Mitigation of greenhouse gas emissions from land use: creatingincentives within greenhouse gas emissions trading systems

Terrestrial carbon sinks and sources were introduced into climate change mitigation related policy relatively late in the design of the architecture of those policies. Much literature addresses how terrestrial sources and sinks differ from emissions from fossil fuel combustion and, hence, is a possible justification for differential treatment of them in policy design. Late introduction in climate policy discussions and perceived differences appear to have resulted in very different policy approaches for sinks versus fossil emission sources. The attempt to differentiate has generated complexity in policy design and likely inefficiency in the operation of these policies. We review these issues and find that the characteristics claimed to apply to sinks apply as well to fossil sources, and differences that do exist are often more a matter of degree than of kind. Because cap-and-trade has gained momentum as the instrument of choice to control fossil emissions, we use as a starting point, how such a cap-and-trade system could be altered to include terrestrial carbon sinks and sources.