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Amazonas Workshop:
Readiness for REDD
Experiences from Papua, Indonesia
Marisa Meizlish
Director
New Forests Advisory Inc
+1-415-321-3301
mmeizlish@newforests.com.au
Thursday, February 12, 2009
South-South Collaboration Workshop
Amazonas, Brazil
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Outline
1. Introduction to New Forests
2. Context for Papua Project
3. Papua project summary
4. Project characteristics
a) Governance
b) Baseline
c) Consultation / social
d) Link to national strategies
e) Distribution of benefits
f) Financing
5. Lessons learned & conclusions
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1. New Forests
• Private for-profit forest investment management and advisory services
firm
• Headquartered in Sydney, Australia, with offices in Washington, D.C.,
San Francisco and Kota Kinabalu, Malaysia
• Investments primarily in Australia, New Zealand and the Asia Pacific
region
• REDD: began studying in 2007 and developing the Papua project in
2008; hope to achieve certification (Voluntary Carbon Standard) in
2009
• Developing other smaller REDD projects as part of larger investments
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2. Papua Project Context
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2. Papua Project Context: Deforestation Drivers
• 90% of world’s palm oil exports come from Malaysia & Indonesia
• 300,000 ha converted per year globally
• Luxury products (cosmetics, shampoos, food) & biofuels
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2. Papua Project Context: REDD Markets
Mitigation – Forestry
Mechanism Market
Project-Based / Credits National Accounting
(“market”) (“non-market”)
Reforestation /
CDM – Only Reforestation
UNFCCC Deforestation
Regulatory “CDM” – REDD post-2012 ?
REDD post-2012 – ?
2008: $118B Domestic Regulatory Reforestation
3.9 BtCO2 Reforestation /
Markets (i.e. U.S., Forest Management
Deforestation
Australia, Canada) REDD – ?
Voluntary
Business Commitments / Reforestation
Marketing / Forest Management not relevant
2008: $499M
Personal Choice REDD
100 MtCO2
• Voluntary market projects can move the REDD market forward while
complex regulatory mechanisms are negotiated
• Develop technical methodologies and new business models
• Ultimately, REDD will survive or fail in regulatory markets
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3. Papua Project Summary
• Began with Memorandum of Understanding between Governor
Suebu & New Forests, May 2008
• Government nominated 3 concession areas – 2 were prioritized
after desktop review
• June 2008, site visits to begin feasibility and project design
Mamberamb
o
Mimik
a
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3. Papua Project Summary
• Project framework
o Baseline assumes conversion to palm
o Approximately 28MtCO2e conserved under project scenario
o Voluntary carbon sales – Voluntary Carbon Standard (VCS) & Climate,
Community & Biodiversity Alliance Standards (CCBA)
o Revenues to local foundation, government & investors
o Local partner with political & implementation experience
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4a. Governance
• MOU for joint development of
REDD project: “commercially
sustainable model for forest
conservation and community
development”
• Applying for provincial license that
will grant carbon rights to New
Forests
Gov. Suebu signing MOU, May 2008
• Term sheet defines financial arrangements
• Regency and district governments provide local political and logistical
support
• Papua Carbon Foundation receives revenue from credit sales to fund
community development & forest protection activities
o Governed by Advisory Committee with local stakeholders and relevant
experts
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4b. Baseline
• No existing methodologies for Avoiding
Planned Deforestation - areas with low
rates of historical deforestation require
technical rigor
• Other areas of province have higher
deforestation rates but causal “link”
needs to be established
• Limited data and existing quantitative
analysis of deforestation drivers
Where we are now:
• Understanding data requirements needed to establish biophysical and
economic feasibility of conversion
• Understanding modeling requirements to demonstrate likely rates of
deforestation
• Evaluating in-house capabilities and resource needs
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4c. Consultation Process
• Dozens of small villages in both project areas – primarily small scale
agriculture, sago palm harvesting, hunting & fishing
• Loosely organized through district & regency governments
• In June 2008 met with local governments and held village meetings
in conjunction with local NGOs and met with dewan adat (tribal
council)
• “Oxygen” project
Village meeting in Bagusa, Mamberamo, June Meeting with regency & district government officials and
2008
village elders in Mimika, June 2008
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4c. Consultation Process
• Initial feedback at all levels of was
positive
• Written letter of support from
head of dewan adat in Mamberamo
• However, questions remain
regarding community development
aspirations, project activities and
socio-economic considerations Receiving letter from head of dewan adat in
Casanoyagia, Mamberamo, June 2008
relevant to project design and
implementation
• Free, Prior & Informed Consent crucial to ensure
successful project and social & environmental outcomes
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4c. Consultation Process
• Free, Prior & Informed Consent
o Limited guidance & standards
o Work with best experts with field experience in community
engagement for forestry in Papua and Indonesia
o Intention to provide full information about the project and
potential outcomes & risks
o Decisions and debate at the community level to accept or reject
the project
• Help shape the objectives and management plan for the Papua
Carbon Foundation
• Further establish channels of communication between impacted
communities and government
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4d. Link to National Strategies
• Indonesia is extremely active in REDD
o More than 20 REDD projects in development in the country
o Participant in the UN-REDD Programme and the World Bank
Forest Carbon Partnership Facility
o Bilateral agreements with Germany (Forest and Climate Change
Program) and Australia (Forest Carbon Partnership)
o Governors of Aceh & Papua (and several Brazilian states) have
signed an MOU with US governors for inclusion of REDD credits
in emerging carbon schemes
• Unclear how these activities will interact on a technical level (i.e.
carbon accounting)
• However, biggest questions now are legal and financial
o Draft national legislation issued in mid-2008 and national
government is now working to revise and finalize legislation – June
2009
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4e. Distribution of Benefits
• Beneficiaries at village, district, province and national level
• Private investment necessitates returns
• Primary distribution channel is the Papua Carbon Foundation
o annual disbursements to fund community development and forest
protection activities – determined by FPIC process
o Advisory Board comprising representatives of community
stakeholders and relevant experts
• Remaining revenue: government, investors & project managers
New Forests & Emerald Planet staff with provincial
Forestry Department staff and government officials in 15
Mamberamo, June 2008

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4f. Project Financing
• New Forests represents private
investors interested in financial
and environmental returns
• Skilled in monetizing
environmental assets associated
with forestry investment
• Well aligned with Papua’s
objectives and project parameters
• Returns delivered through credit
sales over time
Managing Directors of New Forests and Emerald
Planet meeting with Governor Suebu, May 2008 c
• Upfront costs shared among project partners
• Long-term commitment to sustainable resource use in Indonesia
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5. Lessons Learned
• Projects in areas with low rates of deforestation have high hurdle
to establish evidence-based baselines
• Area, such as Papua, where this is limited data availability make
this even harder
• Legal uncertainty for REDD projects outside national-level
demonstration activities – right to transact credits?
• Also face technical uncertainty – project vs. national level
baselines?
• FPIC is time consuming and requires dedicated resources – lack
of standardized guidance
Difficult to get early project financing where
there is no established legal & methodological
frameworks
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6. Conclusions
• Private investment can play pivotal role in more challenging
REDD areas that attract less public & multilateral funding
• Will take on the risks as long as there is some certainty on
fundamental issues:
o Legal right to transact in carbon
o Legal arrangements for revenue
sharing among government
agencies/levels
o Legal recognition of project
activities within national-level
activities
• Donor / grant / multilateral finance
remains important for information Arial view of Mimika site, June 2008
gathering, data analysis and FPIC/
community engagement
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www.newforests.com.au
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