Carbon stock ownership in PNG

ENVIRONMENT

Dealing with customary landowners entails overcoming a number of hurdles before realising benefits in the global carbon trade

WHAT is carbon and why has it become so important in the world economics today?
Scientifically, carbon is a non-metallic chemical element with atomic number 6 that readily forms compounds with many other elements and is a constituent of organic compounds in all known living tissues.
Carbon is named after coal and is one of the most common chemical elements in the universe. It is sometimes referred to as the glue of life chemical element as it easily bonds with other elements.
Interestingly, it forms almost a fifth of your total body weight. Carbon compounds are used almost in everything in today’s economic developments. It is essential part of any organic material including food, oil, lubricants and may more. It is also a vital component of plastic and rubber. All raw materials contain carbon in some extent.
Carbon is a way of life, a building block just like any other chemical element. It is a basic building block of biomolecules just like hydrogen and nitrogen. Carbon exists in three forms on earth. It can exist as a solid, as dissolved carbon and in gaseous form.
For example, carbon can exist as a solid in rocks such as graphite and diamond, but can also combine with oxygen molecules to form gaseous carbon dioxide (CO2). It is this gaseous state we are trying address.

Climate crisis
Desipite being an essential element in all building blocks, carbon has also brought about global climatic problems that threaten the survival of all other living forms, including human beings in today’s world.
Carbon in the form of carbon dioxide (CO2) in its gaseous form is also a greenhouse gas that contributes to the destruction of the ozone layer leading to increase incoming solar radiation resulting in rising global temperatures, leading to rising sea levels with melting of ice and bringing about other related issues.
Carbon dioxide (CO2) is the primary greenhouse gas emitted through human activities. Other greenhouse gases include methane, nitrous oxide and fluorinated gases. These gases in the earth’s atmosphere trap heat by allowing sunlight to pass through the atmosphere but prevent the heat that the sunlight brings from leaving (escaping) atmosphere.
This trapping effect than lead to the increase or rise in temperatures.

Carbon commerce
Due to global climatic crisis, carbon has become a highly sought after trading commodity between countries.
The idea about trading carbon is similar to the trading of securities or commodities in a market place. Carbon is given an economic value, allowing people, companies, or nations to trade it. If a nation buys carbon, it is buying the right to burn it, and a nation selling its carbon gives up its right to burn it.

Carbon sources
There is just too much carbon dioxide (CO2) in the atmosphere that has been building up over the years due to both the natural and anthropogenic (human) activities.
Carbon dioxide with the other greenhouse gases prevents the outgoing reflected energy (heat) from escaping into atmosphere thereby causing the earth’s temperature to increase and now you know why we are faced with these climate change issues.
Global efforts now are to reduce and stabilise the volume of free CO2 in the atmosphere so that hopefully it will lower the earth’s temperature and address climate changes issues.
This has led to the development of climate change agreements and protocols such as the UNFCCC, Kyoto Protocol and the Paris Agreement.
This has then lead to the development of carbon trade as a means to assist countries in their efforts to reduce carbon dioxide emissions. So now you can take part in carbon trade and gain some benefits while at the same time contributing to the efforts in reducing free carbon dioxide in the atmosphere.

Carbon sink
A carbon sink is anything that absorbs and stores more carbon from the atmosphere than it releases such as vegetation, the ocean and soil. It is opposed to carbon emission/sources that release (emissions) more carbon into the atmosphere than it absorbs such as burning of fossil fuels or volcanic eruptions.

PNG a carbon sink
PNG has large tracts of forests that are now being developed into carbon trade markets. Carbon trade is the buying and selling of credits that permit a company or other entity to emit a certain amount of carbon dioxide or other greenhouse gases.
Carbon markets are carbon pricing mechanisms enabling governments and non-state actors to trade greenhouse emission credits. The aim is to achieve climate targets and implement climate actions cost effectively.
There are two types of carbon markets, compliance and voluntary. Papua New Guinea can participate at both markets. Most landowners in Papua New Guinea are getting into developing carbon trade projects in the voluntary markets. We need to understand in the very beginning the ownership of the carbon stock that will be generated from carbon trade projects.

Carbon rights and ownership
More and more landowners in PNG are now getting into developing carbon trade projects. A mechanism known as Reducing Emissions from Deforestation and forest Degradation (REDD+) was developed under the 1992 United Nations Framework Convention on Climate Change (UNFCCC) to reduce forest destruction and regulate the release of carbon emissions into the atmosphere.
The development of REDD+ Avoided deforestation is to provide developing countries with a financial incentive to reduce their level of deforestation and forest degradation, and to increase their forest carbon stocks.
No specific legislation has been developed to deal with REDD+ forest carbon stock rights and ownership or payments for environmental services in PNG. In the absence of this specific legislation, however the country already has a well-developed legal system with a number of elements which could support the creation of national framework for REDD+ and forest carbon rights. There is a well-defined customary system dealing with private property ownership and protection.
Most of the landmass is owned by the landowners, about 97 per cent under customary ownership.
Therefore, the ownership and control of forests, and the carbon sequestered in forests, derives from customary ownership of the land on which the forests grow.
However, the current customary landownership system will be unable to support legal requirements of the market-based approach of REDD+ which requires site-specific forest carbon projects due to legal restrictions that come with customary land tenure and the contractual obligations that underpin REDD+ projects.
The landownership and resources rights are well vested to be owned by the landowners themselves under customary law. However, it is the rules of REDD+ that do not allow venturing into commercial business due to a number of reasons.
Customary land is not registered in PNG and it is therefore difficult to clearly identify who the real landowners are for a particular area and who has customary interest and rights.
This may change in the future as legislation has recently been passed that will enable customary land to be registered.
Customary land is not surveyed and boundaries are not identified therefore this leads to disputes on ownership.
Customary landownership is governed by customary law that may differ from place to place and not documented.

Amendments required
Currently, the carbon ownership rights belong to the landowners as governed by customary law and as provided for in lands legislation. It however, does not meet the legal requirements of REDD+ rules when it comes to developing carbon trade projects relating to trade in carbon. To enable this REDD+ process, there needs to be amendments done on relevant legislation but to maintain that the carbon rights still belong to landowners.
Alienation of customary land is not possible except to the State and in other very limited circumstances, and any instrument purporting to create an interest in customary land (such as a forest carbon contract) can be declared void.
There is no suitable mechanism for customary landowner groups to join together as a legally recognised entity to hold and manage forest carbon, and to distribute benefits in an equitable, open and transparent way.
Further, approximately 12 million hectares, or 80 per cent of production forest, has already been “acquired” by the PNG Forest Authority under the Forestry Act, with the PNGFA and other third parties (logging companies) holding legal rights to harvest trees from these forests. This has significant implications for how forest carbon right might be allocated in PNG, as these interests will need to be reconciled with the interests of customary landowners who may wish to engage in REDD+ activities.
Legislation is required to address these issues. Amendments to legislation is required to maintain carbon rights belong to the landowners and should remain with them.

Work in progress
PNG is developing a national REDD+ scheme to prepare itself to receive performance-based payments for emission reductions/removals accounted at a national level. As with the other Melanesian countries, PNG has opted for a national approach to REDD+.
However, given that it may take some years for the REDD+ mechanism to become functioning under the UNFCCC framework, PNG may support the development of a project-based approach in the interim, and may seek to integrate this into its national REDD+ framework at a later date.
Key documents developed to date to guide REDD+ activities in PNG include:

•  The national REDD+ Project Guidelines, prepared by OCCD. These guidelines require a project proponent to “demonstrate that they have clear, uncontested title to the land, or provide legal documentation demonstrating that the project is undertaken on behalf of the land owners with their full consent”; and
• Draft guidance to establishing free, prior and informed consent for REDD+ Projects in PNG.
  Pacific Islands Regional Policy Framework for REDD+ calls on countries to develop their REDD+ policies, strategies, action plans, guidelines, and legislation to define forest carbon rights, forest carbon financing and benefit-sharing arrangements.

The regional framework contains the following guidance on forest carbon rights for Pacific Island countries, under the Safeguards heading: REDD+ implementation can take place on government-owned land, freehold land, and/or customary land.
Performance-based payments for REDD+ will be dependent upon clear delineation of land tenure, carbon tenure arrangements, as well as effective, equitable, and transparent benefit-sharing arrangements for REDD+ implementation activities.