The role of REDD+ Patricia Gorin, FAO Rome Vientiane, 30 Aug 2011

Content  Context and Definitions of REDD+  Importance of REDD+ for UNCCD & SLM  REDD+ potential worldwide and for drylands  REDD+ eligibility in the carbon markets & existing projects  REDD+ in the international negotiation arena  Drivers of deforestation and degradation  Phases and financing REDD+

Content  Context and Definitions of REDD+  Importance of REDD+ for UNCCD & SLM  REDD+ potential worldwide and for drylands  REDD+ eligibility in the carbon markets & existing projects  REDD+ in the international negotiation arena  Drivers of deforestation and degradation  Phases and financing REDD+

Reducing Emissions from Deforestation in Developing Countries Reducing Emissions from Forest Degradation Conservation Sustainable Management of Forests Enhancement of Forest Carbon Stocks Agriculture? Other land-use types? REDD REDD+ AFOLU What is REDD+?

aims to compensate countries for reducing their deforestation rates compared to a defined baseline Tropical Deforestation is not covered by the current climate regime Why is REDD+ important? 13 million ha per year is deforested contributing up to 17% of global emissions The Deforestation is largest source of emissions in the developing world (2 nd largest source after fossil fuel) has been long discussed in the definition of CDM rules already, but came back into discussions in 2005 now back on all agendas, on the road to be included into post 2012 UNFCCC measures

REDD concept Project start Red = baseline, emission level without project Baseline = Business as Usual Scenario, Scenario in the absence of the project

REDD+ UN-REDD (UNDP-UNEP-FAO) Program $ M MRV and monitoring 1 1 National REDD+ governance Stakeholders engagement Multiple benefit Transparent, equitable and accountable management Sector transformation Strategy work areas:

Content  Context and Definitions of REDD+  Importance of REDD+ for UNCCD & SLM  REDD+ potential worldwide and for drylands  REDD+ eligibility in the carbon markets & existing projects  REDD+ in the international negotiation arena  Drivers of deforestation and degradation  Phases and financing REDD+

REDD+ and UNCCD Mandate of the UNCCD: to combat land degradation and desertification, and to promote SLM and rural development in drought-prone areas Deforestation in drylands significantly increases the risk of soil degradation and desertification Land degradation, particularly unsustainable land management practices and deforestation, are major contributors to the increase in GHG in the atmosphere REDD may provide a unique opportunity to fund measures aiming at ongoing degradation of forestlands in arid and semi-arid areas

Content  Context and Definitions of REDD+  Importance of REDD+ for UNCCD & SLM  REDD+ potential worldwide and for drylands  REDD+ eligibility in the carbon markets & existing projects  REDD+ in the international negotiation arena  Drivers of deforestation and degradation  Phases and financing REDD+

Deforestation trends Mainly in South America, Southeast Asia, West & Central Africa 13 M ha deforested annually

Potential for drylands Carbon contents of forests vary widely Payments in carbon markets would be based on carbon content of ecosystems Cambodia: average 80 t C/ha Sudan: average 6 t C/ha

Potential for drylands Potential rewards from REDD vary proportionally: Rewards for REDD not exclusively based on carbon Maximise funds raised through market-based approach Co-financing from non-carbon fundsOther? However, these are areas most at risk from land degradation and desertification! Solutions? Countries / areas with predominantly arid forests would gain very little from REDD

Content  Context and Definitions of REDD+  Importance of REDD+ for UNCCD & SLM  REDD+ potential worldwide and for drylands  REDD+ eligibility in the carbon markets & existing projects  REDD+ in the international negotiation arena  Drivers of deforestation and degradation  Phases and financing REDD+

REDD eligibility Voluntary markets! VCS: Voluntary Carbon Standard CCX: Chicago Climate Exchange VER+: Verified Emission Reductions Standards

REDD+ in the Carbon Markets

Official UN REDD scheme and markets only after 2012 Several large pilot schemes already underway Voluntary markets for avoided deforestation already exist  can generate carbon finance now with pilot projects Voluntary markets can prepare a country for REDD Can help set up necessary institutions (e.g., transparent management, monitoring, dedicated government divisions) Projects could be integrated in national REDD strategy

Content  Context and Definitions of REDD+  Importance of REDD+ for UNCCD & SLM  REDD+ potential worldwide and for drylands  REDD+ eligibility in the carbon markets & existing projects  REDD+ in the international negotiation arena  Drivers of deforestation and degradation  Phases and financing REDD+

International negociations on REDD COP 11 in Montreal PNG and Costa Rica: Proposal for "compensated reductions" in deforestation rates COP 11 agreed to launch a consideration process and tasked SBSTA with it (RED) 2007 SBSTA work on technical and methodological issues, policy approaches & positive incentives COP 13 decision “Reducing emissions from deforestation in developing countries: approaches to stimulate action“ -> REDD part of the Bali Action Plan, pilot projects 2009 Since Bali, REDD expanded from only being a SBSTA item to entering the AWG-LCA negotiation track No decision in Copenhagen, but REDD among most advanced topics 2010 Cancun agreement: Clearly states that REDD+ is not only about reducing emissions but halting and reversing forest loss Encourages all countries to find effective ways to reduce the human pressures on forests that result in greenhouse gas emissions Provides countries with guidance on REDD+ readiness SBSTA: Subsidiary body for scientific and technological advice AWG-LCA: Ad Hoc Working Group on Long-term Cooperative Action under the Convention

Cancún 100 B $/ pledged until 2020 ~ $ 10B/year (?) Reinforced REDD+ Continue to seek a legally binding agreement on second commitment period, South Africa >>> ongoing Action Framework on adaptation New programme on technology transfer Green Fund World Bank trustee, independent board

Pilot countries and observators 29 partners countries, from which pilot countries

Content  Context and Definitions of REDD+  Importance of REDD+ for UNCCD & SLM  REDD+ potential worldwide and for drylands  REDD+ eligibility in the carbon markets & existing projects  REDD+ in the international negotiation arena  Drivers of deforestation and degradation  Phases and financing REDD+

Deforestation & Degradation Drivers Remote, marginal areas – Land tenure – Illegal logging – Enforcement / impunity High opportunity costs of sustainable forest use and conservation relative to other land uses and commodities Weak governance – Policy coherence / will – Capacities, resources – Contradicting legal frameworks – Transparency / accountability – Ownership, participation But:

Content  Context and Definitions of REDD+  Importance of REDD+ for UNCCD & SLM  REDD+ potential worldwide and for drylands  REDD+ eligibility in the carbon markets & existing projects  REDD+ in the international negotiation arena  Drivers of deforestation and degradation  Phases and financing REDD+

REDD+ phasing I. Countries to develop National REDD+ Strategies to address FDD drivers and to build capacities (readiness) II. Implementation phase – capacity building – MRV - and payments for demonstrated reduction results III. Full scale implementation: performance based payments for verified emission reduction and removal

REDD+ finance  3.5 B$ preparatory activities (readiness)  B$ performance based payments for emission reduction  at least~ 4 B$ / year until 2015 (UNFCCC-Informal Working Group on Interim Finance, October 2009) Estimated need: $ B to reduce annual deforestation 25% (3.2 M ha / year): Oslo REDD+ Partnership: 4.5 B US$ pledged for “fast start” activities

Mitigation costs REDD+ is a key component in the UNFCCC negociations towards major financing transactions REDD+: 2– 4 $/t CO 2 Industrial CO 2 capture and storage: $ / t REDD+ can be achieved relatively cheaply, could reduce the cost of global action by 40%

What’s new? Difference: REDD+ finance needs would Increase substantially the investment in governance and national capacity building Current “mitigation aid” around 8 B $/year.

Governance is the main challenge Of the countries participating in UN-REDD and FCPF, 83% are rated as having unstable business climates and 13% are rated as highly risky.

Possible “first” impacts Governance –institutional capacities –law enforcement, certainty Improved policy coherence –Investment climate for agriculture, energy, infrastructure, environment, forestry, others Landscape impact –Land use planning –Tenure regulation

Thanks! Patricia Gorin Climate Change and Environment Officer FAO Rome, Centre d’investissement Patricia Gorin Climate Change and Environment Officer FAO Rome, Investment Centre (TCID)