Will the EU finally get its forest management incentives right? Today, a great deal of EU public financial support goes to bioenergy production (about €10 billion per year for woody biomass), causing additional logging and harming the climate, nature and forests’ role as a carbon sink. By comparison, public funding for improving forest biodiversity is rarely used and, sadly, a recent EU Court of Auditors found it had little impact on shifting the curve of carbon and biodiversity loss.
Things could change, however, with the Fit for 55 climate package currently being negotiated.
Two reports drafted for the European Parliament’s Environment Committee propose key changes to the two main climate files impacting European forests, the Renewable Energy Directive (RED) and the Land Use Land Use Change and Forestry (LULUCF) Regulation. Together, they could represent a welcome shift in how the EU organises its public financial support to forestry.
In his report on the RED, Finnish rapporteur MEP Nils Torvalds proposes excluding “primary woody biomass from forests” from national public bioenergy-support schemes: energy companies burning wood taken directly from forests would no longer be eligible for public financial support under the EU’s renewable energy rules. This is in keeping with published science on the matter, which shows that using primary woody biomass instead of coal or gas delivers no climate benefit for decades and even centuries. While other elements in MEP Torvalds’ report are less positive, this exclusion of the most destructive biomass feedstocks is very much worth noting.
LULUCF rapporteur Ville Niinistö presents a handful of key changes in his report, including a higher carbon sequestration target across the EU, the reduction of offsets between forests and other sectors, and an addition to national compliance reports to check for negative environmental impacts. One particular innovation could trigger actual change on the ground: amendments that channel public funding into ecosystem-based activities in Member States. In the rapporteur’s vision, this would be done through fees for LULUCF credit transfers, money from auctions of allowances in the Emissions Trading System, and penalties for missing targets. Revenue generated would encourage countries to recycle funds and provide opportunities to foresters and land managers to support restoration and close-to-nature forestry.
Of course, such a shift will first need to survive the lobbying offensive launched by the bioenergy industry and its allies to defend the status quo. But if these changes are adopted in the final revision, this will mark a significant step in shifting financial flows from wood burning to supporting forest management practices that target higher quality wood production, increase biodiversity, help forests better play their role as a carbon sink, and help foresters increase their forests’ resilience to the climate change challenge.
The deadline for MEPs from the Environment Committee (ENVI) to table amendments is 9 February 2022 for RED, and 3 February for LULUCF. The ENVI Committee vote on these files is expected on 28 April for LULUCF and 16 - 17 May for RED, and plenary votes in Parliament on both files will be sometime in the summer.