REDD Negotiators Inch Towards Inking Market-Based Mechanism

Steve Zwick on December 17, 2009 2 Comments

17 December 2009 | It's past midnight here in the Bella Center, and the last time we checked the group drafting the REDD text was still sequestered after being called in more than six hours ago. From the bits and pieces we've managed to hear, however, it looks like they are close to embedding institutional arrangements for direct funding of REDD projects in the document that will be handed up to ministers on Friday, as well as a provision for incorporating the value of ecosystem services into environmental safeguards on REDD projects.

Several negotiators said they believe that language explicitly describing such direct payments will make it into the text, albeit without the phrase "market-based" and perhaps in brackets - which is what UN negotiators do to provisions they disagree on. Such bracketing helps guide negotiations once they reach the higher level.

Negotiators are mixed on the outcome (as negotiators are wont to be), but one predicted a solution before the session ends.

NAMAs and Sub-Nationals
There is still no agreement on whether or not to categorize REDD as a "nationally-appropriate mitigation activity" (NAMA) under the Bali Action Plan. As we've reported on Ecosystem Marketplace, NAMAs are an olive branch from the developing world in lieu of mandatory caps. The idea is that the developing countries could proactively elect to reduce emissions by doing activities that suit them instead of signing up for binding targets under the Kyoto Protocol. The problem is that there's no agreement on what constitutes a NAMA (although there is no shortage of definitions - we've seen at least 15).

Proponents of categorizing REDD as a NAMA offer two arguments: first, that reducing emissions from deforestation is nothing if not a nationally-appropriate mitigation activity. Second, they argue that specific financing mechanisms for NAMAs are bound to evolve as NAMAs come into focus, and that placing REDD outside the NAMA regime now will leave it out forever.

Opponents of categorizing REDD as a NAMA counter that such categorization would slow down the implementation of REDD activities, at tremendous cost down the road.

At this point, it's bracketed as a NAMA, and that will have to be decided by higher-level negotiators on Friday.

Then you have question of whether to follow national or sub-national accounting for REDD. Most parties agree that national accounting is the only way to prevent leakage, but a consensus has formed around limited sub-national accounting in the building phases of REDD, but not in the mature phase. Columbia and Peru, however, have pushed back - with Columbia offering to monitor its deforestation on a national basis, but not agreeing to be held accountable.

Safeguards and Deforestation Targets
Social safeguards against abuse are in the preamble of the text, but are bracketed in the operational part, while environmental safeguards have several forms, some bracketed and some not.

A suggestion to specifically disallow projects that convert native forest to plantations was shot down, but a new suggestion to draft language that talks of reduced ecosystem services appears to be resonating among negotiators.

Finally, specific targets on deforestation rates have been left blank - and to be decided by high-level negotiators. Developing countries argue that any deforestation targets should be tied to funding.

REDD and LULUCF Wrap
On the way out of the center, we ran into Marcelo Rocha, co-chair of the group focusing on Land Use, Land-Use Change, and Forestry (LULUCF) in the Kyoto Protocol tract. He said his group expects to be working through the night.

When this is all over, Kate Hamilton will write up an analysis of LULUCF, and I'll be doing a wrap of the latest in REDD.

Keep checking Ecosystem Marketplace for the latest.