Oil palm and Green Economy in Indonesia:
lessons from East Kalimantan
LEDs Asia Forum, Jogjakarta, 10-13 November 2014
Krystof Obidzinski, CIFOR

1. Background: Indonesia CO2
emissions
1.2 Gt

2. GHG emissions in East
Kalimantan

3. GHG emissions and Green
Economy in E. Kalimantan
BAU Scenario
GE =
Reduce
GHG
15.7%
by
2020
(RAN-
GRK)
Source: McKinsey Report

4. Green Economy in East
Kalimantan and GHG emissions
68
57.32
52
43.48
50
42.15
35
29.51
20
16.86
20
16.86
4
3.37
2
1.69
0
50
100
150
200
250
300
2010 2020
Oil Palm Agriculture Forestry Mining Construction Petroleum dan Refining Manufacturing Services
Reduce
GHG from
OP by 10
M tons
Source: McKinsey Report

5. Scenarios

6. GHG implications of scenarios
The total of current carbon stock is 1,811,356,370.91 Tons CO2eq

6. GHG implications of scenarios
Saved Converted Saved Converted
Below ground Above ground
Scenario 1 0.00 -1438015365.77 0.00 221033821.40
Scenario 2 -808750110.96 -665605791.93 87107274.05 240243665.28
Scenario 3 -1590322549.47 0.00 222231587.19 98518475.67
-2500.00
-2000.00
-1500.00
-1000.00
-500.00
0.00
500.00
1000.00
Millions
Scenario 1 Scenario 2 Scenario 3

Landcover in East
Kalimantan in 2011

Land cover in East
Kalimantan under
Scenario 1

Land cover in East
Kalimantan under
Scenario 2

Land cover in East
Kalimantan under
Scenario 3

Indicative value of ecosystem
services Lost under each scenario
25.73
20.01
6.27
0.00 5.00 10.00 15.00 20.00 25.00 30.00
SCENARIO 1
SCENARIO 2
SCENARIO 3
USD Billions
Source: Constanza et al 2014

Conclusions
 Scenario 3 most optimal for GHG reduction in OP to
meet the Green Economy target
 PES loss also lowest
 However, Scenario 3 results in 1.6 M ha (50%) of
allocated plantation area being taken out of
development
 Degraded land is all under commercial concessions and
thus unavailable to offset the loss of the plantation
area
 Scenario 3 has the additionality of 100M tons of CO2
eq, thus the cut off threshold of 35 tons of CO2 /ha
could be adjusted upwards to 45-50 tons of CO2 /ha
 This would enable OP to be in line with the GE target
and keep the loss of the plantation area to below 1 M
ha

Commercial land
availability in East
Kalimantan