State of Forest Carbon Finance 2015 - Report
Companies and governments that put a value on the carbon stored in the world’s remaining forests are ramping up results-based finance for those assets, according to Ecosystem Marketplace’s State of Forest Carbon Finance 2015 report, launched last week.
Bonn, 11th of November 2015
2014 marked a breakout year for forest carbon markets, with buyers paying a record-high $257 million for 34.4 million offsets. Voluntary demand increased 18% over 2013’s volumes, to 23.7 million tonnes, and voluntary prices recovered to an average of $5.4/tonne. Meanwhile, compliance demand jumped over 200% as buyers in California and Australia collectively purchased 10.6 million tonnes in land-use offsets to meet regulatory obligations, with compliance prices coming in just beneath the going allowance price or set carbon tax.
Offsets from REDD+ (Reducing Emissions from Deforestation and Forest
Degradation) were the most commonly transacted project type last year, with
voluntary market actors purchasing 16.1 million tonnes from project-level
activities. More than 100 forest carbon projects are located in states, provinces,
or countries engaged in larger-scale avoided deforestation programs, and many
are grappling with how to "nest” into these jurisdictional efforts as more
international finance may soon be targeted towards regional-level programs. In
climate plans submitted to the United Nations Framework Convention on Climate
Change (UNFCCC), 29 developing countries specifically mention that they plan to
implement a national REDD+ policy or sell REDD+ offsets – with a portion of
their emissions reductions target hinging on this possibility.
"Tropical forest countries are poised to make huge contributions to climate
change mitigation by pursuing development pathways that treat standing forests
as their greatest asset,” said Forest Trends President and CEO Michael Jenkins.
"But they need a strong signal that companies and developed country governments
are ready to pay for those assets.”
In additional to the market numbers, the report tracked $219 million
committed to forest protection in 2014 in the form of non-market, bilateral
payments from the Norwegian and German governments to help reduce tropical
deforestation in Brazil and Guyana. At least $1.2 billion in new results-based
finance is "on the table” for tropical forest countries in the near future
through similar bilateral deals.
The report is
available for download here
Tags: Ecosystem valuation | Supply Chain Management
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