New forestsmeizlish

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Workshop: South‐South collaboration on REDD demonstration activities, Manaus Brazil 2009

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New forestsmeizlish

  1. 1. <ul><li>Thursday, February 12, 2009 </li></ul><ul><li>South-South Collaboration Workshop </li></ul><ul><li>Amazonas, Brazil </li></ul>Marisa Meizlish Director New Forests Advisory Inc +1-415-321-3301 [email_address] Amazonas Workshop: Readiness for REDD Experiences from Papua, Indonesia
  2. 2. Outline <ul><li>Introduction to New Forests </li></ul><ul><li>Context for Papua Project </li></ul><ul><li>Papua project summary </li></ul><ul><li>Project characteristics </li></ul><ul><ul><li>Governance </li></ul></ul><ul><ul><li>Baseline </li></ul></ul><ul><ul><li>Consultation / social </li></ul></ul><ul><ul><li>Link to national strategies </li></ul></ul><ul><ul><li>Distribution of benefits </li></ul></ul><ul><ul><li>Financing </li></ul></ul><ul><li>Lessons learned & conclusions </li></ul>
  3. 3. 1. New Forests <ul><li>Private for-profit forest investment management and advisory services firm </li></ul><ul><li>Headquartered in Sydney, Australia, with offices in Washington, D.C., San Francisco and Kota Kinabalu, Malaysia </li></ul><ul><li>Investments primarily in Australia, New Zealand and the Asia Pacific region </li></ul><ul><li>REDD: began studying in 2007 and developing the Papua project in 2008; hope to achieve certification (Voluntary Carbon Standard) in 2009 </li></ul><ul><li>Developing other smaller REDD projects as part of larger investments </li></ul>
  4. 4. 2. Papua Project Context
  5. 5. 2. Papua Project Context: Deforestation Drivers <ul><li>90% of world’s palm oil exports come from Malaysia & Indonesia </li></ul><ul><li>300,000 ha converted per year globally </li></ul><ul><li>Luxury products (cosmetics, shampoos, food) & biofuels </li></ul>
  6. 6. 2. Papua Project Context: REDD Markets <ul><li>Voluntary market projects can move the REDD market forward while complex regulatory mechanisms are negotiated </li></ul><ul><li>Develop technical methodologies and new business models </li></ul><ul><li>Ultimately, REDD will survive or fail in regulatory markets </li></ul>Mechanism Market Mitigation – Forestry Project-Based / Credits (“market”) National Accounting (“non-market”) Regulatory 2008: $118B 3.9 BtCO2 UNFCCC CDM – Only Reforestation “ CDM” – REDD post-2012 ? Reforestation / Deforestation REDD post-2012 – ? Domestic Regulatory Markets (i.e. U.S., Australia, Canada) Reforestation Forest Management REDD – ? Reforestation / Deforestation Voluntary 2008: $499M 100 MtCO2 Business Commitments / Marketing / Personal Choice Reforestation Forest Management REDD not relevant
  7. 7. 3. Papua Project Summary <ul><li>Began with Memorandum of Understanding between Governor Suebu & New Forests, May 2008 </li></ul><ul><li>Government nominated 3 concession areas – 2 were prioritized after desktop review </li></ul><ul><li>June 2008, site visits to begin feasibility and project design </li></ul>Mamberambo Mimika
  8. 8. 3. Papua Project Summary <ul><li>Project framework </li></ul><ul><ul><li>Baseline assumes conversion to palm </li></ul></ul><ul><ul><li>Approximately 28MtCO2e conserved under project scenario </li></ul></ul><ul><ul><li>Voluntary carbon sales – Voluntary Carbon Standard (VCS) & Climate, Community & Biodiversity Alliance Standards (CCBA) </li></ul></ul><ul><ul><li>Revenues to local foundation, government & investors </li></ul></ul><ul><ul><li>Local partner with political & implementation experience </li></ul></ul>
  9. 9. 4a. Governance <ul><li>MOU for joint development of REDD project: “ commercially sustainable model for forest conservation and community development” </li></ul><ul><li>Applying for provincial license that will grant carbon rights to New Forests </li></ul><ul><li>Term sheet defines financial arrangements </li></ul><ul><li>Regency and district governments provide local political and logistical support </li></ul><ul><li>Papua Carbon Foundation receives revenue from credit sales to fund community development & forest protection activities </li></ul><ul><ul><li>Governed by Advisory Committee with local stakeholders and relevant experts </li></ul></ul>Gov. Suebu signing MOU, May 2008
  10. 10. 4b. Baseline <ul><li>No existing methodologies for Avoiding Planned Deforestation - areas with low rates of historical deforestation require technical rigor </li></ul><ul><li>Other areas of province have higher deforestation rates but causal “link” needs to be established </li></ul><ul><li>Limited data and existing quantitative analysis of deforestation drivers </li></ul><ul><li>Where we are now: </li></ul><ul><li>Understanding data requirements needed to establish biophysical and economic feasibility of conversion </li></ul><ul><li>Understanding modeling requirements to demonstrate likely rates of deforestation </li></ul><ul><li>Evaluating in-house capabilities and resource needs </li></ul>
  11. 11. 4c. Consultation Process <ul><li>Dozens of small villages in both project areas – primarily small scale agriculture, sago palm harvesting, hunting & fishing </li></ul><ul><li>Loosely organized through district & regency governments </li></ul><ul><li>In June 2008 met with local governments and held village meetings in conjunction with local NGOs and met with dewan adat (tribal council) </li></ul><ul><li>“ Oxygen” project </li></ul>Village meeting in Bagusa, Mamberamo, June 2008 Meeting with regency & district government officials and village elders in Mimika, June 2008
  12. 12. 4c. Consultation Process <ul><li>Initial feedback at all levels of was positive </li></ul><ul><li>Written letter of support from head of dewan adat in Mamberamo </li></ul><ul><li>However, questions remain regarding community development aspirations, project activities and socio-economic considerations relevant to project design and implementation </li></ul>Receiving letter from head of dewan adat in Casanoyagia, Mamberamo, June 2008 <ul><li>Free, Prior & Informed Consent crucial to ensure successful project and social & environmental outcomes </li></ul>
  13. 13. 4c. Consultation Process <ul><li>Free, Prior & Informed Consent </li></ul><ul><ul><li>Limited guidance & standards </li></ul></ul><ul><ul><li>Work with best experts with field experience in community engagement for forestry in Papua and Indonesia </li></ul></ul><ul><ul><li>Intention to provide full information about the project and potential outcomes & risks </li></ul></ul><ul><ul><li>Decisions and debate at the community level to accept or reject the project </li></ul></ul><ul><li>Help shape the objectives and management plan for the Papua Carbon Foundation </li></ul><ul><li>Further establish channels of communication between impacted communities and government </li></ul>
  14. 14. 4d. Link to National Strategies <ul><li>Indonesia is extremely active in REDD </li></ul><ul><ul><li>More than 20 REDD projects in development in the country </li></ul></ul><ul><ul><li>Participant in the UN-REDD Programme and the World Bank Forest Carbon Partnership Facility </li></ul></ul><ul><ul><li>Bilateral agreements with Germany (Forest and Climate Change Program) and Australia (Forest Carbon Partnership) </li></ul></ul><ul><ul><li>Governors of Aceh & Papua (and several Brazilian states) have signed an MOU with US governors for inclusion of REDD credits in emerging carbon schemes </li></ul></ul><ul><li>Unclear how these activities will interact on a technical level (i.e. carbon accounting) </li></ul><ul><li>However, biggest questions now are legal and financial </li></ul><ul><ul><li>Draft national legislation issued in mid-2008 and national government is now working to revise and finalize legislation – June 2009 </li></ul></ul>
  15. 15. 4e. Distribution of Benefits <ul><li>Beneficiaries at village, district, province and national level </li></ul><ul><li>Private investment necessitates returns </li></ul><ul><li>Primary distribution channel is the Papua Carbon Foundation </li></ul><ul><ul><li>annual disbursements to fund community development and forest protection activities – determined by FPIC process </li></ul></ul><ul><ul><li>Advisory Board comprising representatives of community stakeholders and relevant experts </li></ul></ul><ul><li>Remaining revenue: government, investors & project managers </li></ul>New Forests & Emerald Planet staff with provincial Forestry Department staff and government officials in Mamberamo, June 2008
  16. 16. 4f. Project Financing <ul><li>New Forests represents private investors interested in financial and environmental returns </li></ul><ul><li>Skilled in monetizing environmental assets associated with forestry investment </li></ul><ul><li>Well aligned with Papua’s objectives and project parameters </li></ul><ul><li>Returns delivered through credit sales over time </li></ul>Managing Directors of New Forests and Emerald Planet meeting with Governor Suebu, May 2008 c <ul><li>Upfront costs shared among project partners </li></ul><ul><li>Long-term commitment to sustainable resource use in Indonesia </li></ul>
  17. 17. 5. Lessons Learned <ul><li>Projects in areas with low rates of deforestation have high hurdle to establish evidence-based baselines </li></ul><ul><li>Area, such as Papua, where this is limited data availability make this even harder </li></ul><ul><li>Legal uncertainty for REDD projects outside national-level demonstration activities – right to transact credits? </li></ul><ul><li>Also face technical uncertainty – project vs. national level baselines? </li></ul><ul><li>FPIC is time consuming and requires dedicated resources – lack of standardized guidance </li></ul><ul><ul><li>Difficult to get early project financing where there is no established legal & methodological frameworks </li></ul></ul>
  18. 18. 6. Conclusions <ul><li>Private investment can play pivotal role in more challenging REDD areas that attract less public & multilateral funding </li></ul><ul><li>Will take on the risks as long as there is some certainty on fundamental issues: </li></ul><ul><ul><li>Legal right to transact in carbon </li></ul></ul><ul><ul><li>Legal arrangements for revenue sharing among government agencies/levels </li></ul></ul><ul><ul><li>Legal recognition of project activities within national-level activities </li></ul></ul><ul><li>Donor / grant / multilateral finance remains important for information gathering, data analysis and FPIC/community engagement </li></ul>Arial view of Mimika site, June 2008
  19. 19. www.newforests.com.au

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