Permanence / reversals

For the purposes of this website, permanence refers to whether the net benefit of an action, such as carbon removed from the atmosphere, will remain fixed for a long period, or whether the process may soon be reversed. Permanence is important when emission reductions or removals from REDD+ are used as offsets – if the forest underlying the offset is destroyed the offset will also be compromised unless the loss of forest is taken into account.

In the case of GHG standards for land use, permanence refers to the longevity of a carbon pool and the stability of its stocks, given the management and disturbance of the environment in which it occurs. The risk of non-permanence (also referred to as “reversals”) describes the possibility of reversing climate benefits through the loss of forest carbon biomass, for example through a fire or pest outbreak that releases carbon back into the atmosphere. Reversals are sometimes categorized as “intentional vs. unintentional” referring to whether it was anthropogenic (i.e. induced by human activity, such as harvesting) or a natural disturbance (e.g. a hurricane). However, there are challenges in attributing and separating natural from man-made effects on emissions.

Until recently, the only tool available to developed countries under the Convention or commitments under the Kyoto Protocol was the IPCC’s “managed land” proxy—which allows countries to designate lands “where interventions and practices have been applied” versus those which were assumed to be “untouched” and therefore the country bore no responsibility for emissions, nor reaped benefits from removals, from such lands. More recently, Parties to the Kyoto Protocol have agreed to allow countries with commitments the option of excluding emissions from natural disturbances. 

In the case of developing country REDD+ programmes, the managed land proxy is available—as current guidance in the UNFCCC supports the use of IPCC guidance. However, whether and how natural disturbances may be treated under the Convention has not been decided. Neither Brazil nor Guyana has created a mechanism to manage force majeure events or natural disturbances. Brazil’s Amazon Fund states that if emissions exceed the reference level, no payments would be made in that year and equivalent emissions would be deducted from positive results in subsequent years.

Concerns about the risk of reversals for CDM (Clean Development Mechanism) projects have been managed in a different manner. Afforestation and reforestation projects are only issued temporary credits (tCERs) or long-term certified emission reductions (lCERs), which must be replaced upon expiration. This has resulted in lowering the value of such credits in comparison to permanent Certified Emission Reductions from other sectors.

Unlike the CDM, domestic systems and voluntary carbon standards do not create a different type of credit, but instead establish “risk buffer pools” and require a proportion—often corresponding to the reversal risk—of the credits generated by projects or programs to be contributed to such a pool as a kind of insurance mechanism. Domestic systems, such as California’s cap-and-trade system, require lengthy monitoring periods to ensure forest carbon offsets are permanent, i.e. up to 100 years beyond the lifetime of the project.

Most safeguard standards generally defer management of permanence risks related to carbon sequestration to the complementary carbon standard that is assumed to be used for forest projects. The Climate, Community and Biodiversity Standards, however, do suggest a project should also maintain and enhance the community and biodiversity benefits of activities beyond the project’s lifetime.