- Minutes of the last Commission meeting
This 8th newsletter starts with the minutes of the last Commission meeting, held on April 6, 2023.
- A review of the issues and conclusions of the OFS which, as Alain Karsenty reminded us, was initially an initiative supported by the French government to find solutions to remunerate so-called "HFLD" countries (high forest cover and low deforestation) that cannot benefit from traditional carbon finance due to the principle of additionality (demonstrating that without carbon finance, the country or project would not have been able to reduce its emissions). The OFS was an opportunity to discuss alternatives to carbon finance as we know it, in order to "reward" these HFLD countries and value their carbon stocks. The issue of biodiversity credits, an adapted reference level based on the country's absorption potential, and the development of sovereign carbon credits that take into account this HFLD characteristic were discussed. But constraints remain: unattractive to private buyers, ambiguity of these sovereign credits and their place in the voluntary carbon markets, etc. One avenue explored by the OFS is that of high environmental and social integrity credits, on a project or national scale, to value these stocks. But according to Alain Karsenty, the question of the market on which these credits would be sold (voluntary or compliance) and that of the link with carbon certification standards have not yet been resolved. Biodiversity certificates were also debated. They are part of a contribution logic and not a compensation logic. The question of additionality will be central, in particular to verify that they are not a rent for the countries but rather a remuneration for the actions implemented. There are still many points to be clarified, such as their link with carbon credits, the measurability of their impact, etc. The Commission will closely monitor the commitments made at the OFS in the coming months, ahead of the COP28 in Dubai at the end of the year.
- Carbon projects in Côte d'Ivoire: Côte d'Ivoire is the country with the highest rate of deforestation in the world over the last 20 years. Faced with increasing international pressure, through initiatives such as the CDN or the recent European law on products from deforestation the Ivorian government has had to react. The country's ambitions are, among others, to (a) generate a transformational change in forest management, through the adoption of an integrated approach combining economic development, social welfare and natural resource conservation, (b) increase forest cover from 11% to 20% and from 20% to 50% in classified forests by 2040, (c) reduce deforestation by 80%, (d) reforest more than 5,000,000 ha in agricultural and rural landscapes. Since 2011, the Government has been committed to the Reducing Emissions from Deforestation and Forest Degradation (REDD+) process, in order to address the drivers of deforestation and forest degradation. In November 2019, the government adopted a series of decrees and orders to support the implementation of the new Forestry Code (2019) and the SPREF (Strategy for the Preservation, Rehabilitation and Extension of Forests, 2018), thus establishing a policy framework that supports the implementation of World Bank-supported operations. To achieve this, the country relies on PES (Payment for Environmental Services) money such as carbon credits and foreign investors to finance these forest cover projection/regeneration projects. To date, only one project with this type of funding has reached the implementation phase: the World Bank's ERP (Emissions Reduction Project).
- The progress of the Organization for Biodiversity Certificates: The organisation is growing and now has 18 members. Funding is coming in: on the one hand, the new Gold standard member is helping the OBC to find investors and on the other hand, groups are ready to finance the methodological grids on the agricultural part. The ATIBT has invested in this organisation for several reasons. Indeed, one of the objectives of the ATIBT is to increase the value of forests and the work of its certified manager members. Their model is currently rather limited economically and the other services provided by forest management are not valued. This is why the ATIBT is seeking to find innovative financing mechanisms to supplement the income of this model so that it is sustainable. Although foresters are eligible for carbon projects (and by extension carbon credits), the margin resulting from an additional effort by forest concessionaires would be quite small. Indeed, they have already implemented high-level management mechanisms. The initiative of the biodiversity-based financing mechanism proposed by the OBC is innovative and interesting. It would respond to another observation about the role of certified forest managers, which is that they are conservation actors (through their management and means, anti-poaching, etc.).
- Emerging carbon initiatives
The newsletter presents two initiatives.
The Ecosystem Restoration Standard is a new certification standard for nature restoration projects in voluntary carbon markets. It is designed to strengthen restoration efforts that combat climate change, increase biodiversity and improve conditions for local people.
The Integrity Council for the Voluntary Carbon Market (ICVCM) is an independent governance body, which aims to define and maintain a voluntary global threshold standard for the quality of the voluntary carbon market. It launches global benchmark for high integrity carbon credits.
- Emerging or existing biodiversity initiatives
The newsletter also presents two biodiversity initiatives.
The protocol TERRASOS, under development, is designed to enable biodiversity conservation projects to record, quantify and issue Voluntary Biodiversity Credits (VBCs). The aim of this protocol is to demonstrate the gains in biodiversity brought about by preservation and/or restoration actions. Like the OBC methodology, TERRASOS will use a biodiversity indicator linked to actions beneficial to biodiversity (action indicator) and not a direct measurement of biodiversity which is very complicated to achieve (result indicator).
Finally, the RePlanet Standard is developed by a working group involving the World Bank, TNFD, NatureFinance and GSK. The principle of measuring biodiversity is based on an outcome indicator inspired by the Consumer Price Index (CPI) for measuring inflation.
The newsletter also provides an update on the news of the members of the Carbon & Biodiversity Commission and on upcoming events.
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