9 A u g u s t 2 0 1 1

Evidence of Voluntary Transactions

Training Workshop on Payments for Ecosystem Services (PES) and Reducing Emissions from Deforestation and Forest Degradation (REDD+)

I L L U S T R AT I V E C A S E S T U D I E S

1. Water

2. Biodiversity

3. Voluntary Carbon

4. Forest Carbon

Evidence of Voluntary Transactions

Payments for Watershed Services:

• $9.25 billion total transacted

• 216 total programs (113 active)

Water Quality Trading: $10.8 billion total

• $10.8 billion total transacted

• 72 total programs (14 active)

Payment Mechanisms

• Government direct

• Private negotiation

• Market-driven transactions

1. Water Transactions

Source: State of the Watershed Payments : An Emerging Marketplace. June 2010. Stanton, Echavarria, Hamilton, Ott. Ecosystem Marketplace

1. Water Transactions

Source: State of the Watershed Payments : An Emerging Marketplace. June 2010. Stanton, Echavarria, Hamilton, Ott. Ecosystem Marketplace

Equitable Payments for Watershed Services Tanzania

Facilitators: CARE International, WWF, IIED, PREM

Buyers: Industry in Dar es Salaam and Tanga (DAWASCO, Coca-Cola, etc.)

Providers: 450+ farmers in Uluguru and East Usambara Mountains, Ruvu and Sigi River Basins

Goal: long –term financial investment in upstream land-use changes to conserve and improve watersheds

Challenges: • Farm expansion • Unsustainable irrigation• Illegal mining

For more information: http://www.fao.org/es/esa/pesal/attachments/5_Dosteus_day1.pdf

2. Biodiversity Transactions

Worldwide

• 2,4 – 4.0 billion USD min. Annual

• 187,000 hectares

• Compensatory mitigation programs: 45 operating, 27 developing

Africa

• 6 biodiversity offset programs developing

• South Africa: leader with one national and two provincial offset policies

• Uganda, Madagascar, Ghana, Namibia exploring EIA and offset policy

Source: State of Biodiversity Markets: Offset and Compensation Programs Worldwide. July 2011. Madsen, Carroll, Kandy, Bennett Ecosystem Marketplace

2. Biodiversity Transactions

Source: State of Biodiversity Markets: Offset and Compensation Programs Worldwide. July 2011. Madsen, Carroll, Kandy, Bennett Ecosystem Marketplace

Wildlife Protection in North-West Serengeti

Project profile: Markets for wildlife products and services provide incentives to conserve wildlife habitat and end poaching

Suppliers: villagers outside of The Serengeti National Park

Buyers: local corporations and commercial tourism industry

Activities

• Revenue Sharing by Tourist Hunters

• Local Sourcing of Products

• Community Wildlife – Cropping

• Land-leases and joint tourism enterprises

For more information: http://pubs.iied.org/pdfs/7794IIED.pdf

3. Voluntary Carbon Transactions

• OTC average: $6/ tCO2e

• Total 2010 value : 424 million USD

• Total 2010 volume: 131 MtCO2e

• Land-based credits ≈50% of 2010 OTC market, 100% of African

• Sellers transacting credits in 2010 • 284 suppliers • 38 countries • 9 suppliers in Africa, 5 countries

• Buyers: for profit, motivated by credit retirement, led by the EU

Source: Back to the Future: State of Voluntary Carbon Markets 2011. Peters=Stanley, Hamilton, Marcello, Sjardin. Ecosystem Marketplace

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• 34% of suppliers from US• Suppliers from developing countries doubled (2009: 29; 2010: 58) • 9 Suppliers from Africa

• Kenya (1) , Uganda (2) , Sierra Leone (2) , Mauritius (1), South Africa (3)

3. Voluntary Carbon Transactions

Source: Back to the Future: State of Voluntary Carbon Markets 2011. Peters=Stanley, Hamilton, Marcello, Sjardin. Ecosystem Marketplace

3. Voluntary Carbon Transactions

Transaction Volume by Location and Project Type09

10

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US Latin America

Asia Europe (non-EU)

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Source: Back to the Future: State of Voluntary Carbon Markets 2011. Peters=Stanley, Hamilton, Marcello, Sjardin. Ecosystem Marketplace

29%

16%

11%6%

6%

6%

5%3%2%

2%

2%

2%

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REDD/Avoided Conversion

Landfill methane

Wind

Afforestation/ Refor-estation

Run-of-river hydro

ODS (US-based)

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Agricultural soil

Biomass

Livestock methane

Forestry (general)

Energy Efficiency

Other

Transaction Volume by Project Type

Other - non-descript 3%

Wast water 2%

Fuel switching 1%

N2O 1%

12 types <1%

3. Voluntary Carbon Transactions

Source: Back to the Future: State of Voluntary Carbon Markets 2011. Peters=Stanley, Hamilton, Marcello, Sjardin. Ecosystem Marketplace

A Personal Forestry Carbon Sale in Uganda

• ECOTRUST with ICRAF, CARE, LTS International and ECCM project to aggregate local farmers to sequester carbon

• Beatrice Ahimbisibwe, Mitooma-Bushenyi in 2003: • Contract with ECOTRUST• 1 ha of native trees, 52 tons CO2 ,10 years• USD 8/ ton = $416 total

• Since 2003: • Beatrice plants additional 2.5 ha• Her son 2.5 ha, and her daughter 1 ha • Price up 50% to USD 12/ton • Number of farmers in total project = 300 • Buyers: Tetra Pak UK, YOU, CAMCO and WE (through

ECOTRUST) • Beatrice travels to build capacity for local Ugandan farmers

For more information: http://www.planvivo.org/

4. Forest Carbon Transactions

• 2009 value: 20.8 MtCO2

• 226 projects

• 2.1 million hectares

• $149.2 million credits

• Average price $8.99/ tCO2

• 86% use third party standard

• Africa 11% of volume, $20.9 million in revenue

• 2009 project types: A/R 53%, Mixed 24%, IFM 20%

• Suppliers: 53.7% NGOs, 40% private sector, 7% public

Source: State of the Forest Carbon Markets 2009: Taking Root and Branching Out. Hamilton, Chokjalingam, Bendana. Ecosystem Marketplace

4. Forest Carbon Transactions

Source: http://www..forestcarbonportal.com/

Cocoa Carbon in Ghana

• Shade cocoa farming techniques to store 2X CO2 (159 tonnes/ ha)

• Benefits: carbon income and increased soil quality

• Approx. 120,0000 has cocoa farming landscape in Bonsambepo

• Sellers: Farmer and cocoa-buyer groups

• Developers: Incubator, NCRC

• High biodiversity benefits

For more information: http://www.katoombagroup.org/incubator

Cocoa Carbon in Ghana

Project Goals

1. Pilot development of REDD+/ agricultural carbon credits

2. Reduce emissions from forest degradation, enhance carbon stock

3. Improve productivity and ecological resilience of cocoa farming

4. Livelihood benefits through capacity and increased income

5. Introduce certification, extension services, and credit facilities for higher productivity

Increasing farm profits will avoid deforestation and degradation for new farms. Using shade-grown approach will increase carbon stocks and enhance soil quality.

For more information: http://www.katoombagroup.org/incubator

M i c h a e l R i c h a r d s

T h e K a t o o m b a I n c u b a t o r

m r i c h a r d s @ f o r e s t - t r e n d s . o r g

w w w. f o r e s t - t r e n d s . o r g

w w w. k a t o o m b a g r o u p . o r g / i n c u b a t o r

Thank You!

Questions and Discussion