Carbon Credit Watch

Power taken from the people: UN carbon scheme threatens to ‘recentralize’ forest governance, spelling doom for forest ecologies

(May 18, 2010) A carbon emissions program created by the United Nations and financed by the UN and development institutions may strip forest use and management from citizens in the developing world, writes Brady Yauch.

Taking forest use, management, and ownership away from citizens in the developing world who depend on the forests for their health and livelihoods would seem a big step backwards. But that is exactly what will happen if a carbon emissions program created by the United Nations and financed by the UN and development institutions, such as the World Bank, gets the go-ahead say researchers in last month’s Science magazine.

According to researchers, Jacob Phelps, Edward L. Webb and Arun Agrawal from the National University of Singapore and the University of Michigan, for the past 25 years, central governments have been devolving rights and responsibilities over forests to local parties in recognition that it was a cheaper and more effective way to conserve, use, and manage forests.

“Local actors’ benefits and rights in forests,” say the researchers, “reduced costs of protection, and provided opportunities for biodiversity conservation.”

“A recent analysis of 80 forest commons across 10 countries shows that rule-making autonomy at the local level is associated with greater forest carbon storage and higher livelihood benefits.”

In fact, the trend was so successful at protecting forests that it was called “the most significant … most distinctive and [most] visible shift in national environmental policies since the late 1980s.”

That success is now threatened by the UN’s REDD  or “Reducing Emission from Deforestation and Forest Degradation” (known as REDD+) program. The plan is designed to give developed country CO2 emitters opportunities to “sequester” carbon in developing countries by paying governments to capture carbon in their trees. But the effect of the plan will be a recentralized control over forests and to undo the years of progress made, say the researchers.

Early signs show that REDD could channel huge sums to central governments in developing countries, with some estimates as high as $30-billion annually in REDD+ investments by 2020.

Regulators at the UN and other supporters of the REDD program are hoping to include REDD projects in the UN’s global carbon credit program, the Clean Development Mechanism (CDM), from which they are currently excluded.

If that happens, they could be traded in carbon markets, such as Europe’s, where CO2 caps are legally enforced and trading is obligatory if an emitter exceeds his cap. Currently, any credit earned in a REDD program is traded or sold only in voluntary markets—such as booths at the airport shilling carbon offsets to fliers.

The irony is that, by making forests cash cows for central governments, REDD+ will undermine decentralized governance systems that were already accomplishing the program’s goal—saving forests and sequestering carbon.

“Generous, long-term REDD+ funding will considerably reduce past financial burdens that motivated decentralization,” the authors write. For central governments, forest management was always more of a liability than an asset, so they were happy to offload control onto local parties. That cost-benefit calculation changes now with REDD+, say the researchers. They point out that the market value for avoided deforestation in Indonesia—$108-million—for example, is more than the entire 2006 Department of Forestry budget of $102-million. That kind of money would be hard for any government—even the most honest—to ignore.

Furthermore, say the researchers, by monetizing forest carbon, REDD+ will substantially increase the market value of forests previously considered marginal.

“With billions of dollars at stake, governments could justify recentralization by portraying themselves as more capable and reliable than local communities at protecting national interest.”

The result for local citizens could be tragic, write the authors, as it “could involve the imposition of excessive requirements or even evictions of local users, as in some national parks.”

The authors’ fears that locals will have a minor role, if any, in the REDD+ program are well founded, as a majority of the submissions for REDD+ ‘readiness’ funding from the World Bank gloss over forest fundamentals like who lives there now, how do people currently use the forests, and what are their rights and responsibilities. Neither does the UN currently mandate local involvement in REDD+ applications.

Worse, say the authors, is that the donors, governments and corporations looking for cheap carbon credits to “green” their image will “have little incentive to create local partnerships.” The result is that financial transfers from the REDD+ program will be detrimental to efficiency and equity in forest management. The authors call for more research and studies to optimize REDD+ and ensure that local citizens are provided with the authority and information to determine whether they want to participate in the projects.

But reform of the system is unlikely to change much. The real beneficiaries from schemes like REDD+ and other carbon finance initiatives says Grainne Ryder, former director of research at Probe International, are “the aid bureaucracies that oversee growing fiefdoms, and the corporations that have learned to game the system.”

There can be no doubt that billions of dollars are being squandered on carbon schemes that are unwelcome in the Third World, where they harm both the environment and the economy, she adds.

Brady Yauch, Probe International, May 18, 2010

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