One of the more notable developments at the intersection of economics and environmentalism has been the growth of carbon trading markets. In the 1980s, sulfur dioxide markets helped substantially reduce acid rain in the United States, and carbon trading is seen as a useful tool against global warming-- not to mention a significant new commodities market. (Shell and BP, among others, have developed internal carbon trading markets, in part to cultivate expertise that they hope will eventually form the basis of new businesses.)
But Nature reports on a new study led by Duke University biologist Robert Jackson (who is, according to his faculty Web page, director of "Duke's Center on Global Change, the Duke University Program in Ecology, and Duke's Stable Isotope Mass Spectrometry Laboratory," as well as the "National Institute for Climate Change Research for the southeastern U.S.," as well as the author of a forthcoming children's book about the environment-- clearly a lazy guy) that examines the impact of carbon forestation programs on local water supplies.
Planting forests to soak up carbon dioxide from the atmosphere can have a range of side effects, including drying up streams and making soil saltier, according to a global study. The discovery highlights the tradeoffs involved in tree-planting projects, say researchers.
Because plants use carbon dioxide to grow, planting forests of large, fast-growing trees is one way to remove the gas from the atmosphere, thus staving off global warming. But such forests need a lot of water... The [Duke] team surveyed more than 500 places where new forests have been planted over the past half-century. In 13% of cases, streams dried up completely for at least a year. On average, plantations cut local stream flow by more than 50%.
These changes occur partly because tree-planting projects choose fast-growing species that suck up more carbon dioxide.... Often these are evergreen trees that grow all year round, meaning that they take up a lot of carbon dioxide and water.
Of course, the logical conclusion here is not (despite suggestions to the contrary) to speed deforestation, in the interests of having more water available for people. But it does highlight the existence of tradeoffs in what we've perhaps naively regarded as no-lose propositions. If deforestation is a problem, and carbon trading can create an incentive to plant more trees, how could there be a downside? Things, it turns out, are more complicated than that.
More broadly, the Duke project also calls attention to the fact that there are depths of complexity in environmental and ecological management that we're still trying to get our hands (and brains, and computer models) around. Recently I interviewed an ecologist who argued that projects like carbon trading, and more generally efforts to assign economic values to ecological processes in general, and to understand the specific economic value created by particular places, would be one of the drivers of earth and climate science in the coming decades. While there's a left-wing critique of the argument that market processes can be brought into alignment with ecological interests (Joel Kovel's recent Enemy of Nature and this 2004 essay are representative examples), this professor saw things differently.
The idea that you should put value on ecological processes, she argued, led quickly to a recognition that complexity was worth paying extra for. Put another way, rain forest provided more services than a tree farm. It would also create an incentive to look more closely at some basic biological processes. Just how much carbon does a tree absorb in year? How much water is cleaned in this watershed? How much damage to the neighboring city does this swamp prevent during the flood season? You can't make money if you don't know what value you've got; and knowing something is valuable creates additional incentives to treat it well. Being able to more comprehensively catalog these benefits, and the costs-- how much malaria does that swamp generate?-- is an essential part of that project.
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