The Kyoto Protocol makes provisions for carbon sinks from forest management to be taken into account as a contribution towards fulfilling a country's emission reduction target. Additional emission allowances are allocated for these forest carbon sinks. If Switzerland uses this extra contingent of allowances to the full it would then only have to reduce emissions by 4.5% instead of the actual target of 8%. Emission allowances from carbon sinks can be traded on the emissions trading market and be claimed by forest owners. An assessment of the income that could be anticipated was carried out in four forestry companies: with the CO2 price set at 10 CHF per ton it was seen that a potential revenue of between 6 and 71 CHF per hectare and year could be realised. However, the legal basis for allocating emission allowances from carbon sinks to forest owners has yet to be created. In view of the fact that the two chambers of Parliament refused the introduction of the Forests Act Revision Bill, it is not clear if and in what form this will be done. For the period after 2012, the rules will be renegotiated at the international level and it is expected that the carbon stored in harvested wood products will be taken into account. Accordingly, wood removed from the forest would no longer be automatically counted as a CO2 source in the emission balance.
Carbon Taxation versus Emissions Trading Schemes?