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Result-based payments for REDD+

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Presented by Arild Angelsen (Professor, School of Economics and Business, Norwegian University of Life Sciences (NMBU), Ås, Norway & Senior Associate, CIFOR , Bogor, Indonesia) at SBSTA 50, 25 Jun 2019, World Conference Center, Bonn, Germany.

Publié dans : Environnement
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Result-based payments for REDD+

  1. 1. Result-based payments for REDD+ SBSTA, 25. June 2019 1 Arild Angelsen Professor, School of Economics and Business, Norwegian University of Life Sciences (NMBU), Ås, Norway & Senior Associate, CIFOR , Bogor, Indonesia arild.angelsen@nmbu.no Result-based REDD+ payments
  2. 2. • 10 years of CGS-REDD+ research • CIFOR and partners • Almost 500 publications 2008 2009 2012 2018 Result-based REDD+ payments 2
  3. 3. Result-based REDD+ payments 3
  4. 4. Results-based payment • Many names, essentially the same idea – Performance/Output-based Pay, PES, COD, etc. • A key element of the REDD+ idea, and phase 3 • Limited in practice, but increasing – Phase 1 & 2 – Not backed by sufficient funding – Major hindrances in MRV, transparency, institutional arrangements, etc. Result-based REDD+ payments 4
  5. 5. What is RBP? 1. Payment based on predefined results; 2. Recipient discretion to decide how to achieve results; 3. Independent verification of results (Perrin, 2013). Do current “RBP” funding meet these criteria? Only partially 1. Some post-hoc payment 2. Not full recipient discretion (e.g. safeguards) 3. Negotiation of results Result-based REDD+ payments 5
  6. 6. Challange 1: What to pay for? Two dimensions: 1. Where to pay along the impact chain inputs → activities → outputs → outcomes → impact Strong arguments to pay for what matters (= impacts), but measurement, risk spreading and ref.levels more tricky 2. Which outcomes: C vs. NCBs – Climate the mandate of UNFCCC – Carbonization of forest governance” (Gupta et al. 2012) – How to include NCBs? • Constraints (safeguards) • Extra payments: – VCS price USD 2.3 per tCO2 (2016) – VCS + CCB: USD 3.9 (+ 70%) Result-based REDD+ payments 6
  7. 7. Ways forward • Incentives for all REDD+ phases –Important steps towards the ultimate goal –Fair as countries are at different stages • Focus on carbon, with safeguards and NCB as additional incentives –Carbon sufficiently important to be main focus –Conserving standing forests largely compatible with other objectives, particularly if use PES (Duchelle et al. 2018) Result-based REDD+ payments 7
  8. 8. Challenge 2: Ensuring additionality (setting FRELs) • What would happen without REDD+? • Has REDD+ made a difference? • Establishing the hypothetical counterfactual is the key problem in any impact assessment • … and indeed in science (i.e., establishing causality) Result-based REDD+ payments 8
  9. 9. Meanings of FREL/FRL/RL 1. Business as Usual (BAU) or counterfactual – Emission reductions = actual emissions - FREL – Benchmark to measure performance/impact/effectiveness – Did the project/policy work? 2. FIB: financial incentive benchmark (“emission quota”) – How much to pay? 3. “Expected effort“ – The contribution to international mitigation through REDD+ actions under the UNFCCC (UN REDD programme, 2015) 4. “Aspirational target” • Overloading of the concept Result-based REDD+ payments 9
  10. 10. UNFCCC: Historical + National circumstances 10 Herold et al. (2012) Result-based REDD+ payments
  11. 11. Different ref.levels for Brazil: (1) Amazon Fund: Last 10 years (stacked lines). (2) UNFCCC submission 1996-current (blue) 0.000 5.000 10.000 15.000 20.000 25.000 30.000 Deforestation, Amazon (Brazil), km2 Annual defor 96-05 avg 01-10 avg 96-15 avg 06-15 avg Result-based REDD+ payments 11
  12. 12. Peru Result-based REDD+ payments 12 20% above 2015 level
  13. 13. Ways forward • The Paris rule book needs to clarify key aspects: –Defining D&D –Standardizing the period for historical emissions –Eligible “national conditions” –Flexibility (buy-in) vs. detailed rules –Learning, cf. CDM • Independent, third party review needed –Independent of UNFCCC/GCF –Critical, stimulate debate Result-based REDD+ payments 13
  14. 14. Challenge 3: whom to pay? • Who owns the emission reductions (ER) • Luttrell et al. (2013), 6 potential recipients: 1. actors with legal land rights (land owners) 2. actors achieving ER (companies, communities, ..) 3. low-emitting forest stewards (e.g. indig. peoples) 4. actors incurring the costs (proponents, governments,..) 5. effective facilitators of REDD+ implementation (NGOs, government); 6. poorest groups in the region (achieve other objectives and boost public acceptance). Result-based REDD+ payments 14
  15. 15. Distribution within countries • Who is to be credited for broad national policy reforms? • Sharing between federal level and states/provinces –Brazil: 40-60 –Indonesia: provincial distribution of FRELs –Nested approaches Result-based REDD+ payments 15
  16. 16. Ways forward (C3) • Main principle: incurred costs and attribution of results –Opportunity costs of forest conservation (forsaken benefits of forest conversion) –Transaction costs –Loss of tax revenue –But tricky: how much D&D is fair and legal? • National REDD+ offices the key to manage fragmented REDD+ finance Result-based REDD+ payments 16
  17. 17. Only by recognizing the pitfalls can we avoid them • RBP has a number of attractive feature, in theory • Will it also deliver more – compared with other approaches – in practice? –The empirical evidence is weak • The effectiveness depends on design and implementation –Potential for gaming and misuse Result-based REDD+ payments 17