CPI Webinar: Deterring Deforestation in the Brazilian Amazon

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The Amazon is the world’s largest rainforest. In Brazil, the forest originally occupied over four million km2 – an area equivalent to almost half of continental Europe. Amazon deforestation rates escalated in the early 2000s, peaking at over 27,000 km2 in 2004, but fell sharply to about 5,000 km2 in 2011 (INPE [2012]).

A new study by Climate Policy Initiative (CPI), DETERring Deforestation in the Brazilian Amazon, reveals that the implementation of a satellite-based system that enables frequent and quick identification of deforestation hot spots was the main driver of the 2000s deforestation slowdown.

CPI estimates that satellite-based environmental monitoring and law enforcement policies prevented the clearing of over 59,500 km2 of Amazon forest area (a land area comparable to the size of Latvia) from 2007 through 2011. Deforestation observed during this period totaled 41,500 km2 – 59% less than in the absence of the policy change. CPI also finds that the policy change had no impact on agricultural production.

This webinar focuses on high level findings from this analysis.

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CPI Webinar: Deterring Deforestation in the Brazilian Amazon

  1. 1. 0BRAZILCHINAEUROPEINDIAINDONESIAUNITED STATESEstrada da Gávea, 50 – 4o andarGávea – Rio de Janeiro – RJ22451-263Brazilclimatepolicyinitiative.orgDETERring Deforestation in the BrazilianAmazonJuliano Assunção Clarissa Gandour Romero RochaEnvironmental Monitoring and LawEnforcement
  2. 2. 1Agenda Introduction Institutional context Methodology Key findings Policy implications CPI Rio projects Q&A
  3. 3. 2Introduction | The Brazilian Amazon The Brazilian Amazon• 4 million km2• 80% remains covered by native vegetation• 20% of planet’s fresh water• Unique biodiversity• Carbon sink… combating illegal deforestation is an immensechallenge !
  4. 4. 3051015202530deforestationrate(thousandkm2)Annual Amazon Deforestation RateIntroduction | The Brazilian Amazonagricultural outputprices&conservation policies
  5. 5. 4Introduction | This Study Main question• What role did monitoring and law enforcement play inthe recent deforestation slowdown? Our approach• Empirical regression-based analysis• Sample: 526 Amazon municipalities from 2007 through2011• Explore policy implementation details to assess policyeffectiveness• Satellite-based targeting of monitoring and lawenforcement
  6. 6. 5 Main findings• Large deterrent effect of monitoring and law enforcement• 2007-2011: preserved over 59,500 km2 of Amazon forest• Estimated monetary benefits are larger than costs• Forest preservation occurred at no apparent cost to localagricultural production Monitoring and law enforcement policyIntroduction | This Studyeffectivemonetaryagricultural& low-cost
  7. 7. 6Agenda Introduction Institutional context Methodology Key findings Policy implications CPI Rio projects Q&A
  8. 8. 7Institutional Context | What is Ibama? Brazilian Institute for the Environment and RenewableNatural Resources [Ibama]• Environmental monitoring and law enforcement authority• Police force• Investigation of environmental infractions• Sanctioning of environmental crimes
  9. 9. 8Institutional Context | Policy Change Pivotal conservation effort of 2000s• Plan for the Prevention and Control of Deforestation inthe Amazon [PPCDAm] Stricter monitoring and law enforcement• Real-Time System for Detection of Deforestation[DETER]• Satellite-based real-time monitoring
  10. 10. 9Institutional Context | How DETER WorksNational Institutefor Space ResearchRemote SensingCenter
  11. 11. 10Institutional Context | How DETER Worksbeforeafter
  12. 12. 11Institutional Context | How DETER Works
  13. 13. 12Institutional Context | How DETER WorksNational Institutefor Space ResearchRemote CensingCenter
  14. 14. 13
  15. 15. 14
  16. 16. 15
  17. 17. 16Institutional Context | How DETER Works Targeting before DETER• Voluntary reports of deforestation activity Targeting after DETER• Satellite imagery: 3-day intervals, year-round• More timely law enforcement action… significant improvement in Amazon monitoring andlaw enforcement capability DETER is incapable of capturing land cover patternsbeneath cloud coverage
  18. 18. 17Institutional Context | How DETER WorksJan 2011Jul 2011 Oct 2011Apr 2011
  19. 19. 18Agenda Introduction Institutional context Methodology Key findings Policy implications CPI Rio projects Q&A
  20. 20. 19A Word on Methodology Goal: identify causal effect of Ibama’s presence ondeforestation activity• Environmental fines as measure of Ibama’s presence Challenge: address two-way causalitymonitoring andlaw enforcementdeforestation
  21. 21. 20A Word on Methodology Use DETER cloud coverage as source of exogenousvariation in law enforcement• What does this mean?• For a given area, systematically:Greater DETER cloud coverageLower chance of DETER issuing alertLower chance of Ibama targeting the areaLower intensity of monitoring and law enforcement… unrelated to deforestation!
  22. 22. 21Agenda Introduction Institutional context Methodology Key findings Policy implications CPI Rio projects Q&A
  23. 23. 22Results | Key Findings DETER cloud coverage affects Ibama’s presence• Lower cloud coverage leads to greater number of fines Ibama’s presence affects deforestation activity• Greater number of fines in current year leads to lowerdeforestation in following year• Deterrent effect dissipates over timecloud coverage monitoring and lawenforcementdeforestationless more less
  24. 24. 2341.6101.159.5020406080100120140160180observed estimateddeforestation(thousandkm2)Results | What Does This Mean? What if Amazon monitoring and law enforcementcapability had not improved starting in 2004?total deforestation, 2007-2011
  25. 25. 2441.6164.3122.7020406080100120140160180observed estimateddeforestation(thousandkm2)Results | What Does This Mean? What if Amazon monitoring and law enforcement hadbeen entirely inactive?total deforestation, 2007-2011
  26. 26. 25 Simulation 1: 59,500 km2• ≈ 2/3 area of Portugal Simulation 2: 122,000 km2• ≈ area of Nicaragua• Avoided emissions equivalency: 900 million tCO2 peryear• ½ US 2011 transport sector emissions• 2.5–3 times average annual emissions savings fromEuropean renewables sectorResults | What Does This Mean?
  27. 27. 26Results | Worth It? Cost-benefit analysis24,500 km2average forest areapreserved per year900 milliontCO2avoided emissionsper year560 millionUSD125 millionUSDannual budgets forIbama and INPE685 million USDannual budget for Amazonmonitoring and lawenforcementbenefitcost0.76 USD/tCO2break-even price of carbonlow monetarycost5 USD/tCO2common currentprice of carbon>>
  28. 28. 27Results | Key Findings Tradeoff between economic growth and preservation? Ibama’s presence does not affect local agriculturalproduction• Greater number of fines has no impact on localagricultural GDP or crop productionlow agricultural cost
  29. 29. 28Agenda Introduction Institutional context Methodology Key findings Policy implications CPI Rio projects Q&A
  30. 30. 29Policy Implications Maintain Amazon monitoring and law enforcementefforts• Strong deterrent effect at relatively low cost• Need for continuous policy action• Complementary nature of other conservation policies Promote strategic use of technology and information• Improve monitoring technology• Further enhance law enforcement capability
  31. 31. 30Agenda Introduction Institutional context Methodology Key findings Policy implications CPI Rio projects Q&A
  32. 32. 31CPI Rio Projects | Land Use Deforestation• Prices or policies?• Conditional rural credit• Monitoring and law enforcement• Net impact of protected areas• Socioeconomic impact of conservation policies• Forest clearing behavior Agriculture• Enhanced productivity• Technological adoption• Insurance for rural producers
  33. 33. 32BRAZILCHINAEUROPEINDIAINDONESIAUNITED STATESEstrada da Gávea, 50 – 4o andarGávea – Rio de Janeiro – RJ22451-263Brazilclimatepolicyinitiative.orgQuestions?for full paper and executive summary, clickhereclarissa@cpirio.org

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