Money for mangroves
- 31 Jul 2012, 09:19
- Freya Roberts
Mangroves spanning the world's tropical waters perform many
functions, including locking up carbon. By working out how much
carbon they store, and how much it would cost to preserve them, a
new
study in Proceedings of the National Academy of Sciences found
that protecting mangroves is actually cheaper - for each tonne of
carbon dioxide emissions avoided - than buying into the EU's
Emissions Trading Scheme (ETS).
Or at least it was. But since the research was completed, the
carbon price - the cost of emitting one tonne of carbon dioxide
under the Emissions Trading Scheme,
has fallen. So, purely in terms of avoiding greenhouse gas
emissions, is preserving mangroves still the cheaper option of the
two?
What the study did
Before the study could get down to the finer economic details, it
first mapped out how much carbon is stored in the world's
mangroves.
The authors used satellites to work out the area mangroves in the
tropics cover and the amount of carbon they store. This method is
similar to those used in recent studies looking more broadly at
emissions from tropical deforestation. Although this system
isn't perfect, it allows scientists to build a reasonably accurate
picture of carbon stock and to estimate how fast mangroves are
being lost.
Working out the cost of keeping carbon locked up in mangroves is
more complicated. The authors had to work out the most profitable
way of using that land if it were not being preserved, and add to
this the cost of setting up and managing a protection area. And all
of these costs depend on where in the world the mangroves are
located.
But once you know about the amount of carbon being stored, and how
much it costs to prevent it from being released if the land is
developed for other uses, it's relatively simple maths to work out
how much each tonne of stored carbon dioxide is worth.
The economic case
Essentially, the
study finds that a big chunk of global emissions can be avoided
at a relatively low cost, before protecting mangroves becomes
prohibitively expensive. The authors say:
"the majority of potential emissions from mangroves could be
avoided for less than $10 per [metric] ton"
Here's how it looks:
Fig. 1. Avoided emissions from mangrove preservation. Source:
adapted from Siikimaki
et al., 2012
Their conclusion is demonstrated in the central (blue) estimate,
when looking at the global picture. Working out what quantity of
emissions are avoided depends on how much would have been released
if the land had been converted. Since this is only partially
understood, the authors also give a high (black) and low (red)
estimate.
But figuring out how good a deal this is is pretty difficult
unless you can compare it to other mechanisms which essentially aim
to do the same thing - avoid emissions. Like the
EU Emissions Trading Scheme.
The grey band on the graph above demonstrates the carbon price
under the ETS. Looking at the central estimate, and as the authors
summarise, you can see a lot of those avoided emissions could be
achieved for less than $10 per tonne, which is the bottom end of
the spectrum for ETS prices in 2011.
So if you're looking to spend some serious pocket money by taking
future greenhouse gas emissions off the market, mangroves appear to
be better value for money. The only trouble is, the price of carbon
permits can plummet and suddenly buying into the ETS becomes the
cheaper option.
Does it still make economic sense?
This is what is happening now, in mid-2012. The
price of permits has collapsed over the past nine months. The
market is oversupplied, and the tough economic conditions are
reducing demand. In terms of this new study, it may mean that the
range of ETS permit prices no longer reflect the actual
price.
Let's take a quick, crude look. The authors give a range for 2011
carbon prices between $10-$20 per tonne. That's roughly €8-€16. In
the past week
the carbon price has been around €7-€8. And over the past
6 weeks it has at times dropped to around €6.50 and peaked just
above €8. Convert that range back into US dollars, that's $8-$10
ish per tonne.
Fig. 2. Avoided emissions from mangrove preservation, including
current price range of EU carbon permits. Source: adapted from Siikimaki
et al., 2012
That means currently, the carbon price is really sitting on or
just beyond that lower line of the grey band. Looking at the orange
line which is the $8 cut off, this really is the crucial point. If
carbon prices fall any lower, the economic case for preserving
mangroves looks much weaker.
This comparison is of course very simplistic, and doesn't really
capture all the
economic and environmental benefits that mangroves provide. In
tropical regions, they are a natural defence against rising sea
levels, growing upwards out of shallow water and raising the height
of the land in their wake. They are also a first line of defence
against storm surges, absorbing energy and preventing erosion. And
they provide food, building materials, firewood and medicines for
surrounding communities.
All of this doesn't really matter, it's just a fun comparison.
What it does tell you is this: protecting mangroves is cheap, and
buying permits is only just slightly more expensive. The ETS is
supposed to make carbon cost a reasonable amount, enough to
encourage industry and big business to become more efficient and
less polluting. But its failing to do so. The EU have made some
intervention but at the moment it's not enough.