The CarbonNeutral Company

The Business Case for REDD


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Deforestation and Degradation
Around the world, forests are being destroyed at a rate of about thirteen million hectares a year and deforestation accounts for an estimated 17 – 20% of all global emissions. In addition, forests and other terrestrial carbon sinks play a vital role in preventing runaway climate change, soaking up a full 2.6 Gt of atmospheric carbon every year. The destruction of forests, therefore, not only emits carbon – a staggering 1.6 Gt a year, which severely impairs forests’ capacity to absorb emissions from other sources – but also drastically reduces the amount of forested land available to act as a carbon sink in the future.

However, the effects of deforestation extend beyond carbon. Rainforests provide a wide variety of ecosystems services, from regulating rainfall to purifying groundwater and keeping fertile soil from eroding; deforestation in one area can seriously damage food production and access to clean water for an entire region. The value of global ecosystem services has been estimated at 33 trillion USD each year (almost half of global GDP), but these services have been taken for granted without a mechanism to make the market reflect their value1. Rainforests are also a home and source of income for a huge number of people in Africa, Asia, and South America. Despite this, economic pressures frequently drive both local communities and national governments in the developing world to exploit these forests in ways that are unsustainable, clear-cutting vast areas for fuel, timber, mining, or agricultural land.

Reduced Emissions from Deforestation and Degradation (REDD) is an emerging system for bringing rainforest conservation within the carbon market. Under this system, companies can offset their carbon emissions by buying credits from programmes that work with local communities to protect sections of rainforest. REDD+, the system currently under discussion through global climate negotiations, broadens the scope of REDD by incorporating conservation, sustainable forest management, and the enhancement of forest carbon stock.

The UN created a collaborative initiative in 2008 to help developing countries create national REDD+ regimes. The UN-REDD programme, funded by donors such as Norway, Denmark, and Spain, has three phases: the development of a national strategy for REDD+; the implementation of that strategy using UN-REDD funds; and the sale of verified REDD+ credits. The countries piloting the UN-REDD programme are the Democratic Republic of Congo, Tanzania, Zambia, Indonesia, Papua New Guinea, Vietnam, Bolivia, Panama, and Paraguay. Most of the national programmes in these countries have now reached the second phase – implantation using UN-REDD funds.

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