Finance and Carbon Markets (FCM)
Countries and their relevant agencies and multilateral and bilateral institutions, along with both global private and public sectors, are rapidly expanding their engagement in the international voluntary, pre-compliance, and compliance REDD+ carbon markets with a focus on "pay-for-performance" compensation with a foundation of significant biodiversity and social co-benefits. Likewise, the long-term success of these same REDD+ activities depends on attracting and securing funding from the capital markets at significant speed and scale.
The FCMC team assists countries and their institutions build the enabling REDD+ finance and carbon markets frameworks needed to attract and engage funding from the capital markets through financial structures and institutions such as risk management products, loan guarantees, registries, settlement and clearinghouse activities, audit and verification, public and private debt issuance, public-private partnerships (PPP), equity markets, municipal finance, emission reduction purchase agreements (ERPAs), and donor-based support.
These services include collaborating with countries and their institutions to provide them a platform from which they can design national and sub-national REDD+ policies and programs, according to international finance best practices, that reduce risk while promote capital markets participation in REDD+ activities.
Furthermore, activities under the FCM task are closely related to other tasks. For example, robust SES standards and MRV systems are foundational to securing any investment in REDD+ activities, while LEDS provides leverage and diversification for climate friendly private sector engagement.
Even with the centrality of securing long-term financing to mitigate climate change, few national or sub-national REDD+ strategies address how national and sub-national REDD+ activities will be financed, either through bilateral and multilateral or market-based activities. This highlights the need for clearly defined financial models, plans, and supporting policy and investment-grade financial architecture. Building long-term funding at speed and scale requires that public and private funders are attracted to participating in REDD+ activities through long-term risk-adjusted competitive rates of return that are complementary to LEDS and integrated with and founded on the highest quality SES indicators and MRV "best practices."
Full List of FCM Documents Follow:
Status of Climate Finance and REDD+ Under the UNFCCC
This paper provides an overview of relevant Conference of Parties (COP) decisions and the current status of negotiations on finance issues related to Reducing Emissions from Deforestation and Forest Degradation, conservation of forest carbon stocks, sustainable management of forests and enhancement of forest carbon stocks (REDD+).
California Cap-and-Trade and International Forest Carbon Offsets for Institutional Investors
This report was prepared to help educate institutional investors about forest carbon markets in general, and more specifically, how forest carbon elements of the new AB 32 law in California may impact institutional investors.
US Experiences with Results-based Finance
Many countries view results-based payments as the principle mechanism that will provide 'positive incentives' for REDD+ results-based actions.
Benefit Sharing and REDD+: Considerations and Options for Effective Design and Operation
As Reducing Emissions from Deforestation and Forest Degradation, conservation of forest carbon stocks, sustainable management of forests and enhancement of forest carbon stocks (REDD+) implementation progresses, governments and communities alike are working to develop systems to manage payments and other benefits.
Incentivizing No-Deforestation Palm Oil Production in Liberia and the Democratic Republic of Congo
The objective of this paper is to identify and develop options for actions that the U.
Emerging Compliance Markets for REDD+: An Assessment of Supply and Demand: Summary for Policymakers
This report summarizes the findings of the full FCMC Report, and provides abbreviated analysis and recommendations for policymakers.
Colombia REDD+ Finance and Markets Assessment
In Colombia, there is a strong commitment at both the national and local levels to develop REDD+ activities.
California Climate Legislation: Cap-and-Trade and International Forest Carbon Offsets
Prepared in advance of a webcast held on the AB 32 law for institutional investors and the general public, this briefing paper summarizes the findings and analysis of the full report produced by FCMC.
REDD+ Supply and Demand 2015-2025
Forest loss in developing countries represents a significant contribution to global emissions along with significant climate change mitigation potential.
Guidance for Jurisdictional and Nested REDD+ Program Design
The objective of this document is to assist in the development of jurisdictional programs and nested projects, as well as to provide further background and context to the JNR Requirements.
Orientación para el Diseño de Programas Jurisdiccionales y Anidados de REDD+
El objetivo de este documento es prestar asistencia para el desarrollo de programas jurisdiccionales y proyectos anidados, al igual que ofrecer más antecedentes y un mayor contexto de los Requisitos de JNR.
Safeguards in Bilateral REDD+ Finance
This report consists of three papers produced as a followup to Safeguards for REDD+ from a Donor Perspective.
Benefit Sharing and REDD+: Considerations and Options for Effective Design and Operation
This report offers policy makers and stakeholders benefit-sharing design considerations that focus specifically on outcome-driven incentives—as opposed to benefit sharing for policy reforms or public sector programs—based on three different models: payments for services, managed funds, and collaborative resource management.
Technical Guidance for Jurisdictional and Nested REDD+ Programs
The objective of this document is to assist in the development of jurisdictional programs and nested projects, as well as to provide further background and context to the JNR Requirements.
Apoio à REDD+ em países em desenvolvimento: uma análise de opções de políticas
Este documento tem como objetivo avaliar o potencial de diversas opções de políticas de mercado e não baseadas em mercado disponíveis para países em desenvolvimento dispostos a contribuir para se obter uma solução para a mudança climática global reduzindo emissões provenientes de desflorestamento e degradação das florestas, conservação e manejo sustentável de florestas, aumento de estoques de carbono florestal (REDD+) e fornecer benefícios agregados adicionais.
Emerging Compliance Markets for REDD+: An Assessment of Supply and Demand
In response to the increasing relevance of compliance markets for REDD+, FCMC commissioned this study that analyzes the current trends in these market-based REDD+ mechanisms and their impact on international finance architecture and REDD+ project implementation.
Léxico Financiero y de Mercados de Carbono
Este léxico trata de fomentar la comunicación efectiva entre agencias de gobernación y las instituciones del sector privado y público como proveer el vocabulario detallado, acrónimos y referencias para términos del REDD+ y finanzas.
Supporting REDD+ in Developing Countries: A Review of Policy Options
The objective of this paper is to evaluate the potential of a range of market and non-market policy options available to developing countries willing to contribute to a global climate change solution by reducing emissions from deforestation and forest degradation, forest conservation, sustainable management of forests, and enhancement of forest carbon stocks (REDD+) and to deliver additional co-benefits.
Appuyer la REDD+ dans les pays en développement : Examen des options en matière de politiques
L’objectif de ce document est d’évaluer le potentiel d’un éventail d’options de politiques de marché et hors marché à la disposition de pays en développement souhaitant contribuer à une solution mondiale face au changement climatique par la réduction des émissions résultant de la déforestation et de la dégradation des forêts, la conservation de la forêt, la gestion durable des forêts et l’accroissement des stocks de carbone forestier (REDD+) et fournir des co-bénéfices supplémentaires.
Report Brief: Eastern Africa - Forest Carbon Projects Study
This brief summarizes the analysis found in the full report on Forest Carbon Projects in Eastern Africa, which reviews the biodiversity and climate change impacts and challenges of four forest carbon projects in Uganda, Kenya and Ethiopia.
