Sveaskog’s Climate Accounting and the Challenges of Measuring Biogenic Emissions
Sveaskog, a Swedish state-owned forestry company, is committed to ambitious climate targets aligned with the Paris Agreement. This commitment is reflected in the company’s reporting practices, which aim to provide a comprehensive picture of its climate impact. However, the complexities inherent in measuring biogenic greenhouse gas emissions, particularly within the forestry sector, present ongoing challenges and necessitate continuous improvement in accounting methodologies. Recent criticisms of Sveaskog’s reporting practices, particularly concerning the inclusion of biogenic emissions, highlight the need for a deeper understanding of these complexities and the ongoing efforts to standardize measurement approaches.
A central point of contention revolves around the inclusion of biogenic greenhouse gas emissions in corporate reporting. Unlike fossil emissions, which release carbon stored for millions of years, biogenic emissions represent a part of a shorter carbon cycle. The carbon released originates from recently absorbed atmospheric CO2 by growing plants, thus representing a different kind of climate impact. While Sveaskog includes carbon flows, both uptake and release, in its calculation of the forest’s total climate impact, and reports emissions of potent biogenic greenhouse gases like methane and nitrous oxide from biofuel combustion, questions have been raised regarding the inclusion of biogenic CO2 emissions across the value chain. Sveaskog has clarified that while not previously reported, these emissions will be included in its 2024 reporting, following a decision made earlier this year. This demonstrates a commitment to progressively improving transparency and completeness in their reporting.
The complexity of calculating value chain greenhouse gas emissions, especially those of a biogenic nature, is acknowledged by both Sveaskog and its critics. This complexity stems from the intricate interplay of biological processes, land management practices, and product lifecycles. A lack of standardized methodologies further complicates comparisons between companies and hinders a complete understanding of the sector’s overall climate impact. Currently, there is no universally accepted standard for calculating the climate impact of biogenic processes in forestry. This absence of standardization makes comparing climate performance across companies within the sector virtually impossible, as various approaches are used to account for carbon sequestration and emissions.
Sveaskog actively participates in developing a robust measurement standard for the land sector as part of the Greenhouse Gas Protocol initiative. This involvement signifies the company’s dedication to advancing scientific, stakeholder-balanced methods for assessing and reporting emissions and carbon storage. By contributing to pilot tests and following the development of this protocol, Sveaskog is working towards a more rigorous and consistent approach to biogenic emissions accounting. The company’s involvement in this initiative underscores its recognition of the need for standardized methodologies to enhance transparency and comparability within the forestry sector.
A significant area of divergence in reporting practices within the forestry sector concerns the accounting of carbon sequestration. While Sveaskog adopts a conservative approach, solely considering carbon sequestration in forests and land, other companies often include the potential substitution benefits of wood products in their climate calculations. Substitution benefits refer to the climate advantage gained by using wood products in place of materials with higher fossil fuel-based emissions, such as concrete or steel. While these substitution effects undoubtedly contribute to reducing overall societal climate impact, quantifying them at the company level can lead to overestimations. Sveaskog’s conservative approach avoids this potential for overestimation, focusing solely on the demonstrable carbon sequestration within its managed forests.
Critically, equating biogenic and fossil CO2 emissions is misleading, as they represent fundamentally different processes within the carbon cycle. Fossil emissions release carbon stored for millions of years, contributing to a net increase of atmospheric CO2. Biogenic emissions, on the other hand, are part of a continuous cycle of carbon uptake and release through photosynthesis, respiration, and decomposition. While biogenic emissions still contribute to atmospheric CO2 concentrations, their impact is different due to the shorter timescale of the carbon cycle involved. Confusing these two types of emissions obscures the distinct roles they play in the global carbon cycle and climate change dynamics.
The transition to a low-carbon economy necessitates a shift from fossil fuels to renewable alternatives, including biofuels. This transition, while crucial for reducing fossil CO2 emissions, can lead to increased biogenic CO2 emissions. For companies operating within the forestry sector, biogenic emissions will inherently be larger than fossil emissions. However, the crucial point is that the positive climate benefit derived from sustainable forestry practices, primarily through carbon sequestration in forests, significantly outweighs both biogenic and fossil emissions. Understanding these interconnected dynamics within the carbon cycle is essential for evaluating the net climate impact of forestry operations and the role they play in climate change mitigation. The ongoing efforts to standardize and refine the measurement and reporting of biogenic emissions will provide a clearer and more accurate picture of the complex relationship between forestry, carbon cycling, and climate change.
