Money doesn’t grow on trees

moneytreeWalking into the COP, observer and party delegations alike are given a bar of chocolate. And while the candy bar does not give its holder a Golden Ticket, it does draw chocolate-lovers’ attention to an important message for the Trillion Tree Campaign. That campaign is spearheaded by Plant-for-the-Planet, an NGO launched in 2007 by a nine-year-old boy to plant a trillion trees on the world’s degraded forest land. Such efforts are priceless when it comes to climate change: trees are the only “machines” on earth that can store carbon. Plus, they provide invaluable resources (like cacao for the COP’s beloved chocolate).

The Paris Agreement highlights the importance of forests, as well. Article 5 of the Agreement calls for parties to take action in reducing emissions from deforestation and forest degradation, and to conserve and enhance sinks and reservoirs of greenhouse gases. Programs like REDD+ aim to reduce emissions from deforestation and forest degradation. Working under the UNFCCC, REDD+ provides technical and financial support for developing countries to reduce emissions and enhance the removal of greenhouse gases.

The biggest challenge for REDD+ is now moving to implementation. At the COP, parties are discussing–and will soon decide–what implementation should look like in terms of governance: should the UNFCCC create a new body or structure to govern REDD+ implementation, or do the existing structures suffice? Should parties continue to meet in voluntary meetings that support implementation of activities that contribute to mitigation actions in the forest sector, or have these meetings already served their purpose?

One argument put forth by many developed countries–who are against future voluntary meetings–is the Green Climate Fund’s (GCF) recent decision to allocate $500 million to results-based financing for REDD+ activities. This decision, as the argument goes, shows that the financial landscape for REDD+ implementation is now in place, and that parties and entities have taken the Paris Agreement (particularly Article 5) quite seriously.

Under the program, the GCF pays at most $5 per ton of CO2eq of emissions reduced. The pilot program applies to projects showing results between 2013-2018, and thus is still open for developing countries.

The decision is a result of multilateral negotiations, which were not–and are never–perfect or easy. But the decision took into account a large spectrum of national interests. Many countries do not want to compromise this decision by reaching alternative conclusions in future voluntary meetings for REDD+.

With a scorecard indicating the highest standard for REDD+ activities, developing countries now have a gold standard for the program that sets the bar high for financing. For the sake of REDD+ and the Paris Agreement, it is important that results-based financing has become a part of GCF’s portfolio: this provides GCF with the opportunity to test the waters of this approach while also inspiring a race to the top in implementing REDD+.