Page 161 - Research on Financial Development Mechanism and Path of Forestry Carbon Sequestration in Developing Countries under Double Carbon Targets

Chapter IV Forestry Carbon Sequestration Financial Practice

measurement is to be achieved, people are required to have a clearer understanding of
the specific changes in carbon sequestration of this type of products. At present, the car-
bon footprint of wood products is calculated and tracked based on the domestic wood
production and processing statistics of EU member states, the general service life of the
products and the total return of carbon sinks of the products to the atmosphere. In 2019,
the European Parliament voted to approve a budget of 2 million euros to support a pilot
project for a new carbon sequestration accounting method in 2020.
In order to steadily increase carbon sinks and achieve “carbon neutrality”, the
current carbon capture and storage (CCS) technology has limitations in terms of cost,
storage capacity and public acceptance, and limiting the number of recoverable trees
in Europe is not a necessary measure to “reduce carbon sink losses”, which requires
farmers to be encouraged to increase carbon sinks in cultivated land and forest land.
At present, EU ministers of agriculture have discussed the incentive mechanism un-
der the framework of the EU Common Agricultural Policy (CAP), thinking about the
use of ecological mechanisms to reward farmers for increasing carbon sinks through
strengthening soil carbon sinks or through afforestation and reforestation. The next step
will be to develop a sound regulatory framework and further study the introduction of
forestry into the EU emissions trading system. With the continuous development of the
European carbon trading market, the industry participating in the carbon sink market is
also expanding. Mecger believes that the existing United Nations Clean Development
Mechanism has partially confirmed the feasibility of the participation of agriculture and
forestry in the carbon emission system. However, the discussion should be conducted
on the basis that a certification system has been established and is functioning well. It is
inappropriate to rush into the forestry carbon emission trading system at this stage.
On the one hand, with the advancement of the bio-recycling economy action plan,
the European Commission will study and establish an accounting and certification
mechanism for agricultural and forestry carbon sinks in the next few years, and plans
to develop a carbon sink certification system by 2023. In the process, it will also face
many challenges. Due to the “reversibility” of forest and soil carbon sinks, in the case
of certified forest fires causing carbon emissions, it is necessary to consider abolishing
relevant certification certificates or relevant carbon sink products that have been circu-
lated in the market. For the issue that the revocation of certification has been used to
offset carbon emissions, it is also necessary to formulate countermeasures in advance.
In order to effectively integrate agriculture and forestry into the carbon emissions trad-
ing system, it is necessary to establish accounting standards that can ensure the accura-

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