, (2014) 19 Mitigation and Adaptation Strategies for Global Change 411.

[9] Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions, An EU Strategy on Adaptation to Climate Change, COM (2013) 0216 final, 8.

[10] Art. 28(6) Regulation (EU) No 1305/2013.

[11] Jonathan Verschuuren, Towards a Regulatory Design for Reducing Emissions from Agriculture: Lessons from Australia’s Carbon Farming Initiative, (2017) 7:1 Climate Law 1; Dong Sun et al., Carbon Markets in China: Development and Challenges, (2016) 52:6 Emerging Markets Finance and Trade 1361.

[12] Verschuuren 2017.

 

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 This blog is a summary of a paper accepted for presentation at the 3rd European Climate Change Adaptation Conference ‘Our Climate Ready Future’, Glasgow, 5th-9th June 2017 (ECCA2017). My project has received funding from the European Union’s Horizon 2020 research and innovation programme under the Marie Sklodowska-Curie grant agreement No 655565.

EU

 

 


25/02/2017

Climate Change Impacts on Agriculture and Food Security: What Role for Disaster Law?

By Jonathan Verschuuren (TLS)

Agriculture depends on a stable climate. Crops need a fertile soil, sufficient water and temperatures that remain within a certain (plant specific) bandwidth, livestock needs healthy grazing land, sufficient water and livable temperatures. The climate needs to be predictable, so that farmers can plan their activities with the aim to secure the best possible harvest. Such stable conditions only occurred after the previous major climate change that took place on Earth and which marked the end of the last ice age, around 12,000 years ago. Around that time, man settled down and started to grow his own food through agriculture.

Given the dependence of agriculture on weather and climate, it does not come as a surprise that the agricultural sector is and will be hit hard by climate change impacts. The impacts are diverse and potentially disastrous for global food security. The latest IPCC report on the impacts on agriculture and food security gives a chilling image of what is expected to happen and, in fact, is already happening across the world.[1] Water shortages in droughts and heat waves have a negative impact on crops as well as livestock. A surplus of water with excessive precipitation, floods and inundation, increased and changing occurrence of pests, weeds and diseases, are but a few examples of the other impacts of climate change that negatively affect agriculture. Extreme weather events, generally, hit rural areas hard with a profound negative impact on rural communities and food production.

Against this background of increasing climate change impacts on agriculture, both through slow- and sudden-onset disasters, it is particularly worrying that food demand is and will continue to grow over the next few decades until 2050. It is expected that increasing climate change impacts on agriculture and rising demand will lead to an increase of food prices across the globe. According to the IPCC, ‘it is very likely that changes in temperature and precipitation (…) will lead to increased food prices by 2050, with estimated increases ranging from 3 to 84%.[2] A World Bank report adds that losses in the agricultural sector and spikes in food prices can push vulnerable consumers into poverty, as poor people spend a large part of their budget on food.[3] The 2008 food spike caused around 100 million people to fall into poverty, and the 2010–2011 food price spike has been estimated to have pushed 44 million people below the basic needs poverty line across 28 countries.[4] It can, therefore, be expected that there is a substantial risk of increasing famine in developing countries.

Developed countries, however, are not safe either. Consumers in developed countries are not only expected to face drastic price increases, but food safety issues as well.[5] Rural communities in developed countries are particularly vulnerable for climate change impacts, for several reasons, such as the substantially higher average age compared to urban areas. The IPCC refers to the social impact of the prolonged drought in Australia during the early 2000s which led to ‘farm closures, increased poverty, increased off-farm work, and, hence, involuntary separation of families, increased social isolation, rising stress and associated health impacts, including suicide (especially of male farmers), accelerated rural depopulation, and closure of key services’.[6]

Climate disaster law

Disaster law is the field of law that aims to respond to disasters, to compensate for the losses that occurred in a disaster and to facilitate recovery and rebuilding, as well as to mitigate the possible impact of future disasters. Climate disaster law is the rapidly developing new body of law which responds specifically to climate disasters. So far, however, attention for agriculture and food security has been fairly limited and it is clear that in this area, much needs to be done to prepare the world for increasing climate disasters hitting agriculture and food security.

Disaster mitigation in agriculture

The disaster mitigation phase, usually, is considered to be the most important phase of the disaster cycle (mitigation-response-rebuilding), not just because of the simple fact that prevention is better than curing, but also because of the nature of climate disasters. Adler rightfully observes that ‘drought and other disaster response policies that might be appropriate for occasional and difficult-to-foresee events may no longer be appropriate for conditions that will now occur with increasing frequency due to climate disruption’.[7]

Disaster mitigation for agriculture starts with the adoption of climate smart practices and technologies. Most countries, around the globe, do not have comprehensive and effective legal instruments in place that stimulate farmers to adopt climate smart practices and technologies.[8] To make the agricultural sector more resilient to climate change, it is essential that law and policymakers around the world rapidly start developing policies and laws so that climate-smart agricultural practices are commonplace soon. Financial instruments, such as subsidies or offset mechanisms under carbon pricing programmes can be used to achieve this goal. In addition, well-functioning early warning systems should be operational to help farmers to manage the hazards and avoid these turning into disasters. International collaboration and fundraising seems required to speed up the development and implementation of early warning systems for agricultural climate disasters. The same is true for climate and weather information and forecasts. These do exist, but have to be further developed to make the forecasts more useful for farmers.

Disaster response in agriculture

According to the FAO, between 2003 and 2013, about 3.4 percent of all humanitarian assistance was directed to the agriculture sector, with an average of around 374 million USD annually. The average annual crop and livestock production losses in developing countries, however, were much larger: an analysis of 140 disasters triggered by natural hazards found annual costs of crop and livestock losses to be 7 billion USD per year over the same period. With the expected increase of the number and size of disasters under climate change over the next few decades, much remains to be done to improve our ability to effectively respond to climate disasters, especially in the area of agriculture and food security. The current instrument of the Food Assistance Convention, that lays down a set of principles and best practices for effective and efficient food assistance for the most vulnerable people needs to be expanded to a full and comprehensive legal framework on international climate disaster response, so that the response efforts are well coordinated and aligned and so that domestic emergency managers are fully engaged and empowered.

Rebuilding: getting the farmer back into business asap

After a climate disaster, food production needs to be restored as soon as possible. Financial aid is usually needed so that farmers can clean up and prepare the land for agricultural activities, buy new seeds, new machines, new livestock etc. At the international level, organizations such as the World Bank, the International Fund for Agricultural Development, and the Special Climate Change Fund under the UNFCCC, put much effort into providing such financial aid. It is now well understood that farmers and communities should undertake investments with long term benefits, so that the next climate disaster has less impact. The compensation and rebuilding phase, therefore, is closely linked to the disaster mitigation phase.

A range of methods is explored for their suitability to compensate for the loss caused by climate change. Although private insurance has its limitations in the case of climate disasters, new insurance products are being developed, such as the ‘Broad Weather Insurance Policy’ which was developed by agricultural insurance companies together with agribusiness organisations and the government in the Netherlands to offer farmers insurance against climate change related crop damage.[9] This policy covers financial loss caused by natural disasters, such as extreme rainfall, extreme drought, erosion, severe windstorms, hailstorms and fires (caused by lightning). This insurance does not cover all damages, but instead requires farmers to bear 30% of the loss. The government has a subsidy scheme in place to provide financial assistance to individual farmers to pay for the premium. Reinsurance firms are even starting to operate in developing countries in Africa, where micro-insurance policies have been developed for farmers to cover for loss of crops due to drought, storms, pests, and diseases.[10] Private markets alone cannot provide the funding that is needed to develop and operate insurance products for farmers to protect them from financial losses caused by climate disasters. Some form of government intervention and cooperation between insurers, banks, governments and NGOs is essential to make climate disaster insurance for farmers a success. In order to avoid that farmers keep relying on government aid and insurance claims, and do not make the necessary changes to become more resilient to climate change, it is important that legal instruments in the area of disaster compensation reward the adaptive farmer.

 

[1] J.R. Porter et al., ‘Food Security and Food Production Systems’ in: Climate Change 2014: Impacts, Adaptation, and Vulnerability. Part A: Global and Sectoral Aspects. Contribution of Working Group II to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change (CUP 2014), 485-533. The IPCC is currently preparing a special report on climate change, desertification, land degradation, sustainable land management, food security, and greenhouse gas fluxes in terrestrial ecosystems. This report is due to come out in 2019.

[2] Id. at 512.

[3] S. Hallegatte et al., Shock waves. Managing the impacts of climate change on poverty (Worldbank 2016) at 5.

[4] W.N. Adger et al., Human security in Climate Change 2014: Impacts, Adaptation, and Vulnerability. Part A: Global and Sectoral Aspects. Contribution of Working Group II to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change (CUP 2014) at 763.

[5] M. Miraglia et al., Climate Change and Food Safety: An Emerging Issue with Special Focus on Europe, (2009) 47(5) Food and Chemical Toxicology 1009–21.

[6] A. Reisinger et al., ‘Australasia’ in: Climate Change 2014: Impacts, Adaptation, and Vulnerability. Part B: Regional Aspects. Contribution of Working Group II to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change (CUP 2014) at 1398.

[7] Robert W. Adler, Balancing Compassion and Risk in Climate Adaptation: U.S. Water, Drought, and Agricultural Law, (2012) 64(1) Florida Law Review 201, 265.

[8] Jonathan Verschuuren, Towards a Regulatory Design for Reducing Emissions from Agriculture: Lessons from Australia’s Carbon Farming Initiative, (2017) 7(1) Climate Law at 6-10.

[9] W.J. Wouter Botzen, Managing Extreme Climate Change Risks through Insurance 57 (2012). For an up-to-date description of the cover of the current policy, see agricultural insurance company ‘AgriVer’ website, http://www.agriver.nl/gewassen-te-velde.html (in Dutch).

[10] The World Bank’s Global Index Insurance Facility, for example, stimulated the emergence of ACRE Africa (Agriculture and Climate Risk Enterprise Ltd.), operating in Kenya, Rwanda and Tanzania, see ACRE’s website http://acreafrica.com.

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Jonathan Verschuuren is professor of international and European environmental law at Tilburg University, the Netherlands. E-mail: j.m.verschuuren@tilburguniversity.edu. A detailed article on this topic will be published later this year in: Rosemary Lyster and Rob Verchick (eds), Climate Disaster Law: Barriers and Opportunities (Edward Elgar, 2017). This project received funding from the European Union’s Horizon 2020 research and innovation programme under the Marie Sklodowska-Curie grant agreement No 655565.

EU

Category: Agriculture, Climate

10/11/2016

WTO limitations for domestic climate smart agriculture policies

By Jonathan Verschuuren (TLS)

Achieving the Paris Agreement’s climate goals will require states to start focusing both on reducing emissions from agriculture and on the sequestration potential of agriculture and land use.  The imminent rise in global food demand coupled with the decline in fertile agricultural land caused by climate change will further necessitate the drafting and implementation of effective policies. These policies have to aim for mitigation, adaptation and food security, the three pillars of ‘climate smart agriculture’. Climate smart agriculture is an approach to developing the technical, policy and investment conditions to achieve sustainable agricultural development for food security under climate change (FAO 2013).  Examples of climate smart practices are the introduction of rotational grazing management schemes, crop rotation, minimum tilling, permanent native vegetation on farmland and the use of compost and other soil additives to increase soil carbon levels.  Examples of climate smart technologies are sophisticated, computerized drip-irrigation systems, and methane capture and conversion technologies in animal raising facilities.  A comprehensive regulatory framework to incentivize the agricultural sector to convert from conventional practices to become climate smart is still largely lacking, not just in the EU, but worldwide. Incentives that already are applied on a small scale are subsidies and tradable offsets under a carbon pricing mechanism. It is expected that future policies aimed at advancing the implementation of climate smart practices and technologies in the farming sector will use one of these or both instruments.

WTOBoth are voluntary instruments in the sense that farmers can choose not to apply for a subsidy or participate in an offset scheme, yet both do have an impact on trade because these instruments incentivize certain agricultural practices thus favouring some domestic farmers and their products over foreign farmers and their (imported or exported) products. When drafting a policy aimed at stimulating climate smart agriculture, it is, therefore, important to remain within the legal boundaries set by international trade law. There has been remarkable little attention for these trade law limitations to domestic policies in the area of climate smart agriculture. In Australia, for example, there does not seem to have been any debate on possible WTO requirements for the domestic Australian carbon farming initiative, which is a scheme aimed at stimulating farmers to reduce emissions or increase sequestration through offsets that are bought up by the government in reversed auctions. Academic literature does exist, but mostly focuses on the WTO boundaries for domestic climate law in a broad sense. That literature is rather worrying. Because it takes a broad perspective and deals with all potential instruments that may infringe upon a wide range of WTO instruments, it looks as if the WTO is a huge stumbling block for domestic policies.[1]

In my view, it is more worthwhile to focus on the two most likely instruments. As stated above, policies aimed at stimulating climate smart agriculture are likely to be some sort of government subsidy of a system of offsets from agriculture that are allowed in the carbon market. These instruments primarily have to be assessed against the requirements of two WTO instruments: the Agreement on Agriculture (AoA) and the Agreement on Subsidies and Countervailing Measures (SCM).

Domestic policies aimed at stimulating the adoption of climate smart agricultural practices and technologies are environmental protection programmes that, in principle, are allowed under the so-called ‘Green Box’ of the AoA, provided the support is only given in the start-up phase and is terminated after the benefits from the conversion to climate smart practices, be it from improved productivity, the generation of energy or from the sale of carbon credits on the private carbon market, greatly surpass the costs involved. Incentives that have a positive impact on production, such as for soil carbon projects, and that are not allowed under the AoA’s Green Box, are actionable under the SCM Agreement. It is hard to say in general whether payments to farmers, be it through a subsidy or through the carbon market, are not actionable because they do not cause adverse effects on competing producers in other countries. This very much depends on the individual case.

Several carbon farming methodologies definitely have production-enhancing co-benefits and would, therefore be actionable under the SCM Agreement. Soil sequestration projects, for example, are known to have a tremendous positive impact on the production of crops. Financing such projects could, therefore, be seen as granting an actionable subsidy, as long as they are not covered by the AoA. This means that it is up to the injured WTO member state to prove these subsidies caused serious prejudice to its interests, i.e., that because of the subsidy, it suffers from displaced imports into the market of the subsidizing country, displaced exports to third countries, significant price suppression, or an increase in the world market share by the subsidizing country.  Should a country succeed and subsequent consultations not lead to an agreement, the injured state can take countermeasures.

The accused state could argue that the subsidies are non-actionable because these are meant to promote adaptation of existing facilities to new environmental requirements imposed by law and/or regulations, as allowed under the SCM Agreement.  It is, however, unlikely that all of the six conditions for this exception clause to apply are met as current schemes are voluntary, the subsidies are not one-time but re-occur every time new abatement has been achieved, and the payments are not limited to 20 per cent of the cost of adaptation.  The condition that financial assistance should be directly linked to and proportionate to a firm’s pollution reduction,  is only met in case of emissions abatement projects, such as methane capture. Sequestration projects are not covered as these do not reduce the firm’s own emissions. Whether the condition that the financial assistance needs to be available to all firms which can adopt the new equipment and/or production processes is met, depends on the design of the regulatory scheme. The Australian scheme, for example, under which only farmers with winning bids in a reversed auction receive government funds, seems incompatible with the latter condition.

The other WTO instruments are only relevant to a very limited extend. The GATT and TBT Agreement, generally, are not applicable in the case of the two instruments that are most likely to be used to stimulate climate smart agriculture. The GATS requires a policy to enable foreign service providers to be active under a carbon pricing mechanism aimed at offsets from agriculture. The TRIP Agreement requires states to protect the invention of climate smart technologies to be protected under patent law. Should policies be aimed at a rapid adoption of patented climate smart technologies, then states can opt for excluding a climate smart technology from patentability based on grounds of avoiding serious prejudice to the environment.

To further facilitate the adoption and implementation of policies promoting climate smart agriculture, the international community should take action in the area of international trade law. Unfortunately, climate change is not addressed in a comprehensive manner in the ongoing negotiations on liberalizing environmental goods and services, on the relationship between the WTO and the UNFCCC and the Paris Agreement, and on agriculture, nor in the regular meetings of the Committee on Trade and the Environment and the TBT Committee.  It is clear that policies aimed at stimulating climate smart agriculture cannot be neatly assessed under one of the current WTO Agreements, but instead are situated in between and across the various agreements, depending on the specific type of measure and the specific activity that is incentivized. It seems that it is difficult to give due consideration to climate smart agriculture in all of the ongoing negotiations and discussions within the WTO framework, although several realistic options to at least create more room do exist. The most realistic and feasible options in my view are including climate smart agriculture technologies in the yet to be concluded WTO Agreement on Environmental Goods and Services and to recognize carbon sequestration as an agricultural product under the AoA so that it becomes possible to support farmers’ sequestration measures under the Green Box.

 

[1] For example, David Blandford and Tim Josling, Greenhouse Gas Reduction Policies and Agriculture: Implications for Production Incentives and International Trade Disciplines (Geneva: International Centre for Trade and Sustainable Development, 2009); David Blandford, “Climate Change Policies for Agriculture and WTO Agreements”, in Joseph A. McMahon, Melaku Geboye Desta (eds.), Research Handbook on the WTO Agriculture Agreement. New and Emerging Issues on International Agricultural Trade Law (Cheltenham: Edward Elgar, 2012), pp. 223 et sqq.; David Blandford, International Trade Disciplines and Policy Measures to Address Climate Change Mitigation and Adaptation in Agriculture, E15 Expert Group on Agriculture, Trade and Food Security Challenges Think Piece (Geneva: ICTSD/WEF, 2013); Andrew Green, “Climate Change, Regulatory Policy and the WTO. How Constraining are Trade rules?”, 8:1 Journal of International Economic Law (2005), pp. 143 et sqq.; Christian Hberli, WTO Rules Can Prevent Climate Change Mitigation for Agriculture, Working Paper No. 2016/06 (London: Society of International Economic Law, 2016); Deok-Young Park (ed.), Legal Issues on Climate Change and International Trade Law (Cham: Springer International, 2016); Richard G. Tarasofsky, “Heating Up International Trade Law: Challenges and Opportunities Posed by Efforts to Combat Climate Change”, 2:1 Carbon and Climate Law Review (2008), pp. 7 et sqq.

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This project has received funding from the European Union’s Horizon 2020 research and innovation programme under the Marie Sklodowska-Curie grant agreement No 655565.

 EU


25/07/2016

Reducing Emissions from Agriculture: Australia’s Unique Approach (Part 2)

By Jonathan Verschuuren (TLS)

In my previous blog, I showed how various countries around the world are in the process of setting up offset schemes for agriculture, in an attempt to reduce greenhouse gas emissions from this sector. I also explained that Australia has a unique position as it has the longest operating system in place, and one that currently is not linked to emissions trading but is a stand-alone system. Technically, therefore, Australia’s Carbon Farming Initiative, is not an offset instrument, but a regulatory instrument aimed at achieving emissions reductions in the land use sector on its own. In this blog, I will focus on some of the results that have been achieved with the system so far, based on an empirical research that I carried out.[1] In case studies into selected CFI-projects and in a series of interviews with the key stakeholders, I searched for the experiences with the scheme in Australia, with the objective to draw lessons for other countries, including the EU as a whole, that wish to establish a policy aimed at reducing emissions from agriculture.

Sunset over rural Australia (Photo: J. Verschuuren)

Sunset over rural Australia (Photo: J. Verschuuren)

My research found that the current legislation on carbon farming in Australia provides an elaborate, yet reliable legal framework that seems well suited to assess project applications and issue credits to participating farmers who, through these projects, generated real and additional emission reductions. It was especially interesting to find that a major overhaul of the legislation in 2015, delinking the scheme from emissions trading, really pushed the scheme forward. Not having to sell credits on the volatile international carbon market, but being able to rely on long term, fixed government money (called ‘Emissions Reduction Fund’), spurred Australia’s farmers into action. It shows that it is important to create long term certainty for farmers. Farmers who want to introduce carbon farming have to implement structural changes to their farming practices with long term impacts on their business. The policy environment, as well as the agribusiness’ financial environment, has to accommodate such long term impacts. This also implies that relying on the carbon market for funding should only be done when there is long term certainty that carbon credits will earn an acceptable minimum price.

Another interesting finding is that, although Australia’s carbon farming policy and the associated regulatory framework is only aimed at achieving as much greenhouse gas abatement as possible against the lowest possible costs, many project actually have important co-benefits. These co-benefits often are an as important and sometimes even more important stimulus for farmers to convert to carbon farming than the direct financial benefits arising from selling generated carbon credits to the government. Generally, it is found that the policy is leading to the introduction of better farming methods in an overall conservative sector. These methods are not just good for combatting climate change, but have many benefits for farmers and even for food security. Vegetation projects generally reduce salination and erosion and improve water retention. Soil carbon projects were especially mentioned for having an astonishing impact on soil quality. Research indicates that an increase in the level of soil organic carbon, leads to a drastic increase of water availability and fertility, and thus to an increase in agricultural production. One respondent referred to an example he knew, of two brothers who had farmland adjacent to each other: ‘One of them was involved in a soil carbon project, the other was not. After a while, you could clearly see the difference, with much more and better growing crops on the land of the first. The other brother had to drive across his brother’s land to reach his own land and saw the difference every day.’ Although many respondents stressed that conservatism, especially among older farmers, slows down the adoption of these new climate smart practices, they all felt that the farming sector is slowly changing and is taking up these new practices. Assessing the impact of soil carbon projects, however, is complex and several stakeholders indicated that ‘we are still learning how to do it under different circumstances.’ Since the regulatory framework requires farmers to carefully monitor what is happening in the soil, a lot of new knowledge is generated. One respondent said: ‘We are in fact doing large scale experiments with soil carbon, all thanks to the Emissions Reduction Fund.’ There are many interesting case studies available remarkable results of reduced carbon emissions, better growing conditions, more water availability, and more biodiversity under such programmes as ‘soils for life’ and ‘healthy soils’.

Increasing soil carbon, therefore, has strong positive side-effects on adaptation as they increase the resilience of the land and lead to greater efficiency. Here, mitigation and adaptation go hand in hand. The same is true for some of the other sequestration methods that are allowed under the Australian scheme, such as native tree planting in arid and semi-arid areas both to store carbon and to stop degradation and salinization of farmland.

Sometimes, there are also direct economic co-benefits associated to carbon farming projects. In the piggeries sector, for example, there are producers who save A$ 15,000 (roughly € 10,000) per month on energy bills and earn an additional A$ 15,000 by delivering energy to the grid after having adopted methane capture and biogas production technology. When asked whether the CFI/ERF was the push factor, or the expected economic co-benefit, the respondent from the pork sector said that the CFI/ERF was the main driver for the distribution of this technology: ‘About half of the participating producers jumped because of the CFI/ERF push. It especially pushes medium sized producers, because it increases their payback just enough to get involved. Eighteen biogas projects in piggeries have to date generated A$ 6 million (€3.9m) a year in electricity savings and A$ 10.2 million (€ 6.6m) through carbon credits under the Emissions Reduction Fund. The Fund really was the driver for most of these eighteen producers.’ It is clear, though, that for the longer term, these co-benefits will continue to exist on a yearly basis, also without carbon credits being purchased by the government.

Grazing land regeneration project in western New South Wales (Photo: http://www.soilsforlife.org.au)

Grazing land regeneration project in western New South Wales (Photo: http://www.soilsforlife.org.au)

From these findings, the lesson can be drawn that a policy that has a wider focus on adaptation, food security, resilient and sustainable farm businesses and securing and creating jobs in the agribusiness sector, is likely to be more successful than one that only focuses on reducing emissions from agriculture. Several of the methods accepted or under development in Australia, such as those dealing with soil carbon, show that such co-benefits can indeed be achieved. Developing climate smart methodologies that not only deliver real, additional, measurable and verifiable emission reductions but also foster long term innovation and create economic, social and environmental co-benefits is essential for the success of any policy aimed at stimulating climate smart agriculture. Science has to be central in the development and adoption of methods that are accepted under the regulatory framework. In Australia, much research effort has already gone into method development. This now has to be taken to a global level. In order to avoid that every country is trying to invent the wheel, international collaboration in method development is pivotal. The aim has to be to roll out climate smart agriculture policies across the world, so as to stimulate our farmers to make a switch from conventional farming to climate smart farming.

 

[1] An article covering all the results of the project will be published in early 2017.

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This project has received funding from the European Union’s Horizon 2020 research and innovation programme under the Marie Sklodowska-Curie grant agreement No 655565.

EU


24/05/2016

Reducing Emissions from Agriculture: Australia’s Unique Approach (Part I)

By Jonathan Verschuuren (TLS)

Not many countries have regulatory schemes in place aimed at reducing greenhouse gas emissions from agriculture. As indicated in the blog on the Paris Agreement and agriculture, the agricultural sector is responsible for almost 25% of anthropogenic GHG emissions, both through CO2 emissions caused by deforestation and peatland drainage, and through methane (NH4) emitted by livestock and rice cultivation, as well as through nitrous oxide (N2O) emissions caused by the use of synthetic fertilizers and the application of manure on soils and pasture. There is a dark cloud hanging over this because emissions are expected to rise over the coming years and decades because of an expected sharp rise in food demand. The Australian Climate Change Authority, in a 2014 climate change policy review for that country, for example, reports that the agricultural sector is expecting a doubling of demand for agrifood commodities in emerging economies in Asia, particularly China and India. It is expected that Australia is in a good position to meet this increased demand, as a consequence of which Australia’s production of agrifood is expected to increase by 77% in 2050 (from 2007 level). The Climate Change Authority in its  report is pessimistic about what that means for climate change. Because of the strong economic incentives of the global food market, increasing emissions are inevitable: the expected production growth is likely to offset emission reductions achieved through the introduction of climate smart agriculture practices and technologies.

Photo by Flickr user Oli.

Photo by Flickr user Oli.

Doing nothing, however, is no option, as this will lead to an even bigger rise in emissions. And what is more: the agricultural sector has the potential to store large quantities of carbon in soils and vegetation. Domestic regulators, however, have been reluctant to address agricultural emissions, partly because of regulatory difficulties. It is, for example, difficult to measure emissions at the individual farm level since a variety of factors determine the amount of emissions (such as the diet of individual animals, soil composition, weather systems of individual regions, the way in which fertilizer is applied, etc.). In addition to emissions, removals are relevant as well since crops and other vegetation absorb CO2 from the air, and lots of carbon is stored in soils (more carbon is stored in soils than what is present in vegetation and the atmosphere). Soil carbon may be released, or remains there, or is increased, depending on how you manage the land.

A growing number of countries is setting up regulatory schemes aimed at reducing emissions from agriculture, mostly in the form of an offsets scheme linked to emissions trading. Under these schemes, industries and energy producers can buy credits generated by agriculture, and use these partly to comply with their obligation to hand in allowances equal to their emissions. This is the case in California, Quebec, Alberta, and Ontario. Under the California ETS, two types of agricultural offset projects are accepted, both aimed at reducing methane emissions: biogas systems in dairy cattle and swine farms, and rice cultivation projects. In Alberta, agricultural offsets include a wide range of projects: nitrous oxide emission reductions, biofuel production and usage, waste biomass projects, conservation cropping, several types of projects concerning beef production, projects aimed at reducing emissions from dairy cattle and biogas production.

The country with the longest experience in this area, however, is Australia. Despite the country’s much criticized poor overall climate policy, Australia adopted a Carbon Farming Initiative (CFI) as early as 2011, which spurred farmers into action and, therefore, potentially provides the rest of the world with a model to reduce emissions from agriculture. In 2011, the CFI originally was set up as an offset scheme under its ETS. Since the repeal of the ETS in 2015 (just before trading was set to start), the initiative, now called Emissions Reduction Fund (ERF) functions on its own and is enjoying rapidly increasing attention from farmers.

Instead of having to rely on the (unreliable) international carbon market, under the ERF farmers can offer the credits that they generated to the government through reversed auctions. Farmers can obtain credits for both emission avoidance projects and sequestration projects and offer these credits to the government. The government buys up credits from projects that achieved the biggest emissions cuts against the lowest costs. Agricultural emission avoidance projects mostly focus on methane emissions reductions: methane capture and combustion from livestock manure and methane emissions reduction through manipulation of digestive processes of livestock. A third important emission avoidance project for the agricultural sector is the application of urease or nitrification inhibitors aimed at reducing fertilizer and manure emissions. Sequestration projects are for example projects aimed at sequestering carbon in soils in grazing systems, on farm revegetation, rangeland or wetland restoration, the application of biochar to the soil, and the establishment of permanent plantings on farmland.

Since 2011, an enormous amount of expertise has been built up in Australia, and a very elaborate and effective regulatory system has been developed that on the one hand seems to ensure a high level of environmental integrity, while on the other hand not overburdening farmers with costly administrative obligations. The Australian scheme, therefore, is an interesting example for the rest of the world, particularly for the EU, that has yet to tackle emissions from agriculture. A government funded, project based system of emissions reductions seems to fit well in the EU’s Common Agricultural Policy.

In May 2016, the results from the latest auction were released. After three auctions a total of 309 carbon abatement contracts have been awarded by the Australian government to deliver more than 143 million tonnes of CO2 equivalent abatement, earning the project proponents a total of A$1.7 billion (about € 1 billion). The vast majority of abatement is by vegetation projects, which often are on farmland (but not always). Carbon farming has grown into an important new income stream for farmers in Australia. In a country prone to droughts, floods and bush fires, the scheme, therefore, not only helps to reduce emissions from agriculture, it also assists in diversification of agricultural practices and leads to a more resilient sector.

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This project has received funding from the European Union’s Horizon 2020 research and innovation programme under the Marie Sklodowska-Curie grant agreement No 655565.

EU


02/02/2016

The Paris Climate Agreement: silent about agriculture

By Jonathan Verschuuren (TLS)

In our previous blog on the Paris Climate Agreement, we already showed that there are important things missing from the Agreement, such as a collective emissions reduction target and a proper enforcement mechanism. This time, I would like to focus on another missing and completely underestimated issue: the impact of climate change on agriculture and vice versa.

Photo by Flickr user philHendley

Photo by Flickr user philHendley

The very few references that earlier versions of the negotiating texts made to agriculture all disappeared from the Agreement. As a consequence, the Agreement does not mention agriculture at all. This is a missed opportunity. There are pressing reasons for the international community to start regulating both emissions from agriculture and adaptation in this sector. The agricultural sector is responsible for almost 25% of anthropogenic GHG emissions, both through CO2 emissions caused by deforestation and peatland drainage, and through methane (NH4) emitted by livestock and rice cultivation, as well as through nitrous oxide (N2O) emissions caused by the use of synthetic fertilizers and the application of manure on soils and pasture. The latter two substances have a 25 times and 300 times stronger impact on the climate than CO2 respectively. With a sharp rise in food demand ahead of us, these emissions can be expected to go up drastically when no regulatory caps are in place.

Agriculture is also among the sectors that will suffer the largest negative impacts of climate change, for which, consequently, huge adaptation efforts are needed. Local temperature increases of 2°C or more without adaptation will negatively impact production of the major crops in tropical and temperate regions (wheat, rice and maize) and irrigation demand will increase by more than 40% across Europe, USA, and parts of Asia. The negotiators of the Paris Climate Agreement were worried about the food security issues and mentioned in the preamble that they recognize the fundamental priority of safeguarding food security and ending hunger, and the particular vulnerabilities of food production systems to the adverse impacts of climate change. This is a much weaker version, though, of an earlier proposal to include a binding adaptation goal in the Agreement on “maintaining food security”. The first part of the preambular provision on food security seems to imply that maintaining food security might be a reason to not impose mitigation measures on the agricultural sector. In the negotiating texts, food production regularly emerged as a limiting factor to mitigation actions. In the final version of the Paris Climate Agreement, only one such reference survived. One of the objectives of the Agreement, laid down in Article 2, is: “Increasing the ability to adapt to the adverse impacts of climate change and foster climate resilience and low greenhouse gas emissions development, in a manner that does not threaten food production”.

Given the contribution of agriculture to climate change and the impact of climate change on agriculture, it is disappointing that so little attention is paid to agriculture in the Paris Climate Agreement, as this document is expected to set the tone for the world’s climate policies of the coming years.

The European Union opted for a much firmer approach toward agriculture. In the run-up to the Paris Climate Agreement, the European Commission announced that it would encourage “climate friendly and resilient food production, while optimising the sector’s contribution to greenhouse gas mitigation and sequestration.” For example, it proposed to include cropland and grazing land management in its policy from 2020, developing instruments to do so before 2020. The EU even proposed to focus its future climate change instruments on all agricultural activities, such as enteric fermentation, manure management, rice cultivation, agricultural soils, prescribed burning of savannahs, field burning of agricultural residues, liming, urea application, other carbon-containing fertilisers, cropland management and grazing land management and “other.” As a consequence, the EU proposed to fully include agriculture in the Paris Climate Agreement in two ways: as a source of greenhouse gas emissions, and as a means of CO2 absorption and sequestration. This would mean that the agricultural sector has to undergo a drastic transition from conventional farming to farming using climate smart agricultural practices.

The above account of what survived the negotiations shows that the EU negotiators were not able to convince the others of the importance of including agriculture in the Paris Climate Agreement.

The fact that the Paris Climate Agreement does not pay attention to agriculture, however, does not mean that the document will not be important for the sector at all. Article 4 states that a balance needs to be achieved between anthropogenic emissions by sources and removals by sinks of greenhouse gasses in the second half of this century, in order to hold the increase in the global average temperature well below 2°C. It is obvious that this automatically implies that drastic mitigation actions are needed to reduce emissions from a sector that is responsible for almost 25% of the greenhouse gas emissions. Apparently, the world leaders were afraid to tell you…

Similarly in the area of adaptation, the silence about agriculture does not mean nothing will happen. Many of the provisions on adaptation and finance aim at giving increased support to developing countries to meet their adaptation needs, both through greater emphasis on providing financial resources and through the transfer of technology and capacity building. Given the impact of climate change on agriculture and the dependence of developing countries on this sector, it is beyond doubt that implementation of these new provisions will in fact largely focus on agriculture. The same might be true for the role National Adaptation Plans will play. Article 7(9) of the Paris Climate Agreement requires states to have such a plan aimed at building the resilience of “socioeconomic systems”. Agriculture definitely falls in this category.

Within only two decades a drastic transformation of the entire agricultural sector across the world, in developed and developing countries, is needed. This requires tremendous efforts of policymakers, farmers and the entire agribusiness. Let us hope that, despite the remarkable and regrettable silence of the Paris Climate Agreement about agriculture, states understand the urge to start to develop effective policies aimed at reducing emissions from agriculture while at the same time helping the sector to become more resilient to climate change.

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This project has received funding from the European Union’s Horizon 2020 research and innovation programme under the Marie Sklodowska-Curie grant agreement No 655565.

EU

Category: Agriculture, Climate

21/12/2015

The EU Regulation of Genetically Modified Organisms in 2015: at the Crossroad of History

By Ji Li (TLS)

The EU authorization of genetically modified organisms (GMOs) is the most strange and controversial area in the whole EU law system: the scientists are seriously distrusted by the general public, the authorization procedure is ‘unreasonably’ paralyzed or delayed, and the authorized GM products are banned by Member States without legitimate reason. But this is not the case in any other field of innovative technology or environmental law, and cannot be explained simply by precautionary principle or political pressure. This conundrum has puzzled the EU policy makers and lawyers for many years, and 2015 is a crucial year of fundamental reform. With the introduction of the opt-out clause, Member States now have freedom to ban GMOs without recourse to scientific evidence. Such a move may also cause negative effects concerning the EU internal market law and its obligations under the WTO law. We are now standing at the crossroad of history.

GMO is defined as “an organism, with the exception of human beings, in which the genetic material has been altered in a way that does not occur naturally by mating and/or natural recombination”.[1] The commercial application of GM technology in the agricultural sector can introduce many desirable traits into one single crop, thus has huge economic, health and environmental benefits. At the same time, people are also concerned about its potential environmental and health risks, as well as some ethical and socio-economic issues. Under the current EU law, both GM crops and foods/feeds must go through the authorization procedure before marketing. This involves two stages of decision-making: a scientific assessment about their safety and a political vote about their overall acceptability. However, in the past voting, because Member States were deeply divided in their opinions, there were hardly any qualified majority reached in the authorization procedure. In the end, it is always the Commission makes the decisions, which are based on the scientific reports of the European Food Safety Authority (EFSA) and usually grant the authorizations. This fact (purely science-based decisions, at least on the surface) triggers many Member States’ objections and the Council’s reactions. As a result, the authorization of GM food/feed is seriously delayed, and the authorization of GM crops is totally paralyzed, which are in violation of the EU law. But the Commission could not do anything about it because the Member States’ ‘illegal’ actions were backed by the Council.[2]

After many years’ tough negotiations and some small legal revisions, in March 2015 a fundamental legal reform called ‘opt-out clause’ was agreed by all Member States and enacted by the Commission.[3] According to this new legislation, on the issue of GMO cultivation, Member States pro- and anti-GMO are finally unleashed from the political disputes and formally part with each other. For anti-GMO countries, they can now ban GM crops even after authorization without any need of scientific evidence. This can be done either by a blanket withdrawal from all the future authorizations (without need of giving any reason) before 3 October 2015, or (after that date) by quoting some ‘compelling’ socio-economic reasons listed in the legislation in individual case. As a result, 17 out of the 28 Member States have totally opted out on all their territories in this way,[4] while 3 kingdoms of the UK (Scotland, Wales and Northern Ireland, leaving only England to be willing to cultivate GMO) and the French-speaking Wallonia region of Belgium also declared to be GMO-free.[5] For pro-GMO countries, it is expected that the paralysis in the GMO authorization can be unblocked so that more GM crops can be authorized and cultivated.

However, this move also brings about legal uncertainties and new challenges. First, it is hard to say the opt-out clause is conform to the EU internal market law. It is rather to say that it is an exception to the principle of free movement of goods based upon all Member States’ political endorsement.[6] Some Member States and MEPs also would like to opt out for GM food/feed, but such requests were firmly rejected by the European Parliament’s Environmental Committee on the grounds of protecting the EU internal market. This shows that the EU policy makers are very aware that the political exception to the internal market rule cannot be too wide. Second, the opt-out clause is also against the EU’s obligations under the WTO law, especially after the famous US-EU Biotech case in 2006. There is no way to defend in this respect, people just hope the EU will not be sued by the Unites States (and other GMO-producing countries) for two practical reasons: (1) more GM crops will be cultivated in pro-GMO countries, which will hopefully make up for their losses; (2) the import of GM crops is relatively a small part of business (compared to GM products). Third, whether the principle of proportionality is applicable in the scenario of GMOs is also a big issue. It is uncertain at this moment whether Member States’ blanket ban of GM crops (without even giving reasons) would be challenged in the EU courts. Last, the increased cultivation in pro-GMO countries and the total ban in anti-GMO states will expose the sensitive issue of cross-border coordination and the potential liability arising out of GMO ‘contamination’.

In sum, the whole EU GMO regulatory framework stands at the crossroad of history and is facing new possibilities and challenges. Instead of one unified procedure, now the EU regulation of GMOs is running on double trajectories. In the coming few years we will witness how this new approach addresses the needs and pressures from inside and outside EU.

 

[1] Article 2(2), Directive 2001/18/EC.

[2] It is illegal because these Member States do not have scientific evidence to support a prohibition or restriction to the free movement of an authorized goods in the EU internal market.

[3] Directive (EU) 2015/412.

[4] These Member States include: Austria, Bulgaria, Croatia, Cyprus, Denmark, France, Germany, Greece, Hungary, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Poland and Slovennia.

[5] Reuters.com by Barbara Lewis, ‘Majority of EU Nations Seek Opt-Out from Growing GM Crops’, 2015.10.04, available online at: http://www.reuters.com/article/2015/10/04/us-eu-gmo-opt-out-idUSKCN0RY0M320151004#xu0BYp9saiqghPUK.97 (last visited on 2015.11.08).

[6] The Commission indicates that the legal basis of opt-out clause could be Article 2 TFEU, which is a new provision introduced by the Lisbon Treaty. The third sentence of Article 2 (2) TFEU reads: “the Member States shall again exercise their competence to the extent that the Union has decided to cease exercising its competence”.


25/02/2014

Where is the legal framework for Climate Smart Agriculture?

By Jonathan Verschuuren (TLS)

Between now and 2050, there will be a sharp increase in the demand for agricultural products. This is caused by an increase of the world’s population from 7 billion today (2012) to 9 billion, the rise in global calorie intake by 60% due to greater affluence, particularly in countries like China and India, and the production of bio-fuels (Meridian Institute 2011). The increase in agricultural production is likely to be accompanied by an increase in the emission of greenhouse gasses. Agriculture is responsible for 30% of total global greenhouse emissions, mainly through land-use change (particularly deforestation driven by agricultural expansion, also affecting biodiversity), methane and nitrous oxide emissions (from livestock and the use of fertilizers). The Meridian Institute, in its 2011 report ‘Agriculture and Climate Change: a Scoping Report’ shows that agriculture is not only a major cause of climate change but in many regions of the world, it is also seriously impacted by climate change. It is expected that by 2050, 56% of crops in Sub-Saharan Africa and 21% of crops in Asia will be negatively affected by the consequences of climate change, for instance because of shifts in water availability, temperature shifts, and changes in the occurrence of pests. This often has direct effects on the availability of food. In other regions, such as Europe, it seems that at least in the short term, climate change can be beneficial to agricultural production, allowing, for example for an additional yield per year or the opportunity to grow a more profitable crop. Europe, though, ultimately will be affected by these developments as well: food shortages are expected due to demand in other markets, particularly the emerging economies, even when taking into account the decline of Europe’s population (European Commission 2012).

Limiting food security risks under climate change requires new climate-smart agriculture policies to be implemented. Around the world, a wide variety of adaptation and mitigation projects are being trialed in the agricultural sector under such headings as ‘carbon farming’ or ‘climate smart agriculture’ (hereafter: CSA). The FAO website on climate smart agriculture has a list of more than 150 projects around the globe. Examples of these are the application of low water use technologies, crop changes, tillage and residue management, land-use change, agroforestry, enhancement of agro-biodiversity, etc.  So far, these, mostly experimental, projects have not or only barely been brought under the existing legal framework on climate change adaptation and mitigation.

With the varieties in effects of agriculture on climate change and in the effects of climate change per region, it is a challenge to come up with an overarching legal framework that allows for both climate change mitigation and adaptation, while maintaining or even improving food security as well as providing benefits to as many people as possible. Although food security has been acknowledged as an important issue under the UN Framework Convention on Climate Change, bringing adaptation and mitigation in the agricultural sector under the UNFCCC and the Kyoto Protocol is only happening at a slow pace. Emissions from land use change and agriculture are included in the Protocol accounting mechanisms, but only when measurable as verifiable changes in carbon stocks. In addition, Parties could elect additional human-induced activities related to LULUCF (Land-Use, Land-Use Change and Forestry), specifically, forest management, cropland management, grazing land management and revegetation, to be included in its accounting for the first commitment period. Only four countries elected for this option in that commitment period, hence strongly limiting the possibilities under the Clean Development Mechanism (CDM) as well. Furthermore, methodological questions have led to restrictive limits. Soil sequestration, for example, has been excluded from the CDM, and land use change can only account for 1% of all CDM credits. Some support to developing countries in the field of agriculture is provided for by the Adaptation Fund and the Green Climate Fund.

In general, it must be concluded that the instruments aimed at reducing greenhouse gas emissions only apply to agriculture to a very limited extend. The relationship between agriculture and climate change is considered to be too complex to be included in current negotiations. There are seemingly insurmountable practical difficulties in integrating agricultural emissions in an emissions trading scheme.

At the international level, it is not just international climate law under the UNFCCC, but also international trade law under the WTO that is relevant when researching the legal framework for CSA. On the one hand, current income support for farmers may constrain CSA, for instance when support schemes do not ‘reward’ farmers for switching to agricultural practices that are aimed at climate change mitigation and adaptation. Under the WTO, reducing market distortions caused by income support to farmers have been discussed for years now, albeit without significant progress towards the liberalization of trade in agricultural products. On the other hand, the WTO’s intellectual property rights law (TRIPS agreement) seems to favour access to climate smart agricultural technologies and practices, as the TRIPS agreement protects IPRs while at the same time favouring technology transfer to developing countries, although the latter –in practice- still is problematic.

At the domestic level, only in very few countries attempts are made to introduce financial benefits to farmers for their mitigation efforts. Probably the best example is Australia that, in 2011, enacted legislation that allows farmers to (voluntarily) generate carbon credits that can be sold on the domestic and international carbon market: the Carbon Farming Initiative (CFI). Thanks to this initiative, Australia is the country with the most far-reaching example of active legislation aimed at facilitating and stimulating CSA. Farmers earn credits through agricultural emissions avoidance projects (projects that avoid emissions of methane from the digestive tract of livestock, methane or nitrous oxide from the decomposition of livestock urine or dung, methane from rice fields or rice plants, methane or nitrous oxide from the burning of savannahs or grasslands, methane or nitrous oxide from the burning of crop stubble in fields, crop residues in fields or sugar cane before harvest, and methane or nitrous oxide from soil), as well as through sequestration offsets projects.

In the EU, CSA is still very much in the research phase and the regulatory framework is largely absent. Farming is excluded from the EU ETS, but included in the Effort Sharing Decision.  The Effort Sharing Decision establishes binding annual greenhouse gas emission targets for Member States for the period 2013–2020. Member States have to develop their own policies in order to achieve their targets and therefore, may put more emphasis on some sectors than on others. For agriculture, emission reductions could for instance be achieved through more efficient farming practices and conversion of animal waste to biogas. Other than in Australia, LULUCF projects are explicitly excluded from the Effort Sharing Decision, so important measures like cropland and grazing land management and revegetation are not covered. The second route towards addressing emissions from agriculture is through the EU Common Agricultural Policy (CAP) reform in 2013. Here mitigation and adaptation policies meet, as the CAP is also the primary means for promoting climate resilient agriculture. In the initial proposals, the European Commission suggested to earmark 30% of the direct payments for farmers who apply agricultural practices beneficial to climate change and the environment (through crop diversification, maintenance of permanent pasture, the preservation of environmental reservoirs and landscapes, etc.). In addition, it was proposed to give increased financial support to agri-environment-climate projects and organic farming under the EU´s rural development policy. In the final stages of the negotiations, however, these proposals have been watered down to a considerable extent.

Category: Agriculture, Climate

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