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Next wave of opportunities for climate action are in agriculture and forestry

Updated: Nov 25, 2020

Policy Pulse - 15 August 2019 - George Anjaparidze

Last week, the International Panel on Climate Change (IPCC) released a report on land. Highlighting that land is a critical resource. The report indicates that about 23% of all human-caused greenhouse gas (GHG) emissions are attributed to land, or those related to agriculture, forestry and other land uses. However, agriculture and forestry are even more important to climate policy than their relative share of global GHG emissions. The next wave of opportunities for scaling-up climate action are in agriculture and forestry.[i]

Achieving the current targets communicated through Nationally Determined Contributions (NDCs) implies reducing the 2030 GHG emissions trajectory by 4.8 Gt CO2e or about 8%.[ii] Countries can largely achieve this trajectory by focusing on win-win solutions, where GHG abatement measures create cost savings. Within the basket of such cost-effective measures, agriculture and forestry can contribute about 11% of all GHG abatement potential. However, if countries start raising the level of ambition, they will increasingly need to rely on agriculture and forestry. A more “ambitious NDC” scenario that targets reducing the 2030 GHG emissions trajectory by 9.6 Gt CO2e or about 16%, would result in 49% of all cost-effective abatement potential to be in agriculture and forestry (see chart above). In fact, nearly 70% of all additional cost-effective abatement measures, beyond those in the NDC scenario, would be in the agriculture and forestry sector.

Even the more “ambitious NDC” scenario, presented above, falls short of the effort needed to limit global warming to 1.5° to 2°C. The “1.5° to 2°C” scenario would imply reducing the 2030 GHG emissions trajectory by 27 Gt CO2e or about 44%. Under this scenario, agriculture and forestry would also be a major source of abatement potential, with over 33% of all cost-effective abatement measures.

Targeting agriculture and forestry for GHG emission reductions is also attractive because approaches used generally rely on proven technology and are relatively less capital intensive.[iii] This means that these measures are more conducive to be taken up in developing countries and can more rapidly be deployed at scale. In many cases, there are also significant co-benefits that could be generated beyond climate change mitigation.

The IPCC report on land concludes that, despite human activity, this sector managed to on net remove 6 Gt CO2e from the atmosphere between 2007 and 2016. Increasing international support for mitigation measures in agriculture and forestry, channeled through development banks and others, can serve as a catalyst to realizing potential opportunities. Companies involved in producing agricultural products and managing large areas of land would stand to benefit from this additional support. The world as a whole would also benefit. Agriculture and forestry offer an opportunity to scale-up action on climate change by leveraging a natural advantage.

[i]SeeMcKinsey analysisof global GHG abatement costs (version 2.1).

[ii]See earlier analysis from Veritas Global Paris Agreement: the inconvenient gap between ambition and reality

[iii]SeeMcKinsey analysisof global GHG abatement costs (version 2.0).

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