35
3. 2. At t ach T oRs f or t his component as separat e Annexes 3a, 3b, 3c, and 3d. See Annex 3
Component 4: REDD Implementation Framework
Obj ectives for this component:
The REDD implement at ion f ramework aims t o est abl ish inst it ut ional, policy and legal set t ing t o enable operat ionalizat ion of REDDI f ramework and implement at ion of t he REDDI which can
deliver real reduct ion of emissions f rom def orest at ion and f orest degradat ion measurable, report able, verif iable according t o int ernat ional st andard UNFCCC relevant decisions, while
at t he same t ime provide source of revenue t o support nat ional development , povert y alleviat ion, and sust ainabl e management of f orest .
Expect ed out come:
•
Policy, legal and inst it ut ional set t ing including governance syst em is in place
•
Nat ional Carbon account ing and nat ional regist ry and sub-nat ional wherever needed is in pl ace
•
Payment Dist ribut ion Mechanism implement ed, which enables Indonesia t o implement REDDI st rat egy t o deliver real emissions reduct ion and
generat e revenue t o support sust ainabl e development at al l level s.
These principles and challenges raise some quest ions t hat will be answered by t his act ivit y. The quest ions are as f ollows: what is t he best opt ion f or managing nat ional account ing and sub
nat ional impl ement at ion ?, what is t he impact of dif f erent sub-nat ional implement at i on on monit oring, report ing and verif ying ?, how t o provide a low-cost , large-scale, pro-poor REDD?
how t o engage inst it ut ion involved i n monit oring, report ing and verif ying , including local people, who need alt ernat ive income-generat ing act ivit ies ?, how t o generat e a viable REDD?
This could part ly be achieved t hrough ef f ect ive payment s f or environment al services, which woul d require some f orm of cont ract ual arrangement bet ween landholders and government or
a REDD developer t o arrange monit oring and cert if icat ion of carbon of f set s. One of t he most import ant obst acl es t o such arrangement s is t he presence of t ransact ion cost s. Transact ion cost s
arise because carbon st ored in f orest s needs t o be account ed f or in a way t hat ensures t hat carbon changes are real, direct ly at t ribut able t o t he proj ect , and addit ional t o any changes t hat
woul d have occurred in t he absence of t he REDD act ivit y. In ot her words, carbon credit s must be measured relat ive t o a ref erence emissions level baseline business as usual scenario.
An ef f ect ive REDD mechanism requires t hat appropriat e rewards accrue t o t hose t hat undert ake init iat ives t hat reduce def orest at ion and f orest degradat ion. The IFCA st udies 2007 suggest ed
t he design of t he Indonesian nat ional REDD payment s syst em will involve decisions over:
1. Financial t ransf er mechanisms at dif f erent scal es;
2. Revenue allocat ion;
3. Forms of payment and t iming;
4. Legal and ot her inst it ut ional st ruct ures; and
5. Risk management opt ions.
The f irst issue t hat needs t o be agreed upon is who will be t he “ sellers” assuming market scheme will exist f or REDD and who would be responsible f or t he f inancial allocat ions.
Regarding t he f irst quest ion, t here are t wo opt ions: 1. Transact ions would t ake pl ace wit h t he cent ral government ;
36
2. Transact ions would be carried out wit h lower government levels sub-nat ional level or direct ly wit h REDD developer. Wit h respect t o t he second issue, redist ribut ion of f unds can
t ake place in t hree ways: i
Following t he government administ rat ion hierarchy: Nat ional Provincial Dist rict government Village;
ii Based on management of f orest f unct ions: Nat ional Nat ional f orest ry aut horit y Local f orest management unit s;
iii Domest ic proj ect -based wit h t he nat ion as re-seller on t he int ernat ional market : Nat ional aut horit y Proj ect ent it ies local act ors.
The advant ages and disadvant ages of t hese combinat ions are current ly being discussed. There are several opt ions t o organize t he all ocat ion of revenues t o dif f erent ent it ies. These allocat ion
issues will be vit al f or t he cent ral government t o resolve, regardless of how t ransact ions may t ake place bet ween int ernat ional, nat ional and sub nat ional levels.
Wit h regard t o t he f orms of payment s, several opt ions have been explored in det ail during t he IFCA process. These include whet her payment s t o main act ors should be in t he f orm of a lump
sum, or st aged over t ime; whet her t o individuals or groups, or whet her on a cash or non-cash basis. A resolut ion of what mechanisms woul d be pref erred is needed t aking int o account of t he
ef f ect iveness and ef f iciency levels t hat can be achieved in each case and t he t ransact ion cost s t hat are l ikely t o mat erialize.
The legal f ramework t o regulat e t he various opt ions is complex. Revenue Sharing Funds DBH, General All ocat ion Funds DAP, and Special Al locat ion Funds DAK, are exampl es of revenue
sharing bet ween nat ional and sub-nat ional government ent it ies and are likely t o play a role in allocat ion decisions. Regulat ions relat ed t o decent ralizat ion of roles and aut horit ies of f orest
governance will also have a maj or inf luence in t he design of REDD mechanisms. The Minist ry of Finance and BAPPENAS is current ly coordinat ing t he est ablishment of Climat e Change Trust Fund
which cover all sect ors including f orest ry. Det ail mechanism on management and dist ribut ion of such f und, however, st ill need t o be developed.
A signif icant number of demonst rat ion and pilot proj ect s are already being init iat ed by privat e and public ent it ies, but t hose proj ect s are current ly using dif f erent st andards and approaches.
A comprehensive syst em of approval crit eria, monit oring and report ing syst em needs t o be developed t o guarant ee a coherent nat ional account ing syst em. To guarant ee t ransparency and
unif ied st andards, a nat ional regist ry needs t o be designed, implement ed and maint ained. In doing so, t he government has issued regulat ion on REDD PERMENHUT No. 30 Menhut -II 2009
See Annex 2c.
Act ivit ies t o achieve out come: As can be seen in Figure 3. REDDI f ramework and Table 3. in Component 2 Management of
Readiness f or t he main act ivit ies t o be covered in developing REDDI implement at ion f ramework. The main act ivit ies in t he REDDI f ramework can be broken down but not limit ed
int o t he f ollowing act ivit ies :
1. Assessment of legal and i nst it ut ional set t ing needed t o implement REDD act ivit ies which
also cover broad arrangement of t he f ollowing act ivit ies: set t ing baseline Ref erence Emission Level Covered in Component 7, Report ing and monit oring Covered in
Component 8 , f inancial market aspect s,
2. Def ining roles and responsibilit ies of nat ional government including nat ional regist ry, local
government , ot her agencies, communit ies and t he privat e sect or in managing carbon asset s. It is al so import ant t o underst and what mechanism t o assure t he reduct ion of
emissions at t he sub-nat ional implement at ion is monit ored and report ed t o nat ional regist ry periodically.
3. Def init ion of t he scale of REDD act ivit ies, in t his case elaborat e REDDI approach ‘ nat i onal
account i ng wi t h sub-nat i onal i mpl ement at i on’ , and how t he approach can be ef f ect ively
37
implement ed in Indonesia, considering t he i diversit y of bio-socio-geographical condit ions, ii polit ical and inst it ut ional organizat ion, iii drivers of def orest at ion iv and nat ional
development priorit ies. 4.
El aborat ion on how act ivit ies at dif f erent scales wil l be implement ed, monit ored and report ed
5. Tracking implement at ion of REDD act ivit ies and payment s in a nat ional carbon regist ry;
6. Est imat e t he t ransact ion cost s associat ed wit h al t ernat ive arrangement s and ident if y
st rat egies t o reduce t hese t ransact ion cost s 7.
Development of mechanism f or management of int eract ion bet ween int ernat ional buyers and invest ors
8. Def init ion of who woul d be ent it led t o sell Emission Reduct ions or receive payment s f or
Emission Reduct ion 9.
Def init ion of an equit abl e payment dist ribut i on syst em t hat is t ransparent , adequat ely compensat es agent s t hat incur losses as a result of changed f orest -resource use, and
rewards good perf ormance and at t he same t ime is eit her based on exist ing mechanisms and or mechanisms t hat creat e lit t le t ransact ion cost s
10. Def init ion of ownership and t ransf er of carbon right s;
6
CO
2
Reference Emission Level
Strategy Monitoring
Market Funding
Distribution 1
2 3
4 5
WG-FCC
REDDI Guideline REDDI Committee
REDDI FRAMEWORK
Historical emission future scenario
• Forest cover and carbon stock changes,
• National registry
National approach, sub-national
implementation
Attractiveness, Source of fund
Responsibilities and benefits
Developed from IFCA study 2007
Awareness raising Stakeholders
communication, Capacity building
Access to data Access to technology
IFCA 2007 recommendations : REDD strategy for 5 landscapes :
Production forest, Conservation forest, Timber plantation, Peat
land, Oil palm plantation related to LUC
o1
Figure 3. REDD Indonesia Framework
Partners and organizations involved: Minist ry of Forest ry, Minist ry of Nat ional Development Planning, Minist ry of Agricult ure, Minist ry
of Environment , Nat ional Land Agency, local government provincial government , dist rict government , Communit y inst it ut ions , NGOs, Privat e Sect ors, Scient if ic inst it ut ions,
Int ernat ional Organizat ion
38
Table 7. Schedule and Sequencing of activities:
Schedule No. Act ivities
2009 2010 2011
1 Assessment of legal and inst it ut ional set t ing needed t o
implement REDD act ivit ies
•
Regul at ion and St andard f or Nat ional Regist ry
•
Workable REDD Commit t ee
•
Ident if y Pot ent ial Funding Agencies
•
Technical and Governance Risk Assessment 2
Def ining roles and responsibilit ies of inst it ut ion involved including government agencies, communit ies and t he privat e
sect or in managing carbon asset s
•
Nat ional Government
•
Local Government
•
Privat e sect ors
•
Communit ies
•
NGOs 3
Def init ion of t he scal e of REDD act ivit ies, in t his case elaborat e REDDI approach ‘ nat i onal account i ng wi t h sub-
nat i onal i mpl ement at i on’ , and how t he approach can be ef f ect ively implement ed in Indonesia
•
Assessment on pot ent ial mechanism
•
Risk Management pot ent ial leakage and permanence, social, cult ure
4 Elaborat ion on how act ivit ies at dif f erent scales will be
implement ed, monit ored and report ed
•
Mechanism t o link bet ween Nat ional Regist ry-and Sub Nat ional
•
Searching Ef f ect ive Coordinat ion Mechanism 5
Tracking implement at ion of REDD act ivit ies and payment s in a nat ional carbon regist ry;
Basis f or payment
•
Commencement of syst em
•
St andards 6
Est imat e t he t ransact ion cost s associat ed wit h al t ernat ive arrangement s and ident if y st rat egies t o reduce t hese
t ransact ion cost s 7
Development of mechanism f or management of int eract ion bet ween int ernat ional buyers and invest ors
•
Financial Arrangement Agreement 8 Development
of mechanism
f or payment dist ribut ion def init ion of who would be ent it l ed t o sell Emission
Reduct ions or receive payment s f or Emission Reduct ion and def init ion of ownership and t ransf er of carbon right s
•
Benef it and responsibilit ies
•
Set t ing ef f ect ive basis of payment
39
Indicat ors of performance f or obj ect ive:
•
Nat ional Regist ry est ablished,
•
Inst it ut ional set t ing t o implement REDD in place
•
Incent ive payment dist ribut ion mechanism in place
4. 2. At t ach your T oRs for t his component as a separat e Annex 4. See Annex 4
Component 5. Assess the social and environmental impacts, and potential additional benefits, of candidate REDD strategy activities
5. 1. Obj ectives and activities: 5. 1. 1. Obj ectives of Environmental and Social Assessment of readiness Activities:
Background The ef f ect ive REDD should cover an appropriat e balance bet ween social, environment al, and
economic issues. Focusing on any of t hese dimensions is unlikely t o achieve permanent emissions reduct ions. For example, a f ocus on ef f icient reduct ion of emissions alone is unlikely t o have a
long-t erm impact on t he drivers of def orest at ion, f or example f orest encroachment and coul d result in negat ive impact s on people, leading t o f urt her def orest at ion. Triple account abilit y
requires t he emergence of int egrat ed REDD st rat egy act ivit ies t hat are: i ef f icient in reducing emissions at af f ordable cost , linking local t o int ernat ional scales in ways t hat are account able
f or emissions but as simpl e as possible, ii address social equit y and f airness, wit hin improved syst ems of governance and account abilit y f rom local t o int ernat ional scal es, iii design a proj ect
goals f or co-benef it s including environment al e. g. , maint ain soil f ert ilit y t hrough erosion reduct ion, provide sust ainable livelihood f or communit ies and biodiversit y and habit at
rest orat ion, and iv express a commit ment t o learning and account abilit y f or t he REDD process. This act ivit ies will help overcome t he obst acles associat ed wit h engaging local people,
environment and economic assessment , and lack of inst it ut ional inf rast ruct ure. This will result in social-economic benef it s by improving t he livelihoods of people living in and around f orest s, as
well as environment al benef it s by conserving f orest s and cont ribut ing t o climat e mit igat ion t hrough REDD.
The overall obj ect ives is how t o make REDD a viable opt ion f rom social , environment and economic benef it ?
Specific obj ectives:
Assess environment al and socio-economic impact s of REDD, Assess pot ent ial addit ional benef it s of REDD :
Assess t rade-of f s and risks of REDD t o sust ainable development Assess risks of t he REDDI st rat egy
Expected Outcome: Posit ive environment al and socio-economic impact s of REDD
Addit ional benef it s of REDD act ivit ies ident if ied Trade-of f s and risks of REDD analyzed,
40
Risks of REDDI st rat egy ident if ied and addressed.
Methods to be used to achieve outcome:
1. Analyt ical works
2. Survey and mapping
3. St akeholders consult at ions and policy dialogue t o reach consensus common underst anding
on t he issues and ways t o addressed risks
Activities :
1. Review t he current ref erences and proposals f or REDD policies.
2. Obt ain spat ially ref erenced of socio-economic dat a populat ion, income, et c.
3. Est imat e vulnerabilit y assessment t o det ermine likely def orest at ion rat es based on
socioeconomics and environment al charact erist ics of t he area. 4.
Det ermine t he possibl e t ransact ion cost s associat ed wit h alt ernat ive policies f or avoiding def orest at ion
5. Assess inst it ut ional arrangement s t hat will cont ribut e t o t he ef f icient impl ement at ion of
several policies
Table 8. Schedule and Sequencing of activities:
Schedule No Activit ies
2009 2010 2011 2012
1 Anal yze environment al and socio-economic impact s of REDD :
•
Review current ref erences and proposal s f or REDD policies
•
Obt ain spat ial ref erence of socio-economic dat a popul at ion, income, et c.
•
Vulnerabil it y assessment t o det ermine likel y def orest at ion rat es based on socioeconomics and environment al
charact erist ics of t he area. 2
Eval uat e pot ent ial addit ional benef it s of REDD :
•
Ident if icat ion and valuat ion of addit ional benef it f rom REDD incl . biodiversit y conservat ion, livelihood improvement ,
wat ershed prot ect ion 3
Assess t rade-of f s and risks of REDD t o sust ainable :
•
Det ermine t he possible t ransact ion cost s associat ed wit h alt ernat ive policies f or avoiding def orest at ion
4 Assess risks of t he REDDI st rat egy
•
Assess inst it ut ional arrangement s t hat will cont ribut e t o t he ef f icient implement at ion of several policies
5. 2. Attach your ToR for this component as a separate Annex 5. See Annex 5
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Component 6: Assess investment and capacity building requirements
6. 1. Obj ectives and activities: Obj ectives for this component:
Kategori