| Sourced From Carbonpositive.net |
A UN case study of a CDM reforestation project in central Africa provides some valuable insights into two familiar obstacles in the carbon project development space. First, is the difficulty of establishing CDM projects in the afforestation and reforestation sector, and second, the barriers to getting any sort of carbon project up and running in Africa, a continent poorly represented in the CDM and voluntary carbon markets now worth hundreds of billions worldwide.
The UN Environment Programme Finance Initiative has released a report entitled “And yet it moves – Success stories and drivers of CDM project development in sub-Saharan Africa”. The study considers what has prevented the CDM from achieving its full potential in sub-Saharan Africa by looking in depth at five CDM projects across a range of technology types. Each case study includes a country assessment, project description and analysis of lessons learned. There are also general conclusions and recommendations gleaned across all the case studies.
The report notes that Africa is expected to account for no more than 3 per cent of the global supply of Certified Emission Reductions (CERs) volumes by 2012, and most of those will come from South Africa.
The A/R project reviewed is the Ibi Batéké carbon sink plantation in Democratic Republic of Congo, planting a mix of native and non-native species over 8000 hectares of savannah land, which has been highly vulnerable to fire. Financed through the World Bank’s BioCarbon fund, it aims to generate emissions reductions of 2.4 million tonnes of CO2 over its 30 year lifetime, half a million of those by 2012. The forest would also provide a source of sustainable fuel wood supply.
Like many CDM A/R projects, delays in achieving UN registration has meant the developers are taking dual market approach, seeking to sell VCU carbon credits into the voluntary market in the early years. It is estimated that carbon revenues, temporary CERs and VERs, will account for 55.6 per cent of project income but the project is not yet requesting registration with the CDM executive board.
The study nevertheless concludes this to be a successful project. Key drivers of this success are identified as a strong government backing in the host country. In particular, the study found a well-functioning and committed designated national authority (DNA) and land registry, often lacking in other African countries. Valuable too was early private sector finance commitment and ERPAs struck with reliable buyers, making “this project an early success and an example both in Africa and beyond”.
Across all the projects studied, the involvement of international finance and development agencies, in Ibi Batéké’s case, the World Bank, were judged to be important to managing the risks that might otherwise prevent private sector investment.
The report confirms great potential for both A/R and REDD carbon projects in Africa but that it falls short of being realised. There are two key recommendations to address this; firstly, better developed forestry frameworks at a national level. Second, a new approach in the CDM to ensuring permanence of forest carbon sequestration so that forestry projects are competitive and fully-fungible with other carbon credits. This effectively means scrapping the current system of temporary and long term CERs in A/R in favour of permanent CERs along the lines of those issued un the voluntary market. “Only then will the private sector more intensively engage in this area,” the report says.
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This is an interesting project for Africa and similar initiatives should be promoted to enhance Africa’s participation in contributing to addressing cliamte change problem and achieving sustainable development. However, it is not clear on the basis of additinality how the project will reduce fire hazards prone in savannah ecosystems. Also, the issue of leakage should be mentioned considering the nature of the project and the magnitude within a local community establishment, a number of anticipated issues of illegal wood harvesting are likely to occur as aresult of restrictions to manage and conserve the the planted trees to meet the A/R for CER objectives.