Leakage (SSC A/R)
Leakage for afforestation and reforestation (A/R) projects generally is defined in 5/CMP.1, Annex, paragraph 1(e):
Leakage is the increase in GHG emissions by sources which occurs outside the boundary of an A/R CDM project activity which is measurable and attributable to the A/R CDM project activity (5/CMP.1, Annex, paragraph 1(e)).
Small-scale A/R (SSC A/R) project activities must be designed so as to minimise leakage:
An afforestation or reforestation project activity under the CDM shall be designed in such a manner as to minimize leakage (6/CMP.1, Annex, paragraph 22).
In estimating leakage, the Executive Board clarified in EB 22, Annex 15, paragraph 1 and reiterated in EB 28, paragraph 31 that the displacement of pre-project emissions from sources only needs to be taken into account if the emissions from the displaced location are greater than pre-project conditions.
In other words, if an afforestation project activity displaces agricultural activities from the project site to another site, then the agricultural emissions at the new site must only be accounted for as leakage from the project if:
- the agricultural emissions (at the new site) are greater than before; and
- this increase resulted from the implementation of the project activity:
- In accordance with paragraph 21 of the modalities and procedures for CDM A/R project activities, only the increase of pre-project GHG emissions as a consequence of the implementation of the project activity has to be taken into account in the calculation of net anthropogenic GHG removals by sinks;
- Pre-project GHG emissions by sources which are displaced outside the project boundary in order to enable an afforestation or reforestation project activity under the CDM shall not be included under leakage if the displacement does not increase these emissions with respect to the pre-project conditions. Otherwise, leakage for the displacement of pre-project activities is equal to the incremental GHG emissions compared with the pre-project conditions (EB 22, Annex 15, paragraph 1; EB 28, paragraph 31).
However, decreases of carbon pools outside the project boundary are to be included as leakage. That is to say, if a project activity causes deforestation outside the project boundary, this is to be included in calculations as leakage from the project:
The Board clarified that the accounting of decreases of carbon pools outside the project boundary are to be considered as leakage and that, in particular:
- In the case of deforestation as land clearance outside the project boundary due to activity shifting, effects on all carbon pools shall be considered (EB 22, Annex 15, paragraph 3).
However, collection of fuelwood from places outside the project boundary are not to be considered leakage unless the forests are significantly degraded and the volume of wood being gathered means the forest cannot renew itself:
- In the case of fuelwood collection or similar activities outside the project boundary, only the gathered volume of wood that is non-renewable shall be considered as an emission by sources if forests are not significantly degraded due to this activity (EB 22, Annex 15, paragraph 3).
However, participants in small-scale A/R (SSC A/R) projects will not be required to estimate leakage if:
- the project activity does not result in the displacement of activities or people; or
- does not trigger activities outside the project boundary that would cause in increase in greenhouse gas emissions by sources that is attributable to the project.
Therefore, small-scale A/R project activities are not required to estimate leakage where it would simply be due to a reduction in carbon pools:
If project participants demonstrate that the small-scale afforestation or reforestation project activity under the CDM does not result in the displacement of activities or people, or does not trigger activities outside the project boundary, that would be attributable to the small-scale afforestation or reforestation project activity under the CDM, such that an increase in greenhouse gas emissions by sources occurs, a leakage estimation is not required. In all other cases leakage estimation is required (6/CMP.1, Appendix B, paragraph 9).