climate funding opportunities: redd+ funds

Climate funding opportunities:REDD+ funds

1

Intra-ACP GCCA Programme

Briefing to the ACP Group of States July 19, 2012, ACP Secretariat, Brussels

Duncan Brack, [email protected] to the ACP GCCA Programme(LTS-Baastel-CAMCO)

Outline

1. REDD+ concept2. Three multilateral initiatives in detail:

a) Forest Carbon Partnership Facility (FCPF)b) Forest Investment Programme (FIP)c) UN-REDD

3. Three initiatives more briefly:a) Congo Basin Forest Fund (CBFF)b) Australia’s International Forest Carbon Initiativec) Clean Development Mechanism (CDM)

4. REDD+ funding in practice5. The future

2Intra-ACP GCCA Programme

REDD+: background

Deforestation ~17% global emissions Relatively cheap to reduce (in theory) Not included in Kyoto – too difficult Aim of seeing developing countries adopt

targets meant had forests to be included Bali Roadmap, 2007; Copenhagen

Accord, 2009 Needs new treaty, so not imminent But funding for ‘readiness’ activities

available3Intra-ACP GCCA Programme

REDD+: the concept

Basic idea: add value to standing forests

Development RED – REDD – REDD+ Reducing emissions from deforestation Reducing emissions from forest

degradation Forest conservation Sustainable management of forests Enhancement of forest carbon stocks


Challenges

Reference levels Leakage Permanence Safeguards Governance Measuring, reporting and verifying

(MRV) Finance


Implementation

Step-wise approach, codified 2010: Phase 1: ‘development of national strategies

or action plans, policies and measures, and capacity-building’ (‘REDD readiness’)

Phase 2: implementation of strategy, including further capacity-building, testing MRV, payments for ‘results-based demonstration activities’

Phase 3: fully implemented programme with a pay-for-performance system


‘REDD readiness’ Preparation of national strategies to reduce

emissions Designing and implementing national forest

carbon accounting, including baselines and reference emissions levels and MRV systems

Developing benefit-sharing mechanisms Developing safeguards and grievance

mechanisms to protect the interests of forest communities, indigenous people, biodiversity, etc.


Major multilateral initiatives

World Bank’s Forest Carbon Partnership Facility (FCPF): Readiness Fund and Carbon Fund

World Bank’s Forest Investment Programme (FIP)

UN-REDD Programme (FAO, UNDP, UNEP) Congo Basin Forest Fund (CBFF) Amazon Fund Indonesia Climate Change Trust Fund Global Environment Facility Clean Development Mechanism (CDM) of the

Kyoto Protocol


Major bilateral initiatives

Australia’s International Forest Carbon Initiative

Norway’s International Climate and Forest Initiative (also main donor to Amazon Fund, UN-REDD)

Other donor funds not only REDD+, including Germany’s International Climate Initiative and UK’s International Climate Fund


Multilateral initiatives funding ($m)

Initiative Pledged Deposited

Approved

Disbursed

FCPF (RF) 229.6 229.6 27.2 9.1FCPF (CF) 204.5 179.3 1.44 0.2FIP 644 459 51.0 3.2UN-REDD 150.8 118.2 108.1 90.9Congo Basin Forest Fund 165 165 75.0 12.1Amazon Fund 1032.2 57.5 141.6 42.5Indonesia CCTF 18.6 8.9 6.3 5.5Total 2444.7 1217.5 410.6 163.5Total % pledged 100 49.8 16.8 6.7See Table 3 in paper (page 12–13) for developing country participation in initiatives


Funding summary

All sources of REDD+ finance together, 2008 – November 2011: $446 million approved, $252 million disbursed

(13% total climate finance) Eliasch Review recommendations:

‘REDD readiness’ – $4 billion over five years for forty forest nations ($20m / country / year)

$17–33 billion a year by 2030 for fully fledged REDD+ mechanism achieving a 50% reduction in deforestation


Regional distribution ($m)

Region Approved

Disbursed

Asia 94 88– major recipient: Indonesia 42 40Latin America 178 73– major recipient: Brazil / Amazon Fund 143 49Sub-Saharan Africa 119 47– major recipient: DRC 66 16


Coordination REDD+ Partnership established 2010 Voluntary REDD+ Database

June 2012: 40 countries reported 652 ‘arrangements’

Total funding 2006–16: $5.74 billion (reported by funders) or $2.72 billion (reported by recipients)

Forest Trends project will track REDD+ funds

FCPF and UN-REDD collaborate, e.g. over funding application templates – but still follow different processes in many cases


Forest Carbon Partnership Facility

World Bank programme, operational 2008 Readiness Fund – capacity-building Carbon Fund – pilot performance-based

payments 37 developing countries 11 candidate countries Participants Committee main

decision-making body 14 donors, 14 REDD+ countries,

observers14Intra-ACP GCCA Programme

FCPF Readiness Fund

Eligibility: IBRD/IDA member in tropics/sub-tropics Significant forest area / carbon stock High relevance of forests in economy High current/project deforestation

Funding: $229.6m pledged/deposited $27.2m approved (11.8%) $9.1m disbursed (4.0%)


Stage 1: Readiness Plan Idea Note (R-PIN)

R-PIN submitted to Participants Committee Example, Ghana:

Submitted October 2007, approved July 2008 25-page document Background information on forestry, deforestation, current

policies Potential further programmes: forest governance, land tenure and

land use regulations, building institutional capacity for REDD+ Other relevant cross-sectoral policies: poverty reduction,

agriculture Stakeholder consultation processes Challenges to implementation Potential monitoring and implementation systems Plan and tentative budget ($4.82 million)


Stage 2: Readiness Preparation Proposal (R-PP)

April 2012 26 prepared 19 submitted 5 received grants (DRC, Ghana,

Indonesia, Nepal, RoC) Formulation grant of $200,000 Clear plan, budget, schedule


Ghana’s R-PP (1)

Ghana: Started work May 2009 Draft R-PP September 2009 Final R-PP submitted January 2010 Approved subject to revision March 2010 Final revised R-PP submitted December

2010 Formulation grant disbursed November


Ghana’s R-PP (2)

128-page document Roadmap for readiness activities Readiness phase 2009–11,

implementation 2011–12, country ‘ready’ thereafter

Budget: $7.334 million FCPF: $3.6 million (max) Government: $1.7 million Other donors


Ghana’s R-PP (3) Component 1: Organise and Consult

1a. National Readiness Management Arrangements 1b. Stakeholder Consultation and Participation

Component 2: Prepare the REDD Strategy 2a. Assessment of Land Use, Forestry Policy and Governance 2b. REDD Strategy Options 2c. Arrangement for REDD Implementation 2d. Social and Environmental Impacts

Component 3: Develop a Reference Scenario Component 4: Design a Monitoring System Component 5: Schedule and Budget Component 6: Design a Program Monitoring and

Evaluation 20Intra-ACP GCCA Programme

Stage 3: Readiness Package

Move country to Phase 2 of REDD+: Activities are tested within a transparent

framework, social and environmental risks mitigated

Should cover all REDD+ activities (not just FCPF)

Endorsement of R-Package necessary for participation in FCPF Carbon Fund

Content still under development21Intra-ACP GCCA Programme

FCPF Carbon Fund (1) Operational May 2011 Payments for verified emission reductions –

i.e. part of REDD+ phase 2 Funding:

$204.5m pledged $179.3m deposited $1.44m approved (0.7%) $0.2m disbursed (0.1%)

Aims to leverage private finance – though difficult in absence of global carbon market


FCPF Carbon Fund (2) About five participants qualify initially, based

on: Potential for sustainable emissions reductions Scale of implementation Consistency with compliance standards Potential to generate learning value Benefit-sharing mechanisms, broad community

support Transparent stakeholder consultations

$30m – $40m / country over five years Still under development


Forest Investment Programme (1)

One of World Bank’s Climate Investment Funds (CIFs), operational July 2009

Aim: financing to developing countries for readiness reforms and public and private investments; much larger sums than FCPF

Funding: $644m pledged $459m deposited $51m approved (7.9%) $3.2m disbursed (0.5%)

Will close on new UNFCCC financial architecture24Intra-ACP GCCA Programme

Forest Investment Programme (2)

FIP Sub-Committee main decision-making body: 6 donor countries 6 eligible recipient countries Observers

Eight pilot countries: Brazil, Burkina Faso, DRC, Ghana, Indonesia,

Lao PDR, Mexico, Peru Three potential further pilots:

Philippines, Mozambique, Nepal 25Intra-ACP GCCA Programme

FIP: applying for funds 45 expressions of interest; selection based on:

Programme potential to contribute and adhere to FIP objectives and principles

Country preparedness and ability to undertake REDD initiatives

Existing pilot programme distribution across regions and biomes, ensuring that pilot programmes generate lessons on scaling up activities

Investment plans approved by FIP Sub-Committee – 5 approved to date, aim for end 2012 for remaining


FIP: examples of projects

DRC: addressing deforestation and degradation in the Kinshasa supply area ($36.9 million, December 2012)

Mexico: strengthening financial inclusion of ejidos and communities through technical assistance and capacity-building for low-carbon strategies in forest landscapes ($2.9 million, July 2012)

Lao PDR: smallholder forestry project ($3.0 million, September 2012)


UN-REDD (1) Some countries not keen on World Bank FAO / UNDP / UNEP initiative, operational

2008 42 partner countries16 of them with national programmes Funding:

$150.8m pledged $118.2m deposited $108.1m approved (71.7%) $90.9m disbursed (60.3%)


UN-REDD (2)

Programme Policy Board main decision-making body 3 full members from donor countries 3 full and 6 alternate from programme

countries NGOs, indigenous peoples, UN agencies

Global programme – common approaches, analyses, methodologies, tools, data, best practices (all countries can access)

National programmes29Intra-ACP GCCA Programme

National programmes Aim to achieve outcomes:

Develop and implement MRV and monitoring systems Credible, inclusive national governance systems

developed Systems for management of REDD+ funding strengthened Indigenous peoples, local communities, civil society

organisations and other stakeholders participate effectively

Multiple benefits of forests promoted and realised REDD+ strategies and related investments catalyse shifts

to a green economy Knowledge is developed, managed, analysed and shared


UN-REDD: applying for funds

Must be UN-REDD partner country Regional balance of investment Prioritise according to:

Contribution of UN-REDD to national readiness process Effective engagement of UN agencies at country level REDD+ potential of the country (forest cover, annual rate of

change, potential importance of forests to poor) Also must display commitment to UN-REDD principles:

Human-rights based approach to development Engagement of indigenous peoples Social and environmental principles and criteria Consistency with REDD+ safeguards Etc.


National programme template (1)

Component 1: Organise and Consult 1a. National Readiness Management Arrangements 1b. Information Sharing and Early Dialogue with Key

Stakeholder Groups 1c. Consultation and Participation Process

Component 2: Prepare the REDD-plus Strategy 2a. Assessment of Land Use, Land Use Change

Drivers, Forest Law, Policy and Governance 2b. REDD-plus Strategy Options 2c. REDD-plus Implementation Framework 2d. Social and Environmental Impacts during

Readiness Preparation and REDD-plus Implementation32Intra-ACP GCCA Programme

National programme template (2)

Component 3: Develop a National Forest Reference Emission Level and/or a Forest Reference Level

Component 4: Design Systems for National Forest Monitoring and Information on Safeguards 4a. National Forest Monitoring System 4b. Designing an Information System for Multiple

Benefits, Other Impacts, Governance, and Safeguards Component 5: Schedule and Budget Component 6: Design a Program Monitoring and

Evaluation Framework


UN-REDD: examples of funding

Ecuador: $4m for 2011–13. Expected outcomes include: Design and implementation of: National Forest

Monitoring System; consultation process; policies, instruments, operational framework for implementation; ensuring multiple environmental and social benefits; benefit-sharing system.

Viet Nam: $4.4 m for 2009–12. Expected outcomes include: improved institutional, technical, management capacity;

incorporation of economic incentives; approaches to reduce regional displacement of emissions.

Zambia: $4.5m for 2011–13. Expected outcomes include: Capacity strengthened; stakeholder support established;

national governance framework and institutional capacities strengthened; REDD+ strategies identified; MRV capacity strengthened; assessment of reference emission level and reference level.


Congo Basin Forest Fund (1)

Established 2008 COMIFAC member countries:

Burundi, Cameroon, Central African Republic, Chad, DRC, Equatorial Guinea, Gabon, Republic of Congo, Rwanda, Sao Tome & Principe

Funding: $165m pledged / deposited (UK and Norway) $75.0m approved (45.5%) $12.1m disbursed (7.3%)


Congo Basin Forest Fund (2)

Key thematic areas for grants: Forest management and sustainable

practice Livelihoods and economic development Monitoring, assessment and verification Benefits from carbon markets and

payment for ecosystem services Capacity-building in REDD; monitoring,

assessment and verification; SFM Wide range of applicants


CBFF: examples of funding

Alternatives to mangrove destruction for women's livelihoods in Central Africa (Cameroon; $0.38m)

Civil society and government capacity-building within the REDD framework (DRC, $4.26m)

Improving beekeeping and reforestation around the Bagandou forest, CAR ($0.35m).

Promoting community land tenure rights in the Congo Basin (Cameroon, CAR, Gabon, RoC, DRC, $0.73m)

Quantifying carbon stocks and emissions in the forests of Cameroon and RoC ($1.74m)

Reconciling the needs of the logging industry with those of forest-dependent people (Cameroon, Gabon, DRC, $2.19m)


Australia’s IFCI

Established 2007 Projects mainly based in Asia-Pacific,

especially Indonesia, PNG Funding:

$216.2m pledged $185.5m approved (85.8%) $31.7m disbursed (14.7%)


IFCI: Examples of funding

Kalimantan Forests and Climate Partnership ($43m) – focus on 120,000ha of degraded and forested peatland in Central Kalimantan.

Sumatra Forest Carbon Partnership (($27.6m) – similar to the Kalimantan Partnership, on different forest type (mineral soils)

Papua New Guinea–Australia Forest Carbon Partnership ($3m initial) – support for government policy development on REDD+.

Roadmap for Access to International Carbon Markets – assisting Indonesia to develop prerequisites for participation in future international carbon markets

Partnership with the Clinton Climate Initiative on carbon monitoring – providing forest carbon data to developing countries (including Guyana, Tanzania, Kenya and Cambodia)


Clean Development Mechanism

Kyoto Protocol flexibility mechanism Enables Annex I countries to earn

credits by investing in emission reduction projects in developing countries

Forestry projects limited to afforestation or reforestation

Credits time-limited <1% of CDM projects


CDM: examples of projects

Chile: Restoration of Degraded Lands of Small and Medium Farmers through Afforestation and Reforestation

China: Facilitating Reforestation for Guangxi Watershed Management in Pearl River Basin

India: Improving Rural Livelihoods Nicaragua: Precious Woods Uganda: Nile Basin Reforestation Most operating through BioCarbon Fund Future depends on UNFCCC developments


REDD+ funding in practice (1)

Role and structure of multilaterals UN-REDD quicker to disburse funds, more flexible FCPF better at standards, governance,

safeguards; Carbon Fund valuable in long term Still confusion over different bodies, selection

criteria Coordination, overlaps, gaps

Lack of coordination serious but improving Common approaches, e.g. on safeguards, MRV,

admin processes (but still different processes on safeguards)



Finance Very low disbursement rate (UN-REDD best

– often has on-the-ground capacity) When are countries ‘ready’?

No clear definition But early estimates far too optimistic

Safeguards and governance Streamlining process controversial Governance initiatives (e.g. FLEGT)

important43Intra-ACP GCCA Programme


Stakeholder engagement Good participation at international level More difficult at national level

Knowledge transfer Too much information available; difficult to

identify reliable and up-to-date Private sector

Generally not engaged; FIP may help Too uncertain for international carbon

markets44Intra-ACP GCCA Programme


National ownership Initially often seen as imposed from outside;

less problematic now, but still often limited buy-in

UN-REDD agencies benefit from on-the-ground capacity; but can sometimes take over process

Misperceptions and uncertainty In early days, often unrealistic expectations Link to livelihoods not well understood Uncertainty over long-term future


The future

‘REDD is moving ahead, but at a slower pace and in a different form than we expected when it was launched at Bali in 2007.’ Early expectations of global

framework under new climate treaty, substantial performance-based funding

Now most REDD+ funding from development aid budgets

Readiness activities slow and expensive


Possible developments

Funding will continue to be made available; will retain payments-for-results focus

Disbursement will speed up, but donors more likely to use bilateral arrangements

Readiness activities are slow – and should be

Forest governance initiatives important

Interest will grow in root causes of deforestation


Conclusion

‘The litany of problems encountered by the first generation of REDD+ initiatives can make for discouraging reading. But despite adverse changes in the broader context, and hard lessons learned from early experience, the potential of REDD+ continues to capture the imagination and attract continuing investment at all levels … REDD+ as a worthy objective is still very much alive.’


climate funding opportunities: redd+ funds

Documents

forest initiative

acp secretariat

acp gcca programmeltsbaastel

basin forest fund16516575

acp group of states

redd readiness phase

readiness fund

imminentbut funding