Key trends in the timber industry: forest climate projects and the market for carbon units
The ninth item on our list of ten key trends that have influenced the forest industry over the past decade and will continue to shape it in the coming years - forest climate projects and the carbon market.
- In 2020, the transition to a new carbon regulation system began, which allows reducing the carbon footprint of economic activities through the creation of climate projects.
- In 2021, the Strategy for Socio-Economic Development with Low Greenhouse Gas Emissions until 2050 was approved, and a law limiting greenhouse gas emissions also came into force. Since 2021, a climate experiment has been launched on Sakhalin, and in 2022, the Ministry of Economic Development of the Russian Federation approved the criteria and procedure for classifying projects as climate projects. Mandatory carbon reporting is being introduced for the largest issuers.
- Russia accounts for 20% of the world's forests, which absorb about 700 million tons of CO₂ equivalent per year. Forest climate projects aim to store carbon in forests, thereby reducing its impact on the warming of our planet's atmosphere and, consequently, on climate change.
- In September 2022, information about the first climate project to undergo independent verification of compliance with legal standards was entered into the Russian register of carbon units. This is a project in the Sakhalin region, the implementation of which should ensure the absorption of 1.5 million tons of greenhouse gases over the next 75 years.
- An even larger scale forest climate project will be created in the Khabarovsk Territory - the decision on it was made at the regional government level, and the presentation took place within the framework of the Eastern Economic Forum in 2023. The experience of its launch will be broadcast to other regions.
- Various technologies for absorbing carbon dioxide are being developed by leading Russian universities at our country's carbon sites - 17 sites cover natural landscapes in all climatic zones.
- The first agricultural carbon fiber test site in the Russian Federation will be created in the Samara region. Scientists will have to develop a draft national protocol for measuring, reporting and verifying changes in soil carbon stocks with the ability to calculate carbon credits for their sale on the carbon market.
- In the next ten years, Yakutia will be able to claim the status of a Russian donor of carbon units. In the forest and tundra ecosystems of the region, the high carbon sink will be completely leveled - this is how scientists call the amount of CO₂ in plant tissues.
Olga Kalyuzhnaya, President of the Russian Timber Association: “At the beginning of 2024, it became known that Russia could initiate the creation of a register of carbon units of the BRICS+ countries. The State Duma Committee on Energy plans to recommend that the Russian Government consider this possibility. This is an important step for the development of the carbon market and a great example that environmental responsibility and financial impact are not at odds with each other. Trading carbon units helps businesses reduce their burden on the environment, and provides international investors with new opportunities to invest in “green” technologies and projects.”.