The United Nations 'Reducing Emissions from Deforestation and forest Degradation in developing countries' (REDD) scheme is a system involving payment to developing countries (with remaining intact forests) by developed countries (with high greenhouse gas (GHG) emissions and high reduction targets) to reduce deforestation and degradation rates which contribute to ≈15% of global annual GHG emissions. The scheme has now attracted over US$ 4.5 billion in pledged funds. If successful, the donor countries can count the carbon saved towards their carbon budgets.
At the recent UN summit on biodiversity in Nagoya, Japan, the UK Environment Secretary Caroline Spelman noted that funding for the REDD scheme is needed because 'it will contribute towards alleviating poverty, promoting biodiversity and cutting carbon emissions, all of which are high priorities for this government''. However, the current pilot schemes for REDD are primarily basing their performance on the success in ensuring the trees are still standing and the carbon is therefore conserved. The forests could be hunted out and no benefits to local communities accrued and yet REDD funds would still flow to that forest.
The UN funded REDD scheme is government to government funding and 12 countries have been selected for inclusion in trial funding. The scheme has already had some notable successes with the Indonesian Government agreeing a two year moratorium on logging. Using this top-down approach has the advantage that it can ensure that entire forested areas in a supported country are protected, avoiding the problem of leakage where one forest is funded but the threats to that forest are just transferred to a nearby forest. The downside of this government to government approach is a lack of transparency and possible corruption issues in some of the receiving government departments.
A bottom up approach to REDD has been developed by a number of international NGOs who have agreed a Climate, Community and Biodiversity Alliance set of standards for packaging forests for the REDD scheme. Large international NGOs have started packaging their most important forests using these standards which produce Voluntary Carbon Units but also require performance data on biodiversity protection and poverty alleviation. Funding mainly from the private sector has been obtained to fund a number of these CCBA packaged forests.
The Opwall Trust is funding a postdoc researcher at Oxford University to work on the extensive data sets produced by the Operation Wallacea teams in the Cusuco National Park, Honduras; the Lambusango forest, SE Sulawesi; and the Mahamavo and Mandrare Valley in Madagascar. This will enable the development of suitable REDD projects to be submitted for validation under the CCBA standards once funding for the projects has been secured.
There are two main objectives for the Opwall Trust in funding this research:
- To enable the in-country partners for the studied forests to obtain REDD funding to ensure the forests are protected.
- To provide best practice examples of how forests can be packaged for REDD funding so that the supply of packaged forests coming to market can be significantly increased. In the long-term the Opwall Trust and other international NGOs can only package a small number of forests. To get the scale needed to avoid the criticism that by protecting one forest the threats are simply being transferred to other areas, entire regions will need to be packaged and this will mean many local NGOs and businesses will need to package forests. One of the ways that the private sector in the past has been able to produce large scale investment has been to develop derivative type products. One of the objectives of the funding with Oxford University is to work with the financial sector to develop this type of product where forests are marketed not just on VCU value but on impacts on poverty alleviation and in protecting biodiversity.