Featured Articles – Page 5 – Ecosystem Marketplace

Drought, Deforestation and Degradation Plague Paraguay’s Forest Peoples; Can REDD+ Help?

20 October 2014 | What’s happening to Paraguay’s forest is, unfortunately, a well-told story. The forests are under pressure from a multitude of threats that are undermining its health. A changing climate continues to alter rain patterns and affect food security. Drought plagues the farming and indigenous communities that rely on the forests for their livelihoods.

Meanwhile, poor local people living nearby are over-hunting and illegally logging. And the forest people receive little help from authorities in the way of law enforcement toward preventing these crimes.

Because of these threats, Paraguay’s 16 million hectares of forest are diminishing. This includes the Gran Chaco, the largest dry forest in South America. But as in several other countries struggling with similar challenges, REDD (reducing emissions from deforestation and forest degradation) could serve as a solution.

With REDD, sustainable forest management is fundamental. And in the video below, the UN-REDD programme demonstrates the advantages of REDD-one of them being its ability to empower indigenous communities. Many in this sector consider that a key component to successfully protecting the forests.

“We believe that if Paraguay really wants to start a process that protects the forests, it must work with those who live in the forests, says Mirta Pereira, a Legal Adviser for a local indigenous organization. “There has to be a relationship with the indigenous peoples.

She discusses the potential of REDD in Paraguay. “It’s clear to me that interacting with the state of Paraguay, of having a signed document at the highest level and of having the support of the UN is a great opportunity for us.

Specifically in Paraguay, the UN-REDD programme notes how it enables the forest inhabitants to plant trees on land unfit for agriculture while leaving open areas for grazing animals. In the agriculture fields, farmers plant a variety of plants like sunflowers, wheat and soy, which is better for the soil.

“The forest is not only carbon, not only trees, says Hipolito Acevei, the President of an indigenous organization. “It is an entire history-the place where we as humans and indigenous people co-exist.

Countering Illegal And Unsustainable Activities With REDD+ In Panama

13 October 2014 | Between 1992 and 2008, nearly 900,000 hectares of Panama’s forest were deforested. The land was cleared for development or converted into pastureland.

But despite the increase in development and growth in the agricultural sector, almost half of Panama’s rural population live in poverty and rely on unsustainable practices for their livelihoods. They continue to burn patches of forest and plant crops.

On top of the threats of slash and burn farming and expanding development, climate change and illegal logging activities pose a risk to the forests. The threats are affecting forest health which in turn affects the services they provide, like clean water, to the local people. Many of the local people living in the forests are indigenous to the region and because of traditionally sustainable land practices, these groups have managed to preserve pieces of Panama’s forests. Majority of remaining forestland in the country lies within indigenous peoples’ territories. But the lack of clear and comprehensive land rights in Panama make enforcing laws and securing the forests’ protection difficult for indigenous tribes and acts as another risk.

While these threats are relentless, the UN-REDD programme insists REDD activities serves as a solution that could solve each challenge. Ultimately, it will provide alternative livelihoods that are sustainable empowering local communities to act as good land stewards. REDD also has the ability to generate revenue giving greater value to leaving trees standing.

“My advice is everyone involved in this project should take full advantage of this opportunity,” says Jose Angel Vargas, a local farmer.

“We must preserve the environment” says Samuel Pote, the president of a youth association in the region. “If we destroy a hectare of land for agriculture, then we must also plant trees.”

In the video below, the UN-REDD programme highlights the Panama Canal Authority’s program, which enables sustainable farming. REDD initiatives like reforestation and coffee planting have brought real change, one resident says.

“With all of these projects that have started up in our area such as planting coffee, we have been able to recover some of our sources of water that provide us with healthier and cleaner water.”

California May Void Some Carbon Offsets After Investigation

9 October, 2014 For the first time, California regulators plan to invoke the dreaded invalidation provisions featured in the state’s carbon offsets program.

The California Air Resources Board (ARB) the agency tasked with overseeing the state’s cap-and-trade program and its offset composition in May began reviewing offsets issued for ozone depleting substances (ODS) destruction events at the Clean Harbors Incineration Facility in El Dorado, Arkansas. These substances, which include foam blowing agents and refrigerants, are much more potent than carbon dioxide in terms of their global warming potential, so the ARB has adopted a process to count the greenhouse gas emissions reductions associated with destroying these materials in the United States and allow these reductions to be used for compliance in its program.

California’s cap-and-trade regulations include so-called buyers liability provisions that allow the regulators to invalidate offsets found to be faulty or fraudulent and require regulated entities to surrender replacement offsets for compliance. These controversial rules are often blamed for a lack of liquidity in the California offset market.

In a preliminary decision, the ARB ruled that the offsets generated by two ODS projects one developed by Environmental Credit Corp (ECC) and the other by EOS Climate should be invalidated because the Arkansas facility was out of compliance with its operating permit issued under the Resource Conservation and Recovery Act (RCRA). Of the 231,154 offsets the ARB is seeking to invalidate, 142,199 were generated by ECC’s offset project and 88,955 from the EOS Climate project. However, the ARBÃ’s preliminary decision cleared the vast majority of the 4.3 million compliance offsets being investigated.

ECC declined to comment, but EOS Climate officials say the Clean Harbors facility has been destroying ODS in full compliance with RCRA, the Clean Air Act and Montreal Protocol requirements for more than 20 years.

“At no point has the facility been the subject of any enforcement action related to ODS destruction, the company said in a statement. “EOS Climate believes that ARB’s determination is based on an incorrect interpretation and characterization of a number of fundamental facts and of ARB’s own regulations and guidance.

EOS Climate plans to ask the ARB to reverse its preliminary ruling before a final decision is made on invalidation. The preliminary decision starts the clock on a 10-day public comment period, followed by a 30-day internal review at ARB although the regulators can issue a final decision anytime in or after that 30-day period.

Once a final determination is made, the offsets not subject to invalidation will be returned to account holders after being removed in May when the investigation commenced, while the other offsets are marked for permanent invalidation.

The 1976 RCRA legislation gave the US Environmental Protection Agency the authority to control hazardous waste from “cradle-to-graveincluding generation, transportation, treatment, storage and disposal and established a framework for the management of non-hazardous solid wastes. ARB’s Executive Officer determined that the Clean Harbors Facility was not operating in accordance with its RCRA permit on February 2-3, 2012, meaning that offsets generated by destruction events taking place on those dates were subject to invalidation.

“It goes to show that ARB is very serious about their intention to invalidate offsets, said Julian Richardson, CEO of Parhelion Underwriting, a specialty insurer focusing on the climate finance sector that has developed a policy to cover the invalidation risk. “This is important for the long-term good of the offset mechanism, which needs to be robust in terms of environmental integrity for it to be credible.

Both projects were initially registered with the Climate Action Reserve (CAR), a voluntary carbon standard, before migrating to the ARB’s compliance program under its early action provisions.

“We’re pleased that ARB has reached this milestone point in the investigation and that the conclusion of this investigation is near, said CAR President Gary Gero. “I don’t think we can assess the real impact on demand until the final determination is issued, and with the final determination, we’re looking forward to seeing clear guidance on how to implement these provisions, which would more fully assist project developers and other market participants. This is certainly a precedent setting determination for the program.

Ghost Of Milton Friedman Materializes In Chicago, Endorses A Price On Carbon

13 October 2014 |The familiar, shimmering apparition hovered above the room for a minute or two, then left, then reappeared for a bit longer before fading away.

“There’s always a case for the government, to some extent, when what two people do affects a third party,” it said. “There is a case, for example, for emission controls.”

Nearly a decade after his death in 2006, Milton Friedman the man the Economist described as “the most influential economist of the second half of the 20th century … possibly of all of it was back at the University of Chicago, where he’d built the reputation that won him the Nobel Prize for Economics in 1976 and established him as the patron saint of laissez-faire economics.

But unlike the free-market fundamentalists and Tea Party pontificators who often invoke his name, Friedman didn’t see the market as some all-knowing force that operates without governance, and he wasn’t opposed to environmental legislation. What he opposed was command-and-control regulation that dictated narrow solutions to complex and evolving challenges, and what he favored was something a bit more nuanced than the simplistic slogans spouted on Fox News.

So last week, former South Carolina Congressman Bob Inglis and two University of Chicago professors revived Friedman to answer the question,“What would Milton Friedman do about climate change?”

Watch the Full Discussion or Scroll Down for Summary

Using excerpts from videos of the fiery Friedman wrestling with 20th-Century challenges, they sparked an insightful, informative, and even entertaining dialectic on the economics of pollution and the art of communicating with ideologues creating in the process an introduction to the economics of “externalities”, which is what Friedman’s referring to when he says “what two people do affects a third party. Pollution is a classic externality.)

In his first appearance, Virtual Friedman offers his solution to one of the vexing problems of his day.

“The best way to [reduce auto emissions] is to impose a tax on the amount of pollutants emitted by a car,” he says. “[This] make[s] it in the self-interest of car manufacturers and consumers to keep down the amount of pollution.

Steve Cicala, who is an assistant professor at the U of C’s Harris School of Public Policy, then brings us into the logic of Friedman’s conclusion with a hypothetical. Let’s pretend, he says, that he owns a steel mill that sells its product for $100 a ton. And let’s further pretend that co-panelist Michael Greenstone, who is the U of CÃs Milton Friedman Professor of Economics, lives downwind from his mill.

“I’ve got to burn coal, and [Greenstone] has asthma,” Cicala says. “So, for every ton of steel, it costs him $20 in health.”

Pollution is Theft

Cicala is unequivocal on the morality of this situation: “I compensate every one of my other input suppliers,” he says. “I have to buy the coal. I have to buy the steel. All of that exchange is based on mutually-beneficial, willing exchange, but there’s no market for the pollution that I’m inflicting on Michael.

If he doesn’t compensate Greenstone for damages and do so in a way that Greenstone agrees to then Cicala says he’s not a capitalist. He’s a criminal.

“Companies that don’t pay are guilty of theft,” he says. “If someone has a better way of describing [the act of] taking something from someone without their consent and without compensating them, I’d be happy to use that term.”

Inglis, a rational Republican who was ousted by Tea Party insurgents in 2010, then asks the professors what they think to the anti-tax rhetoric that’s become dogma in his own party specifically, he brings up Texas Governor Rick Perrys dismissal of a carbon tax because it would raise energy rates.

Greenstone says the governor was probably correct, but that doesn’t make him morally right because greenhouse gasses are “sprinkling around damages in Bangladesh, in Los Angeles, in Houston, and even in Austin, where Governor Perry works.

And, unlike Cicala’s factory, this isn’t a hypothetical.

“Those costs are real, he says “And they’re not being reflected in the price I pay when I fill my gas tank or turn on the light.

So, yes, Perry is correct about the cost of energy at least in the short term, and to immediate consumers but he’s morally wrong to resist an effort to pay for “these innocent parties who are minding their own business and having the climate change around them.

Greenstone then reminds us that externalities aren’t part of radical, socialist ideology.

“Its a core idea of economics,” he says. “It’s an apolitical idea.”

Why not Just Ban the Stuff?

So, why focus on making polluters pay instead of passing a law that either bans certain pollutants or imposes standards? Friedman’s apparition returns with an answer:

“What we need is an adjustment mechanism that will enable us to adapt to what happens as it develops,” he says. “And of course, as everybody in this room knows, there is such a system: namely, the price mechanism which successfully steered us over several centuries from wood to coal to whale oil to petroleum to natural gas.”

That mechanism works better than command-and-control, he says, because it promotes solutions that we never could have predicted bureaucratically, and Greenstone wholeheartedly agrees.

“The price system isn’t working in the energy system right now, exactly because carbon is priced at zero, he says. “Its going to be very hard for companies to raise money to come up with new energy innovations when there’s no market for them.”

Then he reminds us again that this isn’t some crazy idea, for just as 98% of the 200 most often-cited climate scientists agree that climate change is real, dangerous, and man-made (despite the best efforts of climate-science deniers to tell us otherwise), so do most economists endorse a price on carbon.

“It’s really remarkable the media always reports this near-consensus among scientists about the effect of human activity on climate change,” says Greenstone. “What does not receive as much attention [is the] greater consensus, starting with Friedman and moving to the most left-wing economists that you can find, that the most correct public policy solution is to put a price on carbon.”

He may be overstating the consensus on a carbon price, although he later points out that all regulation has a price; it’s just than an explicit price on a specific pollutant is more targeted and efficient.

How to Set the Price?

Cicala agrees, and then offers the two most common methods for setting an explicit carbon price: one method is cap-and-trade, which puts a cap on the amount of emissions allowed and lets the price fluctuate. The other method starts with a price and lets that drive the amount.

“For most economists, I think it would be uncontroversial that we should have a cap-and-trade system in which we define the quantity of carbon that can go into the air,” he says. “Then, through trading, we’ll figure out..the least-cost way of [reducing emissions]. [Under such an approach], we’re not quite sure what the price is, but we’re certain about the quantity.

The second approach the one that starts with a price essentially amounts to a tax, and it has the distinct advantage of sending a clear and possibly long-term price signal so companies know it’s worth their while to find climate solutions.

“But the fear with the tax is that it will keep on going up,” says Inglis. “If you start taxing at this price, then how high does it go?”

Greenstone concedes the point and proposes a price that starts with the “social cost of carbon.” While this doesn’t really give the victims a say in the matter, it is a step towards justice. The problem is: how do you determine that price?

“There’s emerging science around that,” he says, citing research into the impact of plunges in crop yields and other results.

“The US government actually has an official number,” he says. “It’s $37 a ton. That would provide an excellent guidepost on how to set the tax and would be a way to constrain a mischievous congress from monkeying with it and making it go up or down to satisfy something political.”

Later in the discussion, he says that failing to embed the cost of environmental degradation in the cost of production amounts to a massive subsidy of nearly $240 billion annually for industry a number he arrives at by rounding US emissions off to 6 billion tons a year and multiplying by $40 per ton.

“I don’t think there’s anything that’s subsidized at that rate in the rest of the economy.

(As a side note, the European Commission also advocates a set price on based on the cost of switching to low-emission technology. Their target price is ¬30 per ton.)

How to Implement it?

While it all sounds great in theory, how do you implement such a set price?

“If we’re the first to implement a tax, then carbon-intense pollution is just going to move overseas, says Cicala, floating the idea of “border adjustments” that “tax goods arriving at the US based on the carbon content.

Inglis then says that, to him, a tax without a border adjustment is a no-go.

“If I were still in Congress and had a carbon tax that wasn’t border adjustable, I couldn’t vote for it because of the problem just identified, he says.“We would become double losers. We lose employment and we lose the race to reduce emissions. Then, domestically, there are those who will fight anything that increases taxes in one area without a reduction elsewhere.”

He then opens an ideological can of worms by pointing out that the organization he now heads, the conservative Energy & Enterprise Initiative (which co-hosted last weeks event), believes any carbon tax should be “revenue-neutral”, which “means a dollar-for-dollar tax cut somewhere else. If we add a carbon tax, then we have to reduce another tax to keep government from getting too big, he says asking the others, with refreshing introspection, “Is that indicated by the economics or is that just my conservative philosophy coming to bear there?

Here they flounder a bit talking about the chance to reduce “distortionary” taxes while ramping up a tax that corrects a market distortion, but not directly taking on the distortionary subsidies given to the oil sector.

Offsetting and Other Missing Components

They manage to cover an incredible amount of territory in a very short period of time, but two glaring elements are missing from the discussion.

One is implicit: you can tell from their other statements that these gentlemen abhor subsidies for the oil sector. The other, however, is one they only skirt: namely, what happens to the money if this is a tax especially if revenue neutrality is an “imperative”, as Inglis says?

If revenue neutrality means you get to cut income taxes, doesn’t that defeat the purpose of charging a tax based on the social cost? After all, if the proceeds from that carbon tax just end up going to fund an income-tax cut, then where does that leave the victims of climate change? Greenstone does touch on this later in the discussion by alluding to energy transfers to the developing world, but the group never picks up the topic of offsetting, which is when the money raised under cap-and-trade goes directly to a reduction program elsewhere. I’m sure I’ll find some great stuff from both Cicola and Greenstone online, but it would have been great to explore this issue here.

There’s also a weird digression where they talk about the importance of American leadership this on an issue where the US has been doing globally what the Republicans have been doing domestically: namely, gunking things up. You could also argue, as Greenstone implies, that the global “solutions” developed so far are flawed to the bone, but they don’t really address existing global measures or lessons to be learned from their failures.

Going Global

Despite this or maybe because of it the discussion around border adjustments actually gets quite fascinating, especially when Cicola brings up the idea of inviting a challenge at the World Trade Organization. Under his scenario, a US carbon tax on imported goods would be structured in such a way that it can be offset by an equal tax in the country of origin.

“That gives more of an incentive for other countries to buy in,” he says. “Because if I start collecting the revenue on China’s or India carbon emissions, they’ll want a piece of that.”

And if those countries don’t implement a carbon tax on their own exported products?

“We have an opportunity to collect a bunch of revenue from other countries non-participation.”

How to Sell It?

Towards the end, Inglis opens a thread that’s obviously near and dear to his heart: how to convince idealogues on the right that climate science is real and we need to deal with it. He provides two answers: one is to slowly build a tribe of rational conservatives who are now too afraid to raise their voices lest some pinhead from the Heartland Institute pillories them; the other is to begin with the end in mind namely, begin with the message that we can fix this mess without creating the kind of bloated bureaucracy that none of us really wants.

Cicola and Greenstone warm to the first, but are leery of overselling the second point. While Greenstone does concede that the Obama administration’s current climate strategy is a mess, he points out that it’s a mess borne of necessity. Maybe, he says, now is a time for Republicans to offer a real plan based on a carbon price a plan that will be better than the mess necessitated in part by their own obstinacy.

Both however, go out of their way to remind us that free-market fundamentalism isn’t a strategy. It’s a fantasy. While recognizing the cost of government inefficiency, Cicola reminds us that government is a necessary evil, especially given the threat at hand. “If were deciding between catastrophe for civilization and government inefficiency, Im willing to take a bit of government inefficiency for that trade-off,” he says.

“It a kind of a fiction to think that markets exist on their own,” adds Greenstone. “They exist because government creates ground rules for them to operate in.”

Will Last Month’s Climate Summit Stir Real Action on Climate Change?

10 October 2014 | United Nations (UN) Secretary General Ban Ki-moon raised eyebrows last year when he announced that the UN would host a Climate Summit in New York City in September 2014. Some observers questioned what could be accomplished at the Summit that had not been achieved during years of international climate negotiations. A lot, as it turns out.

The People’s Climate March brought more than 400,000 people to the streets ahead of the Summit to demand leaders of countries and corporations alike take ambitious action to address the climate change threat. The gathering was the largest civil demonstration in history on climate change and world leaders still had those voices echoing in their ears when Ki-moon called the Summit to order two days later.

Countries and corporations participating in the Summit responded to Ki-moon’s call for bold pledges with a wide range of commitments on agriculture, cities, energy, financing, industry, resilience and transportation. Perhaps the most ambitious in terms of emissions reductions was the New York Declaration on Forests through which government, business, civil society and indigenous leaders pledged $1 billion to end deforestation by 2030. Norway and the United Kingdom made particularly rich promises for climate finance (see Climate Finance section). If successful, the pledge would prevent the emission of between 4.5 billion and 8.8 billion tonnes of carbon dioxide (tCO2e) annually.

“I think the Summit was a success,” said Paul Bodner, Director for Environment and Climate Change for the White House’s National Security Council. “We talk about tipping points on climate change. I think it’s possible we’ll look back on this Summit as a different type of tipping point where countries really got serious about action.”

Carbon pricing was also at the top of leaders’ minds in New York. The World Bank counted 74 countries, 23 subnational jurisdictions and more than 1,000 businesses and investors as signatories on its petition supporting carbon pricing. Noticeably absent was the United States, which Bodner attributed to the lack of political consensus at the federal level.

On the opposite side of the world, New Zealand’s National Party maintained control of the parliament after a general election seen aspivotal for the country’s emissions trading system (ETS). In June, the Green Party pledged to abandon the “failed” ETS in favor of a tax of $25 per tonne of carbon dioxide equivalent on emissions for all sectors, except agriculture, if it prevailed in the election.

The opposing Labor Party promised to strengthen demand for domestic offsets through rule changes during a review of the ETS in 2015, but he National Party has no plans to make changes to the system. However, New Zealand Unit prices are still expected to rise since compliance entities will lose access to inexpensive international Emission Reduction Units next year.

More news from the voluntary carbon marketplace is summarized below, so keep reading!

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The Editors

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VOLUNTARY CARBON

Walking the Walk

In what Ki-moon called “walking the walk,” the UN maintained its commitment to keeping its system carbon neutral by minimizing the greenhouse gas (GHG) emissions associated with the Summit. The UN purchased over 18,000 tonnes of Certified Emission Reductions (CERs) to offset the emissions of participants’ air travel and make the event carbon neutral. Read more here

Mickey Mouse to the rescue

The Walt Disney Company is one of the largest purchasers of offsets in the voluntary carbon markets, retiring 457,882 tCO2e in 2013 and 433,677 tCO2e in 2012, according to company data. Its latest project supported the replanting of 234,000 spruces along the Missionary Ridge in Colorado’s San Juan National Forest through the National Forest Foundation. Intervention was necessary since the area showed no signs of regrowth after a 2002 fire. The 250-acre project area is expected to sequester about 54,000 tCO2e over the next 100 years, according to project documents filed with the American Carbon Registry. Read more here

Riding the rails

The Delhi Metro Rail Corporation (DMRC) is making a profit by selling CERs under the UN’s Clean Development Mechanism. However, income from international offset sales has waned as prices dropped from 20 euros per tonne to under a euro per tonne, said K K Saberwal, DMRC Director of Finance. “The West’s own attempts to reduce carbon footprints has impacted the cost of CERs.” The DMRC generates offsets through a regenerative braking system and its Modal Shift project, which accounts for the difference between train travel and more polluting transportation options. The Metro system handles 250,000 riders daily and generates more than 630,000 tCO2e offsets annually, according to DMRC’s blog. Read more here
More on Modal Shift methodology

Trees for you and me

A new initiative from Code REDD, Stand for Trees, is attempting to channel the public’s enthusiasm from the UN Climate Summit into real GHG reductions utilizing avoided deforestation offsets. The campaign will facilitate sales of forest offsets to the general public in half tonne increments through a new mobile web platform. “People are what motivate the private sector and the public sector decision making, so we feel it’s essential to engage the general population in forest conservation and helping them to understand the role of forests in climate regulation, said Kate Dillon, Director of Membership Development at Code REDD. Individuals represented less than 1% of demand for forest-based offsets in 2012, according to Ecosystem Marketplace’s State of the Forest Carbon Markets 2013. Read more here

COMPLIANCE CARBON

Mock trials for carbon

South Korea is set to launch its ETS on January 1, so the Korean Exchange (KRX) began testing the system last month. During the first phase, KRX will coordinate infrastructure between itself, the country’s GHG management system and settlement banks as well as educate corporations on the trading process. The second phase will begin October 27 with mock trading for compliance entities. South Korea has voluntarily committed to reduce its GHG emissions 30% below business-as-usual levels by 2020. Officials expect allowances in South Korea’s program to trade around $20/tCO2e, but some analysts say the price could reach nearly $100/tCO2e. Read more here

Chile reception for CO2

Chile has officially adopted a carbon tax, making it the first South American country to price CO2 emissions. The $5 per tCO2e tax will focus on electricity generators larger than 50 megawatts (MW). Chile has a voluntary target of cutting GHG emissions 20% from 2007 levels by 2020. The carbon tax is scheduled to begin in 2018 and is expected to raise $160 million in revenue as part of a broader tax reform bill. Chile’s program does not include provisions for the use of offsets, unlike similar taxes in Mexico and South Africa. Read more here

Filling their dance card

California and Quebec are courting others to join their cap-and-trade program. Quebec Premier Philippe Couillard said his staff has been in discussions with regulators in Ontario and New England states while California officials continue talks with fellowPacific Coast Collaborative members Washington and Oregon. Couillard singled out Vermont as particularly interested in partnership, but the state is currently a member of the Regional Greenhouse Gas Initiative (RGGI) with eight other Northeastern states. “Vermont is not considering leaving RGGI – rather we are looking to strengthen RGGI even further by exploring the possibilities to integrate our market with others, said Justin Johnson, Deputy Secretary of Vermont’s Agency of Natural Resources. Read more here

Double, but still trouble

The Climate Action Reserve (CAR) expects offset issuance will more than double from 40 million tCO2e in 2014 to over 80 million tCO2e in 2017 over half of which will come from project types eligible for California’s compliance program. However, CAR issuances would still fall short of fulfilling demand for offsets for California’s program if covered entities maximized the 8% limit they can use toward their compliance obligations because not all protocols are allowed into the program. Currently, only offsets generated under five protocols forest, urban forestry, livestock, U.S. Ozone Depleting Substances (ODS) and mine methane are eligible, with rice cultivation possibly added to the mix later this year. Read more here

Always be prepared

Chinese companies are preparing for a domestic carbon market scheduled to begin in 2016. Foxconn, an electronics manufacturer headquartered in Taiwan, has established its own carbon trading business, Shenzhen Fox-Energy Technology. The company has already benefited from investments in CO2 reduction technologies that allowed it to sell part of its allowance allocation in the Shenzhen pilot carbon market in addition to saving on electricity expenses. Once China establishes a national price on carbon, other markets will follow, according to leaders at the recent Summit. China could regulate 3-4 billion tCO2e by 2020 under its planned ETS, which would make it the largest carbon market in the world, according to officials. Read more on Foxconn’s activities
Read more about China’s influence

Gas in the power grid

Genalta Power has become the first company in Alberta to earn carbon offsets for converting waste gas that would otherwise be flared into electricity. The 4-MW Cadotte Peace River project generated more than 8,000 tCO2e in 2013 and will result in 240,000 tCO2e of reductions over its lifetime to be sold to the gas provider Baytex Energy. The project was developed under Alberta Environment’s waste heat recovery protocol in partnership with Blue Source Canada, with verification by Alberta-based Stantec. Read more here

CARBON FINANCE

No empty promise

The New York Declaration on Forest commits governments, multinational corporations, civil society and indigenous peoples to cut forest loss in half by 2020 and completely end it by 2030. The commitment comes backed with a promised down payment of $1 billion in economic incentives for countries to reduce forest loss. Norway has pledged up to $300 million to Peru and $150 million to Liberia to support their forest preservation efforts, bringing Norway’s total support for climate and forests initiatives to about $3 billion through 2020. The United Kingdom pledged $235 million split between two programs designed to jump start sustainable land-use programs across the developing world. Read more here

The perils of peace

The Democratic Republic of the Congo (DRC) has the second largest forested area in the world, and the usual threats to forests logging and agricultural expansion have historically been muted by the civil war that has plagued the country since the mid-1990s. However, the DRC’s increasing political stability could result in the forests falling under threat from development, so a new effort to protect the home of endangered species such as the bonobo the great ape that is the closest living relative to humans is now underway. The government is launching a pay-for-performance avoided deforestation program seeking $50 million a year from the private sector, but the program will first need a $20 million boost from philanthropic donors. Read more here

STANDARDS AND METHODOLOGIES

Just a little tweak

The CAR will adapt its ODS protocol for use with ODSs sourced in Mexico and destroyed in Mexican facilities. The organization has invited stakeholders to form a working group this month to develop the modified protocol, which is expected to be complete by April 2015. ODSs have a high global warming potential and offsets are generated from their destruction in cases where they would have otherwise been vented to the atmosphere. Read more here

SCIENCE & TECHNOLOGY

On different latitudes

A New York Times op-ed by Yale atmospheric chemistry professor Nadine Unger caused a stir last month when it argued that “large-scale increases in forest cover can actually make global warming worse” and warned against UN funding for forestry. Unger’s research found that increasing forest cover at high latitudes darkens the color of the Earth’s surface and absorbs more sunlight. But scientists responding to the op-ed pointed out that REDD funding is directed specifically to tropical (low-latitude) forests, where the clouds that trees create lighten Earth’s surface color. Unger also stated that the volatile organic compounds (VOCs) released naturally by trees mix with fossil fuel emissions to produce GHGs. Critics responded that Unger’s own research shows that VOCs have anywhere from a cooling to a warming effect, while deforestation is clearly connected to an increase in GHGs. New York Times op-ed
Scientists response

Actions have consequences

Scientists have made an uncharacteristically strong connection between Australia’s 2013 heat wave and human-related GHG emissions. Five independent researchers using different methods concluded that last year’s temperatures could not have occurred without human intervention.“When we look at the heat across the whole of Australia and the whole 12 months of 2013, we can say that this was virtually impossible without climate change, said David Karoly, a climate scientist at the University of Melbourne. The ground-breaking finding came too late to preserve Australia’s carbon pricing program designed to reduce the country’s GHG emissions which federal legislators voted to repeal in July. Read more on the heat wave
Read more about the carbon tax repeal

AIME Program Senior Associate Forest Trends

Based in Washington, D.C., the Senior Associate will lead all administrative functions of the Accelerating Inclusion and Mitigating Emissions (AIME) grant and support the Manager and Chief of Party of the AIME program. Eligible applicants should have demonstrated experience with the rules and regulations associated with the use of US federal funds. Ideal candidates will have previous experience with US Agency for International Development grants. Fluency in English and Spanish is required, working knowledge of Portuguese is preferred. More information here

Asia Program Manager Center for Clean Air Policy

Based in Bangkok, Thailand, the Asia Program Manager will serve as a consultant and contribute to the Mitigation Action Implementation Network project focused on helping developing countries create Nationally Appropriate Mitigation Actions to reduce GHGs and promote sustainable development. Successful candidates should have eight years of climate change mitigation or environmental policy experience with government, international or a regional development institution in a position of responsibility in at least one of the target countries. Fluency in English is required and fluency in Thai is preferred. More information here

Manager, Corporate Program Ceres

Based in Boston, Massachusetts, the Manager will organize and lead ongoing dialogues and develop advocacy positions focused on companies within several sectors, such as financial services, technology and consumer products. Eligible candidates should have five years or more of direct experience working on sustainability and corporate responsibility issues in the corporate, investor or non-profit sectors. Preferred candidates will have experience in North America with knowledge of the broader international context of sustainability. More information here

Program Assistant – Natural Resources Defense Council

Based in Washington, D.C., the Program Assistant will provide administrative and research support for both the China Program and the Energy and Transportation Program. The position will require flexible hours given the coordination challenges that the time difference with Beijing-based China Program team presents. Previous administrative and research experience highly desired. A Bachelor’s degree and proficiency in Mandarin is required. More information here

Operation Associate, Shipping Efficiency Carbon War Room

Based in Oxford, United Kingdom, the Operations Associate will be responsible for the day to-day coordination of the shippingefficiency.org website and conduct research for the Operation team. Ideal candidates will have a Master’s degree in environmental science, energy, economics, business or other related field. More information here

Associate Outreach Director, Pricing Carbon Initiative U.S. Climate Plan

Based in Washington, D.C., the Associate Outreach Director will help coordinate the “Price Pollution, Cut Carbon: A National Dialogue to Address Climate Change event on November 14-16. This is a two-month position with the potential for longer-term employment as funding allows. Applicants should have proven competency in managing, coordinating, and overseeing staff and volunteers. Experience with the NationBuilder community development software, communications expertise and web design proficiency is preferred. More information here

ABOUT THE ECOSYSTEM MARKETPLACEEcosystem Marketplace is a project of Forest Trends, a tax-exempt corporation under Section 501(c)3. This newsletter and other dimensions of our voluntary carbon markets program are funded by a series of international development agencies, philanthropic foundations, and private sector organizations. For more information on donating to Ecosystem Marketplace, please contact [email protected].

Fixing Water By Fixing Land: What Works And What Doesn’t

9 October 2014 |Taking a watershed approach means strategically identifying and directing wetland and stream restoration and protection projects to best meet the needs of the watershed.

The Environmental Protection Agency (EPA) labeled it the most effective framework to meet today’s water resource challenges. In 2008 the EPA and the Army Corp of Engineers (Corps) published the Final Compensatory Mitigation Rule, which required for the first time that the Corps use a watershed approach when making compensatory mitigation decisions.

Despite this general consensus, implementing a watershed approach remains challenging. “Using a watershed approach may mean a more significant up-front investment, but the conservation outcomes can be significant,” says Jessica Wilkinson, a Senior Policy Advisor on mitigation at the conservation organization The Nature Conservancy (TNC). “The watershed approach can direct both compensatory mitigation projects and voluntary, non-regulatory protection and restoration projects to the best sites leading to more significant, watershed-scale conservation outcomes.

A lot of money is spent every year on mitigation programs that deliver less than stellar results, Wilkinson says. According to a 2007 study from the Environmental Law Institute (ELI), nearly $4 billion is spent on land restoration and protection through mitigation annually. This money has obvious potential to contribute to conservation but perhaps lacks the guidance to do so effectively.

To help with this aspect of the problem, TNC and ELI recently published the Watershed Approach Handbook: Improving Outcomes and Increasing Benefits Associated with Wetland and Stream Restoration and Protection Projects. Through on-the-ground pilot projects sponsored by the two organizations, as well as EPA and the Corps, the handbook demonstrates how a watershed approach contributes to flood mitigation, better water quality and quantity and species habitat among other ecosystem services.

“We felt that through our respective expertise on policy and science, we could contribute to advancing a vision for the watershed approach that would help maximize the conservation outcomes of mitigation,” Wilkinson says. “So mitigation can contribute to larger landscape and watershed goals and get bigger better conservation bang for the buck.”

The intention of both organizations is to influence a shift in decision-making toward a landscape- or watershed-level and away from the project-by-project basis programs are currently operating under. It’s aimed at the parties involved in the planning process: mitigation bankers, state agencies, conservation organizations and members of the Interagency Review Teams that evaluate compensatory mitigation proposals.

Wilkinson notes the particular importance of the state-level actors. The managers of state wetland mitigation programs have been real innovators in this space, she says. ELI emphasized this point last year in another handbook that provides information on the range of tools being used at state and local levels countrywide. This new handbook, then, takes it one step further by providing guidance on how to apply these tools in a way that delivers high-value conservation.

“A watershed approach can maximize multiple benefits of mitigation and restoration,” Wilkinson says. “But in order for this to happen, state agencies and conservation organizations need to know about the opportunity and reach out to their partners at the Corps IRT agencies and provide them with information on the needs of watersheds and the most important places to which compensatory mitigation investments should be directed.”

This Week In Forest Carbon: Half Of Tropical Deforestation Comes From Illegal Activities

17 September 2014 |What do a hamburger, a chicken nugget, a tube of toothpaste, and a cardboard box have in common? They’re all products that are likely connected to tropical deforestation.

About three-quarters of all tropical deforestation between 2000 and 2012 was caused by commercial agriculture for major crops such as beef (that hamburger), soy (used in chicken feed), and palm oil (which makes its way into toothpaste and countless other products), according to a new report by Forest Trends. The ‘conversion timber’ the trees cut down as a forest is converted to other land uses is often used in packaging materials.

Nearly half (49%) of tropical deforestation since the turn of the millennium has been due to illegal land conversion, the report finds. Illegal activity takes on many forms. In Brazil, for instance, organized land grabbers cleared swaths of the Amazon and then took advantage of government programs that grant land titles after the fact. In Cambodia, a rubber company was issued a land concession five times the size allowed by law, with more than half of the land area falling within a national park. In Tanzania, a jatropha company fudged the authorship of an environmental impact assessment and convinced villagers to sign documents they didn’t fully understand.

Illegal deforestation is a topic that has often been brushed under the rug, but it’s essential to address, the report argues, in part because of its scale.

Existing efforts to address global deforestation, such as the United Nations-backed program for developed countries to pay developing ones to reduce emissions from deforestation (REDD), are undermined by rampant illicit activity. Voluntary “zero deforestation” commitments by companies such as pulp giant Asia Pulp and Paper and palm oil trader Wilmar are also less meaningful when their pledges focus only on future deforestation, since illegally cleared land can continue to yield products such as soy and palm for decades, Lawson says. And as long as illegal activity goes unpoliced in so many places, there will always be companies willing to take the path of least resistance.

“One of the ways of getting ahead of the curve on agricultural commodities is if you learn the lessons of what took the timber community 20 or 30 years to realize that you need regulation at the consumer country level rather than just voluntary policies, and you may need to look at legality instead of sustainability,” Lawson says.

The report, Consumer Goods and Deforestation: An Analysis of the Extent and Nature of Illegality in Forest Conversion for Agriculture and Timber Plantations, can be downloaded here. Its findings have already echoed around the world through news coverage in The Guardian, Le Monde, Deutsche Welle, Die Zeit, BBC, and The Wall Street Journal.

More stories from the Forest Carbon Marketplace are summarized below, so keep reading!

The Ecosystem Marketplace Team

If you have comments or would like to submit news stories, write to us at [email protected].

INTERNATIONAL POLICY

Bold ambitions for Climate Week

On Sunday, September 21, artists Nora Ligorano and Marshall Reese will install a 3,000-pound ice sculpture called ‘Dawn of the Anthropocene’ at the intersection of Broadway and 23rd Streets in New York City. And, as an anticipated 100,000 people walk through the streets as part of the People’s Climate Summit, the ice sculpture will symbolically melt away. The march is just one of the events surrounding the United Nations Climate Summit, during which Secretary-General Ban Ki-moon has invited world leaders from government, finance, business and civil society to “bring bold announcements and actions” next week. Forest-related events that will be occurring around the Summit include: a discussion of the demand-side challenge of deforestation-free supply chains; a panel of leaders from corporations, indigenous peoples and governments calling for action to reduce deforestation; a colloquium for thinking about big ideas for “transformational change” for forests and climate; and a photography exhibit on indigenous people protecting forests. A full list of events is available here.

Partners in forest

A new partnership between the United Nations Environment Programme and the International Union for the Conservation of Nature (IUCN) aims to restore at least 150 million hectares of forest landscapes by 2020, an area the size of Alaska. Achieving this would sequester an estimated one gigatonne of carbon dioxide equivalent (CO2e) from the atmosphere each year and generate $85 billion worth of annual ecosystem services benefits to developing countries. The collaboration brings together two major global initiatives the UN’s REDD program and IUCN’s Global Partnership on Forest Landscape Restoration and will include a Helpdesk function for assessing restoration opportunities, as well as a mapping database for carbon and other benefits.

NATIONAL STRATEGY AND CAPACITY

Guyana, you are the weakest link!

The Norwegian Ministry of Foreign Affairs singled out Guyana as a “weak element” among its partner countries in forest protection because of slow progress in utilizing Guyana REDD+ Investment Fund monies and other issues. But Norway’s International Climate and Forest Initiative Secretariat has a more positive view of the partnership because Guyana has made remarkable progress on the technical aspects. Guyana and Norway signed a REDD+ pay-for-performance partnership in 2009 that could amount to $250 million in payments to 2015, depending on Guyana’s performance. But stronger Norwegian representation in Guyana is necessary to ensure the partnership does not go awry.

PROJECT DEVELOPMENT

It’s getting wet out there

The US state of Louisiana loses about a football field worth of wetlands every hour. Barring a major intervention, much of Southeastern Louisiana will sink into the Gulf of Mexico by 2100. The 2012 Louisiana Comprehensive Master Plan for a Sustainable Coast outlined an ambitious plan to save the state’s coastal wetlands, an effort that has already yielded some success in the form of completed projects, including a barrier island rebuilding project on Pelican Island. But current funding levels fall far short of the $50 billion needed for coastal wetlands restoration projects, meaning that other sources of financing including possibly the carbon markets must be identified and accessed.

SUSTAINABLE COMMODITIES

Is your fruit killing that tiger’s home?

Major palm oil suppliers may still be buying tainted palm oil despite commitments to eliminate deforestation from their supply chains, according to a new investigation by Eyes on the Forest, a coalition of environmental groups in Indonesia. The investigation tracked fresh fruit bunches illegally produced within the protected Bukit Batabuh tiger corridor in Sumatra and found the fruit entered palm oil processing facilities owned by Asian Agri, Wilmar and other companies and eventually shipped to a port that counts Cargill among its customers. But the investigation wrapped up in January 2014, before Asian Agri, Cargill and Wilmar announced new steps to eliminate deforestation from their supply chains.

FINANCE & ECONOMICS

When is the price right?

With national emissions trading systems or carbon taxes on the horizon from China to South Africa,companies are adopting a price on carbon for business planning purposes. Globally, 150 companies reported to CDP that they use an internal carbon price, but those prices have a wide range: Microsoft uses $6 per tonne of carbon dioxide equivalent (tCO2e) while UK-based utility Pennon Group uses a range of $84.24-324/tCO2e (2010 and 2050 projections, respectively). These internal carbon prices are sometimes creating a pool of money used to purchase carbon offsets. But what is the right price to instigate behavior change inside companies? “Within the electric utility sector, you’ll start to see behavioral change around $30/tCO2e,” says Mark Trexler, Chief Executive Officer of the climate strategy and risk group Climatographers. “In the transportation sector, you won’t start to see behavior change until over $100/tCO2e.”

HUMAN DIMENSION

A Peruvian tragedy

Four leaders of the Ash¡ninka community Edwin Chota Valera, Leoncio Quincima Melndez, Jorge Rios Perez and Francisco Pinedo were murdered last week on the Peruvian border with Brazil. They were on their way to meet with the Ash¡ninka in Acre, Brazil to continue their collective work to monitor their territories from illegal wood loggers and narco-traffickers. The assassinations may be motivated by revenge by illegal loggers, according to regional indigenous leaders. The Ash¡ninka and human rights campaigners released a manifesto that calls for the perpetrators to be brought to justice, for a permanent forum to address illegal activities on the Peru-Brazil border, and for establishing clear, legal land ownership for the Ash¡ninka.

Ka’apor crackdown

In the Maranhao state in the northeast corner of the Brazilian Amazon, members of the Ka’apor tribe frustrated by inadequate government assistance in stopping illegal logging on their land are protecting their forest by force. A recent photo report shows warriors capturing illegal loggers, beating them with sticks, burning their truck and cutting into their precious logs to ruin the contraband. At least one man wears a shirt that reads “Guarda Ambiental Indigena” (Indigenous Environment Guard) as he expels loggers from the Alto Turiacu territory. The photographs were taken on August 7 by Lunae Parracho, for Reuters.

‘No, thanks’ to carbon finance

The Kuna Yala people of Panama have kept their 3,240-square-kilometer old growth forest intact even as other forests across Central America have fallen to logging and agriculture. In June 2013, the Kuna General Congress voted against participating in a REDD+ project proposed by project developer Wildlife Works that would presumably pay them to continue to keep this forest standing and sequestering carbon dioxide. “The Kuna people feel that many institutions, NGOs, and governments are taking advantage of them,” said Heraclio Herrera, a Kuna biologist. “We’re open to getting help, but we want others to respect the forests because they don’t belong to us; they belong to our creator.”

SCIENCE & TECHNOLOGY

Cooling things down

The conversion of forests into cropland worldwide has triggered an atmospheric change that has had a net cooling effect on global temperatures, according to a study by Yale University Professor Nadine Unger published in the journal Nature Climate Change. Unger reports that large-scale forest losses have reduced global emissions of biogenic volatile organic compounds (BVOCs), which control the atmospheric distribution of many short-lived climate pollutants. She calculated a 30% decline in BVOC emissions between 1850 and 2000, largely through the conversion of forests to cropland, which produced a net global cooling of about 0.1 degrees Celsius. During the same period, the global climate warmed by about 0.6 degrees Celsius, mostly due to increases in fossil fuel carbon dioxide emissions.

A scary view from the top

More than 104 million hectares of intact forest landscapes were degraded between 2000 and 2013, an alarming rate of degradation of forest lands three times the size of Germany, according to a new analysis conducted using satellite technology and advanced techniques. The worst damage was done in the Northern boreal forest belt of Canada, Russia and Alaska, accounting for almost half the degraded land, while 25% of the degraded area was found in the Amazon rainforest and 9% in the Congo Basin. “We can clearly see that business as usual will lead to destruction of most remaining intact forests this century,” said Nigel Sizer, head of Global Forest Watch, the online forest monitoring and alert system hosting the new maps.

What a bargain!

The world’s tropical forests could be quickly and accurately mapped by a fleet of airplanes outfitted with advanced Light Detection and Ranging remote sensing technology at a bargain price of $250 million, according to a new paper published in the journal Carbon Balance and Management. This would be a more cost-effective approach than a typical Earth observation satellite mission, and far less than field-based sampling, according to the paper. The $250 million amounts to just 5% of the funding pledged to REDD+ initiatives.

PUBLICATIONS

Pricing watershed services in a thirsty world

In 2013, governments and companies invested $9.6 billion in initiatives implementing nature-based solutions to sustain the world’s clean water supply, with payments restoring and protecting a total of 365 million hectares of land, according to Forest Trends Ecosystem Marketplace’s State of Watershed Investment 2014. More than 90% of watershed investment came from national public subsidies, mostly in China, though the private sector particularly food and beverage companies is playing a growing role. “Environmental risk mitigation is clearly driving private investment in watershed health,” says lead report author Genevieve Bennett. “Water companies, for example, are finding it more cost-effective to pay for healthy forests that mitigate fire or flood risks upstream, rather than to face supply disruptions after an extreme event.”

Cropping up emissions

While more efficient agricultural technology has decreased pressure on forests in Latin America and Asia, a similar ‘green revolution’ in Africa could actually lead to more deforestation and higher emissions, according to a recent study published in the Proceedings of the National Academy of Sciences. In the context of an integrated global market, crops that shift to Africa will be grown more cheaply but will also have lower yields, therefore requiring more land up to 1.8 million more hectares than are currently cultivated on the continent, according to the study’s authors. The study estimates that pressure on forests would reduce within a few decades as yields improve, but tropical forests and their carbon stocks should be protected in the meantime.

JOBS

Post-Doctoral Researcher in Above-ground Carbon Dynamics Woods Hole Research Center

Based in Woods Hole, Massachusetts, the Researcher will develop novel approaches to the direct measurement and mapping of above-ground carbon dynamics at a global and local scale. The position requires assembling and analyzing remote sensing datasets, and expertise building statistical relationships between field and satellite image data is needed. The successful candidate will be familiar with REDD+ and forest carbon monitoring, reporting, and verification.

Read more about the position here

Knowledge Management and Communications Officer Papau Low Carbon Development Programme

Based in Papau, Indonesia, the Knowledge Management and Communications Officer will support the Papaun Government, five regency governments, and other stakeholders in implementing a 20-year plan for sustainable development. The program aims to develop strong community-based businesses in a range of fields, from sustainable community logging to non-timber forest products to ecotourism. The position will require implementing communications activities such as policy briefs, reports, case studies, a website, seminars, conferences, exchanges and study trips.

Read more about the position here

Project Assistant, Litigation Team ClientEarth

Based in London, United Kingdom, the Project Assistant will provide administrative and research support for ClientEarth’s new litigation team, working on environmental justice, biodiversity, climate and forests, and other issues. The successful candidate will have a bachelor’s degree, excellent organizational and writing skills, and the ability to work well under pressure. Fluency in English is required; proficiency in another European language would be desirable.

Read more about the position here

Climate Negotiator, Sustainable Landscapes U.S. Department of State

Based in Washington, D.C., the Climate Negotiator will support U.S. engagement and help formulate and implement U.S. government policy on international climate change and related issues, particularly with respect to sustainable landscapes and REDD+ issues. Eligible candidates should have at least three years of experience in climate issues. Ideal candidates will have experience or exposure to international negotiations. U.S. citizenship is required.

Read more about the position here

Carbon Offsets Program Manager Google

Based in Mountain View, California, the Program Manager will support sustainability goals globally by coordinating and working on aspects of carbon offset procurement. Ideal candidates will have a master’s degree and five years of relevant experience with climate policy, procurement, contracts, and vendor management. The position will involve travel to all offset project site locations.

Read more about the position here

ABOUT THE FOREST CARBON PORTALThe Forest Carbon Portal provides relevant daily news, a bi-weekly news brief, feature articles, a calendar of events, a searchable member directory, a jobs board, a library of tools and resources. The Portal also includes the Forest Carbon Project Inventory, an international database of projects including those in the pipeline. Projects are described with consistent ‘nutrition labels’ and allow viewers to contact project developers.

Successful Green Pledges Hinge On Procurement Agents And Consumers

1 October 2014 | Dunkin’ Donuts and Krispy Kreme recently vowed to stop buying palm oil from companies that clear-cut forests a clear bid to reach consumers who reward green behavior with open wallets. Such “zero deforestation” pledges, will only have an impact if two things happen: first, the companies have to be able to prove they’re keeping their word; and second, consumers have to put their money where their mouths are.

Historically, the second part of the formula has proven elusive, as paper giant Domtar found when it went through the arduous process of becoming the first manufacturer to offer Forest Stewardship Council (FSC)-certified paper products ten years ago. Today, Domtar’s FSC-certified products make up more than 20% of its total paper sales, and the company recently announced the sale of its five millionth ton of certified paper, but that paper doesn’t attract a higher price than its standard fare.

“FSC certification is celebrating its 20-year anniversary, and I’m very happy to say that Domtar has been a part of that from the beginning, said Paige Goff, the company’s Vice President of Sustainability and Business Communications. “When you think about five million tons, when stacked in pallets, it equals the height of over 12,000 Empire State (New York) buildings. It’s a great way to demonstrate the impact of FSC certification.

But that pile of pallets didn’t come cheap. Domtar had to hire additional staff to help meet FSC’s requirements and fulfill internal and external audits, which was not only a financial cost, but a huge time investment. Did it pay off?

“Maybe a few years back, you could get a price premium, says Goff. “But the price premium is not really there any longer.

She adds that Domtar’s early adoption gave it a competitive advantage in the early days, and the company benefited from positive recognition as a pioneer, which helped the company gain new clientele, but the fact is that the price premium is gone, and the question is why.

Goff says one reason is that the rest of the industry caught on, and now most companies offer at least some FSC-certified products. So, for those consumers who look at labels, there’s more competition. But a recent study by the International Institute for Sustainable Development (IISD) found that green consumers are few and far between. Their research says that two-thirds to one-half of products that meet certification standards are actually sold on the open market as conventional, rather than being sold as certified, primarily due to oversupply and weak demand.

That’s because most supermarket shoppers aren’t looking at certification labels; they’re looking at price tags. And their decisions at the check-out counter are many steps removed from the executive suite.

Procurement Officers on the Front Lines

Who has primary responsibility for all those purchases of certified paper and other sustainable products? None other than thousands of number-crunching procurement officers charged with buying everything from toilet paper to produce to automobiles for large institutional clients such as businesses, local governments, and academic institutions. Procurement officers spend a whopping $10.1 trillion in goods and services each year, according to 2011 data from the United States Department of Commerce.

“Institutional purchasers, whose spending drives an estimated 50-65% of the economy, are uniquely positioned to send economic signals to advance a sustainable future, Jason Pearson, Executive Director of the Sustainable Purchasing Leadership Council(SPLC ), said at its annual meeting this summer.

This purchasing heft makes procurement officers incredibly important allies to suppliers of certified products such as Domtar. However it is not always easy for procurement officers to balance their institution’s needs and budgets while also contracting the most socially and environmentally responsible products. Even when their institution’s leadership is committed to sustainability, that message often does not trickle down to their direct managers, meaning that procurement officers still face pressure to deliver cost savings rather than reward businesses that manage natural resources more sustainably, pay fair wages, or minimize pollution.

Procurement officers must also navigate the often-confusing “ecolabel jungle when making purchasing decisions. Ecolabels such as FSC aim to help by offering a seal of approval for certain products, which ideally would secure additional sales and higher price premiums. But there are a staggering 448 ecolabels to sort through, according to the
Ecolabel Index, some of which overlap or differ in subtle ways, and others that are not independently verified as having any environmental benefits.

SPLC to the Rescue (Sort of)

The SPLC was launched to help procurement officers better understand and reduce the social and environmental impacts of their purchasing. The council develops guidance to help procurement officers understand areas of their purchasing with the highest impacts, prioritize actions to reduce these impacts, benchmark their progress compared to their peers, and receive recognition for advancement.

At its annual meeting, the organization released a set of broad principles that it hopes will help the purchasing community use its immense buying power to advance sustainability. One of the principles, for example, encourages members to use “credible standards that meaningfully address relevant environmental, social, and economic impacts. The broad principles will be followed with more specific guidance on improving performance in the highest categories of institutional spending, such as electricity, transportation, and wood and fibers use. But as of now, the principles do not specifically entreat purchasers to pay premiums for sustainable products.

Domtar was a founding member of the SPLC. The company uses the forum to share experiences with other suppliers, and to hear directly from procurement officers about the challenges they face to sustainable purchasing.

“One of the things I like about the SPLC is that there are a lot of educational components Goff said. “I really felt like it would be beneficial to Domtar to have a seat at the table, to educate on what is viable and doable in our industry.

So what will it take for Domtar to get to 10 million tons of certified paper? Paige Goff sees a bottleneck of certified pulp in a market hungry for more FSC products, primarily from small landholders of 500 to 1,000 acres.

“We have a struggle to get small landholders to understand the FSC certification and why it is good for them. Why would they want to incur the logistical procedures and monetary costs?she asked. “FSC and businesses need to do more education and bring them together to become certified. It will not be successful without collaboration.

Amazon Leader Tashka Yawanaw¡ to Highlight Indigenous Issues At TED Talks

6 October 2014 | As a boy, Tashka Yawanaw¡ watched as the culture of his people was nearly wiped out by outsiders. Now, he is the chief of those people, the Yawanaw¡, of the Acre region of Brazil, and Tuesday he will be a speaker at one of the largest conferences in the world, TEDGlobal 2014.

Click here to follow the talks.

Tashka joins the ranks of past TED speakers like Bill Gates and Jane Goodall. The motto of TED is “Ideas Worth Spreading, with participant speakers sharing ideas in short presentations of 18 minutes of less. The conference this year, called “South!, takes place in Rio de Janeiro, Brazil, from October 6-10, and features more than 65 speakers and performers from all over the world, addressing a wide range of topics, from heritage food, samba music and painting favelas to cancer detection.

He will be the only indigenous person speaking at the conference, and he will tell the narrative of his own life and that of his community.

The Yawanaw¡ were nearly annihilated last century by rubber tappers and missionaries bent on exterminating the Yawanaw¡ spirituality and culture. Tashka left his community as a young man to study in the United States and returned determined to help his people recover from the near-fatal blow to their existence. Eventually, he became leader of the community.

Tashka and his wife, Laura, have worked to increase their territory, rejuvenate the culture, and form and grow socially and economically empowering relationships with the rest of the world. Tashka is particularly interested in developing a new model of sustainability that allows the group to protect their home, the rainforest, and engage with the outside world. Such a model is a valuable tool in response to the problem of climate change, a topic about which many people are confused, polarized, or entrenched in outdated ways of thinking.

In Latin America and the Caribbean, there are roughly 40,000,000 people who belong to close to 600 indigenous groups. Their stories, as yet untold, are heart-wrenching, profound, and at their core, hopeful, particularly as their worlds intersect with the issue of climate change.

Tashka speaks at TED just months before Lima, Peru, is set to host the international climate negotiations at COP 20, and global focus will laser in on identifying opportunities for climate policy and finance to align with other public and private investments and commitments with the goal of ensuring that forests and other ecosystems continue to provide critical support for stable climate and resilient societies.

As DRC Emerges from Civil War, Government Seeks Funds To Protect Forests From Surging Development

6 October 2014 | The forests in the Democratic Republic of the Congo (DRC) do not get nearly as much attention as those in Brazil and Indonesia, even though the DRC’s forests rank right in the middle of those countries on the list of the top three forested areas in the world. The DRC holds 155 million hectares of forests, more than 50% of all of Africa’s forests, and the country’s iconic Congo Basin is second only to Brazil’s Amazon forest in size roughly 540 million hectares and is larger than the 90 million hectares of forests in Indonesia. Brazil and Indonesia are both beneficiaries of pledges potentially valued at up to $1 billion from Norway to support their efforts to conserve their forests. But the DRC has yet to receive that level of commitment from either donors or the private sector, in large part because the civil war that led to the deaths of six million people in the country also perversely protected the DRC’s forests from widespread destruction. In late 2013, however, the main armed rebel group agreed to a peace treaty, which paves the way for increasing political stability in the country. With that political breakthrough comes much-needed development, and with development come increased risks to the DRC’s forests, which, if destroyed, could potentially release 140 billion tonnes of greenhouse gases. Now, donors and investors have a unique opportunity to prevent widespread deforestation before it occurs. To counteract potential forest destruction, the DRC government is launching a new pilot program to safeguard nearly nine million hectares 10% of the DRC’s forests in an area the size of England in the districts of Mai Ndombe and Plateau using the UN REDD+ (reducing emissions from deforestation and forest degradation) mechanism. The area to be protected from deforestation is home to more than 1.8 million people and endangered species some living in Salonga National Park such the bonobo, the great ape that is the closest relative to humans and lives only in the DRC. It is also the site of the largest wetlands on the Ramsar List of Wetlands of International Importance, which originates from the global convention governing the sustainable use of wetlands. The area is the closest forest area to Kinshasa, the capital city, meaning it is also under threat from the growing charcoal, timber and food needs of nearly 10 million people, in part because of transportation infrastructure improvements making the forests more accessible. “Our country believes with good regulation we can participate fully in the solution to climate change, Minister N’sa Mputu Elima, Minister of Environment, Conservation of Nature and Tourism for the Democratic Republic of the Congo, said during a Climate Week NYC 2014 event. Continue reading (for free) on the Forest Carbon Portal.

Gloria Gonzalez is a Senior Associate in Ecosystem Marketplace’s Carbon Program. She can be reached at [email protected].

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With Lima Talks Over, Attention Shifts To Country Initiatives

14 December 2014 | LIMA | Peru | French Foreign Minister Laurent Fabius summed up the outcome of the 20th Conference of the Parties (COP 20) to the United Nations Framework Convention on Climate Change (UNFCCC) as well as anyone.

“We have achieved in Lima a very good and useful agreement, which sets the basis for an agreement in Paris,” he said. “Manuel [Pulgar-Vidal] has been both very efficient and very diplomatic, because on the one hand he has been successful in achieving great agreement.”

But he had a caveat;

“On the other hand, he has left some work to do for Paris.”

The “Lima Call for Climate Action” contains both a 22-paragaph agreement on Intended Nationally-Determined Contributions (INDC), which are the emission-reduction proposals that individual countries will begin proposing in the first quarter of 2015, and a draft negotiating text for the 2015 agreement.

Gone is the laundry list of specific components that comprise a valid INDC, but the Lima agreement does enshrine a procedure for countries to offer their INDCs early and synchronize them over the course of the year.

“The information for the INDCs is key,” said Pulgar-Vidal, the Peruvian Minister of Environment who served as President of COP 20. “The INDCs are key to having this balance between the bottom-up and the top-down process for Paris, and also because the INDCs are going to show us if there is a gap, what is the dimension of the gap.”

The Paris draft negotiating text comprised the bulk of the agreement, and it contained many elements that had been contentious throughout Lima and remain unresolved. Included in the unresolved elements are the methods for accounting for land-use.

The 22 paragraphs on INDCs were less detailed than many had expected, and that will make the next three months especially critical as countries upload their INDCs to the UNFCCC web site. The proposals are supposed to contain specific emission-reduction targets and specific plans for achieving them, and optimists believe their emergence in place of a top-down global agreement will spark a race to the top throughout 2015 and even beyond.

“As contributions are put forward, peer pressure will grow for countries to be as transparent and ambitious as possible,” said Jennifer Morgan of the World Resources Institute (WRI).

“While the Lima summit fell short of expectations, the pressure is still on countries to put forward their best emissions reduction offers early next year,” said Alden Meyer, the director of strategy and policy for the Union of Concerned Scientists (UCS). “The good news is that the world’s three largest emitters – China, Europe, and the U.S. – have already committed to do so, and others are expected to join them.”

An Old Rift

INDCs were created in the final hours of the Warsaw talks in an effort to bridge a gap between developing countries – primarily powerhouse up-and-comers like China and Brazil – and developed countries – primarily the United States. While US negotiators hoped that the introduction of INDCs would blur the distinction between developed and developing countries, China, backed by developing countries, managed to reintroduce language enshrining the obligation of developed countries to pay for “loss and damage”. US negotiators had opposed that language, arguing that China’s rate of economic development placed it in a different category from most other developing countries.

“There are deep and long-standing divisions on major issues including climate finance, which countries are more obligated to take action to reduce emissions, and whether to give greater priority to adaptation,” said Meyer. “These divisions nearly derailed the process in Lima; if they aren’t addressed, they threaten to block an agreement in Paris.”

A key stumbling block was the unwillingness of many countries, especially China, to submit to external scrutiny.

“To avoid the worst impacts of climate change, we need a strong, science-based agreement that sets the world on a path to virtually eliminating heat-trapping emissions before the end of this century,” said Meyer. “The resistance by some countries to allowing scrutiny of their proposals is troubling.”

Pre-2020

The Lima decision included modest steps to increase ambition between now and 2020, including by providing technical support to developing countries to accelerate deployment of renewable energy technologies and other solutions to climate change. Unfortunately, there was no real progress on how to scale up financial resources towards the $100 billion per year by 2020 goal pledged by the U.S. and other developed countries five years ago in Copenhagen.

“Progress on the Green Climate Fund was a bright spot, with countries’ exceeding the $10 billion goal for 2014,” said WRI’s Morgan. “These funds will jump start a transition to a low-carbon and climate-resilient economy. It will be important to identify additional sources of funding that are on par with the scale of the climate challenge.”

Adaptation on the Ascendancy

UNFCCC Executive Secretary stressed the rise of adaptation onto the same level as mitigation, which will be done by providing more visibility to countries’ National Adaptation Plans (NAPs) and the Green Climate Fund. Pulgar-Vidal also launched a NAP Global Network involving Peru, the US, Germany, the Philippines, Togo, the UK, Jamaica, and Japan.

The Lima Information Hub for REDD+

Countries meeting in Lima made progress on providing support to avoid deforestation.Colombia, Guyana, Indonesia, Malaysia and Mexico formally submitted information and data on the status of their greenhouse gas emission reductions in the forest sector to the UNFCCC secretariat following a similar submission by Brazil earlier in the year.

These baselines are likely to increase the possibility of obtaining international funding under initiatives like Reduced Emissions from Deforestations and Forest Degradation (REED+).

In support of this, the COP President announced that an ‘information hub’ will be launched on the UNFCCC web site, spotlighting actions by countries carrying out REDD+ activities.

The aim is to bring greater transparency on both the actions being undertaken, including safeguards for communities and the payments being made.

TNC and CH2M Hill Bring Green Infrastructure to a City Near You

This article was originally published in the Water Log newsletter. Click here to read the original.

1 October 2014 | Greetings! Earlier this month we launched the Executive Summary of the State of Watershed Investment 2014 report at World Water Week in Stockholm. The report finds that $9.6 billion flowed to natural infrastructure for water in 2013, protecting a land area larger than India.

Among our key findings?

More than 90% of watershed investment came from national public subsidies, including $8.8B attributed to the Chinese government.
Private landholders are the leading supplier of natural infrastructure worldwide: at least 7 million households received compensation for sustainable management and protection in 2013.
The private sector invested another $41 million into watershed health – approximately twice as much as was tracked in 2011. Particularly active were businesses with obvious exposure to water-related risks, like private water utilities and the food and beverage sector. The Coca-Cola Company alone has invested at least $2.2M to date to support 20 such projects worldwide.
Other risk-exposed businesses such as energy utilities or agricultural producers were less active in 2013, with market participants linking under-investment to regulatory uncertainty and a lack of clear information about programs’ return on investment.
Survey respondents reported $6B that has already been committed to watershed investment activities through 2020. Leaders in the field are looking to the private sector, climate finance, and the re-allocation of infrastructure spending as future financing channels.

Figure: Count of Newly-Operational Watershed Investment Programs, 1990-2013

Source: Forest Trends’ Ecosystem Marketplace, 2014.

Learn more here. A full report is due out later this fall.

In this month’s Water Log, it’s been a month of firsts. The Washingdon DC District Department of the Environment oversaw its first-ever transaction of Stormwater Retention Credits under a new stormwater trading program. Meanwhile, the Gold Standard launched its Water Benefit Certificate, which certifies water quantity benefits from water stewardship projects. We’re also following a new collaboration between The Nature Conservancy and CH2M Hill that will test out green infrastructure approaches at scale in four regions in North America learn more about that here.

The Ecosystem Marketplace Team

For questions or comments, please contact [email protected]

GENERAL

Nature-Based Water Solutions Drew $9.6 Billion In 2013

Last year, governments and companies invested $9.6 billion in initiatives implementing nature-based solutions to sustain the world’s clean water supplies. According to a new report from Forest Trends Ecosystem Marketplace, this funding which supports healthy watersheds that naturally filter water, absorb storm surge, and perform other critical functions flowed to more than seven million households and restored and protected a total of 365 million hectares (ha) of land, an area larger than India.

Up from $8.2B in investment tracked in 2011, the researchers say the sector’s continued growth and near-doubling of the hundreds of operational programs reflects governments desire to secure water quality and availability with affordable strategies that can complement or replace industrial infrastructure.

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Role Of Carbon Markets Still Evolving In Run-Up To Peru Climate Talks

24 September, 2014 | Just what the carbon markets need: another acronym.

But John Kilani, Director of Sustainable Development Mechanisms for the United Nations Framework Convention on Climate Change (UNFCCC) Secretariat, insists that the acronym INDC (Intended Nationally Determined Contributions) is a good thing. The INDC concept has gained traction since the last round of UNFCCC negotiations in Warsaw in which countries agreed to initiate or intensify preparation of their INDCs, which will establish how individual countries plan to reduce their carbon emissions in the talks leading up to what stakeholders hope will be a new global agreement reached in Paris in 2015.

There will be a lot of talk about INDCs during the next round of UNFCCC negotiations in Lima, Peru in December, he predicted, as the UNFCCC participants consider the role of markets in addressing climate change. While the parties are not expected to put forth their visions for the INDCs until the first quarter of 2015, what the INDCs look like and their scope is going to define the shape and the role of the carbon markets in the future, Kilani told attendees at the International Emissions Trading Association’s (IETA) Carbon Forum North America in New York this week.

“I don’t want you to be disappointed that there is no text coming from Lima that says anything strong about the markets he said. “I don’t think we should expect that in Lima. But we should expect that in Paris because of the level of ambition that is communicated in the INDCs. How much of the INDCs is going to be quantifiable? That is what’s going to define the future landscape of carbon markets.

A new vision for linking

IETA has been developing a new plan to engage in the international climate talks that represents how a price on carbon could fit into a new international agreement because putting a price on carbon “has to happen to address rising carbon emissions, said David Hone, Climate Change Advisor for oil major Shell and former chair of IETA.

“Without it, the direction that investments go and how the investment outlook appears becomes very confused, he said. “Certainly without a price on carbon, we won’t get the clarity we need in terms of real mitigation.

The concept IETA has been working on, in collaboration with the Harvard Project on Climate Agreements, aims to show that in what will likely be an INDC world, these national contributions can potentially link, even if they are very different, Hone said. And it would not be just carbon markets linking together as the concept envisions INDCs built on carbon markets possibly linking to others without carbon markets, as long as there is some type of carbon unit transaction between these contributions, he said.

“That’s the sort of future we imagine, he said.

Speaking the same language

The next challenge for this effort is to think about the language that would need to appear in the Paris agreement to underpin this potential linkage of programs, Hone said.

“It’s unlikely that the Paris agreement is going to talk about global carbon markets, he said. “It’s unlikely that it’s going to have a formula for a global carbon market that we can all take forward and use. Rather it’s going to be text that describes the ideas and concept. The agreement itself may be quite short. It’s probably going to be more of an outline than substance because the next five years is really going to put the substance into this. It’s probably going to focus on the big picture items.

IETA and Harvard have drafted a few lines of text, taking inspiration from the simplicity of the language that underpinned development of the Clean Development Mechanism. The Paris agreement could include a statement that the parties may voluntarily transfer portions of their contributions to other parties and that these transferred units may be used by those on the receiving end to implement their INDCs.

“From a legal perspective, such a statement would be helpful in providing certainty both to governments and private-market participants that linkage is feasible within the UNFCCC framework, and it is likely a necessary condition for widespread linkage to occur, the Harvard Project stated in a document summarizing the approach. “Such a minimalist approach would allow diverse forms of linkage to arise among what will inevitably be heterogeneous nationally determined contributions thereby advancing both cost-effectiveness and environmental integrity.

IETA’s proposals are realistic, given what the international negotiators are trying to do in the run-up to Lima and Paris, said James Bacchus, Member of the High Level Advisory Panel to the President of COP20, Peru & Chair of the ICC Commission on Trade and Investment Policy.

“We’re looking at not a grand, comprehensive, universal agreement to be all and end all, but on another beginning on which we can build, he said. “It will focus mainly on procedures, not on substance.

A little pushback

China is a notable presence on the list of 74 countries, 23 subnational jurisdictions and more than 1,000 businesses and investors that signed the World Bank’s petition in support of carbon pricing. Noticeably absent, however, was the United States, which was not an accident, according to Paul Bodner, Director for Environment and Climate Change for the White House’s National Security Council.

“I don’t need to tell you that the President (Barack Obama) is very committed to market-based approaches, but we don’t have a consensus about that in Washington at the federal level, he said.

But he urged advocates of the carbon markets not to wait for a top-down approach to the establishment of market mechanisms.“Why are you waiting for permission from the UNFCCC system to create carbon markets? he asked. “Why are you waiting for permission to link those systems together? You don’t need permission.

Bodner, a former climate negotiator, highlighted IETA’s proposed language that the parties may voluntarily agree to link and the difficulty in getting the 193 countries in the UNFCCC to agree on anything. “The premise is wrong, he said. “If you say the agreement has to contain this text, you’re implying that if it doesn’t it’s not true. But the fact is it is true. Parties can do this today.

The challenges of linking

However, creating linkages outside of the UNFCCC process has its own challenges, even when the partnering jurisdictions are both strongly in favor of linkage. Quebec and California, for example, have been working on linking their cap-and-trade markets for six years, with the first official joint auction of carbon allowances for the two jurisdictions finally set for November. While the two jurisdictions did not need permission to link, their linkage does not have the regulatory weight it would have under the UNFCCC process because they are subnational jurisdictions that have limited authority to enter into a legally binding agreement.

“Even with two jurisdictions that have been trying to link, it’s not very easy, Kilani said. “To have an international framework that everyone commits to is very necessary. I understand where Paul’s coming from. It’s a difficult process, but don’t allow the difficulty to stop you from going for what is necessary. As difficult as the process may be, experience has shown with the exception of Copenhagen (UNFCCC negotiations) parties do eventually find common ground.

The European Union and Australia had plans to link their carbon pricing programs before the Australian government repealed the country’s carbon tax this year. But that linkage would have only been possible because of the underlying Assigned Amount Unit structure, said Andrei Marcu, Senior Fellow, Center for European Policy Studies. The AAU is a market mechanism within the Kyoto Protocol and functions like an allowance in a cap-and-trade system, providing the basis for trade and creating supply and demand through its allocation against national targets relative to actual emissions, an IETA paper noted. This was a fundamental feature in the EU-Australia plans to link. Without the AAU underpinning, there would have been absolutely no reason for the EU to accept those reductions, Marcu said, and a similar recognition of the ability to transfer units and understand exactly what is being accounted for will likely be necessary in the Paris agreement, he said.

The Obama administration remains bonded to the UNFCCC process, but the parties have had difficulty even agreeing on the Framework for Various Approaches the set of components and rules that would ensure that all approaches used for mitigation will meet certain standards, especially from an environmental integrity point of view Bodner observed.

“If you have a desire to create that link, whether you’re California trying to create a link to another country or Quebec, is there anything that makes it not possible for you to purchase those units and count them against your target today? Bodner asked. “There is nothing preventing you from doing that today.

The only feature the agreement needs to include is a way to track units across borders to ensure environmental integrity by guarding against double counting, Bodner said. “It is really important that a country does not present the same tonnes for compliance that another country is presenting, he said.“Just think carefully about what you really need and what you don’t need.

Gloria Gonzalez is a Senior Associate in Ecosystem Marketplace’s Carbon Program. She can be reached at [email protected].

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As Corporates Vow To Purge Deforestation From Supply Chains, A New Conservation Model Emerges

23 September 2014 | Within the last year, the world’s three largest palm-oil suppliers Wilmar, Gold Agri-Resources, and Cargill all made commitments to purge deforestation from their supply chains. The pledges cover 60 percent of globally-traded palm oil, which translates into $30 billion in annual sales. The turnaround came about in part because of pressure from the consumer goods companies that buy most of this palm oil companies such as Unilever, Nestl© and Kellogg’s that are in turn under pressure from non-governmental organizations (NGOs) and consumers.

At an event yesterday hosted by the Ford Foundation and the Climate and Land Use Alliance that previewed the United Nations Climate Summit today, Unilever CEO Paul Polman spoke about business’s role in a climate-changed world.

“It is very clear, increasingly, [to] the business community as well, that although capitalism is fine, capitalism leaving too many people behind isn’t fine, he said. “Capitalism defined very narrowly as GDP (gross domestic product) growth or profit-and-loss growth while we end up not being able to breathe the air or create sufficient jobs for everybody or [we] have these issues with food security or hunger simply isn’t fine.

Polman serves on the board of the Consumer Goods Forum, an industry association representing $3 trillion in annual revenues that in 2010 pledged to eliminate deforestation from its supply chains, addressing forest-encroaching commodities such as palm oil, soya, beef, timber and pulp and paper. Unilever launched a traceability and reporting platform last March and has so far entered 120 palm oil suppliers representing about 1,000 mills into the database.

Destruction of tropical peat forests in Indonesia and other countries for palm plantations releases a huge amount of greenhouse gases. The peat soils of Southeast Asia store an amount of carbon comparable to the aboveground vegetation of the Amazon rainforest, so keeping those forests in tact is critical to keeping global average temperature rise in check.

“If we don’t fix this, then I think we are increasingly being rejected by the same citizens that came out with 400,000 people yesterday on the streets of New York and many other places in the world demanding climate justice, Polman said, referring to the Peoples Climate March that clogged the streets of Manhattan on September 21.

Unilever sells products under more than 1,000 brands, including Dove, Vaseline, Ben & Jerry’s, and Lipton household products that will be in increasing demand as billions of more people move into the global middle class. Speaking later on a panel, Jeff Seabright, Unilever’s chief sustainability officer, said that the company’s efforts on reducing deforestation fall not under a corporate social responsibility strategy, but rather as a business strategy. However, he admitted that NGO pressure has certainly prompted companies to speed efforts on addressing deforestation from palm oil expansion, and its associated emissions.

“I would be remiss if I didn’t acknowledge that some measure of the sense of urgency was a result of Greenpeace showing up at Unilever headquarters in London five years ago and scaling the walls,- he said. “That has an impact, and I don’t think we’d be where we are at this stage without Greenpeace playing the role that they played.

In the wake of the recent murders of Ashaninka leaders in Peru, activists say that securing legal land rights and de-facto protection for indigenous peoples is perhaps the key step to saving forests from the chainsaw and the plow. Abdon Nababan, secretary general of AMAN (the Indigenous People’s Alliance of the Archipelago) and a Toba Batak from North Sumatra, says that the 70 million indigenous people in Indonesia control about 150 million hectares of the country’s land area. Indigenous-controlled forests in Indonesia store roughly 43 Gigatonnes of carbon, he estimates.

“We want to save the forest, but there is no protection for the people who protect the forest, he said. Can you protect the forest from Washington, from New York, from London? I don’t think so.

Nababan sees a new paradigm emerging in which communities are increasingly holding companies accountable, often by civil action such as blocking roads leading to illegal land concessions. In the past, companies could ask the Indonesian government to mobilize the military or the police, he says, but that doesn’t happen much anymore. He called for advocacy partnerships’ rather than business partnerships between communities and companies, both of which are at a disadvantage when policies don’t define clear land rights.

“Doing business in a better way, that’s the only choice, Nababan said. “The world is more democratic now.

Allie Goldstein is an Associate in Ecosystem Marketplace’s Carbon Program. She can be reached at [email protected].

DDOE Approves Trade For First Of Its Kind Stormwater Retention Credit Trading Program

This piece was originally posted as a press release on the DDOE website. Click here to read the original.

23 September 2014 | The District Department of the Environment (DDOE) has approved a trade of 11,013 Stormwater Retention Credits (SRCs). This trade, valued at $25,000, is the first in the nascent SRC trading program, which is the first of its kind in the nation.

The trade demonstrates how the SRC market can provide meaningful financial returns for voluntary installations of green infrastructure that reduce harmful stormwater runoff.

Under the District’s current stormwater management regulations, development projects permitted after January 2014 must meet river-protecting stormwater retention standards and can meet a portion of this requirement by using SRCs. Projects using SRCs must own them by the end of construction, which typically takes a year or longer.

According to DDOE Director Keith A. Anderson, the SRC market is expected to grow as additional regulated projects are completed. “Trades provide a strong incentive for voluntary installations of green infrastructure, says Director Anderson. “In turn, market participants are helping to ensure a more Sustainable DC.

Ann Benefield, seller of the SRCs, added, “Revenue from this trade will help cover the costs of designing, installing, and maintaining the rain gardens that generated the SRCs. Now we’re looking at other ways to install practices on our property to generate additional SRCs.

In addition to providing compliance flexibility for regulated development, SRC trading can increase the total volume of stormwater runoff being kept out of District waterbodies and provide other sustainability benefits, such as reducing the urban heat island effect and providing green jobs.

Global Leaders Pledge $1 Billion To End Deforestation By 2030

23 September 2014 | Heading into this week’s United Nations Climate Summit in New York City, it would have been easy to take the pessimistic view that this would be another exhausting round of discussions where no concrete action was taken to address the climate challenge. But this summit is off to a fast start as governments, multinational corporations, civil society and indigenous peoples have issued the New York Declaration on Forests a joint commitment to cut forest loss in half by 2020 and completely end it by 2030.

It’s an ambitious pledge, but certainly not an empty one. It comes backed with a promised down payment of $1 billion in economic incentives for countries to reduce forest loss. Norway on its own has pledged up to $300 million to Peru and $150 million to Liberia to support their forest preservation efforts, bringing Norway’s total support for climate and forests initiatives through 2020 to about $3 billion.

Indigenous Support

The declaration comes just six weeks after governors from forested states across the world pledged to end deforestation in their states under the Rio Branco Declaration, but only if international funding materializes. It also drew broad support from indigenous peoples, who haven’t always been enthusiastic cheerleaders or partners in the past.

“The ancient stewards of the forests are standing up and saying we’re willing to be partners in this declaration, said Lou Leonard, Vice President of Climate Change for the World Wildlife Fund (WWF), adding that the diversity of donors also provided reason for optimism. “It provides a more realistic and complete picture of the loss of tropical forests and gets all the right players signed on to the solution.

The announcement comes one day after the United Kingdom pledged £144 million ($235 million) split between two programs designed to jump-start sustainable land-use programs across the developing world. The first, a £60 million pledge (US$97 million) for a new program called the Investments in Forests and Sustainable Land Use initiative, will be used to form public-private partnerships with communities, local farmers and local and international businesses to manage forests sustainably and support and encourage agriculture that does not cause further deforestation.

“Through this program, we want to set up partnerships with those companies that are committed to taking deforestation out of their supply chains and we want to work with smallholder farmers to help them comply with those new market requirements and produce timber, palm oil, and other agricultural commodities in ways that do not cause further deforestation, said Justine Greening, U.K. Secretary of State for International Development. “We know that smallholder oil palm farmers are getting around half of the yield that they should be when compared to professionally run plantations. So by supporting investments that help improve smallholder productivity on their existing plantations, we can help those farmers increase their yields without having to clear more forest.”

The second, of £84 million ($137 million) will be available for the Forest Governance, Markets and Climate program, which works to close the European Union market to illegally-harvested timber and support developing countries in tackling weak governance that allows illegal deforestation. The program has already had a “transformational impact in countries such as Indonesia, the Democratic Republic of Congo and Liberia, she said. The additional funding is going to allow this governance reform work to be scaled up in 15 countries already being supported and extend the program to new countries, Greening said.

“We’ll also be going beyond tackling the illegal timber trade and looking at other commodities such as palm oil, soya and beef because we know that many cattle pastures and plantation for palm oil and soya are sited on land that was illegally cleared of forest, she said.

The U.K’s new financial commitment will also support local, civil society organizations in helping communities acquire land rights and ways to mediate disputes between communities and companies, Greening said. The U.K. has already implemented a £20 million program in Nepal to secure land rights for hill communities. About 40% of forestland in Nepal is now under community control, and deforestation has virtually ended in these (community-owned) areas, with many degraded hill slopes now being reforested.

However, “community rights over forests are still the exception rather than the norm in too many countries, she said.

Germany, Norway and the United Kingdom also promised to push for large-scale economic incentives as part of the international climate negotiations in Paris in 2015.

“I asked for countries and companies to bring bold pledges, and here they are, said United Nations Secretary-General Ban Ki-moon. “The New York Declaration aims to reduce more climate pollution each year than the United States emits annually, and it doesn’t stop there. Forests are not only a critical part of the climate solution the actions agreed today will reduce poverty, enhance food security, improve the rule of law, secure the rights of indigenous peoples and benefit communities around the world.

The declaration builds on the progress already being made by companies such as Unilever seeking to eliminate deforestation from their supply chains. Through the Consumer Goods Forum (CGF), 400 companies representing $3 trillion in net revenues have committed to sustainably source the four key commodities that drive deforestation: palm oil, soy, beef and timber.

Jeff Seabright, Unilever’s Chief Sustainability Officer and co-chair of CGF’s sustainability steering group, said companies such as his want to make sure the goods they produce do not come at the expense of the forests. “That’s a big task and we cant do it alone, he said.

In the past year, 60% of globally traded palm oil was sustainably sourced by companies such as Wilmar, Golden Agri-Resources and Cargill “a very, very impressive demand signal in the marketplace, Seabright said. These three companies have pledged to work together on implementing their deforestation-free sourcing policies and joined the Indonesian Business Council in asking incoming Indonesian President Joko Widodo to support their efforts through legislation and policies as part of the declaration.

Deforestation is responsible for roughly 14% of global greenhouse gas emissions, not to mention the devastating impact it has on ecosystems and biodiversity.

Follow-Through

WWF’s Leonard said it’s critical now to maintain the momentum going into Lima, where donor countries must first make good on their promises to fill the Green Climate Fund, which will demonstrate credibility for the new pledges.

“The declaration has the chance to be just what we need at this moment, but it can’t be everything we need, he said. “We need this to live up to the promise. The actions by indigenous people in coming into this conversation, the very fact that the private sector is getting into the policy conversation and leveraging the full weight of their supply chains and the partnership between governments and indigenous people that hasn’t happened before, that’s the promise of the declaration.

Gloria Gonzalez is a Senior Associate in Ecosystem Marketplace’s Carbon Program. She can be reached at [email protected]. Allie Goldstein is an Associate in Ecosystem Marketplace’s Carbon Program. She can be reached at [email protected].

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This Week In V-Carbon: Taking Serious Action On Climate Change

This article was originally posted in the V-Carbon newsletter. Click here to read the original.

22 September 2014 | It’s not too late for serious action to address climate change. That’s a key message heading into this week’s Climate Summit 2014 hosted by United Nations (UN) Secretary-General Ban Ki-moon which will be the largest gathering of global leaders in history to ponder the climate challenge. More than 120 heads of state from major emitting countries such as the United States but not China and India as well as hundreds of business leaders and civil society representatives will travel to New York City this week to work together to build momentum for a strong, global climate agreement in Paris in 2015. The aim of the Paris climate talks will be to limit the average rise in global temperatures since the Industrial Revolution to 2 degrees Celsius the warming that climate scientists have deemed safe(ish) for the planet. But some climate experts believe that, given the current trajectory of greenhouse gas (GHG) emissions, it is too late to meet the target, and that governments should acknowledge this dilemma and work on anticipating and adapting to the catastrophic impacts of climate change. Bob Orr, Assistant Secretary-General for Policy Coordination and Strategic Planning within the Executive Office of the Secretary General, UN, predicted significant announcements and progress during the summit, including commitments to finance the Green Climate Fund (GCF). The GCF was formally established during the UN Conference of Parties in Cancun, Mexico in 2010 and features a stated goal of raising $100 billion per year by 2020 to assist developing countries with climate change adaption and mitigation activities, but actual monies have been slow to materialize to date. “We need funding to flow in many different ways from many different channels,” he said during a Center for American Progress discussion on September 17. “But the Green Climate Fund is an important piece of the architecture. The Secretary-General has called for an initial capitalization for the Green Climate Fund of between $10 billion and $15 billion. We will see a good down payment on that.” One important policy measure that needs to happen is pricing carbon and getting these prices right, said Rachel Kyte, Vice President and Special Envoy for Climate Change for the World Bank. Corporations all around the globe are adopting carbon prices for business planning purposes, according to a new CDP report, although settling on a price that actually instigates changes in behavior to reduce carbon emissions remains an open and often controversial question (see Climate Finance section below). Ahead of the summit, the World Bank has invited organizations to sign a statement that declares that carbon pricing is a necessary step to tackle climate change and making the economic case that there is nothing to be gained by waiting to address the climate problem. “If you wait, it simply gets more expensive,” Kyte said. “What we expect to see (this) week is a remarkable leadership group self-selected of countries, states, cities and companies that are all pricing carbon already or are working through how they are going to price carbon.” An announcement is also expected next week about the so-called New York Declaration on Forests in which countries and other partners will pledge to take concrete actions to slow emissions from tropical deforestation, building on commitments by consumer goods and other companies that pledge that no forests will be cleared to make their products. “I think it’s so incredible what’s happening in the forest sector right now,” said Nigel Purvis, CEO, consultancy Climate Advisers, which was reportedly involved in preparing the document. “We’ve seen a complete revolution. In the last year, we’ve gone from having almost no companies with commitments to being deforestation-free in their palm oil supply chains to 60% of the global market that has committed to, by no later than 2020 and in many cases immediately, eliminating deforestation from their supply chains. This revolution that is happening within the private sector is giving momentum to the international negotiations and policy discussions.” Purvis also cited the “REDD Rulebook,” the guidance on how countries can harvest available data to create reliable snapshots of their forests over time and to use this information to create deforestation reference levels to be recognized by the UN Framework Convention on Climate Change, as a sign of the progress being made in addressing deforestation. Negotiators agreed on the basic tenets of the Rulebook in Warsaw during the most recent round of international climate talks. “That’s the part of the Paris agreement that’s ready to go,” he said.

More news from the voluntary carbon marketplace is summarized below, so keep reading!

Every year, Ecosystem Marketplace relies wholly on offset market participants to financially support the State of research. In return, sponsors ($7.5k+) and supporters ($3k) benefit from the report’s growing exposure, early insight into our findings, and opportunities to engage directly with Ecosystem Marketplace in report-related outreach and events. Interested organizations should contact Molly Peters-Stanley. The Editors For comments or questions, please email: [email protected]

VOLUNTARY CARBON

Holy Cow!

Ice cream maker Ben & Jerry’s is reducing agricultural methane emissions by purchasing the largest share of the nearly 13,000 tonnes of carbon dioxide equivalent (tCO2e) reductions of a project at Green Dream Farms dairy cattle operation in Vermont. By separating and composting the solids from cow effluence, the project diverts manure from a conventional open lagoon and prevents the release of methane from anaerobic digestion. Methane is a GHG 21 times more powerful than CO2. As an added benefit, the resulting compost is alternative bedding to wood chips that is cheaper and more comfortable for the cows. The project is part of NativeEnergy “Help Build initiative, in which companies make an upfront purchase of the projected offsets from the first 10 years of a project. Read more here

It’s getting wet out there

Chevy runs deeper than expected

Chevrolet has exceeded its commitment to offset 500,000 tCO2e through its Campus Clean Energy Campaign, a company spokesperson told Ecosystem Marketplace. Chevrolet’s campaign purchases carbon offsets from campuses to fund GHG reductions through LEED (Leadership in Environmental Design) certified buildings or campus-wide energy efficiency programs through a methodology approved by the Verified Carbon Standard. Grand Valley University is the latest campus to receive support from the program. Chevrolet will purchase offsets generated by energy efficiency projects across the university’s Allendale, Michigan campus. The projects could offset up to 10,000 tCO2e, although the final amount is contingent on certification completion. Chevrolet has undertaken similar efforts at Southern Oregon University, University of Illinois, Ball State and Valencia College. Read more here

COMPLIANCE CARBON

Biggest of the big

China could regulate 3-4 billion tCO2e by 2020 under its planned cap-and-trade carbon market, which would make it the largest carbon market in the world, according to officials. China is the world’s biggest emitter of GHGs and the anticipated market would account for 4% its total GHG emissions. The European Union Emissions Trading System is currently the largest carbon market with two billion tCO2e under its cap. China’s National Development Reform Commission plans to finish its draft rules for implementation of a national carbon market by the end of this year. There are currently seven regional pilot carbon markets operating in China. Read more here

A mutually beneficial relationship

The first official joint auction for carbon allowances between California and Qubec will be held on November 19. The two Western Climate Initiative (WCI) members linked their cap-and-trade systems in January 2014 and tested a joint auction in August. November’s joint auction is the last step towards full linking of the programs, which will enable allowances issued by either program to be used for compliance with the other. A joint auction is generally seen as benefitting both members because of more predictable allowance costs due to the greater number of participants. Qubec had 14 registered bidders and California had 77 bidders in their most recent auctions. Read more here

California Prefers Hanes

The California Air Resources Board has approved the Hanes Ranch Forest Carbon Project under the California Compliance Offset Protocol. The project will issue over 86,000 tCO2e offsets this year and around 140,000 tCO2e through 2018 for use in compliance with California’s cap-and-trade program. The Hanes Ranch project is 2,500 acres of forest along the Garcia River in Mendocino County, California. The project is developed by New Forests, verified by SCS Global Services and registered with the American Carbon Registry. Read more here

A tantalizing proposition

An Oregon legislative committee praised a proposal for a revenue-neutral carbon tax. A charge of $60/tCO2e would raise $2 billion in revenues according to an analysis by the Northwest Economic Research Center though no specific price for a carbon fee has yet been proposed. “The devil is always in the details, but I’m tantalized, said Senator Alan Bates. In 2013, the Oregon legislature passed a bill requiring a study evaluating the impacts of a “clean air tax or fee on the state’s economy and GHG emissions. The final report will be presented on November 15. Oregon came close to pricing carbon as a WCI member before its participation was doomed by the ongoing financial recession in 2011. Read more here

CARBON FINANCE

When is the price right?

Global corporations are adopting internal carbon prices amid expectations that countries from China to South Africa will implement national emissions trading systems or carbon taxes, according to a new CDP report. These companies have a wide range of ideas about carbon pricing: software giant Microsoft uses $6/tCO2e while UK-based utility Pennon Group uses a range of $84.24-324/tCO2e (2010 and 2050 projections, respectively). But what is the right price on carbon to actually reduce emissions? Mark Trexler, Chief Executive Officer of the climate strategy and risk group Climatographers, says behavioral change starts around $30/tCO2e in the electric utility sector and at more than $100/tCO2e in the transportation sector. Read more here

Still more to do

The world’s leading multilateral development banks (MDBs) have reaffirmed their commitment to ambitiously address climate change. In a joint statement, the African Development Bank, Asian Development Bank, European Bank for Reconstruction and Development, European Investment Bank, Inter-American Development Bank and World Bank pledged to build on the more than $75 billion in financing for climate action that has flowed to developing countries since 2011. The MDBs say they are advancing global action by using their resources to leverage additional investment, promoting innovative approaches, integrating climate change into all levels of internal decision making and standardizing climate finance reporting. The presidents of all six banks will be in New York City to share this pledge at the UN Climate Summit. Read more here

SCIENCE & TECHNOLOGY

Breaking bad records

GHG concentrations have reached record levels in the atmosphere and oceans, according to the UN World Meteorological Organization. CO2 concentration in the atmosphere is 142% above pre-industrial levels and increased more between 2012 and 2013 than during any other year since 1984. Initial analysis indicates the marked increase is due in part to reduced uptake by the biosphere. Oceans act as a buffer by absorbing about a quarter of man-made CO2 emissions released into the atmosphere, thereby lowering the atmospheric concentration from what it otherwise would be. The result is ocean acidification, which is now increasing at the fastest rate in the past 300 million years. Read more here

AIME Program Senior Associate Forest Trends

Based in Washington, DC, the Senior Associate will lead all administrative functions of the Accelerating Inclusion and Mitigating Emissions (AIME) grant and support the Manager and Chief of Party of the AIME program. Eligible applicants should have demonstrated experience with the rules and regulations associated with the use of US federal funds. Ideal candidates will have previous experience with US Agency for International Development grants. Fluency in English and Spanish is required, working knowledge of Portuguese is preferred. Read more here

Policy Associate, Federal Legislative Campaigns The Nature Conservancy (TNC)

Based in Arlington, Virginia, the Policy Associate will serve as liaison between TNC and federal, state, county or local municipal agencies and private groups. Ideal candidates will have at least four years of experience compiling research, policy initiatives, writing promotional material and communicating with government staff. Read more here

Senior Policy Director – Washington Wildlife and Recreation Coalition

Based in Seattle, Washington, the Senior Policy Director will develop strategy and implement a state-wide campaign to ensure state and federal funding for parks, trails, wildlife habitat and working farms and forests. Successful candidates will have at least five years of experience with issue advocacy, legislative affairs or political campaigns. Read more here

Junior Consultant Perspectives

Based in Alicante, Spain, the Junior Consultant will provide research for Perspectives thematic areas, contribute to the proposal writing process and support management and senior consultants. Ideal candidates will have a master’s degree and at least three years of experience as a consultant or analyst in the field of international climate policies, market mechanisms or energy policies implementation. Fluency in English and Spanish is required, French language skills are a plus. Read more here

Stakeholder Engagement Consultant, Thailand Global Green Growth Institute

Based in Seoul, South Korea, the Consultant will develop a comprehensive stakeholder engagement plan for Thailand’s draft Climate Change Master Plan. Ideal candidates will have five years of experience in stakeholder engagement, capacity building, development work, or project management plus familiarity with climate change issues. Fluency in Thai and English is necessary. Read more here

Senior Climate Analyst Union of Concerned Scientists (USC)

Based in Oakland, California, the Senior Climate Analyst will lead UCS’s work in California and the Western states to bring sound science, policy and economics to bear on building support for, developing, and implementing strong climate policies. Applicants should have a PhD in environmental science, economics or a related field. Ideal candidates will have seven years of related experience, including a background in environmental and energy economic policy development. Read more here

ABOUT THE ECOSYSTEM MARKETPLACE Ecosystem Marketplace is a project of Forest Trends, a tax-exempt corporation under Section 501(c)3. This newsletter and other dimensions of our voluntary carbon markets program are funded by a series of international development agencies, philanthropic foundations, and private sector organizations. For more information on donating to Ecosystem Marketplace, please contact [email protected].

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How the Rise of the Global Middle Class Is Driving Illegal Deforestation and How We Can Change the Paradigm

10 September 2014 | In Brazil, organized land grabbers and squatters cleared swaths of the Amazon for cattle grazing and then took advantage of government programs that grant land titles after the fact. In Indonesia, palm oil companies bribed local officials to obtain licenses to convert forests to plantations. In Cambodia, a rubber company was issued a land concession five times the size allowed by law, with more than half of the land area falling within a national park. In Tanzania, a jatropha company fudged the authorship of an environmental impact assessment and convinced villagers to sign documents they didn’t fully understand.

Illegal deforestation takes on many forms around the world, and according to new research released today by Ecosystem Marketplace publisher Forest Trends it is more rampant than previously understood. And its drivers are shifting. While in the 20th century tropical forests often went to meet demand for timber, about three-quarters (71%) of all tropical deforestation between 2000 and 2012 was caused by commercial agriculture. Nearly half (49%) of all tropical deforestation in this period was the result of illegal land conversion for commercial agriculture, and nearly one quarter (24%) was the direct result of illegal land conversion for commercial agricultural products bound for export markets. The commodities exported at the end of the process are worth an estimated $61 billion annually.

What is driving all of this outlawed and often unscrupulous activity?

A lot of it has to do with consumer demand. As the global population swells to nine billion by mid-century, and as millions of people escape the pains of poverty and join the growing global middle class, they are buying more hamburgers (beef), chicken (raised using soy feed) and toothpaste (palm oil), and as incomes and literacy rise shipping more goods around the world in cardboard containers and consuming more paper (both packaging and book materials are now increasingly sourced from so-called “conversion timber, the product of trees cut down when converting forestland to other uses such as a large-scale oil palm plantation). The Brookings Institute estimates that there are currently 1.8 billion people in the middle class, and that we can expect that number to rise to 4.9 billion by 2030.

The challenge, then, will to be meet the growing demand for beef, leather, soy, palm oil, pulp and paper and other products without ravaging the world’s remaining tropical forests. Doing so will be essential to protecting the rights of the indigenous peoples and communities who live in and depend on forests, and curbing runaway climate change. Illicit land conversion for mega-crops releases nearly 1.5 gigatonnes of carbon dioxide (CO2) into the atmosphere annually about a quarter of the fossil fuel-based emissions of the European Union. If the international trade in agricultural commodities from illegal deforestation were a country, it would be the sixth largest contributor to climate change in the world.

Why focus on illegality?

“There is a lot of policy work and research and meetings and discussions that have been happening over the past two, three, four years regarding commercial agriculture and these commodities as a driver of deforestation, but the legality point has been almost non-existent within those debates, said Sam Lawson, the lead author of Consumer Goods and Deforestation: An Analysis of the Extent and Nature of Illegality in Forest Conversion for Agriculture and Timber Plantations. “And that’s just madness given how important it is.

In the report, Lawson offers three main reasons to pay closer attention to the legal status of global deforestation.

The first reason is scale. Overseas consumer demand has resulted in the illegal clearing of more than 200,000 square kilometers of tropical forest since the turn of the century, a rate of about five football fields per minute, the research finds. An estimated 40% of all palm oil, 33% of tropical timber, 20% of all soy, and 14% of all beef traded internationally comes from ex-forested land that have been illegally cleared. So, if we ignore these illegal activities, we’re actually missing a chunk of deforestation roughly the size of the land area of Ghana.

The second reason has to do with tactics. Namely, the idea that the methods used to fight illegal deforestation are categorically different than those used to curb legal deforestation. Illegal activity can be stopped by revoking land concessions, issuing fines, or sending perpetrators to jail, whereas none of these strategies can be used to stop legal deforestation. Also, many of the strategies to fight illegal deforestation have proven to be very effective. Brazil has reduced its deforestation 70% since 2004, mainly because of crackdowns on illegal clearing of land for soy and cattle ranching. Marina Silva, a current presidential hopeful who served as Brazil’s Environment Minister from 2003 to 2008, led the effort to shut down over 1,500 illegal operations. So, rather than passing new laws and policies, governments might be wise to work instead on enforcing the laws and policies already in place, the report argues.

The third reason is that reducing illegal deforestation is necessary to making any other effort to save the world’s tropical forests work. In particular, the many recent private sector commitments to “zero deforestation supply chains including those by pulp giant Asia Pulp and Paper and palm oil trader Wilmar are undermined by illegal activities, since sustainably sourced products will have to compete with products sourced not only unsustainably, but also illegally, leading to huge price gaps. As long as illegal operations are business-as-usual and go unpoliced, there will always be companies willing to take the path of least resistance. Case in point: a recent concession of 470,000 hectares in the Republic of Congo, to a Malaysian company called Atama that has no previous experience in the palm oil sector, was found by local inspectors to be in breach of regulation.

Implications for REDD+

REDD, the United Nations (UN)-backed program for developed countries to pay developing ones to reduce emissions from deforestation, is also undercut by illegal activity. The REDD Readiness Preparation Proposals that countries submit to the UN-REDD Programme and the World Bank’s Forest Carbon Partnership Facility in hopes of securing upfrontreadiness’ funding rarely mention governance issues or the extent to which illegal deforestation for commercial agriculture has been the biggest recent driver of deforestation, according to Lawson, and even fewer propose methods for addressing illegal versus planned and legal deforestation. The official statement on drivers of deforestation agreed to by parties to the UN’s Framework Convention on Climate Change in 2013 does not specifically address illegal conversion for commercial agriculture.

“In terms of where most of the money and the effort is going on REDD, there is far too much in my view on tinkering with MRVs (monitoring, reporting and verification) and measuring carbon and negotiating changes in policies regarding development of forested land in these countries and not nearly enough on improving governance and dealing with illegality issues, he said.

One of Indonesia’s core REDD strategies, for example, is persuading companies that have already received land concessions to clear forests for palm plantations to “swap those concessions to already degraded land, such as nine million hectares on Kalimantan that was found to be suitable to grow palm. But voluntary commitments such as these are unlikely to work if many palm producers blatantly operate in violation of national laws, the report argues, and it will be difficult for donor governments to justify payments for performance for reduced emissions in the context of activities that should have already been shut down.

Reason for hope

Though the report offers much fodder for concern, perhaps its most important finding is that, “these illegalities are not insurmountable. In fact, the issues that the agricultural commodity sector is currently facing are ones that have been addressed by the timber industry throughout previous decades.

The ongoing Forest Law, Enforcement, Governance and Trade (FLEGT) action plan, for example, has the European Union develop bilateral agreements with producer countries such as Indonesia. Through these processes, stakeholders from government, civil society, and private sector institutions in the producer country get together to define what legal timber means and establish verification systems to ensure that exports meet this definition. These agreements are government-to-government and legally binding, and they guarantee a market for the products in exchange for improved forest governance.

There are, of course, differences between illegal deforestation driven by timber versus agriculture. For one, when land is unlawfully cleared for timber, those logs are sent to market immediately and only once, whereas if a forest is cleared for cattle or soy or palm, the fruits of that illicit clearing will be produced continuously and sent to market over years or decades. In many cases, developers really only want the wood from a land concession but obtain concessions for agriculture rather than timber simply because those permits are easier to come by. Lawson notes that the commitments coming from the private sector promise “zero deforestation in the future, so much of the trade being done by these companies will still be from land that was illegally deforested in the recent past.

However, there are some ways in which addressing illegal deforestation from commercial agriculture might actually be easier than dealing with illicit timber markets. While trying to determine whether a forest was felled above the legal yield can be tricky, conversion of forest to agriculture can be detected fairly easily from satellite imagery, and tools such as Global Forest Watch allow anyone with an internet connection to access remote-sensed images of forest losses and gains. Also, while agricultural commodity supply chains can be complex, many of them are actually simpler than the supply chains for timber and wood products, according to Lawson.

The report therefore argues that a process similar to FLEGT, that involves many stakeholders discussing legality and deciding on where to draw the line, could work in addressing illegal conversion for agriculture. Doing so could help countries on the verge of massive illegal deforestation countries such as the Republic of Congo and Papua New Guinea to create a process that would bring commercial agriculture to the light side, avoiding at least some of the imminent forest conversion that would be disastrous for forest peoples and the global climate.

“There are practical limitations with what one could do you can’t be perfect, you can’t eliminate everything, Lawson said. “But what we’ve been seeing [in past efforts to address illegality] is essentially blanket amnesty, where everything prior to a certain date is called legal. The Brazilian government has done that, and it’s what these zero deforestation commitments by companies are essentially doing, and I think we should be trying to achieve a higher standard, where we only give amnesty when we absolutely have to.”

Allie Goldstein is an Associate in Ecosystem Marketplace’s Carbon Program. She can be reached at [email protected].

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Green Climate Fund Passes $10 Billion Threshold

9 December 2014 | Lima | Peru | Late last week, the Green Climate Fund (GCF) received good news when Norway doubled its pledge bringing the Fund’s total within USD $50 million of its $10 billion goal. $10 billion is the number the UNFCCC (United Nations Framework Convention on Climate Change) Executive Secretary Christiana Figueres says is the minimum threshold to make a meaningful impact on climate change.

Today the Fund received more good news as Belgium is expected to contribute $60 million to the GCF, which is intended to counter climate change with mitigation and adaptation practices in developing countries. The European nation is expected to make a formal announcement later today during the High-level Ministerial Dialogue on Climate Finance at the 20th meeting of the Conference of the Parties (COP 20) to the UNFCCC (United Nations Framework Convention on Climate Change).

Reaching the $10 billion mark has heavy symbolic meaning as the financial costs of the mitigation and adaptation needs far outweigh this number. In order for negotiations to truly move forward and for the possibility of an international climate agreement to be reached during next year’s COP in Paris, the $10 billion objective had to be achieved, industry analysts say.

“Crossing the $10 billion threshold has symbolic and financial significance,” says Athena Ballesteros, the Finance Center Director at the World Resources Institute. “Contributors have clearly demonstrated their commitment to helping countries confront climate impacts on-the-ground. This is an important down payment on climate action that can help build trust in the negotiations.”

During the high-level dialogue to take place later today (3-6 pm EST), other countries are expected to announce contributions to the GCF.

This Week In Biodiversity: Did The Endangered Species Act Just Get Gutted?

12 September 2014 | Unlike the global carbon market, biodiversity markets have always been local because habitat is often unique and irreplaceable. A road that damages a bit of sage grouse habitat in the United States might be able to make good by restoring or preserving habitat of equal or greater environmental benefit in the same ecosystem, but even that approach has only a narrow band of effectiveness. “You can’t offset an extinction,” as Joshua Bishop of WWF Australia once said.
As a result, most biodiversity banking is confined to the developed world, which has the institutional capacity if not always the political will to balance development with conservation. Most degradation, however, is taking place in the developing world.

That got Frank Vorhies thinking: While we can’t offset biodiversity loss in one part of the world by saving habitat in another, could we somehow introduce the elements of transparency and accountability that work so well in carbon into conservation? That questionlaunched an evolutionary process that drew on expertise from across the biodiversity spectrum and led to the formulation of something called ‘Verified Conservation Areas,’ which are areas with specific conservation needs that have been identified and specific conservation actions that have been defined.

The areas and their action plans will be listed on the new VCA Platform, much as houses are listed on a real estate board Nearly 20 VCAs are currently being considered, and the first one is expected to be approved later this year. But unlike carbon financing mechanisms, the initiative isn’t limited to offsets, although offsets could be one of many options in a developer’s landscape management plan.

“The offset’s only there for when you’ve gotten to the point of irreparable damage and can’t do anything else,” Vorhies explains. “But to get to that point, you have to do a whole lot of good things: like avoid, minimize, and restore. And that’s the stuff that needs to be recognized, celebrated and financed through making conservation visible.” This month Ecosystem Marketplace covers the story of the VCA Platform – and the questions that remain for Vorhies and his colleagues.

We also wanted to remind you that presentation submissions for the National Mitigation and Ecosystem Banking Conference are due on October 1st. The Conference – now in its 18th year! – will be held next May 5-8 in Orlando, Florida. Conference organizers encourage submissions from experienced regulators, mitigation and conservation bankers, customers/users of banks, investors, local, state, federal governments, environmental organizations, consultants, engineers, academia and others who have direct experience in the expanding mitigation, conservation and ecosystem banking industry. You can submit presentations and find out more at www.mitigationbankingconference.com.

The Ecosystem Marketplace Team

If you have comments or would like to submit news stories, write to us at [email protected].

Paradise restored: Inside the fight to save Louisiana’s wetlands

An ambitious plan is underway in the US state of Louisiana to save its coastal wetlands, an effort that has yielded some early success. But current funding levels fall far short of the $50 billion needed for coastal wetlands restoration projects, meaning that other sources of financing including possibly the carbon markets must be identified and accessed.

Ecosystem Marketplace has coverage.

Verified conservation areas: A real-estate market for biodiversity?

A power company in Germany can use forest-carbon from Brazil to offset emissions because carbon offsets are standardized units, but an American city that damages the habitat of endangered species in Arizona has no such option – in part because habitat is as varied and localized as land itself. Frank Vorhies says VCAs are part of the solution.

Keep reading here.

Mitigation News

New NSW offsets policy center of mixed reactions

New South Wales’ (NSW) new biodiversity offsets policy takes effect on October 1 amidst a flurry of both praise and criticism. Its critics are unhappy on a few counts: the first being that loopholes and provisions in the policy allowing offsetters to pay for preservation, research, or protection of different species than the one being impacted mean that no net loss will not be achieved. A new offsets fund may also give miners and developers too much leeway, conservationists say.

NSW officials say the fund is meant to reduce ad-hoc mitigation and result in more consistent landscape-scale conservation.

Did the ESA just lose major force?

New policy interpretation from the US Fish and Wildlife and National Marine Fisheries Services of language in the Endangered Species Act may make it harder in the future to list imperiled species. The ESA states that a species should be listed when it’s at risk of being lost in “a significant portion of its range.” The new policy reads that phrase as meaning that listing is only appropriate if that “significant portion” is critical to the survival of the species’ entire global population.

In other words, if the cactus ferruginous pygmy-owl disappears from the northern Sonoran Desert, but hangs on elsewhere, it should not be protected. Conservationists point out that under this interpretation (which came into play in decisions to delist the gray wolf and not list the wolverine), the bald eagle would never have been protected back in the 1970s.

High Country News has the story.

EC extends comment period on offsetting

The European Commission’s extended its consultation period on a No Net Loss Initiative until October 17th. The consultation asks for public input on options for achieving no net loss of ecosystems and their services, including use of compensation and offsetting.

Provide input here.
Get background on the consultation from the Biodiversity Offsets Blog.

Is South Africa’s mining sector flouting biodiversity guidelines?

Non-adherence to the South African government’s new Mining and Biodiversity Guideline is “alarmingly high,” according to a new report from WWF South Africa. Nearly a third of environmental assessment practitioners (EAPs) failed to adhere to the guideline’s principles, according to the report’s authors, who find “that certain EAPs and/or mining houses are apparently disregarding critically important environmental information in the completion of their coal mining or prospecting applications.”

Learn more.

Solar thermal plant in CA gets heat for bird deaths

The Ivanpah solar thermal power plant in California’s Mojave desert – the world’s largest – may be bad news for wildlife. Federal officials say that it’s killing an average of one bird every two minutes, as birds are literally cooked mid-flight by the plant’s concentrated beams of solar energy. BrightSource Energy, which operates the Ivanpah plant, has committed $1.8 million for domestic cat spay-and-neuter programs as an offset. But federal wildlife investigators want operations halted until a full assessment of deaths can be made. Current counts range considerably, from BrightSource’s estimate of a thousand a year up to 28,000 according to the Center for Biological Diversity.

Keep reading.

Report finds Aus. states failing to carry out Commonwealth species protections

Australian states and territories are failing to fully implement Commonwealth (i.e. federal) environmental laws, according to a report authored by 42 NGOs. Among the report’s findings: no state legislation fully meets biodiversity offset standards nor are threatened species protections being fully carried out. States are also failing to meet World Heritage Conventions.

Learn more and access the report.

Canadian cattlemen pair beef and biodiversity

A pilot program in Saskatchewan pays ranchers for species conservation in the grasslands of the Northern Great Plains. Built on a pay-for-performance structure, the Ranchers Stewardship Alliance Inc.-led project aims to complement existing conservation programs like cost-share arrangements, and take into account ranchers’ previous efforts to provide habitat for at-risk species.

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Fifteen Years Of Warnings Were Ignored Before Recent Ash¡ninka Assassinations

11 September 2014 | Following the murder of indigenous leaders Edwin Chota Valera, Quinticima Leoncio Melendez , Jorge Rios Perez and Francisco Pinedo along the Peru/Brazil border, representatives from several organizations published a “Border Manifesto documenting 15 years of threats and ignored warnings. The manifesto is available for download (right), and we have provided a rough translation here:

Beginning in 1999, the Ash¡ninka indigenous people living in the village of Apiwtxa in Brazil along the border with Peru have been warning state and federal authorities of Peruvians illegally logging timber in their territory and the environmental, social and cultural consequences that come from their actions. Citizens of Apiwtxa, on the Brazilian side of the border, have expressed particular concern for logging occurring in the indigenous territory of Land Kampa do Rio Ammonia and the Serra do Divisor National Park.
Since 2002, Apiwtxa’s sister village of Saweto, on the Peruvian side of the border, has appealed to Peruvian officials on the basis of international laws that grant indigenous peoples the title to their ancestral land. They argue the government should lead a process of demarcation that gives them a legal title to their territory. But the Ash¡ninka peoples’ demands continue to be spurred as the cost of property titles are high and the political motivations of those working inside the office varies.
In 2005, meetings sponsored by the Cross Border Working Group (Grupo de Trabalho Transfronteiri GTT) began occurring both in Acre, Brazil and in Peru’s Ucayali region. The meetings evaluate programs and monitor development of ongoing plans and strategies. GTT also monitors Peru’s forest concessions and the predominantly negative impact they have on indigenous lands.
Indigenous organizations continued to form and hold meetings. Both Brazil’s and Peru’s Ashí¡ninka communities are communicating with each other. They discuss their shared problems and information and exchange successful strategies that resulted in better land management and protection of their territory.
In 2011, the Ash¡ninka communities mobilized the Brazilian Institute for the Environment and Renewable Resources (Instituto Brasileiro de Meio Ambiente e Recursos Renov¡veis IBAMA) and the Chico Mendes Institute of Biodiversity (Instituto Chico Mendes da Biodiversidade ICMBio) to help them in securing the border. Several others, including the National Indian Foundation (Fundao Nacional do ndio FUNAI) and Operation Acai, which was a partnership with the federal police, were used as well. They all served a purpose in organizing the communities into one unit aimed at protecting their territory. They uncovered much illicit behavior- illegal logging and bulldozing along Brazil’s border were some of their discoveries.
The groups compiled data from several sources including institutions like IBAMA but also the University of Richmond in Virginia, the Instituto del Bien Comºn (IBC) and the Secretaria de Estado de Meio Ambiente do Acre (SEMA). The information compiled resulted in a publication of history on the conflicts of the Brazil/Peru border.
In 2012, the Cmara T©cnica de Desenvolvimento Sustent¡vel (CTDs), a space for debate and discussion between civil society and government, reported on uncontrolled drug and timber trafficking happening along the border as well as the swell of illegal Peruvian immigrants in Marechal Thaumaturgo-a municipality in western Acre.
In June 2013, based on the data collected, Saweto leaders met with the Ministry of Foreign Affairs of Peru. The Saweto leaders presented the importance of titling their territory for environmental protection.
Despite all these attempts illegal activities grew in this border region. There were some enforcement efforts but they failed to prevent forest concessions in Peru and an invasion of loggers. The lack of validity regarding the Ash¡ninka’s right to the forests left them all but powerless to stop the continued onslaught.
The threats became so extensive, the plight of the Ash¡ninka people received international attention. National Geographic published an article on the Ash¡ninka peoples’ struggles to protect the forest from ongoing illegal logging.

Considerations

The murder of the four men directly endangers Saweto and the other Ash¡ninka communities in the Acre-Ucayali region.
Participation and cooperation of all the indigenous populations is needed. However, the tribe cannot assume the control and surveillance responsibilities necessary to prevent illegal activities and the ongoing violence.
Titling is crucial for environmental protection and the Ash¡ninka people urge the governments to start the process. It’s complex. A forest concession that overlaps with Indian territory needs to be resized. The responsibility to adjust the forest concession and approve a legal title falls on the regional government, the Ministry of Agriculture and Irrigation and the Forest Service.
Conservation and monitoring activities will fall to the indigenous communities residing on both sides of the border. Cooperation between them-particularly between Saweto and Apiwtxa resulting in bi-national policies is important.

Recommendations

The manifesto recommends the installation of proper infrastructure along the border that will help to prevent illegal activity.
There should be a permanent forum between Brazil and Peru’s authorities regarding illegal activities along the border.
Establishment of cooperation between the two borders where the countries coordinate their strategies and implement plans together.
Establishment of a monitoring system that is based on input from all stakeholders-indigenous communities, Brazilian and Peruvian authorities.
Titling the land so it legally belongs to the Ash¡ninka is required for sustainable land management and effective environmental protection.
Punishment for the instigators and perpetrators of the barbaric killing of the four Ash¡ninka leaders.

Water Benefit Standard Launches at World Water Week

3 September 2014 | STOCKHOLM | Most people associate environmental consultancy First Climate with carbon footprinting and greenhouse-gas neutrality, but as its clients began asking about water risk, CEO Sascha Lafeld began digging for answers. That was about three years ago.

That, however, required a bit of adaptation, because carbon and water are two completely different spaces and must be treated as such. To begin with, he says, water neutrality doesn’t exist, because there’s no way to offset water consumption in one location with water treatment in another. Plus, local populations are always affected by water impacts, whereas the impacts of carbon emissions are felt globally and not necessarily locally. But while the offsetting mechanism won’t work in the water space, the basic formula behind it can.

“You can transfer the logics behind the certification process in carbon to water projects,” Lafeld says.

Out of this line of thought came the concept for the Water Benefit Standard (WBS), a results-based approach to finance global water projects that was launched at World Water Week here today. The Standard was initiated by the Water Benefit Partners, a public-private partnership that includes First Climate and corporates like Nestle and the Carlsberg Group. An original partner was the Gold Standard Foundation, the non-profit carbon project certification organization. The Gold Standard administers the WBS and has been developing it over the past 18 months. The organization, which already manages a carbon standard, carries a lot of experience, Lafeld says.

Brendan Smith, the Water Programme Manager at the Gold Standard, says in the last year they have organized technical experts, aid organizations, donors and financial and project developers to iron out the Standard’s complexities and ensure it was ready for today’s launch.

Under the WBS, projects are certified by the Gold Standard and receive Water Benefit Certificates (WBCs) which can be sold to companies, investors and others with an interest in good water stewardship. Certificate purchases will provide a revenue stream so project activity can continue year after year. The WBCs represent a specific amount of water that has been treated, conserved or sustainably supplied.

An added gain of the WBS projects is the socio-economic and sustainability benefits.

“In the water world, it’s even more important and imminent to look at the socio-economic sides of these projects than in the carbon space,” Lafeld says, because of their guarantee to have a local impact. The Gold Standard has a history of focusing on these aspects as well as the environmental benefits.

Two pilot projects have been certified and fully issued with many more in various stages of development. One is a WASH (water, sanitation and hygiene) project in Uganda and the other is a Sustainable Sugarcane Initiative in India. An access to clean water project in India isn’t too far away from issuing certificates with another WASH project in Mongolia roughly a year away.

The next round of pilots won’t focus on WASH but on agriculture and wastewater treatment. This will involve adopting at least two new methodologies. The methodology designed for the sugarcane project is very specific. In this next phase, the Gold Standard plans on using methodologies with wider appeal by developing them or reviewing and approving external methods. Switching from flood to drip irrigation is one example.

More widely used and adaptable methodologies will help the Standard grow.

“We’re about scaling these projects up beyond the small scale WASH to start looking at large-scale impacts across the landscape,” says Smith. They also plan on incorporating natural infrastructure approaches into many of the projects.

The WBS’ next phase will also include more stakeholder engagement. Smith says an interactive website will be created after the launch during a three month open period where all stakeholders can comment. The comments will be used-along with the knowledge derived from the ongoing pilot projects-to refine and improve the Standard.

The Forest, The Farms, And The Finance: Why The Tolo River People Turned To Carbon Finance

25 August 2014 | Every morning, Jorge Vergara drives his motorcycle from the village of Acand to the Builes Ranch, where he tends the nearly 400 cows and cattle. The ranch is just a ten-minute walk from Tolo River village of Pealoza and one of many bordering their forest. On this day, two boys from the Tolo River community have tagged along to help him with the chores. Their payment will come in the form of a bottle of fresh milk. The night before, Vergara had separated the two dozen or so milk cows from their calves so their udders would be full of milk by the morning. The hungry calves are now mooing by the fence, pushing to get close to their mothers. Vergara lets one calf in, and it anxiously runs to its mom and starts suckling, only to be pulled away by Vergara’s young assistants once the milk-flow has “spiked. Then he takes over to squeeze the warm milk into a bucket. “Boy! he shouts. “Let another one in! Vergara is at the forefront of deforestation in this region, in part because land is so cheap here, and cattle ranching is so lucrative. That disparity left the forest at a disadvantage: living trees delivered no income, while cleared land did, and the desire that the Tolo River people had to save the forest was outweighed by their need to feed their families. To balance that disparity, they turned to REDD (Reducing Emissions from Deforestation and Forest Degradation), which would make it possible for them to earn money by saving trees. The amount of money would depend in part on the amount of carbon stored in the trees they saved and in part on demand for carbon offsets. The advantages of REDD are clear: it conserves tropical forests and unique natural biodiversity; it reduces our global impact on climate; and it fosters sustainable rural community development. Yet to realize and sustain the initiative’s success, many potential pitfalls need to be avoided as such projects scale up around the world.

The Economics of Deforestation

In countries where land is expensive, ranchers keep cows in relatively small spaces and feed them silage fermented fodder produced from grass and maize plants. It’s an efficient, albeit perhaps not humane, way to manage land, and a farmer can raise up to three animals per hectare, greatly reducing the size of the farm, according to the Food and Agriculture Organization. In many tropical countries, however, land is cheap, or even free if no farmer has claimed it yet. Ranchers here exhibit a classic open-frontier mentality: when they see a forest, they feel the land is wasted because it would make a great pasture. “The farm needs to grow, says Vergara. “Silage is too much hassle. They opt for less land-efficient cattle operations because it is easy and cheap to expand the ranch by clearing some of the bordering rainforest. On average, they place only one cow per hectare of land. This ensures that the herd always has fresh pastures with waist-high grass to graze. It’s easy for cattle ranches in Choc³ to illegally grab the forest: they just clear the vegetation on a 60-by-80 foot plot near the edge of the forest, put a fence around it, a salt lick in the middle and let cattle in. Most of the flat lands in the region have already been converted to pasture, so cattle ranchers encroach on the hills of the forest. Some of these cleared plots have an almost 45-degree slope the cows look like mountain goats perched on the hillside.

Vergara1 — Jorge Vergara milking a cow with the help of a local boy. (Photograph: Tanya Dimitrova).

With land so easy to grab, there’s little incentive to farm more efficiently. REDD, however, can change that equation by providing the Tolo River people with a way to earn a living by protecting and managing their forest. “Cattle ranching and illegal gold mines are the top two reasons for deforestation here, says Rub©n Guerrero from Colombia’s Ministry of Environment and Development. He explains that if the current rate of forest loss was to continue, half of Colombia’s rainforest would be gone by the end of the century.

Measuring The Carbon

Doctor lvaro Cogollo is a legendary conservation scientist in Colombia. He began working for forest protection more than 30 years ago when most people in the country hadn’t yet realized the importance of this natural system. “People have this idea that Amazonia has the most spectacular forest in the world, he says. “But the biggest trees are actually here, in Choc³. Cogollo and his 20 assistants spent three months in the Tolo River community forest studying the biodiversity and carbon contained in it. He calculated that one acre of the communal rainforest could contain up to 300 tons of carbon seven times more than the average carbon content in one acre of an Amazonian forest. But the Tolo River people have one weapon that people in other parts of the world don’t, says Natalia Arango, climate change coordinator in a Colombian non-government organization Fondo Acci³n. Specifically, she says, they have Colombia’s willingness to recognize the rights of indigenous and Afro-Colombian forest communities, which offers fertile grounds for the REDD initiative. The progressive 1991 Constitution allowed them to claim their ancestral lands and provided them communal private ownership to the lands they manage.

Colombian REDD

In the past couple of years, the country has received $7.7 million from the World Bank and the United Nation’s REDD program to prepare it for large-scale REDD-financed conservation. The United States Agency for International Development (USAID) also invested $17 million in setting up local forest conservation projects in Colombia. This money is being used to estimate the amount of carbon stored in the nation’s forests, document the major drivers for deforestation in each region, and identify the deforestation rate in unprotected forests, which tends to hover between 1.5% and 2% across Colombia. Additionally, organizations such as Fondo Acci³n work with the indigenous land owners to design community development plans and economic alternatives to deforestation. Arango says that Colombia, despite its progressive legislation, tends to be very slow in practical matters. Implementing change takes a long time because it has a complex society with lots of indigenous peoples and Afro-Colombians. For good reason, the government tends to be very cautious in making big institutional changes. “But it is being too cautious, says Arango. “It has now spent years in the pre-pre-preparation phase of the strategy. And now we have some sort of public acceptance and agreement. We in the civil society think we need to go a bit faster because the forest is going very fast.

An Imperfect Solution

Brodie Ferguson, an anthropologist from Stanford University, remembers first visiting Colombia nearly a decade ago. He was studying how the years of the Violence (a conflict between the Colombian Army and paramilitary and rebel groups) have affected indigenous and Afro-Colombian communities. After working in Choc³ for many months, he eventually developed a close and trusting relationship with the Tolo River community and helped them design their forest conservation project. When thinking about the principle behind REDD, however, his most vivid memory comes from an interaction with another indigenous group: the Arhuacos from Sierra Nevada de Santa Marta.

Logged1 — Jorge Vergara milking a cow with the help of a local boy. (Photograph: Tanya Dimitrova).

Ferguson remembers talking with Danilo, one of the chiefs of the Arhuacos. The indigenous leader, dressed in his traditional white robes, was skeptical about REDD. “Do I want to be paying the youth of our community to conserve the forest? he asked. “Shouldn’t they be doing this anyway out of appreciation for the forest and the community traditions¦ just because it’s the right thing to do? Ferguson concedes the point, but says that REDD isn’t about getting paid to conserve. Rather, when done right, it’s about jump starting new activities that can take the pressure off the forest for the long term. That, he says, means we must look at how REDD income is being spent. “It should be spent on things like education, creating environmental awareness, improving healthcare, empowering women, he says. Such programs have long-term positive effects. “Even if 100% of the profits go to the community the best- case scenario if they are not spent the right way, we are not achieving what we should be. Although new research from the World Resources Institute and the Rights and Resources Initiative indicates that REDD programs tend to strengthen the rights of forest people, that is not a foregone conclusion, and many forest peoples lack the legal protection that the Tolo River community enjoys. In many other countries, forest dwellers do not own the land or the forest they have lived in for centuries.

When Deforestation Moves Down the Street

Another challenge of implementing a REDD project is what happens when bad practices just move someplace else. Ideally, for example, the Builes Ranch and its competitors cwould simply adopt more sustainable land-use practices that let them expand production without gobbling up more forest. But what if the owners simply stop expanding on their current locations and start chopping elsewhere? Or what if some other ranch an hour north picks up the slack in production by gobbling up another patch of unprotected forest? This is known as “leakage, and individual REDD projects don’t claim to halt it. Instead, they try to account for it and reduce the damage that migrated from their total. The only way to resolve the problem with regional leakage is for a country to monitor its avoided carbon dioxide emissions at a national level. That is exactly what Colombia is currently trying to achieve with the $7.7 million grant from the World Bank and UN: to inventory all the carbon in the country and set up a national regulatory agency to monitor avoided deforestation. Even this approach, however, would not resolve the problem with exporting national deforestation to neighboring countries, i.e. across-border leakage, due to international demand for the products driving deforestation. The only hope for truly tackling this issue would be a well-coordinated international system for monitoring deforestation analogous to the cooperation between air traffic controllers or public health officials worldwide. Another concern that critics raise regarding REDD projects is that they might offer an opportunity for big polluters to green-wash their emissions by donating a little money to some remote community while continuing business as usual at home. The original intent for carbon credits, however, is to use them as a final step in a company’s process of reducing its carbon footprint to offset only whatever emissions could not be cut in any other way. “I don’t think anybody likes the idea of a coal company saying OK, we’re going to continue producing coal and we’¢re going to buy some carbon credits halfway around the world just to offset that. Nobody envisions a system like that, says Ferguson. Indeed, the state of California has already considered ways to avoid abuse of its cap-and-trade system. According to California’s climate change legislation (AB32), carbon polluters are not allowed to offset more than 8% of their emissions. Instead, they have to figure out ways to reduce the remaining 92% of their pollution to a cap set by the law a cap that gets lower over time, although it will rise next year as transport fuels are phased into the program. REDD offsets, if eventually allowed into the California program, could only be used for a small portion of this and under very specific circumstances. On top of this is the cost of quantifying the carbon in all 6 million square miles of rainforest around the world. No two forests contain the same tree species and soils so carbon content can vary from 10 to 300 tons per acre. The threats to the standing forests also differ between regions as does the speed with which the forest would be lost had there not been REDD projects. “We don’t want the money to get rich, says community leader C³rdoba. “We want to develop organizationally. That way we can protect our territory, maintain peace, improve our lives. Even if they wanted, though, they could never get rich off a REDD project. Income from selling carbon offsets currently cannot compare to any of the alternative ways to use their land: cattle ranching, cocoa plantations, gold mines, not-to-mention coca growing. A recent study estimated that only a price above around $30 USD per ton of carbon dioxide could make a forest more valuable standing than cleared. There is, however, more to a forest than just carbon. Many biodiverse ecosystems are rich in natural life but do not contain much carbon. Therefore if people chose which forests to conserve only based on their carbon content, many precious spots might go unnoticed or even lose their protection. Although plantations, if well designed and managed, could harbor lots of animals and plants, REDD proponents do not envision this kind of carbon emissions reductions. In fact, to issue forest offsets for tree planting, the Verified Carbon Standard an organization which certifies and maintains an inventory of carbon credits worldwide requires a proof that native forest clearing took place more than two decades ago. What’s more, rich natural life and high carbon content need not be at odds with each other. A recent study found that combined carbon-biodiversity forest conservation strategy could simultaneously protect 90% of carbon stocks and wildlife (relative to a strategy focusing on either alone). So ultimately what is an unsuccessful, poorly-designed REDD project? “It is one where you have a London financier go down to Zambia, buy a bunch of land, hire some locals to protect the forest and then sell the credits on the market, says Ferguson. That is not community-based conservation, though, there are a lot of such REDD projects out there just not in the Tolo River community’s lands. NEXT INSTALLMENT: The Tolo River People Embark On Their REDD Project

This Week In Biodiversity: A Pre-Listed Species Credit Policy Stirs Debate

This article was originally published in the Mitigation Mail newsletter. Click here to read the original.

22 August 2014 | This month, the US Fish and Wildlife Service proposed a new draft policy on building a crediting system that would protect threatened wildlife that hasn’t yet been listed as endangered. The policy, which is part of the Service’s Candidate Conservation program, seeks to incentivize landowners into early conservation.

“The adage ‘an ounce of prevention is worth a pound of cure’ is appropriate here,” says the FWS’ Chief of Public Affairs, Gavin Shire. “This policy is one more tool that can be used in conjunction with the others to help prevent species decline.” Under the proposal, any landowning entity individuals, companies, government agencies, etc. can earn credits by practicing conservation that benefits an unlisted species.

But while early conservation isn’t disputed as a sure way to preserve a species, is some skepticism out there regarding voluntary measures. We cover the debate here. A public comment period on the draft policy is open until September 20, 2014.

In other news this month, environmentalists are not happy about evidence that a mining company successfully haggled down its mitigation costs by one-fourth, and Canada takes a crack at accounting for its natural capital values.

We also have two pieces on results-based finance: one looking back at the evolution of efforts to link payment to performance, and a blog post that considers how to refocus Farm Bill conservation subsidies on outcomes.

Happy reading,

The Ecosystem Marketplace Team

If you have comments or would like to submit news stories, write to us at [email protected].

Should landowners earn biodiversity offsets for conserving a species’ habitat before it becomes endangered?

A new draft policy issued by the US Fish and Wildlife Service grants credits to all types of landowners for practicing conservation for wildlife not yet listed under the Endangered Species Act (ESA). The credits generated can be redeemed or traded only after the species becomes listed, which is already leading certain parties to question the effectiveness of the conservation being practiced.

Get coverage from Ecosystem Marketplace.

Results-based finance: breakthrough or backslide?

Everyone loves “results-based finance at least in the abstract because everyone likes to get what they paid for. Quantifying those results and packaging them for buyers, however, has proven elusive once you get beyond payments for ecosystem services. Here, Ecosystem Marketplace takes a look back on the evolution of results-based finance.

Click here to view this article in its original format.

Verified Conservation Areas:
A Real-Estate Market For Biodiversity?

21 August 2014 | There are markets for silver and there are markets for houses, and it doesn’t take a genius to see the difference between the two: an ounce of silver is an ounce of silver, interchangeable with any other ounce of the same quality, but the value of a house or any piece of property can fluctuate with the color of the flooring.

Carbon markets resemble silver markets because a ton of carbon dioxide has the same impact on the environment regardless of whether it comes from a smokestack in Germany or a forest fire in Brazil. That made it possible to create a global transparent marketplace designed to support sustainable development and identify the most efficient ways to reduce greenhouse gas emissions.

Biodiversity markets, however, have always been local because habitat is often unique and irreplaceable. A road that damages a bit of sage grouse habitat in the United States might be able to make good by restoring or preserving habitat of equal or greater environmental benefit in the same ecosystem, but even that approach has only a narrow band of effectiveness. “You can’t offset an extinction, as Joshua Bishop of WWF Australia once said.

As a result, most biodiversity banking is confined to the developed world, which has the resources if not always the political will to balance development with conservation. Most degradation, however, is taking place in the developing world, which has massive development needs and little resources for conservation.

That got Frank Vorhies thinking: While we can’t offset biodiversity loss in one part of the world by saving habitat in another, could we somehow introduce the elements of transparency and accountability that work so well in carbon into conservation? And if we do, might this free up more capital for proactively supporting environmentally valuable areas, regardless of their location?

These questions, posed in 2008, launched an evolutionary process that drew on expertise from across the biodiversity spectrum and led to the formulation of something called “Verified Conservation Areas, which are areas with specific conservation needs that have been identified and specific conservation actions that have been defined. As envisioned, many will be areas that haven’t yet been degraded, but that are under some sort of threat that can be identified and then either avoided or minimized through a process that is audited and transparent.

The areas and their action plans will be listed on the VCA Platform, much as houses are listed on a real estate board. Nearly 20 VCAs are currently being considered, and the first one is expected to be approved later this year.

Real Estate and Habitat

Vorhies, who set up the economics and business programs at the International Union for Conservation of Nature (IUCN), says that to understand VCAs, you have to look at the real estate market.

“People will tell you what the going rate is for apartments to rent or to buy but each has got a different storyline, a different location, and that’s what biodiversity is like, he says. “Every bit of nature, every landscape on the planet, has a different set of issues and perspectives and legacies and threats and challenges.

Intuitively, we all know this, and the conservation community has long funneled money into protected areas around the world, but that money hasn’t flowed in a standardized way that makes it possible to determine its impact, and it rarely finds it way to areas that are environmentally important but unprotected. Contrast this with carbon, where there are extensive rules both guidelines and methodologies that must be followed, starting with establishing a baseline to measure any changes over time, and where the targets are explicitly those areas that aren’t already protected by law, in the case of forest carbon.

Where’s the Guidance?

“Nobody’s providing practical guidance on area-based biodiversity assessment, says Vorhies, explaining that to improve the conservation status of areas, we need to know baselines on ecosystems and their services, species and their habitats, and both the conservation and sustainable use of an area’s biodiversity.

“CI (Conservation International) produced a rapid biodiversity assessment tool, but it only looks at wild species, he explains. “CI, IUCN, FFI (Fauna & Flora International) and others are helping companies with biodiversity baselines, but these studies are generally not public.

What’s missing, he says, are publicly-available tools for developing conservation baselines that a critical mass of people can agree on.

2008: Why Reinvent the Wheel?

When the initiative first launched in 2008, the carbon markets were in full swing. The Clean Development Mechanism (CDM), the first global trading platform for environmental credits, was backed by the auspices of the United Nations, and Europe’s compliance emissions trading program meant that companies were eager to participate.

“So the folks over in the biodiversity world were saying, Look at those guys in the carbon world they’re getting a stack of money. Why can’t we create a Green Development Mechanism (GDM) for biodiversity financing?

Thus the idea of a GDM was born, but it was a name without structure; and, as Vorhies later learned, that name was as much of a hindrance as a help in securing finance.

What’s in a Name?

When he approached different countries and investors for support of the project, Vorhies encountered two types of people: those who liked the CDM and those who didn’t. On top of that, he found that both camps read too much into the acronym and, for better or worse, they both saw it as more akin to the CDM than it was.

“So we had to change the name, he explains ruefully, “After the 10^th Conference of the Parties to the Convention on Biodiversity (CBD) in 2010, we changed it to the Green Development Initiative, or GDI, to get rid of the CDM-GDM association because it was driving us nuts.

2010: Refining and Redefining

That letter change effectively stopped all comparisons between the two, but the initial problem remained: what would the initiative stand for? All Vorhies knew at the time was that he didn’t want it to be like the CDM.

“It was quite clear that it wasn’t a commodity market; biodiversity isn’t a commodity, he says. “The best market we could use was a property market to think of biodiversity as something that you would recognize, trade and indeed celebrate like you do in property management.

With a property market, such as apartments, each location has unique attributes: some might be close to public transportation; others may have a pool on the rooftop; and others might have a view. But aside from these additional features, all apartments can be described in terms of size, number of bedrooms, and other constant features.

Similarly, every landscape will have characteristics that can’t be replicated just as they will also have basic qualities, like size and ecosystem, which can be described anywhere around the world. Taken as a sum of these descriptors, every conservation hectare has a story and a price.

This holistic approach led to another key difference between the GDI and CDM, at a time when the latter began to crash in the carbon world. The initiative wouldn’t be limited to offsets, although offsets could be one of many options in a developer’s landscape management plan.

“The offset’s only there for when you’ve gotten to the point of irreparable damage and can’t do anything else, he explains. “But to get to that point, you have to do a whole lot of good things: like avoid, minimize, and restore. And that’s the stuff that needs to be recognized, celebrated and financed through making conservation visible.

Good Deeds Unrewarded

Vorhies spoke from experience, having previously consulted Yemen LNG, a natural gas company building a new harbor to export gas over a coral reef ecosystem. The company tried to minimize its impact, and it even contacted IUCN to review its decision to relocate the coral nearby, away from where the piers needed to be. Vorhies says they spent large sums on this innovative technique but received no recognition for their efforts. With nothing of value to show their shareholders and no external driver to conform to, the company couldn’t justify its costs.

“Do you see the coral reefs? asked the company’s environment manager in 2011, explaining his conundrum. “No. Just leave them. We’ve now got to get on with our business.

Vorhies believes that if the company had to do a performance report every year, and had an accountable action plan, that would at least give the environment manager an opportunity to fundraise inside of the company for a biodiversity budget. Indeed, they had already spent a large amount on relocation, and it would not take nearly as much to manage and monitor the conservation of the corals. The company and its investors, could also be recognized publically for their in-situ conservation efforts.

2013: Visibility, Accountability and Marketability

By now, Vorhies had a solid set of criteria for a biodiversity mechanism that he thought would work, but the GDI acronym didn’t quite capture it. “You try to do an elevator speech with the initials GDI and people say, that sounds really good but what is it?

Thus, the Verified Conservation Area (VCA) Platform rose from its rejected predecessors to become the final name of the initiative for now and it came with the elevator pitch that fit the name.

The elevator pitch is this: the VCA Platform will provide visibility, accountability and marketability to project areas, but the specific improvements are up to the project developer. A verified conservation area may then focus on carbon, water, or any other “benefit while, ideally, the central focus would be a cohesive landscape approach much as the landscapes approach that’s evolving in the carbon world, where carbon sequestration is seen as a proxy for good land management.

But how do you create a methodology that’s applicable in any ecosystem?

A Wing and a Toolkit

Recognizing this challenge, the VCA Platform instead relies on making innovation as it goes by only requiring those involved with the project on the ground to have quantifiable metrics and present them publicly and transparently. Armed only with the standard and a basic toolkit approach, VCA hopes to develop best practice guidelines in this way.

“When it comes to actually measuring performance, we don’t have any agreed metrics to do a baseline assessment, let alone performance measurements, Vorhies explained.

Instead, the toolkit provides the basic building blocks for designing a management plan requiring a baseline assessment, SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis, and a concrete action plan. The latter goes onto the VCA Platform, with yearly updates including independent audits. Every year, an annual performance report will detail what exactly has happened in the area. Similar to an annual financial report, the audit will provide transparency about detailed activities in the area. Investors or donors could then go online, and look at actual projects before contributing.

2014: Building up the Brand

Despite the long journey from GDI to VCA Platform, the brand still needs greater recognition. For companies to buy into a new standard, they need assurance that the standard itself is credible. The VCA Platform doesn’t have that yet.

Currently, the platform has started a pilot program and has a mandate from two government agency donors the Swiss and the Dutch to coalesce all of these ideas into a solid business plan for scaling up This business plan is now being presented to potential investors in the platform itself seed capital to establish a new marketplace for verified conservation.

Already, there are a few protected areas (PAs) on the waiting list; even though those areas traditionally have a government mandate for conservation, they see the VCA as a way to state what they are delivering and as a way to raise funds. There are also areas on the other end of the spectrum: both private biodiversity restoration areas, including a rainforest in Brazil and a savannah wilderness in Mozambique, and projects linked to commodity supply chains or traditionally suspect sectors like mining and oil and gas. Yemen LNG, for example, has recently proposed to register its industrial harbor as a VCA.

Regarding working with extractive industries, Vorhies says, “I don’t see myself why mining can’t be just as responsible as the tourism which we run in our national parks in the U.S., with all the roads and hiking trails and the campgrounds and facilities required for tourists. With mining, they could come into a conservation area for 20-30 years and leave an endowment; whereas with tourism, when do we get rid of these people and what do they leave behind?

Similarly with agriculture, a field is often seen as having “destroyed conservation areas, yet Vorhies remains optimistic about their inclusion. This is evidenced by the growing use of sustainability standards for various commodities including coffee, cocoa, soy, and palm oil. The VCA Platform, however, brings a landscape level focus to sustainable agriculture which is of real interest to major food companies like Unilever.

“The VCA in that sense is not about recognizing that we’ve totally damaged this part of the world and therefore must pay. It’s more like saying this is where we are today and this is what we can do to make it better It isn’t a conservation story; it’s a process of improvement. That’s the idea. We’ve tried to move the language from compensation to good practice. If we want to conserve our planet, we need to create a market for delivering conservation.

This Week In Forest Carbon News…

Thirteen governors from rainforest states signed the Rio Branco Declaration, a commitment to cut deforestation 80% by 2020, if funding for avoided deforestation (REDD) materializes. Brazil, the country receiving the most performance-based payments from climate funder Norway, has successfully prevented the clearing of 6.2 million hectares of forest between 2007 and 2013, but many other countries are on the edge of deforesting… or not.

This article was originally posted in the Forest Carbon newsletter. Click here to read the original.

21 August 2014 | Forget presidents, kings and queens – governors may be the ones leading the fight to reduce deforestation, state by state. At last week’s Governors’ Climate and Forests (GCF) Task Force meeting in Acre, Brazil, 13 of them penned the Rio Branco Declaration, named after the Amazonian city they met in. Their commitment? To cut deforestation rates in their jurisdictions 80% by 2020 – a move that would prevent four billion tonnes of carbon dioxide emissions (tCO2e) from entering the atmosphere.

But they can’t do it for free. Deforestation, after all, is largely about economics, and lucrative oilseed crops – mainly palm oil in Indonesia and soybeans in Brazil – are driving deforestation in key rainforest countries. GCF states say that they can slow forest clearing and degradation if performance-based funding for reducing deforestation (REDD) is available, whether through carbon markets or other performance-based payment mechanisms.

So far, this financing has been hard to come by, though many developed nations have promised it. The Rio Branco Declaration explains that the six Brazilian GCF member states have already reduced deforestation 70% between 2006 and 2012, avoiding three billion tCO2e of emissions, but that GCF jurisdictions have seen little of the $7.3 billion pledged for REDD+ by donor governments since 2009.

“Humanity is in grave danger over the destruction of the Amazonia – the climate regulator of the planet,” Edwin Vasquez, the leader of the Huitoto People of Peru and Coordinator General of COICA (Coordinator of Indigenous Organizations of the Amazon River Basin), said at the meeting. “The 5,000 indigenous communities continue to protect the forests and preserve our cultures and the world, as we have done for thousands of years. We are the proprietors of 210 million hectares, covering 25% of the Amazon, which calls for an urgent proposal—’Indigenous Amazonia for Humanity,’ a $210 million project addressing the fact that climate funds have not reached our communities.”

The GCF is a collaboration of 22 states and provinces from Brazil, Indonesia, Mexico, Nigeria, Peru, Spain and the United States. On the buy-side, the US state of California is considering the inclusion of REDD offsets in its cap-and-trade program, which would be the first significant compliance market demand for offsets from avoided deforestation.

“Without action to reduce emissions from the deforestation of tropical forests, we are missing one of the keys to mitigating climate change,” said California Air Resources Board (ARB) Chairman Mary Nichols. “We think the sector-based offset crediting approach being evaluated for jurisdiction-wide programs, like the one in Acre, is the next frontier for California’s carbon offset program.”

Here at Forest Trends’ Ecosystem Marketplace, we’re tracking these developments closely – and putting out a last call to forest project developers to respond to our survey informing the State of the Forest Carbon Markets 2014 report. The survey is available in English HERE and in Spanish AQUí. Questions? Email us.

More news from the forest carbon marketplace is summarized below, so keep reading!

—The Ecosystem Marketplace Team

If you have comments or would like to submit news stories, write to us at [email protected].

INTERNATIONAL POLICY

Top marks for Brazil

Brazil has successfully avoided deforestation of 6.2 million hectares between 2007 and 2013, averting three billion tonnes of carbon dioxide emissions and generating large results-based payments from Norway’s International Climate and Forest Initiative. Brazil has received by far the most funding under the initiative with 44% of the $1.7 billion in total funds disbursed. Indonesia has only received 2% to date, but Norway’s development agency has pledged up to $1 billion to prevent deforestation in that country. However, there is concern that the upcoming presidential leadership change in Indonesia and weaknesses in its legal basis for REDD+ could derail those efforts. The agency has established bilateral partnerships with five other REDD+ countries: Ethiopia, Guyana, Mexico, Tanzania and Vietnam.

NATIONAL STRATEGY AND CAPACITY

An inconvenient truth

What is the actual rate of deforestation in Indonesia? It’s a tough question to answer, say Agus Sari, deputy chair of the country’s REDD+ Management Agency, and Nirartha Samadhi, deputy chair of the Presidential Working Unit for the Supervision and Management of Development. Indonesia’s Forestry Ministry issued a decree that sets the country’s forest emission level at 0.816 billion tons, meaning actual emissions below that reference level constitute a reduction. The ministry estimated Indonesia’s deforestation rate at 628,000 hectares annually, but an independent study pegged it at about 850,000 hectares in 2012. The government is moving forward with plans to clear 14 million hectares of degraded forest between 2010 and 2020, despite a commitment to curb greenhouse gas (GHG) emissions.

Ghana thinking strategically

A study in three districts in Ghana aimed to identify REDD+ strategies that reverse agriculture’s adverse effects on forests and trees as part of the work being done to ensure that REDD+ becomes a key component of the country’s climate change mitigation and adaptation strategy. “Ghana’s REDD+ readiness process is nearing completion and a REDD+ package that would outline Ghana’s strategy and framework for safeguards, among others, would be completed by 2015,” said Samuel Afari Dartey, Chief Executive of Ghana’s Forestry Commission.

Building a forest foundation

South Korea’s Forest Service (KFS) is also working to incorporate REDD+ into its national strategy amid expectations that the country will have GHG emissions reduction requirements as part of a new international climate agreement. The country has a target to voluntarily reduce carbon emissions 30% by 2020. The KFS is developing a customized REDD+ model that features close bonds with local residents, the application of advanced information technology, and its experience overcoming post-war deforestation in the 1960s. “A successful REDD project not only involves the reduction of greenhouse gas but also considers the livelihood of local residents,” a KFS official said.

PROJECT DEVELOPMENT

For the birds

The Audubon Society has sold half of the 450,000 offsets from its Beidler Forest project in South Carolina to companies in California’s cap-and-trade program. The 5,200-acre forest conservation project is registered through Blue Source and the offsets are selling at a minimum of $8/tCO2e. The Audubon Society receives 80% of the proceeds and directs the funds towards an endowment that will support the forest in perpetuity. Jeff Cole, the vice president of portfolio development for Blue Source, expects additional offsets to be generated in the future as the forest grows.

Making new friends

Wildlife Works’ Kasigau REDD+ forestry project is having a positive impact in the local community, not just in terms of stopping unchecked deforestation, but also providing a new source of income for impoverished residents and improving the habitat for elephants, lions, cheetahs, zebras and other native animals. “We were losing everything, but thanks to the project we have learnt even how to live with the wild animals,” said Mercy Joshua, a mother of four. “These days, we don’t cut down trees… they are our friends”. Buyers of the voluntary carbon offsets generated by the project include Microsoft, Barclays Bank and Kenya Airways, which have invested $3.5 million each since the project started.

SUSTAINABLE COMMODITIES

Back to school

Seven palm oil giants are jointly funding a year-long study to define what constitutes a High Carbon Stock (HCS) forest since many of these companies have agreed not to cut down these trees. The HCS has been a subject of debate among palm oil corporations, green groups and forest experts. The study underpins the Sustainable Palm Oil Manifesto, which sets criteria for sustainable palm oil production, including barring conversion of forests and peatlands for plantations, as well as creating traceable palm oil supply chains. But environmental groups such as Greenpeace and Rainforest Action Network have sharply criticized supposed loopholes in the manifesto.

The right kind of palm oil policy

U.S. food giant ConAgra has adopted a new policy that will bar palm oil produced from new plantations established on HCS lands and require suppliers to have no-burn policies and respect the right of communities to give or withhold their Free, Prior and Informed Consent to new development. The policy change comes after Green Century Capital Management and the New York State Comptroller’s Office filed a shareholder resolution alleging the company purchased so-called GreenPalm credits from other sources growing palm oil sustainably, rather than preventing deforestation in its own supply chain. Investors say they are becoming more sensitive about palm oil deforestation, scaling back development plans to only clear degraded forests and setting aside some lands for conservation.

FINANCE & ECONOMICS

Give the EU some credit

The European Union (EU) has declared its commitment to reduce tropical deforestation 50% by 2020 – but what’s its game plan? A recent paper by ClimateFocus and The Nature Conservancy looks at opportunities for the EU to mobilize REDD+ finance in the short to medium term. The authors identify two of the most promising options as being REDD+ Compensation Credits and voluntary sustainable supply chain initiatives. A structurally weak and economically depressed EU has stymied funding streams, but the authors offer some hope: “As European policy makers begin to realize that the current system is not providing the levels of funding that are needed, attention is beginning to shift to new and innovative funding streams,” they write.

SCIENCE & TECHNOLOGY

Bamboo beat

Only in operation since June, Global Forest Watch-Fires (GFW-Fires) is already making some peoples’ jobs easier. GFW-Fires is an online platform that combines high-resolution satellite imagery, real-time fire alerts and land-use and concession maps to monitor and respond to fires. The system allows Indonesia’s REDD agency to warn communities in Indonesia of dangerous fires and also to track potentially illegal activity such as slash-and-burn agriculture. “Just imagine a village resident who beat bamboo tubes to warn others about an ongoing fire,” said agency head Heru Prasetyo. “This system works just like a giant bamboo tube that alerts officials and agencies responsible for handling fires on a massive scale.”

HUMAN DIMENSION

Trouble Down Under

In western Australia, sheep farmer Peter Yench holds a permit to clear his properties of trees, which would open up more land for grazing. But he has agreed to keep almost 7,000 hectares of forest standing for 100 years in exchange for revenue through the government’s Carbon Farming Initiative. However, the recent repeal of Australia’s carbon price has left farmers such as Yench in limbo, and 140,000 hectares of semi-arid woodlands may be up for clearing if the 154 accredited carbon farming projects in Australia cannot find an income stream.

STANDARDS AND METHODOLOGY

VCS sees REDD in Golden State

The Verified Carbon Standard (VCS) is ready to move into California’s regulated market in a major way. The leading voluntary carbon markets standard has now been authorized by the state’s ARB to pre-screen coal mine methane and other types of offset projects for California’s carbon trading program. In addition to evaluating currently eligible projects, the VCS has set a specific goal of helping California welcome REDD+ projects into the program. According to the related job posting, VCS sees California potentially as their first step towards involvement in other compliance markets throughout North America and worldwide.

PUBLICATIONS

Recipe for success?

Secure tenure, stakeholder engagement, clear monitoring frameworks and methods to ensure permanence are among the key “enabling conditions” for successful payments for ecosystem services (PES) programs, according to a new United Nations (UN) report. The report explores forest services through 14 detailed case studies and provides guidance on PES programs, suggesting that a “code of conduct” should be established for valuation, engagement and compliance. It was jointly produced by the Food and Agriculture Organization of the UN, the UN Economic Commission for Europe and the UN Environment Programme.

Bigger, safer, stronger

With much of the pledged financing for REDD coming from bilateral donors, these funders are beginning to move from a “do no harm” approach to proactively promoting positive social and environmental outcomes. In its recently released report, ClimateFocus looks at how the REDD safeguards adopted at the Cancun climate negotioations are currently being used, and how safeguard compliance may need to rely more heavily on country systems as REDD moves from the project scale to the jurisdictional scale. The paper calls for a strong Feedback and Grievance Redress Mechanism to catch major violations and for certain indicators for example, displacement without compensation and high-value biodiversity loss to be prioritized in safeguard monitoring.

JOBS

Director of North America Compliance Markets – Verified Carbon Standard (VCS)

Based in San Francisco, California, the Director of North American Compliance Markets will ensure that VCS plays a prominent role in the success of California’s cap-and-trade program, and other emerging programs. The position will include engaging the California ARB and the broad community of stakeholders in the development of new offset protocols and how to incorporate sector-based offsets such as REDD+.

Read more about the position here

Senior Program Officer, Training and Learning Network – The Center for People and Forests (RECOFTC)

Based in Bangkok, Thailand, the Senior Program Officer will manage RECOFTC’s capacity development activities, including customized courses and study tours for community forestry. The successful candidate will have at least 10 years of experience in participatory training in community forestry or natural resource management. Fluency in one or more languages from RECOFTC focal countries – Cambodia, Indonesia, Myanmar, Thailand and Vietnam – is preferred.

Read more about the position here

Tropical Forest and Climate Initiative Assistant – Union of Concerned Scientists

Based in Washington, D.C., the Tropical Forest and Climate Initiative Assistant will develop a more comprehensive understanding of the drivers of deforestation, policies to mitigate deforestation, and the importance of reducing deforestation rates as a climate change solution. The ideal candidate will have strong research and organizational skills, be attentive to detail, and be able to prioritize many tasks and communicate with diverse audiences. This is a one-year, paid, benefits-eligible internship position.

Read more about the position here

Executive Director – Non-Timber Forest Products Exchange Programme for South and Southeast Asia (NTFP-EP)

Based in Manila, Philippines, the Executive Director will lead NTFP-EP, a collaborative, regional network of grassroots NGOs and peoples’ organizations that seeks to build the capacity of forest-based communities in the conservation and trade of non-timber forest products. The successful candidate will have at least 10 years of experience in development work and at least five years of experience in organizational and program management.

Read more about the position here

Manager, East & Southern Africa – Rainforest Alliance

Based in Nairobi, Kenya, the Manager for East & Southern Africa will be responsible for the successful implementation of Rainforest Alliance Sustainable Agriculture projects, managing and implementing partnerships and maintaining relationships with important stakeholders and partners. The successful candidate will have 7-10 years of experience in the tea and/or coffee sector and farmer training, as well as experience with certification/verification issues and systems. The position requires travel to Kenya and other countries in Eastern and Southern Africa up to 40% of the time.

Read more about the position here

Senior Science Writer and Producer – Center for International Forestry Research (CIFOR)

Based in Bogor, Indonesia, the Senior Science Writer and Producer will work across a range of mediums and topics to turn out compelling, innovative and high-quality communications materials designed to help translate CIFOR’s high-caliber research into meaningful, real-world impact. The ideal candidate will have a strong editorial background, be an excellent writer, and have a rich, varied body of work that demonstrates the ability to think across multimedia platforms.

Read more about the position here

ABOUT THE FOREST CARBON PORTAL

The Forest Carbon Portal provides relevant daily news, a bi-weekly news brief, feature articles, a calendar of events, a searchable member directory, a jobs board, a library of tools and resources. The Portal also includes the Forest Carbon Project Inventory, an international database of projects including those in the pipeline. Projects are described with consistent ‘nutrition labels’ and allow viewers to contact project developers.

ABOUT THE ECOSYSTEM MARKETPLACE

Ecosystem Marketplace is a project of Forest Trends, a tax-exempt corporation under Section 501(c)3. This newsletter and other dimensions of our voluntary carbon markets program are funded by a series of international development agencies, philanthropic foundations, and private sector organizations. For more information on donating to Ecosystem Marketplace, please contact [email protected].

Additional resources

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Should Landowners Earn Biodiversity Offsets For Conserving Species Habitat Before It Becomes Endangered?

19 August 2014 | It usually costs less to prevent a disease than it does to treat one, and it also costs less to manage forests in a way that prevents high-intensity wildfires than it does to fight those fires after they erupt.

The US Fish and Wildlife Service is following this same line of thought into conservation by proposing a policy on building a crediting system that would protect threatened wildlife. The draft policy, which is part of the Service’s Candidate Conservation program, seeks to incentivize landowners into early conservation.

“The adage ‘an ounce of prevention is worth a pound of cure’ is appropriate here,” says the FWS’ Chief of Public Affairs, Gavin Shire. “This policy is one more tool that can be used in conjunction with the others to help prevent species decline.”

How it works

Under the proposal, any landowning entity individuals, companies, government agencies, etc. can earn credits by practicing conservation that benefits an unlisted species. The conservation includes larger actions such as habitat creation and restoration, but also includes actions like planting trees, forgoing timber harvest, and removing invasive species. If the animal that benefits from those actions is later listed under the Endangered Species Act (ESA), those credits can be redeemed and used as mitigation to avoid practicing further conservation for the species.

The credits generated can also be sold to a third party-another entity requiring conservation actions for a listed species.

For example, a landowner, under no legal obligation, plants trees that provide a nesting habitat for a warbler species. The conservation actions are assessed, and the landowner receives credits based on its benefit to the warbler. If that species becomes an endangered or threatened species under the ESA in the future, and the landowner would like to develop an area of warbler habitat, he/she can redeem the credits and practice those actions without additional conservation. However, the value of the conservation must be greater than the negative activity being offset. If this isn’t the case, then additional conservation would need to be carried out. A requirement of the policy is delivering a net conservation benefit to the species.

Other requirements are fairly evident. First, it must be voluntary. The entity can’t be under any legal obligation to carry out the conservation. And the conservation must benefit unlisted wildlife.

Any at-risk species qualifies under the proposal. But because credits can only be redeemed after a species is listed under the ESA, it’s most likely landowners will conserve candidate species, which are those already under review to receive an official ESA listing. The risk of them being listed is higher.

Cost-effective Approach?

The FWS doesn’t have the exact numbers on how much more cost-effective it is to conserve a species voluntarily, but Shire says it’s only a question of how much and not if.

“Bringing a species back from the brink of extinction is always going to cost more than conserving populations before they get to that desperate status,” he says.

Ultimately, healthier ecosystems for wildlife mean a more sustainable flow of ecosystem services for people. And restoring ecosystems for people is expensive, Shire says, so everyone benefits from proactive conservation actions.

But while early conservation isn’t disputed as a sure way to preserve a species, Wayne White of the National Mitigation Banking Association, an organization meant to influence policy on behalf of the mitigation and conservation banking industry, is skeptical of voluntary measures.

For one, White questions the rigor of voluntary conservation standards and if those actions can act as offsets for detrimental impacts. The concept is designed to prevent species listing but, because it’s voluntary, the conservation is at a lower standard and then less likely to enhance the animals’ numbers, White says. A well-known example is the lesser prairie chicken, whose population continued to decline despite voluntary actions. The bird was listed as threatened under the ESA this year.

Then there is the cost of voluntary conservation. And again, because the standards are lower, White says, the cost is lower. Voluntary actions don’t have to ensure long-term preservation for a species and therefore can appear less expensive than conservation banking, which conserves at a high level and manages land for wildlife conservation in perpetuity. White argues this draft policy will undermine private sector investment in conservation banks.

“What we’re not seeing is the true cost of mitigation,” White says. “There is no certainty the voluntary conservation actions are going to be there long-term.”

Administration

White’s take on the draft policy is most likely one of many that will be streaming in over the next month. The proposal is published in the Federal Register and open to public comments until September 22.

As for administration, that will fall to individual states should they decide to adopt the policy. The FWS’ role is largely one of assistance and overseer. The states will take on primary tracking and implementation responsibilities and then report this information to the Service annually. This way, the states can ensure their conservation efforts will be recognized by the FWS should the species be listed eventually.

The FWS is also clear on how the draft policy would operate in coordination with the agency’s other ongoing voluntary initiatives. While some prelisting conservation measures may qualify under different programs, it can’t be treated under more than one. The intended outcomes of these different initiatives are different, the document notes. Candidate Conservation Agreements with Assurances (CCAAs), for instance, are meant to represent a property owners’ entire obligation to conserving a species. The draft policy, on the other hand, is allowing a conservation action to act as mitigation. It doesn’t guarantee further conservation won’t be needed.

CCAAS are also only for non-federal landowners whereas the draft policy is for every type of property owner.

This Week In V-Carbon…

This article was originally posted in the V-Carbon newsletter. Click here to read the original.

14 August 2014 | The Verified Carbon Standard (VCS), known as one of the leading carbon standards in the voluntary markets, is ready to move into California’s regulated market in a major way. VCS announced last week that it has been authorized by the state’s Air Resources Board (ARB) to pre-screen coal mine methane and other types of offset projects for California’s carbon trading program.

The VCS just became the third voluntary registry, following the American Carbon Registry and the Climate Action Reserve (CAR), to be designated as an offset project registry, which allows the VCS to help administer parts of the ARB’s compliance offset program.

“The California system is on the cutting edge of figuring out how to tackle climate change,” said David Antonioli, Chief Executive Officer of the VCS. “We feel it’s time to be part of the game and part of the solution.”

In addition to evaluating currently eligible projects, the VCS has set a specific goal of helping California welcome REDD+ (reduced emissions from deforestation and forest degradation) projects into the program. The VCS jurisdictional and nested REDD+ (JNR) requirements were the first framework for accounting and crediting REDD+ programs implemented at either the national or subnational level. The Brazilian state of Acre with which California and the Mexican state of Chiapas have a memorandum of understanding (MOU) was the first jurisdiction to pilot the JNR framework and is “really quite close” to becoming the first jurisdiction-wide program to deliver compliance-grade REDD+ offsets, Antonioli said.

The VCS has a vision of its toe-hold in California evolving into other compliance markets throughout North America and potentially worldwide.

Meanwhile, officials in California and Mexico in late July signed a MOU and formally agreed to work together on a range of actions to address climate change, including pricing carbon pollution. The most obvious area of cooperation would be for California to recognize REDD offsets generated by projects located in Mexico in its program, he said.

“I think there are great opportunities for making things happen across the border,” Antonioli said.

These and other stories from the voluntary carbon marketplace are summarized below, so keep reading!

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Voluntary Carbon

Driving the carbon away

Volkswagen (VW) and Audi have partnered with 3Degrees to purchase offsets covering the emissions associated with the car and battery manufacturing, distribution, and warranty miles for the VW eGolf and Audi A3 e-tron automobiles. VW selected offsets from the Garcia River and Big River and Salmon Creek Forests afforestation/reforestation projects in California and the methane capture project at the McKinney Landfill in Texas among others. Audi will also source offsets from the McKinney Landfill and the Garcia River projects, plus the Kasigau Corridor REDD+ project in Kenya. The initiative is scheduled to last for the next three model years.– Read more here

Brown gets greener

UPS has set a new goal of a 20% reduction in carbon intensity from transportation by 2020 after meeting its previous goal of reducing its air and ground fleet’s emissions intensity 10% by 2016.The shipping firm’s carbon reduction strategies include alternative fuel vehicles, route optimization, and carbon neutral shipping options for customers. The UPS carbon neutral shipping program purchased 48,467 tonnes of carbon dioxide (tCO2e) offsets in 2013, according to its most recent Sustainability Report, up from 43,575 tCO2e in 2012. The offsets were purchased from the Garcia River and Kasigau Corridor forestry projects, as well as methane destruction projects in Thailand and China. Read more here

Offsetting in the Great White North

Toronto-based CO2EXCHANGE has officially launched a website inviting individuals and businesses to reduce their carbon footprint. The offsets featured on the new online platform are currently sourced from several projects located in Canada including the Darkwoods forestry project the subject of a damning and controversial audit by British Columbia officials in 2013. Other Canadian projects supplying offsets on the platform include a composting facility verified by the VCS and a landfill methane avoidance and a biomass project verified by International Organization for Standardization. The platform also features offset projects outside of North America, including an Australia-based solar project, and an India-based wind energy project. Read more here

COMPLIANCE CARBON

Staying home with the Kiwis

The New Zealand Environmental Protection Agency’s annual report on its national emissions trading system (ETS) shows that compliance entities utilized imported offsets, such as those from the European Union Emissions Trading System, to fulfill nearly all of their obligations under the domestic carbon cap. A change in the program will prevent the use of international offsets after this year, forcing companies to rely on domestic New Zealand Units. But the entire ETS could be in jeopardy as some New Zealand legislators want to replace it with a carbon tax while others want it completely scrapped. Read more here

The list just keeps growing

The Chinese National Development and Reform Commission (NDRC) has approved 33 new projects for use in the countrys seven pilot ETS programs. The new projects could produce up to six million offsets annually, equivalent to about half of the number of offsets traded in the pilots thus far. About 2,000 companies that face restrictions on their greenhouse gas (GHG) emissions under pilot ETSs can use the offsets, known as Chinese Certified Emissions Reductions (CCER), to cover 5-10% of their annual emissions. The new projects bring the total approved by the NDRC to 49, mostly wind and hydro power stations. According to IDEAcarbon, the first issuances of CCERs are expected this fall. Read more here

Speaking the same language

On July 28, California and Mexico signed a MOU to enhance cooperation on climate change. The agreement calls for the participants to formally share their design expertise on climate change policies, including ETS programs, and to discuss the potential for future alignment of policies and programs. The voluntary carbon markets have already established a presence in Mexico through the CAR’s Mexico Forestry Protocol and this agreement could represent another step towards bringing REDD+ into the California offset mix. Separately, Mexico signed a deal allowing Japanese companies to invest in Mexican GHG reductions through Japan’s Joint Crediting Mechanism. Read more on California/Mexico
Read more on Mexico/Japan

For the birds

The beavers need something to chew on

Cap-and-trade programs such as the one in California could help conserve and grow forests in Oregon, which cover nearly half of the US state 62 million acres, according to Christine Yankel, a senior project analyst at The Climate Trust. Forestry offsets overtook ozone-depleting substances projects as the largest source of offsets issued by California regulators earlier this summer. The improved forest management projects allowed in California program provide a path to sustainable forest management that facilitates both timber harvest and conservation, she said. But the challenge for Oregon is that 60% of the forest land in the Beaver State is owned by the US federal government and therefore ineligible to contribute offsets to the California program, Yankel acknowledged. Read more here

Joining the carbon pricing party?

A taskforce in the US state of Washington has begun evaluating the possible implementation of a price on carbon in the state. Governor Jay Inslee has instructed the Carbon Emissions Reduction Taskforce to look at an ETS or a carbon tax that could help meet the Evergreen State’s commitment to reducing GHG emissions to 1990 levels by 2020, 25% below 1990 levels by 2035 and to 50% below by 2050. Inslee plans to use the taskforce recommendations due in November to draft and propose bills for legislative consideration in 2015.Read more here

Carbon Finance

Breakthrough Or Backslide?

Everyone loves “results-based finance at least in the abstract because they like to get what they paid for. Quantifying those results and packaging them for buyers, however, has proven elusive once you get beyond payments for ecosystem services. Ecosystem Marketplace provides a look back at how results-based finance has developed along with the benefits and challenges it presents. Read the story at Ecosystem Marketplace

Science & Technology

Offsets by the mile

A new study from Montana State University conducted for the US Federal Highway Administration (FHWA) shows that active management of roadsides within public lands and US highways could significantly boost their carbon sequestration capacity and generate carbon offsets. The FHWA is currently funding research on the potential along New Mexico’s 7,500 miles of state roads. Results range from a 35% to 350% increase in carbon sequestration in the test areas. New Mexico estimates that revenue could reach $1 million annually, based on current offset prices. Read more here

Calculating the carbon

The U.S. Department of Agriculture recently released a report that provides uniform scientific methods for quantifying changes in GHG emissions and carbon storage from land uses including cropland, grassland, livestock and agroforestry. The new methods and the accompanying website, COMET-Farm, will help farmers, ranchers and forest landowners calculate potential GHG reductions from using practices that qualify for carbon offsets. Read more here

Director of North American Compliance Markets – Verified Carbon Standard

Based in San Francisco, California, the Director will lead the organization’s efforts to work with existing and emerging compliance frameworks throughout North America. Eligible candidates will have at least 10 years of relevant work experience and expertise in carbon markets. Read more here

Carbon Sales Manager Carbonbay

Based in Hamburg, Germany, the Carbon Sales Manager will manage a large carbon project portfolio focusing on South and Central America. Successful candidates will have a masters or a bachelor’s degree in business administration or similar field. Fluency in English and Spanish is required. Read more here

Congress Assistant, Resilient Cities – ICLEI Local Governments for Sustainability

Based in Bonn, Germany, the Congress Assistant will support the Resilient Cities team with the Resilient Cities congress series, as well as related regional events. Ideal candidates will have interest and experience in event organizing, as well as an interest in the areas of cities and local government as an asset. Read more here

Communications Manager – Regional Greenhouse Gas Initiative (RGGI, Inc.)

Based in New York City, New York, the Communications Manager will be responsible for development and implementation of communications related to all aspects of RGGI, Inc., including auctions, allowances tracking and engagement with stakeholders. Eligible candidates should have at least two years of work experience in communications, with demonstrated experience related to sustainability, environmental policy or energy. Read more here

Program Manager, Environment and Health – Global Alliance for Clean Cookstoves

Based in Washington, DC, the Program Manager will provide programmatic and administrative support to the research program at the intersection of its environment, climate, and health portfolios. Successful candidates will have a master’s degree or higher in a relevant area and at least five to seven years of relevant research or work experience. Read more here

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Governors In Rainforest Nations Continue To Step Up On Deforestation. Will The Rest Of The World Follow?

12 August 2014 | RIO BRANCO, Brazil | Indonesia’s largest cash crop is palm oil. In Brazil, it’s soybeans. Those two crops are driving deforestation in both countries, yet governors from oilseed-dependent states in both countries have vowed to slash deforestation if funding for Reduced Emissions from Deforestation and forest Degradation (REDD) materializes.

Thirteen of them on Monday launched the Rio Branco Declaration, which is a clear commitment to reduce deforestation in their states by 80% between now and 2020. That commitment, however, is contingent on developed countries delivering on their own promises to step up funding both market-based and non-market-based to engineer a shift to sustainable land-use practices built in part on support for indigenous agriculture.

The declaration was signed at the 8^th Annual Meeting of the Governors’ Climate & Forests (GCF) Task Force here. The GCF is a collaboration among 22 states and provinces from Brazil, Indonesia, Mexico, Nigeria, Peru, Spain, and the United States. Three additional Mexican states Tabasco, Quintana Roo and Jalisco are expected to join this week. Governors from other GCF member states say they will also sign the declaration.

“GCF members come from different provinces and countries, but we have a common goal to protect forests and build sustainable environments for improved livelihoods for all both now and into the future, said Governor A. Teras Narang of the Indonesian state of Central Kalimantan. “That future is now.

The REDD Factor

Narang’s country, Indonesia, is attempting to halt deforestation by shifting palm-oil development from forested lands to degraded lands a daunting task akin to moving the farms of the US Midwest to the plains of Texas. It amounts to the largest voluntary land-swap in history, and the government aims to use REDD finance to achieve it, while also engaging the demand side of the equation by working with companies willing to re-engineer their supply chains to avoid deforestation.

“Only standing forests are capable of removing greenhouse gases such as CO₂ from our atmosphere, helping to reduce global warming, said Governor Dr. Cornelis MH, a signatory to the declaration and Governor of the Indonesian state of West Kalimantan. “Performance-based incentives or assistance from donor countries to support REDD+ programs and low emissions development will not only rehabilitate forests but support livelihoods among forest-dependent communities€both small-holder farmers and indigenous communities.

Indigenous leaders, conservationists, and private-sector actors meet on the sidelines of the GCF meeting in Brazil.

Edwin Vasquez is the leader of one of those communities, the Huitoto People of Peru, and as Coordinator General of COICA (Coordinadora de las Organizaciones Indígenas de la Cuenca Amazí³nica, Coordinator of Indigenous Organizations of the Amazon River Basin), he represents nearly 400 other indigenous communities across the entire Amazon Basin.

“Humanity is in grave danger over the destruction of the Amazonia the climate regulator of the planet, he said. “The 5,000 indigenous communities continue to protect the forests and preserve our cultures and the world, as we have done for thousands of years. We are the proprietors of 210 million hectares, covering 25% of the Amazon, which calls for an urgent proposal Indigenous Amazonia for Humanity, a $210 million project addressing the fact that climate funds have not reached our communities.

The Declaration

The declaration aims to put the GCF on the world stage, and it invites the international community and partner organizations to work with the GCF to develop clear and transparent mechanisms for securing and delivering performance-based benefits to forest-dependent communities, smallholders, and indigenous peoples.

“For the last 6 years the GCF has been the source of incredible innovation that is now ready for the world stage, said Dan Nepstad, Executive Director of Earth Innovation Institute. “If the GCF states and provinces decide in Rio Branco to reduce 80% of deforestation by 2020, this means 4 billion tons of avoided CO₂ emissions on top of the 3 billion tons of emissions already avoided.

Now, he says, it’s up to the rest of us to step up.

“For the 2020 commitment to become real, the GCF will need the support of companies, donors and investors, and a strong commitment to channel benefits to forest-based communities, said Nepstad. “All of the pieces are coming together for this to happen in the coming months.

California Key

On the buy-side, the US state of California is considering the inclusion of REDD offsets in its cap-and-trade program. The state played a leadership role in the early days of the GCF, and it remains a key driver.

“Without action to reduce emissions from the deforestation of tropical forests, we are missing one of the keys to mitigating climate change, said California Air Resources Board Chairman Mary Nichols. “We think the sector-based offset crediting approach being evaluated for jurisdiction-wide programs, like the one in Acre, is the next frontier for California’s carbon offset program.

Additional resources

Can This Indonesian Official Execute The Largest Voluntary Land-Swap In History?
Governors Move on Climate While Presidents Pother

Crossroads In Climate Negotiations When Adaptation And Mitigation Meet In Bonn And Lima

This article was originally published by Forests Climate Change. Click here to read the original.

11 August 2014 | The June round of climate negotiations commenced with wide recognition amongst Parties of the need for deeper cuts in greenhouse gas (GHG) emissions and to be accelerating negotiations based on the outcomes of the 5^th Assessment Report (AR5) released by the Intergovernmental Panel on Climate Change (IPCC) this year.

This session was the last opportunity for Parties to meet before the United Nations Secretary General’s Climate Summit, to be held in New York in September the first time world leaders have met on the issue since the failed 2009 Copenhagen Conference. High expectations for finance announcements are expected from this meeting.

The June meeting of the UNFCCC Subsidiary Bodies (SBs) and the Ad Hoc Working Group on the Durban Platform (ADP) occurred against the backdrop of the announcement by US President Barak Obama of a 30% reduction in power plant emissions by 2030 and the Green Climate Fund (GCF) completion of the essential elements required for the full operationalization of the fund.

Ministerial meetings took place, from which Parties hoped to gain insights. Emphasis was largely placed on disappointment over lack of ratifications of the Doha Amendments to the Kyoto Protocol (KP) to enable the second commitment period, a stagnation in developed country ambition to cut greenhouse gas emissions and ongoing lack of financial commitments. Many countries spoke of national processes underway for ratification to occur, however no major announcements were made.

The host country for the UNFCCC 20^th Conference of the Parties (COP 20) Peru made their presence known. With much support from Least Developed Countries (LDCs) and Small Island Developing States (SIDS), at every opportunity Peru reminded Parties of the urgency to act and set down high expectations for the meeting to be held in December in Lima. The incoming COP President, Minister Manuel Pulgar-Vidal made it clear that he hoped decisions in Lima will be made concerning pre-2020 mitigation, REDD+, GCF capitalisation, intended nationally determined contributions (INDCs) and a draft text for a new climate agreement.

It could be said that the substantive negotiations have commenced. Points of divergence and convergence are beginning to crystallize, which may enable the Parties to undertake their work to reach a durable and future proof agreement.

The emergence of synergies between adaptation and mitigation

During the Bonn session, it seemed that Parties became more accepting of the synergies and linkages between mitigation and adaptation. The recently released IPCC’s 5th Assessment report identifies that policies governing land use and REDD+ are more effective when both mitigation and adaptation are involved and that REDD+, primarily regarded as a mitigation framework, also has adaptation co-benefits.

During adaptation discussions in the Ad Hoc Working Group on the Durban Platform (ADP), several Parties recognized the link between these two normally siloed issues and the mitigation co benefits associated with adaptation actions. The issue dominated much of the REDD+ discussions concerning non-market based approaches (NMBAs) and non-carbon benefits (NCBs).

In a climate finance context, the Global Environment Facility (GEF) already recognises funding for projects that include both adaptation and mitigation. The Green Climate Fund is also identifying linkages between adaptation and mitigation in the outcomes and results areas that are currently under development. The Standing Committee on Finance (SCF) have also commenced consideration of the issue in the context of forests and finance.

However, identification as to the technical details and development of modalities concerning the relationships between mitigation and adaptation has not yet been considered within the UNFCCC. Many Parties have mentioned that such information would be useful. Some preferred that this work should be considered after 2015, whilst others suggested it as a topic for one of the upcoming Technical Expert Meetings (TEMs).

Adaptation actions can have mitigation benefits and mitigation actions can give rise to adaptation outcomes but trade-offs may arise. Further exploration and safeguarding of circumstances where mitigation actions cause mal-adaptation and adaptation actions cause emissions increases may be warranted.

ADP Enhanced pre-2020 Climate Action (Workstream 2)

There is a recognized need to address the current gap between the likely global greenhouse gas emissions based on current mitigation pledges and those actions required to hold the increase in global average temperature below 2 or 1.5 degrees Celsius above pre-industrial levels.

An important development to accelerate mitigation actions occurred following the Bonn session, with the release of draft text of a pre-2020 decision that will be further negotiated in Lima. It calls on all Parties to accelerate full implementation of the decisions under the 2007 Bali Action Plan with emphasis on technology, finance and capacity building. It also expresses the urgency of ratification of the Doha Amendments to the Kyoto Protocol and calls for developed countries to ensure the initial mobilization of resources of the Green Climate Fund reaches a very significant scale.

As a part of this process, a series of Technical Expert Meetings (TEMs) are being held. These intend to provide Parties with insights, experiences from the ground, examples of success stories, and challenges for scaling up of mitigation actions before 2020. During the June session, a TEM on Land Use was held with expert panellists from civil society organisations, intergovernmental organisations and country delegates.

The major conclusions were that:

there is high mitigation potential from the forest and agricultural sectors whilst contributing to adaptation;
scaling up of finance, technology and capacity building is required for the sector to reach its potential;
success will require long term sectoral policies;
participatory multi-stakeholder dialogues should commence at early stages;
there remains a high interest in REDD+;
it is necessary to identify tradeoffs and safeguards against potential negative impacts on food security, rights of indigenous peoples and biodiversity.

Parties have suggested that the TEMs go beyond the technical examinations and be consolidated into concrete national and international actions and identify outcomes and technical issues that can then obtain financial support. Some seek that the TEM results should be included in a Lima COP decision as a menu of options for countries to apply.

Many Parties considered the TEMs to be a useful and successful process and have expressed a desire to see them continuing up to and beyond 2015. TEMs could also advance the ongoing workplan to enhance mitigation ambition, which will continue until the new agreement comes into effect in 2020.

ADP Workstream 1 Elements Adaptation and Mitigation

Workstream 1 of the ADP was established with a mandate to develop “a protocol, another legal instrument or an agreed outcome with legal force under the Convention applicable to all Parties, which is to be completed no later than 2015 in order for it to be adopted and to be implemented from 2020.

It is the intention of the ADP to enhance action, which includes adaptation action. For this reason, adaptation in the ADP negotiations has increased in profile. This is also reflected by the 50 / 50 mitigation adaptation allocation of funds in the Green Climate Fund.

Parties agree that adaptation will be a critical part of a new climate agreement. Some have put it as a Human Right, to be entitled to the means to adapt.

ADP adaptation discussions in Bonn focused largely around the usefulness and ability to identify a global adaptation goal. Uncertainty remains as to how to establish a global goal for adaptation and how such a goal might be measurable. Some Parties expressed serious doubts as to this approach, whilst others consider the content of Article 2 of the Convention to be sufficient. Building resilience was raised as an area for possible further consideration on the issue and such a goal could be framed in terms of support or within the context of a temperature limitation goal together with mitigation.

Lack of adaptation finance is also a serious concern for developing country Parties. Low mitigation ambition will create higher adaptation funding requirements in an environment that some Parties already consider to be in a funding crisis. Calls have been made for adaptation support to be reflected as a legally binding commitment linked to mitigation ambition. What will be required in terms of adaptation post-2020 will depend on pre-2020 mitigation, as well as mitigation over the longer term.

National Adaptation Plans (NAPs) are considered most likely to be the entry point for adaptation support under the 2015 agreement and Parties have called for strong linkages between NAPs and the Green Climate Fund. Formulation of NAPs, technical guidelines and institutional linkages between the Adaptation Fund and other finance institutions (such as the GCF) is progressing under the Subsidiary Body for Implementation (SBI). Whilst few countries have commenced the NAPs process, lack of financial support to enable implementation was a major emphasis in the discussions as was a need for greater coherence and understanding as to the implementation guidelines.

Mitigation discussions got off to a slow start Parties took issue with the lack of available space and exclusion of observers.

As was the case with adaptation, much focus was on a global goal. What form the mitigation goal will take in the new agreement remains uncertain. Options include: a temperature goal that reflects current science; an emissions reduction goal; a maximum concentration of GHGs in the atmosphere; or as a carbon budget.

There remains no agreement on this issue and questions remain as to whether developing countries should be taking economy-wide emission reduction targets to reach any such goal.

The Alliance of Small Island States (AOSIS) strongly assert that the level should be adequate to protect the most vulnerable countries and should ensure limiting global average temperature increase to below 1.5 degrees Celsius above pre-industrial levels. Many Parties maintain that all should mitigate having regard to the Convention Principles of common but differentiated responsibilities and respective capabilities (CBDR-RC) and equity.

On the issues of MRV and accounting, Parties seek differentiation and flexibility as well as key elements and principles for a common system. It was suggested that the new agreement include key principles specific to the land sector. Laying out the core items, and the specifics such as accounting rules should be negotiated post-2015.

As a mechanism designed for mitigation purposes, the Warsaw Framework provides a foundation for REDD+ to be anchored in a new agreement. Science shows that mitigation opportunities exist in the context of forests as well as coastal marine ecosystems and the inclusion of both has been sought.

ADP Moving towards legal form Contributions and Compliance

Under the Kyoto Protocol, developed countries have legally binding commitments requiring emissions reductions. As a result of more recent negotiations and the intended universal legal application of a new climate agreement, the softer term contributions is now more commonly used. Both developed and developing country Parties are currently in the process of identifying their intended contributions related to climate change action to be taken at the national level and what those contributions mean when considered aggregately at the international level.

Parties agreed at COP 19 in Warsaw, to “initiate or intensify preparation of their intended nationally determined contributions (INDCs). The scope of INDCs remains unclear. Some Parties consider that INDCs relate only to mitigation contributions whereas others understand the notion to relate to adaptation, capacity building, technology transfer and financial support. In Lima, it’s expected that there will be an agreement on the scope of INDCs and the types of information required for INDCs to be assessed internationally and in the context of the 2 degree goal. Against this background, much discussion focused on this issue in Bonn, with draft decision text produced following the session.

Bonn saw progress towards a broader agreement that INDCs may go beyond mitigation and include contributions related to adaptation, capacity building, technology transfer and finance. Difficulties associated with measuring adaptation contributions were highlighted consistently, particularly due to its evolutionary nature and its dependence on mitigation actions. Despite ongoing disagreement on this issue, the revised draft text includes an option for Parties to agree on this broader approach.

Due to the level of convergence related to mitigation contributions, it was asserted that there is nothing to prevent work from commencing at the national level on preparations for intended mitigation contributions. The need for financial support for preparation of INDCs was however highlighted by all developing countries.

The extent to which REDD+ will be included in INDCs remains unknown, however the draft text also includes provision for land sector contributions. This indicates potential for developing forest countries to rely on REDD+ to make their contributions. A question here emerges as to whether such REDD+ contributions may be legally binding under a new agreement. It may be argued that once a Party voluntarily participates in REDD+, certain legally binding obligations may arise.

Parties have proposed an ex-ante assessment in 2015 concerning whether INDCs put forward are sufficient to meet the 2 degree goal. There is disagreement concerning this assessment and calls have been made to include an assessment as to whether the financial commitments made are sufficient. Reviewing the adequacy of finance over time to ensure it remains sufficient was proposed as an ongoing process.

The system of review will be linked with the INDC process. During the review discussion, the term setting a direction of travel was raised several times, as was a no backsliding requirement to enable upward adjustments of contributions over time. Although there was wide agreement to 5 year cycles in line with IPCC science, some Parties seek longer terms of 10 years. Review cycles may be linked with reporting cycles under the processes in place through International Assessment and Review (IAR) and International Consultation and Analyses (ICA).

In this context, Parties continue to emphasise the Convention Principles of CBDR-RC and many accept that, due to national circumstances, not all INDCs will be provided as expected in early 2015. The ADP Co-Chairs will be seeking completion of the decision on INDCs at the October inter-sessional so it can be put forward for recommendation to the COP in Lima.

Linked with the INDC process and post-2020 obligations is that of a new compliance mechanism to be developed in a new agreement.

A rich discussion occurred on this issue, with many Parties seeming eager to move beyond discussing elements and onto legal issues such as compliance and form. Calls were made for a legal expert team to be established to advise the Parties. Suggestions have also been made that a compliance regime may be centred around the concept of climate justice. There was no disagreement on the importance of a new compliance mechanism to be developed under the new agreement however preference was expressed for emphasis on substance rather than legal form, on the basis that the legal form will be determined by the substance and content of a new agreement.

Emerging issues related to a new compliance mechanism include facilitation, sanctions and review. It is widely accepted that compliance should strengthen implementation, and the current reporting frameworks through IAR and ICA may also assist with this.

There was wide agreement that a new compliance mechanism will build on the current rules under the Kyoto Protocol but tailor-made to a new agreement and possibly broader on the basis that the current KP compliance mechanism relates only to mitigation. The way in which a new compliance mechanism might be developed relating to adaptation and finance remains a topic for future negotiation and legal consideration. There was wide acceptance to ensure the mechanism includes a facilitative platform designed to provide assistance to Parties to meet their obligations.

One of the most important outcomes of COP20 will be the draft text of a new post 2020 climate agreement. Some have called for draft text to be produced prior to COP20.

Disagreement remains amongst Parties as to how the draft is to be prepared and whether the co chairs will prepare the text based on the submissions, text provided by other Parties, based on interventions made from the floor, or all of the above. The ADP Chairs are confident that all outputs will reflect inputs from the Parties and whilst some welcome a Chairs draft text, others do not on the basis that this would compromise the Party driven process.

The draft text discussion continues to carry with it negative experiences from the 2009 Copenhagen COP. It was mentioned that the Copenhagen experience fundamentally shook the multilateral process on climate change. Many seek to avoid the same mistakes.

SBSTA 40

The 40^th meeting of the Subsidiary Body on Scientific and Technical Advice (SBSTA) undertook negotiations in Bonn on issues including agriculture, REDD+ non-carbon benefits (NCBs) and non-market based approaches (NMBAs). The SBSTA will consider guidance concerning REDD+ safeguards information systems at COP 20 in Lima.

The discussions concerning agriculture took a step forward, considered to be a larger step by some more than others. An agreed roadmap was developed to progress the issue through to mid-2016. Although calls were made for a work programme to focus on mitigation and adaptation in the sector, the outcome has remained limited to the adaptation mandate.

The work programme, which includes a call for submissions from Parties and Observers, will consider:

development of early warning systems and contingency plans in relation to extreme weather events;
assessment of vulnerability and risk of agricultural systems in relation to different climate change scenarios;
identification of adaptation measures; and
identification and assessment of agricultural practices and technologies to enhance productivity in a sustainable manner, food security and resilience.

Workshops will be held on early warning systems and contingency plans in relation to extreme weather events; and vulnerability and risk of agricultural systems in relation to different climate change scenarios at SBSTA 42 (June 2015) followed by additional issues to be considered at workshops at SBSTA 44 (June 2016).

On the issue of REDD+ non carbon benefits, many parties seek to avoid international guidance and modalities instead seeking that they be identified and defined at the national level only. LDCs however continue to seek international guidance on the issue and it will be further considered at SBSTA 42 in Bonn in June 2015. Many Parties recognize the linkages between NCBs and adaptation and safeguards. (For an analysis of the NCBs outcomes in Bonn see this article written by the Center for International Environmental Law).

Non Market Based Approaches and Joint Mitigation Adaptation REDD+

An In Session Expert Meeting was held on NMBAs with high expectations that the meeting would be informative and assist Parties to reach a decision on this issue before Lima. The Warsaw Framework provides for a mix of policy approaches and sources of finance including market and non-market finance for REDD+ activities.

Many held a view that the expert workshop failed to deliver. Criticisms were raised that it became overly political without any conclusion on how to deal with NMBAs or the approach to joint mitigation adaptation (JMA) as put forward by Bolivia. Some agreed, following the workshop, that a more technical and scientific approach to the issue would be useful.

To contextualise, it is important for a more detailed understanding of the Bolivian proposal. Arising from a concern that REDD+ has become overly focused on mitigation and carbon markets, in 2012 Bolivia put forward an alternative REDD+ policy approach to the now established results-based payments system. The main point of distinction is that the proposal does not allow for carbon offsetting. The proposal involves a more general estimate of carbon sources and sinks as opposed to the high level technical accounting and MRV requirements that are established under the Convention.

The concept goes beyond forests and looks across a landscape incorporating both adaptation and mitigation. It is argued to be a more consistent approach to sustainable land use and indigenous world-views.

This alternative policy approach to REDD+ is proposed to be undertaken through two phases, namely preparation and implementation and has been put forward in both the current SBSTA discussions as well as the ADP approach to forests and land use.

The preparation phase requires evaluation of forest mitigation potential and the preparation of adaptation elements. It seeks a general understanding of mitigation potential without the need for complex inventories. For the adaptation component, it intends to link to current systems such as the NAPs. Needs assessments are undertaken to address priorities, vulnerabilities and financial needs. Finance is provided both ex ante and ex post through mechanisms such as the Green Climate Fund.

The implementation phase is supported by a performance-based approach intended to have both mitigation and adaptation outcomes. It is intended that mitigation outcomes be measured through proxies and general criteria be developed to identify adaptation outcomes. The proposal seeks benchmarks rather than safeguards, on the basis that this approach is considered low risk. It is asserted that safeguards are required where there are higher risks.

In addition to the proposal presented by Bolivia, presentations were provided on NMBAs by ASEAN and the United States.

ASEAN define NMBAs as an approach that does not generate carbon credits. REDD+ readiness work is considered to be an example of where such approaches are already happening. Other examples include grants and creating enabling conditions. ASEAN agree that there is a need for greater clarity on joint mitigation and adaptation at the international level.

The US also provided current ongoing examples of NMBAs however did not take the view of a markets versus non-markets situation. The US consider that the approach to REDD+ should be both markets and non markets and the methodologies developed under the Warsaw Framework are designed to do this. They define market as linked to emissions reductions units in carbon markets and non-markets¢ as being everything else associated with REDD+. Alternative approaches used as examples include cancellation of foreign debt, programmes to promote forest mapping and monitoring, and enhancing broader stakeholder engagement.

Confusion reigned as Parties struggled to understand the nature of the discussion. Was it about markets, non-markets, alternative policy approaches to REDD+ and finance, or the development of methodologies concerning synergies between mitigation and adaptation, or non-carbon benefits? And how are these items linked to one another?

Discussion occurred following the presentation with queries related to the difference between phase 1 & 2 finance as non-market finance, and provision of finance to create enabling conditions for REDD+ markets. Strong views were expressed that the Warsaw Framework provides adequate guidance to enable both market and non-market based approaches and that there was no need for ongoing negotiations on the issue. Strong views were also expressed that REDD+ was finalised in Warsaw on the basis that the Bali mandate was limited to mitigation, however many agreed that NMBAs to REDD+ can strengthen adaptation measures in forests. This was echoed by a call for REDD+ funding to be spread across both the adaptation and mitigation windows of the GCF.

There was much disagreement on the way forward throughout the remainder of the Bonn negotiations. Some expressed the view that the issues of JMA and NMBAs should be de-linked and matters of synergies between mitigation and adaptation and alternative policy approaches should be considered under a new agenda item. Confusion reigned as Parties struggled to understand the nature of the discussion. Was it about markets, non-markets, alternative policy approaches to REDD+ and finance, or the development of methodologies concerning synergies between mitigation and adaptation, or non-carbon benefits? And how are these items linked to one another?

The SBSTSA Conclusions took note of the views submitted and the outcomes of the expert meeting and will further consider the matter at SBSTA41 during COP20 in Lima.

An additional issue to complicate matters was that a separate negotiation was happening related to market and non-market approaches more broadly under the Convention. Many REDD+ negotiators felt that this was the more appropriate place for the discussion that there was a need to avoid agreement on anything that could prejudge or contradict the outcome of that discussion.

A dispute has now emerged related to whether alternative policy approaches, such as joint mitigation and adaptation approaches for the integral and sustainable management of forests should become a new agenda item, or whether the issue can be dealt with as a part of the current agenda item 5“Methodological guidance for activities relating to reducing emissions from deforestation and forest degradation and the role of conservation, sustainable management of forests and enhancement of forest carbon stocks in developing countries (REDD+)

The discussion is likely to now move to a debate concerning agenda items and legal technicalities related to mandates at the commencement of the Lima COP20 meeting, which has the potential to take important negotiating time away from other issues including safeguards guidance.

There is an increasingly strong push for no further modalities, guidance or methodologies related to REDD+ and to avoid further negotiations. Some countries are edging closer to the implementation stage, taking measures such as the development of forest reference emissions levels (FRELs) and safeguard systems at the national level. Brazil have taken the significant step to be the first country to submit their FREL for the required technical assessment.

The other side of the argument however is that many LDCs are concerned that there is insufficient guidance and methodologies to enable them to reach phase 3 REDD+ and access results based finance. It has been asserted that the current markets focused approach to REDD+ does not benefit LDCs or SIDS, that it is overly complex and difficult to meet the requirements to access finance. It will be important to find the right balance. Whilst too much detail may create a burden or be limiting, too little may be difficult to interpret and create difficulties in meeting objectives.

The current challenges in the REDD+ negotiations are not isolated to the REDD+ SBSTA. The recent Convention on Biological Diversity (CBD) Subsidiary Body has recently considered issues related to REDD+ biodiversity safeguards guidance, non market based approaches and similar linkages related to adaptation and mitigation. In that forum Parties again argue that there should be no new requirements and disagreement has prevented outcomes concerning REDD+ at the CBD. The Standing Committee on Finance is undertaking its own process related to coordination and cohesion of forest finance, looking beyond markets and at the linkages between mitigation and adaptation. The GCF will develop phase 3 finance frameworks in coming months and it is expected that discussion will emerge in that forum concerning finance across the mitigation and adaptation windows of the fund and how the fund can contribute to phase 1 and 2 REDD+.

Forests and Climate Finance

A major climate finance milestone was reached in Songdo, South Korea, only weeks prior to the June meeting in Bonn, where the GCF completed its essential elements and put a resource mobilisation process in place for capitalization. The GCF Board and others hope that the fund will become a reality in Lima.

This milestone was a constant point of reference throughout the two weeks of discussions in the ADP and the Subsidiary Bodies. Many calls were made for the fund to be immediately capitalised and for developed countries to urgently scale up finance to ensure meeting the agreed target of US$100 billion by 2020. Some Parties have called for recognition of this target in the Paris Agreement.

Different views were expressed as to how this would be achieved, with some saying there should be no less than US$15 billion contributed to the GCF by 2015, with US$70 billion by 2016 rising to US$100 billion per year by 2020. The UNFCCC has called for US$10 billion by the end of 2014 while the GCF itself is making calls for US$15 billion by the end of 2014. It has been suggested that developed countries provide 1% of their GDP from 2020 onwards.

No concrete finance pledges occurred in Bonn, nor were any announcements made during the first GCF resource mobilisation meeting held in Oslo in late June. Germany has recently made a commitment of a multi-year pledge of up to 750 million with the first payment planned for 2015. There remain high expectations that more countries will be making financial pledges between now and Lima. Finance has now become one of the more critical elements that will determine the success or otherwise of COP20.

Received key data on Brazil’s forests from Brazilian Head of Delegation, Min Raphael Azeredo http://t.co/h1AmpUXsbF pic.twitter.com/qiVOJoZTBt

Christiana Figueres (@CFigueres) June 6, 2014

Concerns were expressed in Bonn, that current discussions in the GCF do not adequately provide finance for phase 1 and 2 REDD+. The immediate work to be undertaken by the GCF relates to a logic model for results based (phase 3) finance. Uncertainty also remains as to whether project and programme proponents will be entitled to seek access to GCF finance through both the adaptation and mitigation windows. Calls continued to be made by Parties in Bonn for a separate REDD+ window in the GCF.

The Standing Committee on Finance held a meeting immediately following the Bonn session to consider a number of items, including the mandates from Warsaw related to coherence and coordination of finance and forests, different policy approaches, ways and means to transfer payments for results-based actions, and the provision of financial resources for alternative approaches.

There was some reluctance to move the item forward due to the sensitive ongoing negotiations in the REDD+ SBSTA. Committee members sought additional time to consult with colleagues on the relevant issues and requested the Secretariat to undertake further work to inform the Standing Committee. This further information will enable decisions to focus its soonest possible forum on issues related to finance for forests as required by the Warsaw mandate, and whether the SCF requires further guidance on the issue from the COP in Lima.

It is suggested that all relevant entities currently engaged in REDD finance come together at the 2015 Standing Committee on Finance Forum, including the Global Environment Facility, United Nations Forum on Forests (UNFF), Forest Carbon Partnership Facility (FCPF), REDD+ Partnership, UN-REDD as well as major donors engaged bilaterally. Having regard to the extent of fragmentation across forest finance, the Standing Committee on Finance will consider coordination and coherence. It intends to look beyond REDD+ across adaptation finance insofar as forests are concerned.

In addition to the above, a process was agreed in Warsaw concerning coordination of support for the implementation of activities in relation to mitigation actions in the forest sector by developing countries, including institutional arrangements. This process is intended to strengthen and enhance good practices; identify needs and gaps in coordination of support; and to share information concerning finance and enhance efficiency. The first substantive meeting as a part of this process will occur in Lima.

During the Bonn session, the first of these meetings was held. The key focus was on implementation, due to growing frustration amongst developing countries about access to REDD+ finance. The meeting, amongst Parties and observers was intended to map out a way forward for the process. Many suggested that a more interactive meeting should be held in Lima, moving away from the usual processes of negotiations around a table. Wide participation was sought including financing institutions and UNFCCC finance experts, indigenous peoples, REDD+ practitioners, private sector, civil society and multilateral donors. It is hoped that the Peruvian Government will engage with the meeting and Parties are currently undertaking the process to identify national focal points.

El Camino hacia Lima

Although it remains early, there are signs emerging within the ADP of increasing cooperation amongst Parties, a decrease in technical time wasting arguments, and completion of important institutional arrangements such as the GCF. The scientific and political windows to put in place adequate international climate policies are rapidly closing. World-leading experts are consistently warning that now is the time to deal with climate change. The emphasis on pre-2020 ambition remains critical to this process, as efforts undertaken before 2020 will determine potential for both adaptation and mitigation post-2020.

It was unfortunate that the SBSTA was left without any substantive outcomes. New issues are emerging and although the Warsaw Framework is in place, it seems highly likely that reducing emissions from forests and land use together with forests and adaptation will remain an ongoing area of negotiations for some time to come. The resistance to guidance or modalities concerning NCBs and NMBAs may also provide some insight to the upcoming safeguards discussion to be held in Lima. The issue of NMBAs and JMA will be a major issue of contention at the commencement of the next SBSTA.

Recognition of the links between adaptation and mitigation has been argued for inclusion in the Paris Agreement and it can be expected that the discussion will be ongoing into the October ADP inter-sessional (ADP 2-6) and COP 20. Further, the non-paper released by the ADP Chairs following the session identifies Party positions on the linkages, such as defining the relationships between mitigation, adaptation and loss and damage as well as potential for institutional linkages between the two as mutually supportive notions.

The Co Chairs of the ADP have also now issued a new reflections note on progress, a draft decision on pre-2020 ambition and a draft decision on INDCs to assist Parties between now and the next ADP intercessional in October.

Several Parties mentioned that a failure in Lima will guarantee a failure in Paris. As things move forward, all Parties will need to consider whether another major climate summit failure is something that the world can afford.