Jurisdictional REDD: Lessons from the GCF, California, and Brazil

Jurisdictional REDD:
Lessons from the GCF, California,
and Brazil
Daniel Nepstad, PhD Director & Senior Scien5st Interna5onal Program January 30, 2013 FCPF, Washington, DC stateredd.org First Public Dialogue: February 5, Stanford U REDD+ Reframed
Unified global mechanism ten years off Public finance un5l 2016 Markets possible aNer 2016 (California, others) Our task: Managing unmet expecta5ons while reframing REDD+ to align with tropical na5on and state agendas. Most REDD+ emissions reduc5ons will not be compensated Nepstad 2012, mongabay.org Which REDD+?
REDD+ = independent PES projects REDD+ = offsets (that take pressure of industry) REDD+ = threat to indigenous peoples’ rights REDD+ = UN mechanism for compensa5ng tropical forest na5ons Jurisdictional REDD+
REDD+ = policy framework for low-­‐emission rural development (LED-­‐R) Centered on performance across en5re poli5cal jurisdic5ons (na5ons, states) REDD+ as one component of a broader process of policy alignment, ins5tu5onal innova5on, private sector engagement Why Jurisdictional REDD+?
• Scale • Aligns/embeds with policy and public finance • Resolves issues of permanence; helps resolve leakage • Lower transac5on costs • Possibility of avoiding the “who owns the carbon” issue • Allows for REDD+ distribu5on that is not directly 5ed to tons REDD+ Reframed
Governors’ Climate and Forests task force. 19 tropical states and provinces coming into alignment with California’s cap-andtrade policy and other REDD finance mechanisms
Nep Nepstad, Boyd, Azevedo, et al. 2012. Overview of state-­‐based Programs to Reduce Emissions from Deforesta5on and Degrada5on (REDD) as part of GCF. EPRI Three Pathways to Jurisdictional REDD+
1. COMMITMENT!
2. PROGRAM!
DEVELOPMENT!
3. IMPLEMENTATION!
KEY!
LIKELIHOOD OF SUCCESS; EFFICIENCY!
GREATER STATE/PROVINCE GOVERNMENT!
CAPACITY OR ENGAGEMENT!
Fully-integrated !
Nested !
Project-Based !
State !
Commitment!
Jurisd.-wide!
Ref. Level!
Nesting!
Framework!
Fully Integrated!
= PROJECT!
REDD+ PROGRAM EVOLUTION!
Lesson:
Priori5ze the defini5on of performance for the jurisdic5on: jurisdic5on-­‐wide reference levels! Establish rules for projects Challenge: Which type of emissions reductions to
include?
Cleared
Land!
REDD+!
Mature
Forest!
REDD+!
REDD+!
Restored or
regenerated
forests!
REDD+!
Logging!
Degraded
Forest!
REDD+ = Deforestation!
EMISSIONS REDUCTIONS!
CARBON ENHANCEMENT!
Fire!
REDD+ !
Degraded
Forest!
Tree!
Plantations!
REDD+!
Recovered and
Well-Managed
Forests!
MORE CARBON!
REDD+!
REDD+ = Degradation!
REDD+ = Carbon Enhancement!
Lesson:
Include deforesta5on, degrada5on, and carbon enhancement (regenera5on, restora5on, tree plan5ng) in an integrated approach to reference level and MRV California ROW Recommenda5on: Deforesta5on and degrada5on (fire, logging) mandatory Lesson:
Start simple Aboveground biomass is the biggest source of emissions $600 $500 $700 Maize (Corn) Commodity Prices Soy $400 $150 $300 $100 $200 $50 $100 $0 Commodity Food Price Index $0 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Corn & Soy Monthly Prices US$/mt REDD+ challenge: engaging the drivers of deforestation
$250 $200 Lesson 1:
The REDD+ program should be fully integrated with agricultural and forestry development policies and programs. Loans with differen5ated interest rates to favor intensifica5on and forest-­‐saving development. Differen5ated tax structures. (This is where big financial levers are!) Lesson 2:
“REDD+” should be embedded in food security, yield improvement, & poverty allevia5on programs In many cases, best to avoid the word “REDD+” Brazil: Declining Deforestation, Rising Production
30 Linha de base (revisada) Rebanho Bovino (milhões de cabeças) 25 90 Desmatamento Anual Rebanho Bovino 80 Produção de Soja (milhões de t) 20 Produção na Amazônia Legal (milhões de toneladas ou milhões de animais) Desmatamento Anual (mil km2) 70 60 50 15 40 10 Produção de Soja 30 20 5 10 0 0 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Lesson 3:
Harmonize REDD+ program with agricultural sustainability ini5a5ves IntegraUng REDD+ Safeguards and Roundtable Criteria “Global Rules for Sustainable Farming”, SUckler et al. 2012, www.ipam.org.br Challenge:
Big emphasis on projects designed deliberately to operate independently of govt Premise: private investors don’t want to deal with governments Lesson:
Private investors could become more interested in dealing with governments: a.  If public finance is used to reduce risk to investor b.  If innova5ve ins5tu5ons (e.g. Acre’s Ecosystem
Service Company) are created Overwhelming complexity
Moratória da Soja, Carne Desmatamento zero para o setor Municípios Crí5cos Redução de desmatamento, CAR, acesso a crédito Polí5cas do Estado / Gov. Federal Redução de desmatamento, legalidade Mesas Redondas ABC REDD Consumer Goods Forum CerUficação socioambiental da propriedade, legalidade Agricultura de Baixo Carbono Linha de base; “salvaguardas” socioambientais Cadeias de “desmatamento zero” Código Florestal Reserva Legal, APP Areas protegidas ICMS ecológico Lesson: Multi-sector, negotiated approach
Conclusions
• KISS* • Focus: jurisdic5on-­‐wide performance • Exploit freedom jurisd. approach permits • Embed “REDD+” in rural development agenda (lose the word “REDD+”) • Business case of sustainable, low-­‐emission, equitable development • Harness market demand for sustainable supply • Mul5-­‐sector nego5a5on/design • REDD+ = icing, not the cake REDD+ is the icing, not the cake Thank you!!