redd casebook tnc ci wcs

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REDUCING EMISSIONSfrom

DEFORESTATIONandDEGRADATION (REDD)A CASEBOOK OF ON-THE-GROUND EXPERIENCE


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Acknowledgements

Contributing Authors: Nicole R. Virgilio, Sarene Marshall, Ola Zerbock and Christopher HolmesEditing: Lisa Haden

Design: DeGarmo Creative

We would also like to thank the following people for their input and contributions: Greg Fishbein, Rane Cortez,Bronson Griscom, Stavros Papageorgio, Marc Steininger, Jeannicq Randrianarisoa, Pierrot Rakotoniaina,

James MacKinnon, Andriambolantsoa Rasoloher, Ben Vitale, Peter Gdritz, Kell Alward,

Tiana Rakotosamimanana, Todd Stevens, Linda Kreger and Marisa Arpels

Special thanks to The David and Lucile Packard Foundation for its generous support of this endeavor.

Please cite this document as:Redcing Emissions rom Deorestation and Degradation (REDD): A Casebook o On-the-Grond Eperience. 2010.

The Natre Conservanc, Conservation International and Wildlie Conservation Societ.Arlington, Virginia.

2010 The Natre Conservanc, Conservation International and Wildlie Conservation Societ

PHOTOS ON COVER: Scott Warren; Mark Godrey/TNC; Bridget Besaw


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REDUCING EMISSIONSfrom

DEFORESTATIONandDEGRADATION (REDD)A CASEBOOK OF ON-THE-GROUND EXPERIENCE


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D | R E D u C I N G E M I S S I O N S F R O M D E F O R E S T AT I O N A N D D E G R A D AT I O N ( R E D D )

Acronyms

AR Aorestation/Reorestation

BioCF Biocarbon Fnd o the World Bank

CAR Climate Action Reserve

CCAR Caliornia Climate Action Registr

CCB Climate, Commnit and

Biodiversit Standard

CDM Clean Development Mechanism

CI Conservation International

DBH Diameter at Breast Height

EU ETS Eropean union Greenhose

Gas Emissions Trading Sstem

FSC Forest Stewardship Concil

GHG Greenhose Gas

GtCO2/GtC Gigatons o carbon dioide/

Gigatons o carbon

IFM Improved Forest Management

IPCC Intergovernmental Panel on

Climate Change

NGO Non-governmental Organization

REDD Redcing Emissions rom

Deorestation and Forest Degradation

RGGI Regional Greenhose Gas Initiative

tCO2e/tC Metric tons o carbon dioide

eqivalent/Metric tons o carbon

TNC The Natre Conservanc

UNEP-WCMC united Nations

Environment Programme World

Conservation Monitoring Centre

UNFCCC united Nations Framework

Convention on Climate Change

WCS Wildlie Conservation Societ

VCS Volntar Carbon Standard

Conversions

1 hectare (ha) = 2.47 acres (ac)

1 metric ton o carbon dioide eqivalent(tCO2e) = 44/12 metric tons carbon (tC)

1 metric ton = 1,000 kilograms (kg) = 2,205

ponds (lb) = 1.10 short (u.S.) tons

1 megaton (Mt) = 1 million metric tons

1 gigaton (Gt) = 1 billion metric tons


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| 1

Table o Contents

Eective Smmar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

Introdction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Project Snapshots . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8The Ankenihen-Zahamena-Mantadia Biodiversit ConservationCorridor and Restoration Project . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9Makira Forest Protected Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10The Noel Kemp Mercado Climate Action Project. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11The Bera Forest Carbon Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

REDD 101 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13The Science: Climate Change, Trees and Carbon . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13The Polic and Financial Contet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Technical Challenges and Field Eperiences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

1: Baselines and Additionalit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18Case study AnkenihenZahamenaMantadia Biodiversit ConservationCorridor and Restoration Project . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

2: Measring and Monitoring . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24Case study Makira Forest Protected Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

3: Leakage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30Case study Noel Kemp Mercado Climate Action Project . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

4: Permanence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35Case study Makira Forest Protected Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

5: Standards and Verication . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39Case study Noel Kemp Climate Action Project . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41

6: Involving and Benetting Local Commnities and Indigenos Peoples . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43Case study AnkenihenZahamenaMantadia Biodiversit ConservationCorridor and Restoration Project . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

7: Assring Environmental Co-Benets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48Case study AnkenihenZahamenaMantadia Biodiversit ConservationCorridor and Restoration Project . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50

8: Scale and Scope . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52Case study The Bera Forest Carbon Program 55

Denitions and Jargon . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57

Reerences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62


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Eective Smmar


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4 | R E D u C I N G E M I S S I O N S F R O M D E F O R E S T A T I O N A N D D E G R A D A T I O N ( R E D D )

Climate change mitigation strategies across all sectors, not jstthe orestr sector, mst address carbon acconting and cred-ibilit challenges, inclding leakage and permanence. Whilethese isses have been mentioned with man tpes o emis-sions redctions eorts, the concerns, nortnatel, are morecommonl raised with orest carbon activities.

Project ExperienceWith 38 ears o combined eperience in ndertaking orestcarbon pilot projects on the grond, TNC, CI and WCS havebilt a repositor o knowledge in orest carbon science andproject implementation. In total, these three organizations haveimplemented 34 pilot projects (with 18 more in development)that represent the ll range o orest carbon activities.4 O thistotal, 17 are REDD specic. These projects serve as eamples othe important role orests can pla in climate change mitigation.This hands-on eperience has helped dispel concerns abotthe eectiveness and easibilit o orest carbon projects, and con-tains valable lessons or the design o tre projects, as well as or

the development o state and national REDD programs, climatechange policies and nancial vehicles aimed at REDD.

There are or REDD pilot projects proled in this doc-ment (project snapshots on pages 710), which are providingimportant insights into REDD activities:

Ankenihen-Zahamena-Mantadia Biodiversit ConservationCorridor/Restoration Project in MadagascarMakira Forest Protected Area Project in MadagascarNoel Kemp Mercado Climate Action Project in EasternBoliviaBera Forest Carbon Program in Indonesia (in development)

The prpose o this report is to present some o the lessonslearned rom this eperience, specicall as the relate to com-monl cited challenges to creating real, credible and veriablecarbon benets to the atmosphere throgh orest carbon activi-ties. The or projects proled in this report are brief describedin the Project Snapshots section to amiliarize the reader withtheir basic design and strateg. The report then reviews basicorest carbon science in the section entitled REDD 101, andthe histor and crrent state o climate change polic and car-bon markets as the relate to orest carbon. Finall, the eight

sections that ollow nder Technical Challenges and FieldEperience, describe the main challenges to REDD, sing oneo or projects proled in the report as an in-depth case stdto demonstrate how this challenge was sccessll overcome onthe grond and what lessons were learned rom the eperience.

The lessons learned rom these and other casestudies help demonstrate:Realistic baselies ca be estimated ad additioality ca be

demostrated

Satellite imager, eld measrements, laborator work, sophis-ticated modeling and carell researched assmptions areall being sed to establish accrate estimates o bsiness-as-

sal emissions scenarios rom deorestation and degradation.These baselines can be adjsted or recalclated over time toencompass changes in management, government and drivers/patterns o land se change, thereore remaining a dependablerefection o what wold likel have happened in the absenceo project interventions. Lessons learned rom the process oproject-level baseline estimation can help inorm the discs-sion on how to most appropriatel calclate national-scalebaselines. Althogh additionalit (redctions in emissions thatare above and beond what wold have occrred withot theREDD project) cannot be measred eactl, several tests areavailable to help reliabl demonstrate it b eamining condi-

tions sch as common practice in the project area, barriers toimplementation and crrent reglations.

The measuremet techology exists

Field stdies and satellite imager enable accrate measre-ments o the carbon seqestered in growing trees and storedin orests, as well as changes in land se (and sbseqent emis-sions) over time. Field methods to determine vegetation coverand measre carbon densit have been sccessll sed orman ears. Global land se change data, determined romsatellite photographs and sed to calclate CO

2emissions

(combined with eld-based carbon estimates), is availablerom as earl as 1972,5 and advances in the interpretation o

4 Forest carbon activities are generall nderstood to encompass one or more o the ollowing tpologies: Redcing Emissions rom Deorestation and Degradation (REDD),Improved Forest Management (IFM) and Aorestation/Reorestation (AR).5 uSGS Website:

Bridget Besaw


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E x E C u T I V E S u M M A R y | 5

this data are occrring ever da. Sch advances inclde methodswhich now allow or the estimation o degradation rom loggingand re, two activities which can contribte sbstantiall to orestcarbon emissions (Asner, et al., 2005; Soza and Roberts, 2005).Measrement and monitoring techniqes emplo rigoros scien-tic methods and are rapidl becoming more economical to seon both small and large scales.

Credible carbo beefts ca be achieved

Third-part verication o carbon osets to stringent standardsdeveloped or REDD demonstrates that emissions redctionsrom REDD projects can be real, measrable and veriable.Project assmptions, methodologies and calclations are sbjectto a transparent and rigoros independent inspection. All proj-ects proled in this report plan to ndergo third-part vericationto an established standard, with the eception o Noel Kemp,

which was developed prior to the eistence o modern REDDstandards and has alread been veried to a standard based onthe Clean Development Mechanisms Aorestation/Reoresta-tion gidance. In act, in the rst hal o 2009 it was determinedthat 96 percent o all orest carbon projects on the volntarmarket were veriing to third-part standards (Hamilton, et al.,2010). Other standards which target social and environmental

co-benets, in addition to climate benets, are in eistence andbeing sed more reqentl as a complement to carbon stan-dards, helping to ensre that hman rights are respected andenvironmental integrit remains high.

Leakage ca be maaged ad accouted or

Man projects are crrentl managing leakage sing a threeoldstrateg: 1) incorporating leakage prevention elements intoproject design and choice o location, 2) calclating leakagethat is likel to occr throgh risk assessments and monitoring,

and 3) disconting carbon benets accordingl i leakage can-not be prevented. Most projects incorporate commnitdevelopment aspects into their design, which provide optionsor commnit members to meet their needs withot simpldeoresting elsewhere. Some projects target degraded landsin their choice o location, which are nlikel to displace agri-cltre or timber harvest. Nonetheless, even i leakage cannotbe completel avoided, economic models and risk assessmentshave been developed and sed to discont project carbon ben-ets and assre the remain real.

Impermaece ca be maaged

Project developers are managing the risk o impermanence bincorporating risk mitigation strategies into the project design,aligning interests o ke stakeholders, sing available nancial,legal and instittional strctres, and emploing insrancemechanisms sch as credit bers. Man o the strategies are

ver similar to those sed in leakage management, sch as com-mnit development and land tenre acilitation, while others,sch as the legal designation o protected stats and adop-tion/enorcement o environmental laws, rel on governmentparticipation and spport. Risk assessments, similar to thosedescribed or leakage management, can be perormed to deter-

mine the likelihood o impermanence, and an eqal amont ocarbon credits can be deposited into a pooled registr ber,spreading the risk over man projects and eectivel redcingthe chances o catastrophic loss.

There exists a wi-wi-wi potetial

REDD oers the potential or a triple benetclimatechange mitigation, commnit development and biodiversitconservationand the most robst projects captre all three.

As national and international climate change polic negotiations

Ami Vitale


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6 | R E D u C I N G E M I S S I O N S F R O M D E F O R E S T AT I O N A N D D E G R A D A T I O N ( R E D D )

move orward, the participation o indigenos peoples (who standto be the most adversel aected b the impacts o climate change(Arican Development Bank, 2003)) in a REDD mechanism willbe critical to the otcome. The projects proled in this report haveillstrated the importance o involving indigenos peoples andlocal commnities in project planning and implementation, as

well as demonstrating that REDD projects can be implementedto provide nmeros co-benets to local people, plants, and ani-mals that depend on health orest ecosstems or srvival.

Lessos or movig to atioal scale

While project-scale REDD initiatives, as most o the eortsproled in this report are, can prodce credible carbon bene-ts, there is an emerging interest, especiall in climate policdialoges, in moving to national REDD Pls schemes. Lessonslearned and methodologies developed rom earlier on-the-grond pilot eorts, sch as those detailed in this report, amongothers, can help inorm these larger scale eorts. The interestin national-scale eorts is in part becase o the magnitde othe positive climate impact that sch nation-wide programs

cold have, bt also becase o the advantages o sch large-scaleeorts in engaging governments and dealing with certain tech-nical challenges across whole contries. Establishing nationalcarbon acconting, or eample, wold likel enable simpler andmore cost-eective methods or dealing with baselines than atthe project scale (which generall relies on comple modeling),

while captring an potential intra-contr leakage.Similarl, eorts that are broader in scope, sch as REDD

Plswhich cold inclde Redcing Emissions rom Deores-tation and Forest Degradation, Forest Conservation, Sstainable

Management o Forests and Carbon Stock Enhancementaregaining traction, not onl or their potential to reslt in more car-bon benets, bt their abilit to ensre the sstainabilit o carbonbenets b maintaining prodction and access to resorces orlocal commnities. REDD Pls was inclded in the Copenha-gen Accord, which came ot o the united Nations FrameworkConvention on Climate Change (uNFCCC) COP-15 heldin December 2009, and man governments, inclding theunited States, provided signicant nancial spport to epandthe scope o REDD to the abovementioned activities.

Despite the advantages o national REDD programs, inthe near term, man contries lack the instittional capacitand legal saegards to ensre that a centralized REDD Plsregime wold eqitabl allocate incentives to local actors (Cos-tenbader, 2009). The implementation o sb-national scalepilot programs that span entire political jrisdictions can bea critical step in the pathwa to sccess that most contries

will need to ollow. Ths, while there are benets to movingtowards national-level acconting as soon as easible, it is likelthat or some time man nations will need to address the cred-

ibilit o REDD eorts with methods sch as those proled inthis report, bt on a sb-national scale (see Bera eample).Since the dnamics and drivers o deorestation var betweennations de to a variet o geographic, political, economic andcltral actors, pilot REDD activities can provide valablelessons to the design o national REDD plans regarding what

works, and what does not, both in terms o actall redcingdeorestation in the eld, as well as monitoring those eorts.

RIGHT: Sterling Zumbrunn/CI

Louise Goggin


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IntrodctionThe purpose of this report is to present some of the lessons learned from our on-the-ground project experience in

Reducing Emissions from Deforestation and Forest Degradation (REDD), specifically as it relates to commonly cited

challenges to creating real, credible and verifiable carbon benefits to the atmosphere. The Introduction briefly

describes the profiled projects and provides background information on forest carbon science, policy and finance.


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I N T R O D u C T I O N |9

Figure 1The Ankeniheny-Zahamena-Mantadia Biodiversity Conservation Corridor and Restoration Project. The Protected Area andCommunity Managed Area together make up the REDD component o the project.

The primar orests o Madagascar harbor incredibl high nm-bers o species ond nowhere else in the world, bt this habitat has

been redced to less than 15 percent o the nations land cover deto a variet o actors, inclding seasonal sbsistence slash-and-brn rice cltivation (tav agricltre) and charcoal prodction.The Ankenihen-Zahamena-Mantadia Biodiversit Conser-

vation Corridor and Restoration Project (Mantadia project)was created in 2004 to tr to combat orest loss in Madagascar,throgh a partnership between the Government o Madagascar(via the Ministr o Environment, Water, Forests and Torism)and a network o national and international non-prot organiza-tions, inclding Conservation International.

The Mantadia project is comprised o two components:REDD and AR. The REDD component, known as Corridor

Ankenihen-Zahamena (CAZ), is epected to redce deoresta-tion on approimatel 420,000 hectares, which incldes a newlcreated 371,000 hectare mltiple-se protected area. Manage-ment o some portions o the protected area will be transitionedto local commnit management, with increased patrolling blocal orest agents and the development o biological monitoring

procedres. This project component is epected to reslt in theredction o at least 10 million metric tons o carbon dioide

eqivalent (tCO2e) emissions over the 30-ear project liespan.The AR component, known as Tetik Asa Mampod Savoka

(TAMS), or Make the fallows go back to forest,will eventall restoreorest cover on approimatel 3,000 hectares o degraded lands,sing a mi o native orest species to reconnect eisting orestragments (so ar, the rst phase o reorestation has been car-ried ot on 610 hectares). This project component is epectedto seqester approimatel one million tCO

2e over the 30-ear

project liespan.The project is addressing both permanence and leakage in its

design, sing legal protected area stats, commnit developmentactivities (with alternative agricltral opportnities), credit b-

ers and disconts, and monitoring o adjacent areas/activities viasatellite and srves. The project is planning to ndergo validationand verication nder the Volntar Carbon Standard (VCS) orthe REDD component, VCS and Clean Development Mecha-nism or dierent portions o the AR component, and Climate,Commnit and Biodiversit Standard or both components.

The Ankeniheny-Zahamena-Mantadia Biodiversity Conservation Corridor and Restoration Project


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10 | R E D u C I N G E M I S S I O N S F R O M D E F O R E S TA T I O N A N D D E G R A D A T I O N ( R E D D )

Figure 2The Makira Forest Protected Area, Madagascar. The Zone o Strict Protection and Zone o Community Management togetherconstitute the REDD project.

In 2001, the Madagascar Ministr o Environment, Forestand Torism, in collaboration with the Wildlie Conserva-

tion Societ, lanched a program to create the 372,470-hectareMakira Forest Protected Area (Makira project). This actionprotected the largest remaining contigos tract o low- andmid-altitde rainorest in eastern Madagascarecologicalland biologicall important becase o the high biodiversit

vale and large nmbers o plants and animals ond nowhereelse in the world.

The establishment o the Makira Forest Protected Area isbased on an integrated approach to redce hman threats to theregions orests, while at the same time addressing the needs othe local commnities and engaging these commnities in themanagement o the protected area. The project combats the

principal case o deorestation in the areaslash-and-brnagricltre (tav), driven b both sbsistence and economicpressresas well as threats rom bsh meat hnting, collec-tion/eploitation o timber and non-timber orest prodcts,brning o orest land or cattle grazing, illicit commercial

eploitation o the orests hardwood species, and illicit commercialmining o qartz and precios stones.

The project design involves three-part zoning o the Makiraorests and srronding areas (Zone of Strict Protection, Multiple-UseZones and Zone of Community Management) and covers a total area o697,827 hectareswhich incldes a 372,470-hectare protected areaand a 325,357-hectare ber zone o commnit managed land. Othe total area, 522,750 hectares are orested and eligible or carboncrediting. The project is epected to avoid the emission o an esti-mated 9.5 million metric tons o carbon dioide eqivalent overits 30-ear lietime. Permanence and leakage are being addressedin the project design throgh designation o legal protected area,commnit development ocsed on sstainable land manage-ment and legal propert rights, the establishment o a project

endowment, the se o credit bers and disconts, and monitor-ing o adjacent areas/activities via satellite and srves. The projectis crrentl ndergoing validation nder the Volntar CarbonStandard (VCS) and Climate, Commnit and Biodiversit Stan-dard and also plans to veri carbon benets throgh VCS.

The Makira Forest Protected Area


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I N T R O D u C T I O N | 11

6 Noel Kemp was developed prior to the eistence o modern REDD standards and has been veried to a standard based on the Clean Development Mechanisms Aorestation/Reorestation gidance.

Figure 3The Noel Kemp Mercado Climate Action Project.

The Noel Kemp Mercado Climate Action Project (NoelKemp project), located in Bolivia and implemented in 1996,

is addressing emissions rom both deorestation and orestdegradation on 642,184 hectares o orested land.

To alleviate the threat o deorestation rom local agri-cltral epansion, The Natre Conservanc and local NGOpartner Fndacin Amigos de la Natraleza (FAN), engagedin a comprehensive 10-ear commnit development pro-gram. The most important aspect o the program was assistingindigenos commnities living adjacent to the Noel KempMercado National Park to gain legal recognition as an indig-enos organization and tenre over ancestral lands borderingthe project area. As a reslt, pressres to deorest within proj-ect bondaries were redced.

Project developers also worked with the governmento Bolivia to cancel the rights to commercial harvest in the

proposed project area, compensate the owners o area timberconcessions or lost income and epand a pre-eisting national

park to encompass these ormer concessions, eectivel stop-ping degradation rom timber harvesting. A novel economicmodel o the national Bolivian timber market was sed in thecalclation o leakage de to these project activities and carbonbenets are disconted to refect this analsis. Ongoing projectmonitoring is being condcted b FAN, nded b initial invest-ments, and a permanent project endowment is in place to ndmonitoring ater the 30-ear project crediting period is p.

Sccess o the Noel Kemp project ths ar is demon-strated b the third-part verication o 1,034,107 metric tonso carbon dioide eqivalent (tCO

2e) throgh 2005.6 It is esti-

mated that over the corse o the project lietime, 5,838,813

tCO2e will be avoided b project activities.

The Noel Kemp Mercado Climate Action Project


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Figure 4The Berau Forest Carbon Project in East Kalimantan on the island o Borneo, Indonesia.

Large-scale orest carbon programs are needed to achieve themost signicant climate change mitigation impacts, and one

sch program in development, the Bera Forest Carbon Pro-gram (Bera Program), is an eample o the net step in projectevoltion. Bera, a district in remote northeastern Borneothat is heavil orested and well-endowed with wildlie, acesthreats rom commercial logging and rapid epansion o oilpalm development, among man others.

In partnership with the local government, the Government oIndonesia and others, The Natre Conservanc is co-developing agrondbreaking orest carbon program that addresses the drivers odeorestation and orest degradation across this entire 2.2-million-hectare political jrisdiction sing a mlti-pronged approach. First,the program is working with logging concessionaires to implement

Improved Forest Management (IFM) practices that redce orestdamage and carbon emissions while sstaining wood prodctionand maintaining jobs. Second, the program will create a model ordirecting oil palm development awa rom health natral orest

areas, and towards alread degraded lands. Third, the program will work with local commnities to strengthen management

o new and eisting protected areas so the do not lose carbonthrogh illegal logging and clearing or agricltre.

These site-specic activities will be complemented withcross-ctting eorts to bild the capacit and instittions tospport sstainable land se planning, carbon acconting andcommnit involvement programs that are well-integrated

with eisting government operations. Project partners willdevelop a nied, district-wide carbon acconting rameworkthat will measre and monitor avoided emissions rom all othe project components and plan to sbmit the methodologor approval b the Volntar Carbon Standard. Leakage andimpermanence avoidance measres are still in development

bt will be inclded in the program design. It is estimated thatthe program will avoid the emission o 10 million metric tonso carbon dioide eqivalent over ve ears.

The Berau Forest Carbon Program


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REDD 101

The Science: Climate Change, Trees and CarbonClimate Chage Sciece

S

trong scientic evidence shows that, since the indstrialrevoltion, the brning o ossil els and the destrctiono orests have cased the concentrations o heat-trapping

greenhose gases to increase signicantl in or atmosphere, ata speed and magnitde mch greater than natral fctations

wold dictate (IPCC, 2007c). I concentrations o greenhosegases in the atmosphere contine to increase, the average tem-peratre at the Earths srace cold grow rom 1.8 to 4C (3to 7F) above 2000 levels b the end o this centr (IPCC,2007c). Impacts o climate change, man o which are alreadbeing seen, inclde temperatre increase, sea level rise, melt-ing o glaciers and sea ice, increased coral bleaching, changesin the location o sitable habitat or plants and animals, moreintense droghts, hrricanes and other etreme weather events,increased wildre risk, and increased damage rom foods and

storms. The rral poor are oten most at risk or being severeland negativel impacted b climate change, as their livelihoodsare closel tied to ecosstems which provide water or drinking,

wildlie or hnting and shing, and medicinal plants (AricanDevelopment Bank, 2003). Deorestation and degradation also

have detrimental eects on soils, redcing the amont o car-bon stored in soils over time, as well as increasing erosion andpollting rivers.

The Role O Forests I The Carbo Cycle

Trees absorb carbon dioide gas rom the atmosphere dring pho-tosnthesis and, in the process o growing, transorm the gas into

the solid carbon that makes p their bark, wood, leaves and roots.When trees are ct down and brned or let to decompose, thesolid carbon chemicall changes back to carbon dioide gas andretrns to the atmosphere. Even i the trees are harvested, onl araction o harvested trees makes it into long-term wood prodctssch as hoses and rnitre. For eample, one std estimates thator ever tree harvested sing conventional logging techniqes in

Amazonia, 35.8 additional trees were damaged (Gerwing, et al.,1996). As mch as 20 percent o sable timber volme that wasetracted rom a tpical hectare was never removed and insteadlet to rot in the orest. Frthermore, less than 35 percent o thetimber that made it to the sawmill was actall converted into

sable boards. Hence, the majorit o the harvested orest vegeta-tion ends p as waste and, whether brned or let to deca, emitscarbon dioide gas as it breaks down (see Figre 5).

Figure 5 Simplistic diagram o trees and the carbon cycle.


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14 | R E D u C I N G E M I S S I O N S F R O M D E F O R E S T AT I O N A N D D E G R A D AT I O N ( R E D D )

7 One gigaton (Gt) is eqal to one billion tons.8 Please note that this graphic is based on the 2007 IPCC Report, which estimates that emissions rom orestr make p 17.4 percent o total annal emissions (IPCC, 2007b).

Althogh more recent stdies (van der Wer, et al., 2009; Canadell, et al., 2007) indicate that this percentage is now closer to 15 percent, calclations or the other sectors have not etbeen pdated.9 First articlated in Decision 11 o COP 7; Land se, land-se change and orestr:10 uNFCCC website November 4, 2009:

Forests and other terrestrial sstems annall absorbapproimatel 9.53 gigatons o carbon dioide eqivalent(GtCO2e),7 while deorestation and degradation o orestsemit approimatel 5.87 GtCO2e, or net absorption o 3.67GtCO2e (IPCC, 2007a). Forests thereore pla an importantrole in the global carbon ccle as both a sink (absorbing carbondioide) and a sorce (emitting carbon dioide). According to

the most recent Intergovernmental Panel on Climate Change(IPCC) report, the 5.87 GtCO2e emitted b deorestation anddegradation o orests acconts or 17.4 percent o total emis-sions rom all sectors, more than the emissions o the entireglobal transportation sector (see Figre 6) (IPCC, 2007b).More recent estimates pt this percentage at abot 15 percent,de mainl to increases in ossil el emissions and the se opdated data (van der Wer, et al., 2009; Canadell, et al., 2007).Polic and economic incentives to crb deorestation and orestdamage have the potential to enhance the natral nctioningo the worlds orests in seqestering, or storing, carbon and toredce their role as a signicant sorce o emissions.

Forest Degradatio

While deorestation reers to the entire loss o patches o orestthrogh clearing and conversion to other land ses (e.g., arm-ing, ranching and development), orest degradation reers tothe loss o biomass (living vegetation) in orests throgh timberharvest, el wood gathering, re and other activities which donot reslt in complete conversion to other land ses. In its clas-sication o orest, the IPCC ses a minimm crown covero 10-30 percent.9 Ths, b this denition, p to 90 percento a orest can be cleared beore it is considered deorested. Assch, orest degradation can lead to sbstantial carbon emis-sions, and is oten an important precrsor to deorestation. Foreample, roads created b logging operations open p previoslntoched land to conversion b colonists. Also, openings in theorest canop cased b orest degradation increase the risk oorest re, which in trn increases the risk o conversion o landto pastre or grazing and ltimatel conversion or agricl-tre (see Figre 7). It is estimated that degradation representsat least 20 percent o total tropical orest emissions (Griscom,et al., 2009).

The Policy and Financial Context

UnFCCC/Kyoto ProtocolThe united Nations Framework Convention on ClimateChange (uNFCCC) was created ollowing the 1992 EarthSmmit in Rio de Janeiro as a orm or governments to tacklethe challenge posed b climate change.10 The Koto Protocol, the

rst specic commitment to protect the shared resorce o theclimate sstem, was negotiated in 1997 and set binding targetsor 37 indstrialized contries and the Eropean Commnit(Anne I contries) to redce greenhose gas emissions an aver-age o ve percent below 1990 emissions levels over the rst ve-earcommitment period (2008 to 2012). All other contries, or Non-

Anne I contries (mainl developing nations), are not crrentlbond to emission redction targets. The united States did not ratithe Koto Protocol, and ths is not bond b these targets, however,the u.S. government has activel engaged in talks abot a post-2012agreement, when the rst commitment period ends.

The Clean Development Mechanism (CDM) was createdas a part o the Koto Protocol to help Anne I contries meettheir emissions targets, and to encorage developing con-tries to contribte to emissions redction eorts. The CDMallows emissions removal projects in developing contries toearn certied emissions redction credits, which can be tradedand sold, and sed b indstrialized contries to meet a parto their targets nder the Koto Protocol. In the orest sec-tor, the CDM onl allows or emissions redctions throgh

Aorestation/Reorestation (AR), eclding activities aimed

at Redcing Emissions rom Deorestation and Degradation(REDD) and Improved Forest Management (IFM). REDDand IFM activities were eclded largel becase o skepti-cism over the credibilit o carbon benets the prodce. TheCDM rles governing AR activities are etremel comple and,

Figure 6 Attribut ion o global greenhouse gas emissions. Source: IPCC, 2007.8


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11 CDM website March 30, 2010: 12 Copenhagen Accord: 13 HR2454: American Clean Energ and Secrit (ACES) Act.

ths ar, onl 13 projects have been registered, representing 0.5percent o all CDM projects.11

In 2005, The Coalition o Rainorest Nations, led b PapaNew Ginea and Costa Rica, pt orth a proposal to reconsiderinclding REDD nder the uNFCCC and sbseqent proto-cols. Since then, the psh or REDD inclsion has picked pmomentm. The 2007 uNFCCC meeting in Bali reslted inthe creation o the Bali Roadmap, an agreement to negotiate anew post-2012 climate change protocol b the December 2009uNFCCC meeting in Copenhagen. The Bali Roadmap openeda negotiation stream to inclde REDD in a post-2012 agree-ment, as well as mentioned the important role o Conservation,Sstainable Management o Forests and the Enhancement oForest Carbon Stocks in developing contries. The idea o apost-2012 agreement that wold inclde the abovementionedorest carbon mitigation strategies, both redcing emissionsand enhancement o carbon stocks, dbbed REDD Pls, hasgained poplarit amongst plaers in the international dialoge.Still others spport the idea o a REDD (or REDD Pls) strat-eg that is incorporated into a larger overall Agricltre, Forestrand Other Land use (AFOLu) ramework.

Althogh the December 2009 meeting in Copenhagen did

not ltimatel reslt in a legall binding post-2012 climate treat,headwa was made in discssions on REDD Pls and the con-cept maintained general spport. The resltant Copenhagen

Accord, a politicall binding agreement engaged b 97 contries,incldes a paragraph recognizing the crcial role o REDD Plsand agreeing on the need to mobilize nancial resorces rom

developed contries throgh the immediate establishment oa REDD Pls mechanism.12 Sbseqentl, si nations (unitedStates, united Kingdom, Norwa, France, Japan, and Astralia)pledged $3.5 billion to spport immediate REDD Pls activitbetween 2010 and 2012.

U.S. Climate Chage Policy

Althogh the united States ailre to rati the Koto Protocolpt a chill on developing ederal climate change polic, man u.S.states and regions have taken polic actions to redce emissions.In 2006, the landmark Caliornia Global Warming Soltions Act(AB32) established a comprehensive program o reglator andmarket mechanisms to achieve real, qantiable, cost-eectiveredctions o greenhose gases. Likewise, 10 Northeastern andMid-Atlantic states, which make p the Regional GreenhoseGas Initiative (RGGI), have agreed to cap and then redce CO

2

emissions rom the power sector 10 percent b 2018. In 2008-2010, there was also signicant momentm bilding in the u.S.Congress to develop national climate change polic, with the

Hose o Representatives passing the rst-ever comprehen-sive climate change bill in Jne 2009.13 Passage o a climate billthrogh both chambers o Congress wold represent a land-mark achievement or both domestic and international climatechange mitigation eorts, as the united States contribtes oneqarter o global greenhose gas emissions annall and has thepotential to pla an important leadership role in internationalnegotiations.

Despite a limited role or orests in eisting internationalclimate rameworks, proposed u.S. climate policies have tendedto be more avorable towards inclding incentives or protectingorests. In part, this is becase the private sector is interested inorest carbon osets as a cost-eective vehicle or redcing green-hose gas emissions. The EPA has estimated that internationalosets wold lower the cost o u.S. climate legislation b 89 per-cent, with the majorit o sch osets epected to come romorests (EPA, 2009).In act, man u.S. corporations are adoptingsstainabilit programs to proactivel redce their carbon oot-prints in anticipation o climate reglations and these eorts havesprred volntar investments in orest carbon programs.

Cap ad Trade

A cap and trade sstem is a market-based mechanism in which

a reglating bod establishes an pper limitor capon theamont o carbon dioide that ma be emitted b covered (reg-lated) entities, sch as power companies and manactrers.The reglator then isses a nmber o allowances eqal tothe cap, and distribtes these allowances to reglated entitiesthrogh action, direct allocation, or a combination o both. The

TIME

FORES

TCARBONS

TOCKS

Figure 7 Illustrative interaction between degradation and processes leading toconversion. Source: Griscom, et al., 2009.


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16 | R E D u C I N G E M I S S I O N S F R O M D E F O R E S T AT I O N A N D D E G R A D A T I O N ( R E D D ) RIGHT: Sterling Zumbrunn/CI

14 Occrring ater credits have been prodced and veried.

reglated entitiesor sorcesmst report on each nit oemissions the prodce and sbmit enogh allowances to coverthese emissions at the end o each compliance period. Sorcesthat do not have enogh allowances to cover their projectedemissions can either redce their emissions, b allowances onthe market rom sorces with ecess allowances, or, i permit-ted, generate or b credits rom emissions oset projects (seeFigre 8). Osets are emission redction credits that are gen-erated throgh activities in sectors not reglated nder the cap.I the orest sector is not covered b the cap, this creates theopportnit or activities that redce emissions rom or seqes-ter carbon in orests (so called orest carbon projects) to plaan important role in climate change mitigation. The Koto Pro-tocol, Eropean union Emissions Trading Sstem (Eu ETS)and most climate change bills proposed in the united States todate all contain cap and trade elements.

Carbo Markets

There are varios nancial mechanisms which cold nd REDDactivities, both pblic and private, ranging rom pront grants orother paments or orest conservation, to e-post14 prchase o

carbon credits rom REDD activities within a carbon market.Varios carbon marketssome reglator (e.g., CDM, Eu ETS,New Soth Wales and RGGI) and others volntar (e.g., Chi-cago Climate Echange and the OTC market)have developedto acilitate the trading o emissions allowances or credits or emis-sions redctions. Crrentl, onl volntar markets allow osetsrom all three tpes o orest carbon activities (REDD, IFM and

AR). A recent Ecosstem Marketplace report, entitled State o

the Forest Carbon Market, estimates that 20.8 million tCO2e

have been transacted b 226 orest carbon projects over the past20 ears, reslting in $149.2 million in carbon nance (Hamilton,et al., 2010). Man o the challenges associated with measring,monitoring and acconting or emissions redctions rom or-est carbon activities can be addressed with approaches that havebeen applied to projects developed or volntar markets. Ocialregistries or these redctions assre that sch credits are niqeand traceable. Some compliance markets, sch as the CDM andRGGI, allow or AR activities, bt others, sch as the Eu ETS,eclde orest carbon entirel. Not all contries spport the se omarkets to nd emissions redctions rom the orest sector andinstead preer the se o pblic nding.

Annex 1

Developing Countries

Figure 8 Simplistic cap and trade diagram.

A. In Annex 1 countries, an administrator will set a cap onemissions or covered entities.

B. The administrator may give some emissions allowancesto covered entities or ree.

C. The administrator will auction o the rest o the emis-

sions allowances to covered entities.D. Companies who can make reductions at a low cost will

sell extra allowances to companies who can only makereductions at higher cost.

E. countries can protect their standing orests and reducethe rate o deorestation, they can sell emission reduc-tion credits to covered entities in Annex 1.

F. Covered entities must turn in allowances and oset creditsequal to their emissions

Julie Larsen Maher/WCS


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Technical Challengesand Field Eperiences

The Technical Challenges and Field Experiences section describes eight main challenges to REDD,

using one of four projects profiled in the report as an in-depth case study to demonstrate how this

challenge was successfully overcome and lessons learned from the experiences on the ground.


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Russell A. Mitterme

S E C T I O N 1

Baselines and Additionalit

Abaseline, also reerred to as the bsiness-as-salscenario, is dened as the level o carbon dioideemissions and carbon seqestration that wold haveoccrred in the absence o the orest carbon project, and isreqired in order to calclate carbon benets. Baselines aregenerall described as alling nder one o two categories: his-torical or projected. In the simplest sense, historical baselinestake an average o emissions data rom a previos time period(e.g. the most recent 10 ears) and, sing spatial modeling inthe calclation, determine the bsiness-as-sal emissionslevel or the net several ears (ntil it is reassessed sing morecrrent historical data). Projected baselines, on the other hand,might emplo historical emissions data, epected changes incritical actors sch as poplation growth or inrastrctredevelopment, and spatial modeling o tre land se changeto determine baselines (see Figre 9). In contrast to histori-

cal baselines, which sta stead over time, projected baselinesmight sddenl increase to accont or tre epected landse change de to phenomena sch as rontier deorestation.15

It is also tpical (and reqired b most accepted standards)or REDD projects that contain IFM and/or AR compo-nents to have separate baselines or each component, de to

the need or dierent methodologies16 to be sed or carbonacconting. As mentioned, REDD baselines can be estimatedsing historical and/or projected data. A project with an IFMcomponent might emplo the average carbon stocks over thebsiness-as-sal harvest ccle as the baseline or this aspect,

while a project that incldes AR activities man times simplses the carbon stocks o the pre-project land se (assmingthe woldnt change in the tre in the absence o the reor-estation project).

Since baselines are essentiall predictions o a tre state,it is generall considered best practice to revisit them overdened intervals or perormance periods in order to adjst oran changes in sitation, government, socio-economic orces,etc. that occr over time, helping to ensre accrac as projectsproceed (see Figre 10).

Carbon benetsthe additional emissions prevented b

REDD activities (or seqestered b AR or IFM activities)are determined b comparing the with-project orest carbonstocks with bsiness-as-sal stocks (see Figre 11), ater mak-ing appropriate dedctions or leakage and/or impermanencebers (see sections entitled Leakage and Permanence).Dierences between the with-project and baseline orest


15 Frontier Deorestation is that which is predicted to occr at some point dring a project crediting period in an area with historicall low deorestation rates bt the potential ortre incrsion, settlement and/or inrastrctre development (VCS, 2008b).16 A methodolog is a detailed approach to determining a project baseline, greenhose gas sorces and sinks, specic additionalit tests and planned monitoring processes nder astandard specic to the par ticlar project tpe and circmstance (See Standards and Verication section or more ino).


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carbon stocks are converted into carbon dioide eqivalentand reerred to as avoided carbon dioide emissions.

Additionalit reers to whether carbon dioide captred,stored or prevented rom reaching the atmosphere as a reslto project activities is above and beond what wold have hap-pened nder bsiness-as-sal (baseline) practices. All climatemitigation projects mst demonstrate additionalit in order toprove that claimed carbon benets are real and wold not havebeen achieved withot project interventions. Since additional-it involves assessing what wold have (bt did not) happen, itcannot be measred eactl. Throgh varios sstems, sch asthe Koto Protocols Clean Development Mechanism (CDM)and the Volntar Carbon Standard (VCS), tests have beendeveloped to determine whether project activities are likeladditional to what wold have occrred nder bsiness-as-sal practices (see Figre 12). Specicall, as per the CDM

AR Additionalit Tool, projects mst demonstrate that thecold not be implemented in the absence o CDM registra-

tion becase o one or more o seven implementation barriers(CDM, EB 35 anne 17).17 VCS oers an option o choosingbetween three tests: 1) The Project Test, 18 2) The PerormanceTest, 19 or 3) The Technolog Test20 (VCS, 2008a).

Ola Zerbock/CI

17 These barriers inclde: 1) investment barrier, 2) instittional barrier, 3) technological barrier, 4) local tradition barrier, 5) common practice barrier, 6) ecological condition barrier,and/or 7) social condition barrier.18 Incldes Reglator Srpls (the project is not mandated b an enorced law, statte or other reglator ramework), Common Practice (the project is not common practice inthe sector/region) and Implementation Barriers (the project aces barriers o at least one o the ollowing tpes: Investment Barrier, Technological Barrier and/or Instittional Barrier).19 Incldes Reglator Srpls and Perormance Standard (emissions generated b the project are below an approved baseline).20 Incldes Reglator Srpls and Technolog Additionalit.

Emissio

ns

Project

Implementation Time

Baseline

Carbon

Benefits

With-Project

Emissions

Carbon Benefts

Figure 11 Simple graph depicting carbon benets resulting rom REDD projectactions using an historical baseline.

CommonPracticeProject activities are

not routinely adopted

and commonplace

RegulatorySurplusProject activities are not

mandated by any enforced

law, statute or other

regulatory framework

ImplementationBarriers

Project activities face one or more barriers

to implementation including investment,

technological, institutional, etc.

Figure 12The building blocks o additionality: An answer o yes to all threecategories can help demonstrate additionality.


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AnkenihenyZahamenaMantadia Biodiversity Conservation Corridor

and Restoration Project

C A S E S T U D Y

T E C H N I C A L C H A L L E N G E S A N D F I E L D E x P E R I E N C E S | Baselines and additionality | 21

AdditionalityDevelopers o the Mantadia project sed tests similar tothose discssed in the previos section to demonstrate thatthe carbon benets reslting rom project activities wold beadditional to those epected in the absence o the project.

Forest conservation was clearl not common practice inthe area where the Mantadia project was carried ot. Tradi-tionall, lands in and arond the project area were clearedor tav agricltrean activit that was epanding earl, asdemonstrated b the high annal deorestation rate o 0.63percent over the period 1990-2005 (calclated b comparing

the etent o orest cover detected in Landsat images taken in1990, 2000, and 2005). The volntar planting o trees wasalso not considered common practice (with the eception oEucalyptus plantations to make charcoal). Native species reor-estation was previosl non-eistent in Madagascar and theproject has epended signicant eort in creating a new bodo knowledge on native species propagation in cooperation

with the universit o Antananarivo.From a nancial perspective the project cold not have been

epected to occr in the absence o signicant p-ront nding.Restoration o orest with native species is etremel epen-sive and the government o Madagascar indicated that thedid not have nding to create and restore the protected area

withot the project. Instead, the project activities were initi-ated sing nding rom CI, uSAID, World Bank,21 and others.This nding has been secred throgh an innovative nancingstrctre combining philanthropic contribtions, internationaldevelopment assistance and carbon revenes. Most o the plansor nancing o the project are based on assmptions o trecarbon revene, and even then, carbon nance is epected tocover onl a percentage o total project costs.

The creation o a new mltiple-se protected area locatedin the corridor between the pre-eisting parks o Mantadia

and Zahamena was conceived nder the government o Mada-gascars Drban Vision, in which the sstem o protected areaswas to be signicantl epanded. However, historicall, deor-estation tpicall still occrred within protected areas de toa lack o capacit or enorcement. Hence, the sccess o thisepansion was predicated on the availabilit o new sorces orevene to increase government capacit to enorce protection,monitoring and alternative livelihoods, especiall throgh the

se o carbon nancing. So while the government was com-mitted to creating new protected areas, these protected areas

wold not have been likel to scceed or wold not have cometo rition de to the lack o government capacit and nancialresorces to appropriatel design and implement them.

BaselinesSince there are two separate components to the Mantadia

project (REDD and AR), project developers are sing twoseparate methodologies or calclating baselines and epectedproject carbon benets. Developers o a new project can se amethodolog written and approved or another project; how-ever, i one does not eist that applies to the project tpe andconditions, project developers mst develop their own (sb-ject to third-part approval).



Ola Zerbock/CI

21 The Mantadia project is part o the second Tranche o the BioCarbon Fnd operationalized in March 2007.


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22 Mosaic Deorestation is dened b the VCS as occrring where poplation pressre and local land se practices prodce a patchwork o cleared lands; where orests are acces-sible; and where the agents o deorestation and degradation tpicall are present within the region containing the area to be protected (VCS, 2008b).

C A S E S T U D Yc o n t i n u e d

REDD ComponentThe REDD component o the Mantadia project is sing a newmethodolog designed to be compliant with the Volntar Car-

bon Standards (VCS) Agricltre, Forestr and Other Landuses (AFOLu) gidance. Since the AFOLu gidance wasrst released in November 2008, or ears ater the MantadiaProject began, there werent an approved REDD methodol-ogies at the time o the project start and project proponentshad to sbmit their own methodolog to the standards com-mittee or approval. Ths in 2008, the BioCarbon Fnd o theWorld Bank (BioCF) commissioned an epert consltant tocreate sch a methodolog (called TheMethodology for EstimatingReductions of GHG Emissions from Mosaic Deforestation),22 that coldbe applied to the project, and potentiall other REDD proj-ects in its portolio. The methodolog was specicall designed

with the Mantadia project in mind, as mosaic deorestationland-se patterns are ond in the area o eastern Madagascarsrronding the Mantadia project.

The BioCF methodolog combines two basic componentsto predict tre emissions rom deorestation in the bsi-ness-as-sal (baseline) case: 1) qantitative assmptions othefuture rates of deforestation (based on historical rates o deor-estation in and arond the project area and assmed trechanges in nderling drivers o deorestation sch as inra-strctre development, agricltre epansion, market actors,etc.) and 2) a spatial land se change model to create apredic-tion of where that deforestation will occur based on the relationshipbetween past deorestation and certain variables that repre-sent signicant drivers (e.g. distance to roads, terrain slope,distance to markets, etc.). Being able to predict where tredeorestation will occr is important becase dierent classeso eisting orest contain dierent qantities o carbon likelto be lost i deorested. Field sampling condcted b WinrockInternational in 2004, as well as rther sampling condctedb CI in 2008, provided data on carbon stocks in the projectarea (66 sampling plots in the REDD component). B com-bining this inormation, the baseline scenario was constrctedto predict the amont o GHG emissions likel to occr in

the absence o the project. The Mosaic Deorestation Meth-odolog described estimates onl the baseline emissions romdeorestation (degradation is not inclded) and crrentl onlconsiders emissions rom the loss o above- and below-grondbiomass de to deorestation (RED) (carbon pools eplainedin detail in Measring and Monitoring section).

The spatial model sed or the REDD component o Man-tadia is the Clark Laboratories Land Change Modeler (2008)based on the IDRISI sotware, originall developed or seb Conservation International. Spatiall eplicit orest coverand deorestation driver inormation was sed rom threepoints in time (1990, 2000, and 2005). Once the model oepected tre deorestation was created sing deorestationand driver relationships rom 1990 to 2000, the predictionstrength o the model was tested b orecasting the orest coverin 2005 and comparing the reslt with the 2005 real orestcover derived rom satellite image processing. This allowed the

model to be calibrated ntil the predictedreslt closel matchedactual orest cover in 2005. The reslting model was then rnorward rom the present time in order to predict the locationo tre orest cover changes inside the project area ot to2035 (the baseline case) based on the historic rate o deores-tation (see Figre 13).

Figure 13 Modeled deorestation risk and location in the project area by 2035.Blue indicates low deorestation risk and Red indicates high deorestation risk.Source: CI, Madagascar.


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T E C H N I C A L C H A L L E N G E S A N D F I E L D E x P E R I E N C E S | Baselines and additionality | 23

The project will periodicall re-evalate the baseline romthe REDD project component based on new data related tothe rates and drivers o deorestation in the project and reer-

ence areas.23 As per VCS rles, a re-assessment o the baselinewill occr at least once ever 10 ears.

AR ComponentThe reorestation component o the project is sing a base-line and monitoring methodolog approved nder the KotoProtocols Clean Development Mechanism (CDM), enti-tled Reorestation or Aorestation o land crrentl nderagricltral se (AR-AM0004).24 Essentiall, the CDMmethodolog is applicable to conditions where the agricltralor grazing activit taking place is epected to contine into the

tre in the absence o the project and where the carbon stocks onthat land are epected to remain low i the area is not restored toorest. The methodolog is conservative, taking into accont onl

the increase in above- and below-grond biomass in its calc-lations o emissions redctions, ignoring the likel gains in soilcarbon and other carbon pools. Carbon stock measrements

were taken in 2004 and 2008, with a total o 57 samplingplots. Trees planted throgh the project, and the associatedcarbon gains, will be monitored at least ever ve ears via on-the-grond plots, which wold identi and accont or annepected changes or loss (e.g. re, insects, etc.) o accm-lated carbon stocks. The baseline will not be monitored, as themethodolog does not reqire it; the project will se a baselinerozen at the time o validation.

23 A reerence area is a larger area with similar conditions, agents and drivers sed or comparison over time.24 AR-AM0004:

The technology and methodologies currently exist

to create credible, veriable project baselines.

The baseline or the Mantadia project employs satellite

imagery, eld measurements and sophisticated model-

ing, which helps encompass dierences across various

ecological landscapes and drivers/patterns o land use

change. The baseline methodologies are being developed

in consultation with orest carbon experts, cross-checked,

made available or public comment and veried by inde-

pendent third parties through a double approval process.

The robust methods used in the development o the proj-

ect baseline will serve as a model or uture projects with

mosaic deorestation patterns.

Project baseline methodologies should be based on

empirical evidence and models.

The estimation o Mantadia carbon stocks, based on 66

biomass inventory plots located in the project area, is an

integral component o the project baseline. Other empiri-

cal, measurable data including deorestation rates, driverso deorestation, time series satellite imagery and testable

land use change models will enable the specic calcula-

tion o the project baseline, o which the accuracy can

be explicitly determined. Such methodologies include

precise scientic calculations or use in project carbon

accounting, ensuring credibility and veriability.

The most accurate project baselines are cross-

checked with recent historical data and adjusted

over time i necessary.

Forest carbon projects generally include an estimate

o lietime carbon benets, both or easibility analysis

and garnering investor interest. These estimates are

derived rom analysis o past land cover, regional land

cover change and drivers, and the baseline is projected

into the uture, sometimes 20, 30, or even 50 years. There

are inherent risks with predicting a baseline this ar into

the uture. Given that underlying drivers o deoresta-

tion, such as socioeconomic actors and government

policies may change, it is a best practice to cross-check

the baseline periodically as a project progresses (VCS

requires reassessment o the baseline at least every 10

years or REDD projects) (VCS, 2008), and to adjust the

baseline i necessary to capture any changes that mightaect the baseline moving orward. Indeed, the Manta-

dia project baseline will be re-evaluated every 10 years

as required by VCS.lesso

ns

learne

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Measring and monitoring are the processes b whichthe amont o carbon stored in orests (carbonstocks), as well as changes in these amonts, arecalclated and tracked, sing both satellite technolog and eldmeasrements (complimented b laborator testing). Measr-ing and monitoring all nder the larger categor o carbonacconting, which reers to the calclation o carbon benetsover time as a reslt o orest carbon activities. Carbon stocksare not isolated to the trees themselves, bt instead are madep o several carbon pools, as shown in Figre 14. Soil andabove-grond live biomass generall constitte the largest car-bon pools (FAO, 2005).

While measring and monitoring are perceived b someas a challenge to prodcing real, veriable carbon credits, themethods sed are time-tested and steeped in rigoros scien-tic theor. The basic steps involved in carbon acconting or

REDD activities are illstrated in Figre 15.

Carbon StocksDelineating orest tpe and area is generall accomplished singsatellite imager, cross-checked with on-the-grond obser-

vations. The tpes o orest present at a REDD project site,as well as the etent o these orest tpes, are ver importantor carbon calclations, as dierent orest tpes have dierentassociated carbon densit. For eample, a tpical redwood or-est in the western united States might contain 397 tC/ha, as

S E C T I O N 2

Measring and Monitoring

Bridget


Figure 14 Five carbon pools make up the carbon stocks o a orest (not drawn to scale).


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25 Derived rom tables provided on page 68 o: u.S. Agricltre and Forestr Greenhose Gas Inventor: 1990-2005. Global Change Program Oce, Oce o the Chie Economist,u.S. Department o Agricltre. Technical Blletin No. 1921. 161 pp. Agst, 2008. 26 uSGS Website: 27 Landsat data is made p o man sqare piels (similar to those on a TV or compter screen), which represent areas 30 meters b 30 meters in length.28 An optical remote sensing technolog that measres properties o scattered light to nd range and/or other inormation o a distant target.

Figure 15 General steps involved in carbon accounting or REDD activities at the project scale. MRV in the diagram stands or Monitoring, Reporting and Verication.

Carbon Stocks

Pre-Implementation Post-Implementation

Deforestation

RateBaseline Leakage and

ImpermanenceMRV

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T E C H N I C A L C H A L L E N G E S A N D F I E L D E x P E R I E N C E S | Measuring and Monitoring | 25

compared to the tpical aspen/birch orest, which might con-tain 161 tC/ha.25

The densit o carbon stocks associated with dierent or-est tpes is determined with eld srves. On-the-grond eldmethods are sed or determining carbon densit, which havebeen emploed or man ears and have long been acceptedas scienticall credible. Since measring ever single treeinside the project area wold be cost prohibitive and highlinecient, sampling methods are reqired. Methods entaildesigning a statisticall rigoros sampling scheme to collectdata on carbon pools in representative sections o the orest,and etrapolating that inormation or the entire project area.Sch etrapolations are standard practice in ecological sr-

veing and the accrac level o the reslts can be specicallcalclated. Desirable accrac is sall within 10 percent othe sample mean.

Common sampling methods inclde measring the height

and diameter at breast height (dbh) o live trees to deter-mine above-grond biomass, and collecting soil, lea litter anddead wood to be analzed or carbon content in the lab withprecise instrments. Below-grond biomass is sall calc-lated throgh scienticall accepted eqations (Cairns, et al.,

1997). Field measrements, when sed in combination with sat-ellite imager to track land cover change over time, allow or thecalclation o carbon stock changes.

Deorestation RateThe annal rate o deorestation in a REDD project area is tp-icall obtained sing satellite images rom several points in time,

which allows scientists to track changes in land se and orestcover dring that period. Landsat satellites have been collect-ing data on land cover since 1972, with an abilit to zoom intoareas as small as 60 meters rom 1972-1982 and 30 meters since1982.26 This historical Landsat satellite data is available, or ree,rom the united States Geological Srve (uSGS).

Signicant advances have been made in interpreting satel-lite data and sing it to precisel measre deorestation rates bcomparing change in satellite photos taken over time on a pielb piel basis (see Figre 16).27 Other advances in the interpre-

tation o Landsat satellite data now allow or the detection odegradation rom logging and re (Asner, et al., 2005; Ro, etal., 2008). Lidar28 and radar technolog ma be sed to redcethe need or on-the-grond eld measrements in carbonstock calclation and can help overcome the challenge posed


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26 | R E D u C I N G E M I S S I O N S F R O M D E F O R E S T AT I O N A N D D E G R A D A T IO N ( R E D D )

29 Mosaic Deorestation is that which occrs where poplation pressre and local land se practices prodce a patchwork o cleared lands; where orests are accessible; and wherethe agents o deorestation and degradation tpicall are present within the region containing the area to be protected. Frontier Deorestation, on the other hand, is that which ispredicted to occr at some point dring a project crediting period in an area with historicall low deorestation rates bt the potential or tre incrsion, settlement and/or inra-strctre development (VCS, 2008b).

b clods, which can hide the landscape in satellite photos. Withtime, these latter options are epected to become more economicaland easier to se at large scales.

Baselineusing inormation on area, densit and rate, it is then pos-sible to calclate the project baseline; the bsiness-as-sal

emissions scenario (baselines are eplained in detail in theBaselines and Additionalit section). Methods o calclation

var depending on the orm deorestation takes (e.g. mosaic vs.rontier)29 and associated drivers; however, several standardssch as the Volntar Carbon Standard (VCS) and Climate

Action Registr (CAR) provide detailed gidance on develop-ing baselines. Calclation o the baseline emissions scenario orREDD projects might involve rnning spatial land se changemodels (and orest growth models i the project has an IFMcomponent). Along with the baseline emissions scenario, it isalso necessar to estimate the with-project emission scenario,since the dierence between the two ields the carbon bene-

ts rom project activities. usall, the assmed deorestationrate in this scenario wold be qite low, with the assmptionthat project interventions scceeded in slowing or stoppingdeorestation in the project area, and is sometimes taken roma comparable established protected area nearb.

Leakage and ImpermanenceAlthogh man REDD project developers wold agree thatthe most eective strategies target leakage and impermanencerom project conception b incorporating preventative mea-sres into the design (sch as edcation, commnit otreach,and alternative livelihoods programs), the two challenges aresometimes impossible to completel avoid. As sch, it is becom-ing increasingl common practice to se bers and discontsin carbon acconting, which provide insrance that an ne-pected loss o carbon can be covered (these topics are coveredin depth in the Leakage and Permanence sections). Riskanalsis, which is inclded in standards sch as the VCS, canhelp determine the amont o carbon credits that shold bedeposited into a pooled impermanence ber that spreads therisk over an entire project portolio and/or the amont o car-bon credits taken o the top o each project to cover predictedleakage. Sch an approach wold help assre a conservative

estimate o generated credits is obtained.

Monitoring, Reporting and Verifcation (MRV)Monitoring is necessar to cross-check anticipated carbonbenets over time and incldes tracking the variables discssedabove (deorestation rate, baseline, leakage and impermanence),

as well as carbon stocks on the grond. In man cases, and as iscrrentl reqired b standards sch as VCS (ever 10 ears),the REDD project baseline will be monitored and re-evalatedat varios points in the tre sing crrent data, to ensre thepredicted scenario is still on target (see Figre 10). The base-line might then be adjsted based on observed changes to thenderling assmptions sed in its creation. Monitoring alsoallows project developers to catch an leakage and/or imper-manence soon ater occrrence, as well as make adjstments todisconts and bers as needed.

Verication and reporting are two means b which toensre qalit and transparenc, and avoid doble-conting ocarbon credits. A review o the project and related measre-ments, calclations and docmentation is generall condctedb an independent third part, to demonstrate that the chosenstandard has been ollowed (a process known as validation).Verication o carbon benets b a third part occrs ater

project implementation and is a means to demonstrate thatgenerated carbon benets are real (more detailed inormationin the Standards and Verication section). Formal registries,sch as the Climate Action Registr and Chicago ClimateEchange, list and allow or the tracking o veried carbonbenets generated rom REDD projects.

Figure 16 False-color Landsat images o Rondnia, Brazil. Notice how the typicalshbone pattern o deorestation grows with time. Images like these allow scientiststo determine deorestation rates. Source: USGS (Campbell, 1997).


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T E C H N I C A L C H A L L E N G E S A N D F I E L D E x P E R I E N C E S | Measuring and Monitoring |27

C A S E S T U D Y

Carbon StocksIn 2004, Winrock International was contracted b Conserva-tion International (CI) and the Wildlie Conservation Societ(WCS) to prepare a easibilit std or estimating the qan-tit o avoided carbon emissions that cold be achieved throghthe creation o the Makira Forest Protected Area. Winrock vis-ited the region in Agst 2004 to condct a preliminar carboninventor and to provide training to WCS sta on long-termmeasrement and monitoring o carbon. Above-grond, below-grond, standing dead and ling dead biomass30 were measredin three temporar matre primar orest inventor plots inan area o relativel ntoched, dense primar orest within

the park bondaries (see Figre 17). Also sed in this stdwas data rom a WCS contracted consltant, who carried otinventories in degraded orests, and inventor data rom a 1995national std o the conditions o Madagascars Classied For-ests, which emploed satellite imager analsis. The vales romthese three data sorces were combined and weighted b theproportion o primar and degraded orest within the area othe proposed protected area, reslting in a weighted average or-est carbon stock or the dened project area, which is crrentlbeing pdated as the project goes throgh VCS validation.

Deorestation RateIn the 2004 easibilit std, to dene a bsiness-as-saldeorestation rate, WCS sta initiall identied or zonesarond the proposed protected area that were characterizedb dierent land se pressres (threats driving land cover con-

version). Annal deorestation rates were generated or eachzone rom the nmber o hectares deorested between 1990and 2000 (based on Landsat satellite imager). The deores-tation rate or each zone was then mltiplied b the proportiono the total area in that zone in order to calclate the weightedaverage baseline deorestation rate o 0.149 percent. Winrockestimated that this bsiness-as-sal deorestation rate wold

increase at a rate o one percent per ear de to poplationgrowth. The deorestation rate in the with-project scenario was predicted to gradall decline to abot 0.07 percentover the rst 10 ears o the project, sing the deorestationrate o nearb and similar Mantadia National Park over thetime period 1990-2000 in the calclation. From this, it was

estimated that over the 30-ear project lietime, the MakiraForest Protected Area Project wold avoid the emission o2,589,898 tC, or 9,496,294 tCO

2eqivalent.31, 32

In 2009 WCS pdated the deorestation rate projected inthe 2004 easibilit std, as it began the VCS validation pro-cess. using data prodced rom a 15-ear national assessmento orest cover change, the historic deorestation rate within a6,184,964-hectare reerence areaa larger area encompassingthe project and with similar conditions, agents and drivers orcomparison over timewas calclated to be 0.76 percent (seeFigre 18) (MEFT, uSAID and CI, 2009). The calclationso projected tre deorestation rates or the reerence area

were based on this analsis and the location o tre deor-estation was predicted sing the IDRISI Andes Land useChange Model (see Figre 19). Deorestation in the with-proj-

ect scenario is now predicted to decline to abot 0.04 percentover the rst 10 ears, sing the crrent deorestation rate oneighboring Masoala National Park. The estimated lietimecarbon benets o the project are crrentl being revised basedon these pdated deorestation rates and are contingent pon

validation o the Makira Project Design Docment (PDD).

30 Carbon vale testing or dead and down tree samples were condcted within a laborator.31 This estimate does not inclde a leakage discont, which will be determined dring VCS validation, and dedcted rom the total.32 It is important to note that additional data collection and analsis are crrentl nderwa as a part o VCS certication. The reslts o the 2004 easibilit std, which was com-pleted beore VCS came into eistence in late 2005, are being revisited so as to ensre that the project baselines, carbon stock estimates and GHG emissions redction estimates andMRV adhere to VCS gidelines.

Makira Forest Protected Area

Figure 17 Site o 2004 Winrock carbon inventory plots and orest strata.From (Martin et al. 2004).

Winrock measurements

Proposed Conservation Area

Measurement sites

Proposed Conservation Area

Outside Conservation Area

Low altitude dense humid orest

Low altitude degraded and/orsecondary dense humid orest

Mid altitude dense humid orest

Mid altitude degraded and/orsecondary dense humid orest

High meadow, savannah and/orpseudosteppe with ligneouselements

Rice cultivation

Savannah and/or pseudosteppewith ligneous elements

Savannah and/or pseudesteppewithout ligneous elements


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C A S E S T U D Y

28 | R E D u C I N G E M I S S I O N S F R O M D E F O R E S T AT I O N A N D D E G R A D A T IO N ( R E D D )

Leakage and ImpermanenceDeorestation or agricltre is the principal and immediatethreat in the Makira project area, coming rom the poplation

srronding the protected area. Leakage and impermanenceavoidance strategies are being sed within the project, incld-ing the se o tools sch as a commnit-managed ber zone,sstainable land se practices, alternative livelihoods pro-grams, assignment o legal rights to lands, protected area statsand a permanent project endowment. Specicall, the proj-ect incldes both a Zone o Strict Protection and an activelengaged Zone o Commnit Management, which srrondsthe protected area and serves as a ber to leakage (a leakagebelt). Given the geograph o the area and the resorce sehabits o the local commnities, leakage as a reslt o the estab-lishment o the project is considered limited. Ths, no leakage

discont is being sed in the project.Project developers plan on tilizing impermanence bers

to rther saegard carbon assets. An impermanence beris being estimated throgh a risk analsis. Preliminar analsisestimates that the most appropriate risk ber or Makira willlikel be 20 percent o the carbon benets. The risk ber orMakira was calclated sing the VCS risk analsis o risk likeli-hood mltiplied b signicance o risk. The reslt places Makirain the medim risk classnatral disaster de to cclone activitand concerns o illegal logging pressres are principal drivers othis risk calclation. These veried emissions redctions will notbe marketed and instead placed in a pooled reserve, to be drawnpon in the case o impermanence.

Monitoring, Reporting and Verifcation (MRV)33

Following the initial verication o the avoided deorestationestimates attribted to the projectthis rst verication pro-cess is crrentl nderwathe avoided deorestation baselineor the Makira Forest Protected Area Project will be monitoredand re-evalated ever ve ears. Monitoring parameters willinclde assessment o relative changes in the project deoresta-tion rate compared to regional deorestation rates (representedb the reerence area) and national deorestation rates. Remote

sensing imagermost likel Landsatwill be sed in combina-tion with orest cover measrement plots. Field data collectionprotocols will ollow Winrock Internationals Terrestrial Carbon

Measurement Standard Operating Procedures(Walker et al. 2009). Thedevelopment o the carbon monitoring protocols, particlarl

33 Althogh the main ocs o this Monitoring section is carbon, it is important to note that monitoring o commnit and environmental impacts (positive and negative) willalso be taking place. Monitoring o impacts on biodiversit and commnities is planned on a bi-annal basis, the modalities o which, particlarl measring commnit net positivebenets, are also in development. Monitoring o biodiversit impacts will ollow alread established commnit participator ecological monitoring protocols. This participatorecological monitoring has been initiated in Makiras orests since 2007 and also incldes monitoring o the state o wellbeing and orest and resorce se tendencies o the localcommnit poplations.

c o n t i n u e d

Figure 18This map depicts the reerence area, project area and leakage belt or theMakira projectas updated in accordance with VCS. Cartography: WCS Madagascar.

Figure 19 Spatial model o deorestation risk within the project area. Cartography:WCS Madagascar.

Percentage o Low and High Risk Zone in the

Project Area o Makira

Makira Project Area

Project area

Reerence area

Water bodies

Cultivated land

Meadow

Forested meadow

Humid meadow

Degraded humid orest

Sea

High risk zone: 46.7%

Low risk zone: 53.7%

Project area


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Hermes Just

S E C T I O N 3

Leakage

Leakage, in the contet o project-level REDD activities,reers to changes in greenhose gas emissions that occrotside o project bondaries as a reslt o the proj-ects emissions redction activities. On a national scale, leakagecan also occr between contries, or eample, i deorestationis shited rom one contr to another. Althogh, b deni-tion, leakage can be positive (the spillover eect), resltingin the broader adoption o low-carbon activities, most debatesabot REDD activities have ocsed on the possibilit o neg-ative leakage. Negative leakage reslts rom shits in emissionsthat negate some or all o the carbon benets associated withREDD activities. For this reason, leakage mst be acconted orand addressed in order or REDD activities to demonstrate theprodce net carbon benets.

Leakage comes in two main orms: activit-shitingleakage, when orest carbon activities directl case carbon-

emitting activities to be shited to another location otside othe project bondaries (or otside the contr, at the nationalscale); and market leakage, when a project or polic changesthe sppl-and-demand eqilibrim, casing market actors toshit their activities. For eample, i a project constrains thesppl o a commodit, sch as agricltral prodcts or timber,market prices ma rise and prodcers elsewhere ma increasetheir activities in response. Estimates o market leakage

atomaticall incorporate activit-shiting leakage in their cal-clation, since all actors, inclding those proimate to projectactivities that might shit their operations, are covered. Leakageis less likel in areas where alternative emploment is available,land se activities are sbsistence and land tenre is clear andenorced. In contrast, it is more likel i emploment optionsare limited, land se activities are commercial in scale and landtenre is ndened. Leakage is not a phenomenon niqe to theorest sector (discssed in the Leakage in Other Sectors bo).

Project-scale activities mst make attempts within theproject design to analze the risk o leakage, take steps toprevent or redce leakage, and monitor and accont or anleakage that does occr. Prevention and monitoring activitiesoten rel on mechanisms sch as agricltral intensica-tion, alternative emploment opportnities, tracking activitieso ke project participants and spport or clear land titling.

Additionall, leakage eects mst be estimated and sed toappl leakage dedctions in carbon acconting. Most voln-tar carbon standards now recommend a leakage dedction o10-20 percent, dependent on a nmber o project risk actors.This percentage is sbject to increase with higher-risk projects.One ke advantage o nation-wide carbon acconting sstemsis the act that the can captre leakage across whole contries(see Scale and Scope section or more detail).


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Leakage in Other Sectors

Although oten thought o as an issue specic to orest carbon activities, leakage is a challenge or emissions

reduction strategies in all sectors. For instance, in the global energy sector, climate change policies have the

potential to change supply and demand dynamics within ossil uel markets, resulting in market leakage (Sergey,

2001). The potential or leakage in the ossil uel sector has been estimated at 5-20 percent and ultimately will

depend on the level o participation in global mechanisms (IPCC, 2007.)

th w xmp w ch c:

1 Under the restrictions o the Kyoto Protocol, demandor carbon intensive energy sources such as coal might

decrease within Annex I countries, leading to a price drop on

global markets. Given the cheaper price o coal, non-Annex

I countries, which do not have emission reduction targets

under the Kyoto Protocol, might switch to carbon-intensive

coal in lieu o relatively more expensive and less carbon-

intensive ossil uel options such as oil. This increase in

emissions rom non-Annex I countries could partially osetcarbon gains achieved by Annex I countries by increasing

non-Annex I country emissions higher than they would

have been without the compliance mechanism.

2 The emissions restrictions

redd casebook tnc ci wcs

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