Rwanda counts on new forest bill to tap global carbon market

Rwanda is banking on a new draft law governing forests and trees, as it seeks to tap into opportunities presented by the global carbon market – selling its forest capacity to absorb carbon emissions, according to the Minister of Environment, Jeanne d’Arc Mujawamariya. Carbon markets are trading systems in which carbon credits are sold and bought. Companies or individuals can use carbon markets to compensate for their greenhouse gas emissions by purchasing carbon credits from entities that remove or reduce greenhouse gas emissions, according to the United Nations Development Programme (UNDP). One tradable carbon credit equals one tonne of carbon dioxide (CO2) or the equivalent amount of a different greenhouse gas reduced, sequestered (absorbed), or avoided. When a credit is used to reduce, sequester, or avoid emissions, it becomes an offset and is no longer tradable. ALSO READ: 2.2m carbon credits issued in Rwanda The relevance of the bill was approved by the Lower House on August 2. It will be scrutinised by a parliamentary committee, prior to being passed by the Lower House. The bill seeks to replace the law governing management and utilisation of forests in Rwanda, which was enacted in 2013. While explaining the relevance of the bill to lawmakers, Mujawamariya said that there are different opportunities like forest carbon emission trading (carbon finance) that need to be captured in the country’s legislation. She indicated that the greater forest and tree protection that the bill seeks to achieve will contribute to the country’s aim to profit from the carbon market, by increasing its capacity to absorb emissions or avoid them. Regarding offenses and penalties, article 48 of the bill provides that a person who harvests state forests or trees without a permit or damages them commits an offense. Upon conviction, he or she is liable to imprisonment for a term of not less than a year but not exceeding three years and a fine of not less than Rwf5 million but not exceeding Rwf10 million. Article 22 provides that the management of forests is done in a manner that they effectively contribute to carbon sequestration. Carbon sequestered by the forest may be exploited, traded on the carbon market, or subject to reward in accordance with relevant laws, it adds. ALSO READ: Rwanda to announce carbon credit offerings in April The Minister said that the legislation (once voted into law), will, along with a national carbon market framework, help the country to position itself well on the global carbon market. “At national level, we are finalising an assessment of the carbon sequestration capacity of our forests and various projects, which we can offer as carbon credits,” Mujawamariya said. According to her, the carbon market presents a huge opportunity. She noted that there are entities that want to buy credits from Rwanda, with some waiting for the country to publish its national carbon framework so that they start engaging with it in that regard. She said that the framework will be available by the end of August, adding that it will help the country to set prices for carbon credits. “We will set prices so that we are not on the losing end in terms of pricing,” she said, giving an example that there is a country in Africa that sold a tonne [of carbon credit] for $8, which is a low price. “But, for us, we cannot go below $30 a tonne of carbon credit,” she remarked. It is not only forests that will be considered for the carbon market, rather even projects that can reduce or prevent emissions, Mujawamariya said, citing biogas projects that turn cow dung (which would emit methane gas into the atmosphere) into lighting and cooking energy, as well as fertilisers [for increased food production]. ALSO READ: Five green projects Rwanda can take to global carbon market The Coordinator of Rwanda Climate Change and Development Network (RCCDN), Faustin Vuningoma, told The New Times that the carbon market mechanism is still marred by injustice such that pricing for the capacity to absorb CO2 emissions is skewed towards developed countries – at the expense of developing ones. Again, expenses incurred on experts mandated with computing the capacity to capture and store CO2 are high, which negatively affects profitably. “Not until the issue of carbon market is addressed, I don’t expect a lot as a benefit. Nonetheless, the fact that Rwanda had the foresight to put in place legislation is a positive thing,” he said. “If our government can negotiate for a favourable price, it would be a good project,” he said.

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Rwanda counts on new forest bill to tap global carbon market