Category: Avoided deforestation

Future fuels, food and land use implications

dchone December 20, 2024

I recently had the honour to represent Shell as an industry observer and panellist at the 80^th anniversary of the International Civil Aviation Organisation (ICAO). This important United Nations agency emerged during the final months of the Second World War, after several years of negotiation. Agreement was reached in early December 1944 at the famous Stevens Hotel in Chicago. 80 years later delegates met again at the same location, now the Hilton Chicago, to celebrate the achievement and to recognise all that ICAO has done over the years to steer civil aviation to be such a successful, safe and highly valued global enterprise.

Today civil aviation constitutes some 28,000 planes carrying nearly 5 billion passengers per year and over 60 million tonnes of cargo, but this operation runs almost exclusively on jet fuel derived from crude oil. In 2024 about 7 million barrels per day of jet fuel is consumed by civil aviation activities, with a resultant global CO₂ footprint of about 1.1 billion tonnes annually, or just over 3% of global energy related CO₂ emissions.

In Chicago, one of the key themes of the 80^th anniversary event was sustainability, with CO₂ emissions from the sector prominent within the panel discussions. While there were some fascinating discussions about short haul electric aviation and longer haul hydrogen powered planes, these upcoming technologies are not going to make any real dent in the aviation carbon footprint for some decades, so the focus for now is on the fuel used by existing planes and those being built with similar engine types over the coming twenty or more years. Given the very long lead times in aviation to develop, test and certify as safe even minor variations of the current technology set, we shouldn’t expect new technologies to displace the existing set anytime soon.

Sustainable aviation fuel (SAF) has become a key focus for the aviation industry. These are fuels that have their origin outside the fossil fuel supply chain, such as from biogenic sources, various waste streams and eventually via direct synthesis from carbon and hydrogen molecules derived from the air and water. As such, their carbon footprint can be much lower than conventional fuel. Carbon emissions can still result from land use change, when biogenic feedstocks are grown and harvested, and when energy is used in the production and transport of SAF. For example, using SAF today (the predominant current feedstock being used cooking oil) can result in a reduction of up to 80% in carbon emissions compared to conventional jet fuel, depending on the feedstock used, production methods, and supply chain logistics (IATA).

In the Sky 2050 scenario, developed as part of The Energy Security Scenarios published by Shell in 2023, SAF make major progress in replacing fossil derived fuels. Nevertheless, even with the rapid progress illustrated in Sky 2050 to limit warming to less than 1.5°C by 2100, the SAF journey for aviation is one that takes over 50 years.

Within this storyline, another discussion emerges and this featured in the panel sessions at the ICAO 80^th event in Chicago. It’s the issue of land use to make the significant amount of biogenic SAF. By 2065 in the chart above, biogenic SAF production has passed 6 million barrels per day, eclipsing the current 2.7 million barrel per day production of biofuels, which are primarily for cars and trucks. Such a level of production has raised concerns about the sustainability of these fuels, given the amount of land that might be needed to grow the crops and whether or not that competes with the need to grow crops for food or leads to further deforestation for agriculture in some parts of the world.

This is a valid set of questions and to help answer them there is a new analysis conducted by MIT and co-authored by three of my colleagues; Land-use competition in 1.5°C climate stabilization: is there enough land for all potential needs?; Gurgel A, Morris J, Haigh M, Robertson AD, van der Ploeg R and Paltsev S (2024), Front. Environ. Sci. 12:1393327. doi: 10.3389/fenvs.2024.139332. The MIT earth-system integrated modelling capability is ideal for such complex questions.

In this analysis the data in the Sky 2050 scenario is used to create a deeper understanding of the land pressures that confront the world. There is a need to grow food and potentially supply much more bio-energy from the land, and consideration must also be given to continued human development, land for wind turbines and solar PV and for land management and restoration to preserve biodiversity and grow the land carbon stock. These current and future needs all intersect.

The authors found that with proper regulatory policies and radical changes in current practices, global land is sufficient to provide increased consumption of food per capita (without large diet changes and accounting for a larger population) over the century while also utilizing 2.5–3.5 billion hectares (Gha) of land for nature based practices that provide a carbon sink of 3–6 gigatonnes (Gt) of CO2 per year as well as 0.4–0.6 Gha of land for energy production—0.2–0.3 Gha for 50–65 exajoules (EJ) per year of bioenergy and 0.2–0.35 Gha for 300–600 EJ/year of wind and solar power generation.

The authors set out the case starting with the split of current global land use, shown below.

They note that global land use was quite stable before the Industrial Revolution, but in the middle of the nineteenth century, changes in land use from natural vegetation to pasture and cropland accelerated—1.08 Gha of natural forests and natural grassland that existed in 1800 became agricultural areas by 1900, and had risen to 3.41 Gha converted by 2000. The most recent 50 years have experienced declining rates of land use conversion worldwide (refer to 4.1 Global land use: 1700–2100, in the paper).

Looking forward, land use becomes a critical consideration in any scenario. There will be more demand for food, there will be more renewable energy production, urban areas will expand and we are likely to see greater demand for bioenergy. At the same time, growing societal pressure to address biodiversity loss may become overwhelming for policymakers and planners, as well as the need to manage global carbon stocks much more proactively. As such, well financed nature-based solutions (NBS) become important, as can be achieved through carbon markets. The paper finds that the two largest adopted options are related to agricultural areas, such as in cropland (including both biochar and a broad suite of regenerative agricultural practices) and optimal grazing in pasture area. Natural forest protection also increases. Other relevant NBS practices accumulate to sizeable amounts by the end of the century, which is the case for reforestation of natural forest areas. Total land managed for NBS by the end of the century is projected to be about 3.5 Gha, of which 0.77 Gha is related to forest, 1.17 Gha to cropland, 1.17 Gha to pasture, 0.26 Gha to grassland and 0.15 Gha to other land types. Globally, the analysis finds there is enough land in each category to accommodate the NBS projections from Sky 2050, while also ensuring growing demand for food and other land-based products is met.

The paper authors project that global land area dedicated to bioenergy more than doubles by mid-century. It grows from about 100 Mha in 2020 to 242 Mha in 2050 and 286 Mha by 2100. Dedicated biomass growing areas enable growing bioenergy consumption. The total commercial bioenergy use grows from about 20 EJ in 2020 to about 50 EJ in 2050, and about 70 EJ in 2100. Land use at the global level can accommodate these demands expected under a 1.5°C climate stabilization scenario. At the regional level, however, challenges to integrate all land uses may arise and the paper explores this aspect in further detail.

The novelty of the study is in providing a clear message that it is possible to meet the land needs for major human requirements such as food and energy, while protecting and restoring land more broadly. The study shows the feasibility of achieving the land-use optimization needed for a climate stabilization scenario. With all inherent uncertainty about the potential cost reductions for existing technologies and deployment of new regulatory and technological options, one message is clear: there is an urgent need for advancing sustainable land management for food, energy and nature.

Note: Shell Scenarios are not predictions or expectations of what will happen, or what will probably happen. They are not expressions of Shell’s strategy, and they are not Shell’s business plan; they are one of the many inputs used by Shell to stretch thinking whilst making decisions. Read more in the Definitions and Cautionary note. Scenarios are informed by data, constructed using models and contain insights from leading experts in the relevant fields. Ultimately, for all readers, scenarios are intended as an aid to making better decisions. They stretch minds, broaden horizons and explore assumptions.

In Brazil, land use change looms large

dchone July 19, 2024

The recent release of the Brazil Scenarios Sketch, based around the Shell Energy Security Scenarios, highlights the role that land-use change could play for Brazil to achieve two important outcomes; reaching net-zero CO₂ emissions within its domestic economy and becoming an important supplier of carbon removal units into the global economy as the world strives to balance carbon emissions and reach net-zero. In fact, these two outcomes are inextricably linked.

The CO₂ emissions starting point from Bazil is shown in the illustration below, with land-use change being the largest component of the story, eclipsing fossil fuel emissions and even exceeding the large bioenergy CO₂ loop.

Within the scenarios team in Shell, understanding and accounting for land emissions has become a core component of the modelling expertise that has been developed. It is approaching the level of detail that is used in energy system modelling, although the uncertainty related to land-use emissions is much greater than that associated with energy system emissions. Nevertheless, by using a consistent data focused approach, clear trends emerge, and conclusions can be reached relating to changes of direction.

In Brazil, the 785 Mt CO₂ emissions shown above come mainly from ongoing deforestation. However, there are contributions from other ecosystems which are under threat. The breakdown is shown below and illustrates the detail available in the scenarios land-use database, which includes nearly twenty different land-use change types. While the categories are referenced by ecosystem type, the fact that they are shown as net positive emissions means that degradation is underway.

The scenario storyline for Brazil features two scenarios, Sky 2050 and Archipelagos. Both start with the realities of the 2020s, including the struggle to end deforestation in Brazil. As time moves on into the 2030s Sky 2050 takes a normative approach that starts with the desired outcome of global net-zero emissions in 2050 and works backwards in time to explore how that outcome could be achieved. By focusing on security through mutual interest, the world achieves the goal and a global temperature rise of less than 1.5°C by 2100. Archipelagos follows a possible path in a world focusing on security through self-interest. Even so, change is still rapid, and the world is nearing net-zero emissions by the end of the century but the temperature outcome in 2100 is a plateau at 2.2°C.

Both scenarios incorporate significant shifts in land-use policies and practices in Brazil. These are partly driven by government and incentive structures, but also driven by necessity and the recognition across society in Brazil that the threats emerging from ongoing deforestation, such as biodiversity loss and changes in South America rainfall patterns are unsustainable in the shorter term.

In Sky 2050 there is global recognition that Brazil holds the keys to net-zero emissions for many countries, in that the potential for natural carbon removals coming from Brazil can balance ongoing emissions in scores of economies. This leads numerous countries to invest in actions in Brazil to end deforestation, an essential first step towards delivering credible carbon removal credits from reforestation. In the scenario Brazil still overshoots its 2030 goal to end deforestation but has certainly achieved the goal by 2035. By then reforestation activities are becoming extensive with some 4 Mha of land under project management.

In the second half of the 2020s in Sky 2050 the agricultural sector adopts sweeping reforms, driven by a clear financial incentive structure underpinned by both domestic and international demand for soil carbon credits. The use of biochar in farming is taken up, together with changes in cropping and grazing. By 2030 these three new practices are drawing down 34 Mt of CO₂ per year, or about 10 Mt of carbon added to the soil, which in turn means improvements in farm output. The carbon credits produced by the farmers are sold into the domestic emissions trading system or transferred out of Brazil to other countries via Article 6 of the Paris Agreement. In 2030 farm income is bolstered by well over $2 billion as a result.

Biochar use has a long history in Brazil. Analysis of soils has revealed that more than 2,000 years ago, Amazonian Indians used to bury stable carbon in the soil. A mixture of broken pottery and various other organic materials has maintained the high fertility potential of these areas to this day. Biochar production is a technique through which carbon from biomass is transformed into stable carbon that can be captured in the soil. In addition to this long-term carbon sequestration role, biochar is also beneficial to soil performance as it improves the retention and diffusion of water and nutrients. Biochar is a soil additive produced through pyrolysis, a process that involves heating biomass waste (manure and agricultural residues) at high temperature in an oxygen limited environment.

By 2050 in the Sky 2050 scenario, Brazil is drawing down nearly 700 Mt of CO₂ through nature-based removals, with reforestation and agricultural biochar practices accounting for well over half the amount. But changed grazing and cropping practices as well as forest management and agroforestry also play important roles. The role of carbon markets acting as a conduit for international financing of domestic actions in Brazil cannot be understated. Without a global demand for carbon removals, the nature-based project investment required and incentives paid out to farmers cannot emerge on the scale necessary for Brazil to make all the changes that the scenario imagines.

In the Archipelagos scenario self-interest prevails globally. As a result, Brazil is not presented with the same level of partnerships or the major global demand for carbon removals. The result is that the country doesn’t end deforestation, although by mid-century the practice has been halved and the net-CO₂ impact is zero as reforestation and forest management activities balance the losses still being seen. Agricultural practices do change in Archipelagos, but with the global voluntary market being the primary driver of change rather than a mixture of voluntary and compliance markets, progress is slower than Sky 2050. However, the same endpoint is eventually reached, albeit one to two decades later.

In both Sky 2050 and Archipelagos the changes that Brazil can deliver in land-use practices mean that net-zero CO₂ emissions in the country is quite possible, coming a decade either side of mid-century with Sky 2050 delivering the outcome more rapidly. In both cases fossil fuel emissions have been reduced by some 20% when net-zero CO₂ emissions is achieved, but that reduction is far from being the major contributor to the outcome.

Note: Shell Scenarios are not predictions or expectations of what will happen, or what will probably happen. They are not expressions of Shell’s strategy, and they are not Shell’s business plan; they are one of the many inputs used by Shell to stretch thinking whilst making decisions. Read more in the Definitions and Cautionary note. Scenarios are informed by data, constructed using models and contain insights from leading experts in the relevant fields. Ultimately, for all readers, scenarios are intended as an aid to making better decisions. They stretch minds, broaden horizons and explore assumptions.

Brazil: Leading the world to net-zero emissions

dchone June 24, 2024

As the world strives to get to net-zero emissions, Brazil can play a formidable role in helping to enable such an outcome, but it won’t happen without the broad recognition of carbon removal credits and a trading capacity to shift the credits between countries.

I have recently been in Rio de Janiero, Sao Paulo and Brasilia participating in the launch of a new analysis by the Shell scenario team that is focused on Brazil and looks in depth at the energy transition in the country, but also the enormous potential for managing carbon dioxide on a scale that is globally relevant. That analysis or country Scenarios Sketch, Brazil: Leading the world to net-zero emissions (in both Portuguese and English), builds from The Energy Security Scenarios, using the detailed country level data for Brazil that we in Shell have available from our World Energy Model.

Brazil is both unique and fascinating from a carbon cycle perspective, given the size of the rainforest, the large agricultural sector, and the important role that both bioenergy and hydroelectricity play in the country today. As such, this Scenarios Sketch is entirely different to all the others we have worked on, in that it draws heavily on our land carbon analysis work and required a deep dive into the Brazil bioenergy sector.

The emissions starting point for Brazil is unlike any other country. Fossil fuel CO₂ emissions, primarily from oil, are 453 Mt per year, but significantly less than land use CO₂ emissions of 785 Mt per year, largely coming from ongoing deforestation in the Amazon region. Fossil fuel CO₂ is also surpassed by the bioenergy system, although that system is effectively carbon neutral. Total CO₂ emissions are around 1.3 Gt per year, but total greenhouse gas emissions are just over 2 Gt per year, with the addition of methane and nitrous oxide mainly coming from the agricultural sector.

The Brazil Scenarios Sketch incorporates two scenarios, Sky 2050 and Archipelagos. Both start with the realities of the 2020s, meaning that the energy system and future energy policy landscape are showing real signs of change, but also recognising that an insufficient amount of progress has been achieved on the scale required to reduce emissions substantially by 2030. As time moves on into the 2030s Sky 2050 takes a normative approach that starts with the desired outcome of global net-zero emissions in 2050 and works backwards in time to explore how that outcome could be achieved. By focusing on security through mutual interest, the world achieves the goal and a global temperature rise of less than 1.5°C by 2100. Archipelagos follows a possible path in a world focusing on security through self-interest. Even so, change is still rapid, and the world is nearing net-zero emissions by the end of the century but the temperature outcome in 2100 is a plateau at 2.2°C.

In the context of Brazil, while the energy transition takes some interesting twists and turns, the initial focus in Sky 2050 is on ending deforestation. In the scenario this is achieved in the early 2030s through a concerted government effort, in combination with the existing efforts through the voluntary carbon market. Government-to-government partnerships flourish and support the effort as countries outside Brazil recognise it is in their interests to see deforestation end such that Brazil can move into a phase of bona fide carbon removal through land-use change.

This achievement sets the scene for significant reforestation efforts driven by carbon markets, as the global demand for carbon removals ramps up and compliance markets, such as the EU Emissions Trading System, open their systems to an inflow of removals from outside their domestic boundaries. The important dynamic that results from ending deforestation is a leap in confidence that land-based credits from Brazil now represent true carbon removal and questions on additionality, that have hampered the avoided deforestation credit market, are put to rest.

Not content with land-based removals, in Sky 2050 Brazil sets about developing a CCS industry, starting with the many ethanol plants in the Sao Paulo region where the prospects for geological storage of CO₂ look good. The fermentation of sugar to produce ethanol releases CO₂ in pure form which can be captured and geologically stored. Further, the combination of bioenergy production or use with carbon capture and storage (BECCS) delivers permanent removal of CO₂ from the atmosphere.

In Sky 2050 in CO₂ terms, by 2040 Brazil is already in a net-drawdown position, with a complete turnaround in land-use emissions and a CCS industry well established and storing over 50 Mt CO₂ per year.

As the transition proceeds in Sky 2050, Brazil also reaches net-zero greenhouse gas emissions by 2050. But doing so requires considerable investment in CCS and mechanisms to incentivise landowners and the agricultural community to adopt new practices and change behaviours. In Sky 2050 a good proportion of these investments and incentives come through the carbon market, both from the domestic emissions trading system and projects channelled through Article 6 of the Paris Agreement. Importantly, Brazil has sufficient space in its carbon budget to allow for international trading of removal credits.

Picturing Brazil from an emissions trading perspective in the early 2030s, it might look like the illustration below. There are many potential counterparties, but the illustration imagines the EU ETS and the aviation sector as two potential partners. In Europe the EU ETS (I) will reach a point of zero new allowances by 2040, so by the 2030s industrial concerns could already be feeling the pressure given the lack of immediate abatement opportunities. In the aviation sector in the 2030s, technical solutions (e.g. SAF, e-fuels, hydrogen) for abatement will take decades more to fully implement, so carbon removals are the only short to medium term option.

By 2040, say, Brazil could be supplying significant volumes to these counter-parties but not compromising its own net-zero ambitions. A similar story could emerge domestically through the implementation of the planned emissions trading system.

Importantly, trade in carbon removals can bring investment and income into the Brazilian economy. But much of the story depends on a fully functioning Article 6 and a willingness by regions such as the EU to make use of it. To date, the signs pointing to such an outcome have been limited, despite some effort by the Article 6 negotiators at UNFCCC meetings.

The Brazil Scenarios Sketch provides many energy and greenhouse gas insights into a vibrant country with an interesting story to tell. You can find that story here.

Seeing the forests and the trees

dchone March 19, 2024

I was fortunate to be in Brazil recently and as part of the trip I visited the offices of Carbonext¹ in São Paulo, one of the leading companies in the voluntary carbon market space, in this case currently focused on avoided deforestation projects. They are engaged in projects that, in total, are conserving between 1.5 and 2 million hectares of Amazon rainforest. The rainforest itself covers an area of some 670 million hectares, but much of this land isn’t necessarily under immediate threat. Rather, the strategic focus of the company is along the southern border of the rainforest, in effect creating a line of defense against further encroachment northwards. In exchange for their efforts, the company, like many others, sells carbon credits into the global voluntary market, which are then used by all sorts of entities for carbon offset purposes.

This latter practice of selling credits on the back of avoided deforestation has drawn criticism, but particularly by a small number of prominent media outlets which almost seem to have set themselves the task of ending the voluntary carbon market. While it might be fair to debate the philosophical issues around avoided emissions being an offset for actual emissions, the criticisms that are made are more often aimed at the credibility of the projects themselves, rather than how the project carbon credits might be used. The argument that is put forward is that there is no guarantee the trees don’t get chopped down at some later time, or that a similar level of deforestation will just happen somewhere else, such that in reality nothing is truly avoided. But none of this chimes with what I saw when visiting the company’s offices. The capacity that now exists to manage these projects and tackle the issues associated with avoided deforestation inspired me.

When we entered their main office, we were presented with large monitors displaying satellite images of the southern regions of the Amazon, with the company projects almost looking like a string of fortifications that you might have seen had satellite images of the Maginot line been available in 1939. But the next step we saw was truly impressive. Zooming into a particular project, it was suddenly possible to see details of the individual projects, almost down to the tree level. An AI system is used to monitor the project images and as new satellite images are received from the likes of the European Space Agency, differences are instantly highlighted. For example, on one project a red alarm was flashing on the fringe of the project border because the tree cover had started to decline over the last few days. This had already been acted on and it was found that an adjacent landowner had started clearing part of the preserved rainforest. As a result of the detailed monitoring, this activity was flagged and the landowner was immediately contacted by someone in the vicinity of the project. It was ascertained, at least in this case, that a genuine error had been made by the landowner regarding the location of the border. The land clearance was stopped, and the damage was contained to a tiny fraction of the overall project.

The attention to detail and the systems in place to monitor individual projects with a granularity that was probably impossible just a few years ago is impressive. It ought to give everyone confidence that a genuine effort is underway through the voluntary carbon market to limit further land clearance in the Amazon rainforest. But I do wonder if the journalists writing the disparaging articles have done their own due diligence into the current state-of-the-art technologies used to monitor forest cover and manage avoidance projects. From what I saw, it’s difficult to believe they have.

Moving out from an individual project, the totality of the effort is also impressive. A bit like the Maginot line, the string of projects is creating a crucial buffer defense against further clearance, ensuring that the other problem associated with avoidance credits, i.e. different trees just get chopped down somewhere else, doesn’t materialize, or is at least limited. But also like the Maginot line, there is the real possibility of breakthrough because the buffer isn’t big enough or there are gaps in it. In 1939 the Wehrmacht famously bypassed the fortifications that had been built and invaded France through Belgium. And here lies a potential problem in Brazil as well, but I would argue that the fault lies not with those developing the string of projects along the edges of the rainforest, but with those criticizing their efforts. By undermining the efforts of the project developers that are creating the buffer, they could also be undermining the buffer itself as new investors and potential buyers for the offsets shy away. This may then limit future project development, leaving gaps in the effort, which in turn may become weak spots in the overall programme. This string of events then snowballs, creating further criticism (always easier than providing support or offering constructive criticism) which in turn may further limit investment and new projects. It’s time for this to stop.

None of the above is meant to argue that everything rests on the back of voluntary carbon credit companies and their projects, it doesn’t. The Brazil government are clearly stepping up their efforts as well, for example by challenging illegal land clearance. But these voluntary market projects are often taking land that can be legally cleared and providing an incentive to landowners not to do so. All these efforts add up to the critical first steps required to end deforestation in the Amazon, so we need the voluntary carbon market acting in this space as much as we need the Brazil government to limit illegal land clearance. Both are important. Allowing the voluntary market to prosper and invest heavily in avoided deforestation will facilitate the creation of a true and complete line of defense. The end result is that deforestation stops, and everyone’s collective attention and efforts can then turn to reforestation, which also means carbon removal from the atmosphere rather than continued addition.

Note that Shell has a minority stake in Carbonext. ↩︎