Indonesia and Climate Change

Is Indonesia part of the problem or part of the solution, or both?

(From a talk by Julian Caldecott in the School of Science and the Environment Research Seminar Series, Bath Spa University, Bath, UK, 23 March 2009).


Indonesia is a huge and important country.  With 240 million people, it’s the fourth most populous nation on Earth.  With 17,000 islands, it has the longest coastline.  It stretches over three time zones between the Indian and Pacific oceans.  It embraces half of the island of New Guinea, two-thirds of Borneo, and all of Sumatra, Java, Bali, Komodo, and Sulawesi.

To the east it has an Australian fauna and flora, but to the west its wildife are Asian.  In the middle lies the unique region of Wallacea (named for the co-discoverer of evolution), with a mixture of Australia and Asia, and many species that evolved locally on these islands isolated by kilometres-deep waters.  The whole country also lies in the middle of the world’s densest array of coral reef species.  In fact it has more species of every sort, more biodiversity, than any other country in the world.

Indonesia’s immense rainforests, covering the eastern and western islands, are now under threat.  Sustained by metres of rainfall every year, these forests are being damaged and cleared at a great rate, and massive forest fires have become common in Indonesia.  Fire in rain forest seems counter-intuitive, but there are good reasons for it these days.  One of these is logging.

The problem with even selective logging is that it breaks open the forest canopy, letting in sunlight and hot, dry, moving air.  This wipes out the fragile organisms of the rain forest, which are adapted to moist conditions.  When this happens in small patches, as in traditional shifting cultivation, then recovery and recolonisation follow.

But in industrial logging operations, vast areas are opened up.  Dead wood lies piled on the forest floor – no longer timber, but tinder.  Hot winds run along logging roads.  The forest shrivels.  If it doesn’t rain for a while, then the damaged forest will burn – either from lightning strikes or because someone sets it alight.

Once enough living greenery has been killed, then the forest cannot continue making its own clouds and rain from transpiration, and the drying continues.  Worse, in South-east Asia, there are long El Niño droughts every few years.  It’s these long droughts, combined with logging and fire, that have done most damage.

But there’s more.  Even wetter than rain forests are peat swamps.  Here the ground is waterlogged, and leaves that fall do not decay because there’s little oxygen and much tannin in they water.  So they stay there, accumulating into peat beds that may be tens of metres deep, lying beneath tall forests where orangutans and hornbills live.

Indonesia has immense areas of such peat swamps, especially in the great islands of Borneo, Sumatra and Papua. These forests often contain lots of tall, straight trees, so are attractive to loggers.  Nowadays it’s easy to make canals into them with digging machines.

Once the canals have been made, and the best trees felled into the water and floated away, the loggers often just abandon the canals.  Especially if they’re illegal loggers in the first place.  Then the peat is steadily drained of its water, until it dries out and starts to decay.  Or until it burns.

Indonesia’s deforestation rate is well over a million hectares a year.  Why should we care?  Well, standing forest contains up to 1,500 tonnes of carbon per hectare, and peat-lands around five times as much. The release of all this carbon as carbon dioxide by burning, or as methane through decay, contributes to the world’s greenhouse gas (GHG) emissions.

We didn’t know how much until 2007, since countries don’t report deforestation comprehensively to the Climate Change Secretariat in Bonn.  The forest data are instead held by FAO in Rome.  But when the sums were done by the IPCC, Indonesia leapt into third place as a carbon polluter, after China and the US.

It turned out that up to a quarter of all GHG emissions come from tropical deforestation and land degradation (the loss of soil carbon through fire and decay).  This is as much as is produced by the world’s entire transport sector, or the total emissions of China or the US.

Although Indonesia is deforesting a smaller area per year than Brazil, its peat beds make all the difference to the total GHGs lost into the air.  This makes Indonesia a key part of the problem of global warming.  Since Indonesia is also the most biodiverse country on Earth, the fires in its rain forests are a major factor in the current mass extinction as well.

It may be tempting to condemn Indonesia for letting all this happen.  But we ourselves were very slow to restrict the import of tropical hardwoods.  And our policies have also sparked an even more deadly scourge of forest and peat-lands: the demand for biofuels.  In Indonesia, this means the worst ‘nemesis crop’ of all: oil palms for making biodiesel.

Besides, in its quest for development, Indonesia has always sought ways to turn its vast forests into money.  First logs, then plywood, then paper-pulp, and now palm oil.  There are, after all, 240 million Indonesians, half of them living on less than $2/day.  They take a lot of feeding, and 10% are unemployed (with far more being under-employed).

So if anyone needs development, Indonesians do.  But we have to slash GHG emissions somehow, and wind farms can’t do it alone.  Part of the equation must involve stopping tropical deforestation.  But how?

In fact the negotiators of the Kyoto Protocol back in the 1990s briefly considered the matter, but dropped it as unimportant and too complicated.  They were more interested in reducing emissions from industrial countries, and setting up carbon markets to help this happen.

Carbon markets are important, since they offer ways to harness the serious money of private investment to the struggle against climate change.  Governments won’t, and charities can’t, finance a wholesale switch to renewables.  But governments can impose a limit on how much carbon can be released by industrial sectors, and then let the various companies buy and sell rights to pollute.

This sounds harsh, but it can work by making pollution more expensive to do, thus forcing companies to invest in being cleaner than they were.  But it takes strong political will to ignore the howls of protests from dirty companies, and the European carbon trading scheme got off to a weak start because of this.  Still, lessons are being learned, and one day soon this mandatory ‘cap and trade’ approach will have proved itself as a part of the way forward.

But not necessarily for Indonesia.  In 2007, Indonesia hosted the 13th Conference of the Climate Change Convention. There, many delegates insisted that deforestation be put back on the table, alongside emission limits, targets and markets.  Most came from countries that still have forests.  What drove them was the thought that Western carbon markets or governments might pay them to conserve those forests.

The problem has always been that conservation is expensive, and not enough people want to pay for it.  You can only go so far with charity money in a hostile world.  Hence the mass extinction that has been gearing up for decades before climate change became a widespread fear.

Many ecosystems rich in endemic species have been destroyed or fragmented.  Because of this, perhaps a million species a year are already becoming committed to extinction.  Most of them are small, unknown insects, but we still ought to mourn them.

All that was already happening in the 1970s, 1980s and 1990s.  But now there’s something new going on.  A critical mass of people and leaders are starting to see that we must fix climate change soon or we may not survive the century.  Costa Rica, Norway, Guyana and just last week the Maldives have committed themselves to carbon neutrality.  The US and UK are following along. The game is changing.

So where does that leave Indonesia? I’d say as a vital piece in the multi-dimensional diplomacy of climate change negotiations.  Indonesia is close to both the developed and developing worlds, so it can act as a bridge between different camps.  The West wants it to moderate the demands of more radical countries.  The radicals want Indonesia to lead the push for greater concessions.

Any major deal, such as fixing a global carbon price, would have to be led by the US and China.  But it would need to be endorsed and implemented by other important players and their allies, including the EU and Indonesia.

From Indonesia’s point of view there are two important factors.  One is that it is itself very vulnerable to climate change.  It suffers ever-harsher droughts, and faces losing swathes of its enormous coastal zone to sea-level rise.  So it needs the world to agree on effective mitigation, and it needs help with adaptation.

Mitigation means reducing the underlying causes of climate change – that is, keeping GHG emissions down and trying to hold the line at a 2o rise in global average temperature.  Any more than that, and the climate may cycle totally out of control. Adaptation means protecting people from the impacts of wilder weather, rising sea levels, droughts, floods and new diseases. These are happening already, and all are very challenging for developing as well as developed countries.

The other factor is that Indonesia still has tens of millions of hectares of forests and peat-lands.  It even has around 60 million hectares in proposed and established protected areas, all of them vulnerable. If these can’t be saved, the risk is shown by the fact that forest losses in just one Indonesian province (Riau) single-handedly offset all the emission gains achieved under the Kyoto Protocol since 2005.


So, Indonesia needs serious help with conservation.  Its protected area budgets are tiny relative to the pressures of expanding palm-oil plantations and illegal logging.  It needs its reserves to be better funded, their staff better equipped, prosecution services purged of corruption, surveillance imagery updated frequently, etc.

We all have an interest in saving Indonesian protected areas.  One way to do this would be to find ways to pay for carbon stored in protected forests and peatlands, an approach known as REDD (Reduced Emissions from Deforestation and Degradation).  This could buy us time while we deal with the capping, trading, rationing, capturing and storing of carbon, and the wholesale conversion of our energy systems to renewables.  It will also help avert mass extinction, maybe more than any other thing we could do.

But no one is going to hand over billions against promises alone, wherever the money comes from.  We need a fair, effective and verifiable system, and we need it at Copenhagen in 2009.  Signs are that the negotiators are not too interested in designing such a system.  Or perhaps they just don’t know how to do it?  Well, we can give them some principles to work with.

What we need is a way to swap money for reliable carbon storage, but in doing this we must meet the needs of quantity, duration, generosity, immediacy, innovation, inclusion and verification.  Seven criteria, no less:

1.    Quantity.  The amount of payment must obviously be based on the amount of carbon stored in the ecosystem.  The densest carbon stores should attract the highest payments.

2.    Duration.  The deal must last for at least 50 years, since this is when our GHG efforts will be most urgent.

3.    Generosity.  Ten thousand hectares of forest might contain 15 million tonnes of carbon.  There will be a big difference in the effectiveness of any deal if the carbon is valued at $5 or $50 per tonne – the difference between $75 million and $750 million spread over 50 years.  Thus a high, stable carbon price is vital for the success of this and all other mitigation investments, from those in renewable energy to carbon capture and storage.

4.    Immediacy.  The system should be front-loaded to reward carbon storage sooner rather than later, since we need the pressure off GHG emissions now, not later when other systems are in place to deal with them.  Besides, GHGs persist in the air for decades, so early reduced emissions give benefits far into the future.

5.    Innovation. If we succeed in fixing the carbon crisis, we will remember that there are many other reasons than carbon to keep forests, including biodiversity, water services and wilderness values.  Conservation will still need to be paid for then, so we should invest in finding non-carbon revenue sources such as payments for catchment services, ecotourism and bioprospecting.  

6.    Inclusion.  Most ecosystems are owned, claimed or used by more than one group of people.  These will often include central and local government, private land owners, communities and indigenous peoples.  All plausible claimants should be rewarded with a share of the carbon revenues, since otherwise they won’t help protect the resource and may even try to destroy it.


7.    Verification. Single, up-front payments in return for promised ecosystem protection will not work.  Instead, there must be series of conditional payments over the 50 years to reward proven ecosystem protection and/or verified carbon absorption and storage.

A REDD system that does not meet all seven of these criteria will not be effective, and it will not work for long.

So how would Indonesia earn its carbon revenues?  One way is to extend its protected area system. This would reward the filling-in of gaps, completing legal establishment of proposed reserves, and creating new ones.  If the carbon price is high enough then every surviving patch of forest and peat would end up protected for at least 50 years.

But what about the need for staged, conditional payments?  There are already several steps in protecting forests in Indonesia, and others could be added to qualify for carbon money.  These would include:

1.    Identifying the stakeholders and agreeing who gets what.

2.    Counting the carbon and studying the forest.    

3.    Legally establishing the protected area.

4.    Completing a management plan for it.

5.    Setting up a management service able to protect it.

6.    Checking that the protection is working every ten years.

If 10% of the value of stored carbon is paid out at each of these stages, then the first 60% of the payment would probably be made by the tenth year, thus front-loading the reward.  The other 40% would then pay for the forest’s continued protection over the next 40 years.

If Copenhagen can endorse an inclusive, fair and effective arrangement like this, then key drivers of GHG release from tropical forests might be disabled.

Without it, deforestation will continue until the forests of Indonesia, the Amazon and the Congo Basin become little more than oil palms and grassland, or worse.

What can Indonesia and other forested countries do to help?  With others, such as its ASEAN partners, it can demand for REDD the seven criteria of quantity, duration, generosity, immediacy, innovation, inclusion and verification.

In helping this to be agreed, Indonesia can contribute decisively to fixing climate change.  It will cease to be part of the problem, and become part of the solution instead.