Unpacking Warsaw, Part One: The Institutional Arrangements

Climate Forests Investments Dec 6, 2013
Steve Zwick
COP 19 Coverage

We covered the COP from beginning to end, with a narrow focus on REDD and those issues still under discussion. Here is the bulk of our coverage, with a few breaking stories omitted.

Demand For Forest Carbon Offsets Rises As Forestland Under Carbon Management Grows sets the stage for Warsaw with a deep dive into the state of forest carbon markets around the world.

REDD, CDM Likely To Find A Place In New Climate Agreement: UNFCCC Executive Secretary Christiana Figueres offers hope that the troubled CDM market and REDD projects will be included in the international climate deal expected to be finalized in 2015.

Understanding Carbon Accounting Under The UN Framework Convention is a work in progress designed to explain in simple terms the complexity of carbon accounting under the emerging “REDD Rulebook”.

Indigenous Leaders Stand Up For Active Role In REDD relates what indigenous leaders expect from forest-carbon finance

REDD Reference Levels Share Stage With Broader Land-Use Issues In Warsaw outlines the issues on the table at the beginning of the talks.

In Warsaw As In California, Forest Carbon Carrot Needs Compliance Stick  explores the need for compliance drivers to boost demand for forest carbon offsets.

Forest, Ag Projects Can Combine Adaptation And Mitigation: CIFOR Study  highlights the missed opportunities to link multiple benefits in projects that aim to tackle the impacts of climate change.

Dutch Platform Turns Landscapes Talk Into REDD Reality examines a new platform unveiled in Warsaw that could serve as a model for future public-private partnerships for financing REDD+ projects.

The REDD Finance Roundtable: A Quick Chat With EDF, WWF, and UCS takes stock of the talks on the eve of the final REDD agreement.

For REDD Proponents, No Regrets  examines the early success of REDD pilot projects despite sluggish progress made in securing policy and financial support at the national and international levels.

US, UK, Norway Launch Next-Stage REDD Finance Mechanism Under World Bank examines a financing mechanism designed to support performance-based payments down the road.

After the talks, we began digging into the decisions and themes of the two-week talk, and will be rolling these stories out as they take shape.

Unpacking Warsaw, Part One: The Institutional Arrangements explores the last-minute deal that lays rules for governing REDD finance through 2015.

Unpacking Warsaw, Part Two: Recognizing The Landscape Reality explores the thinking behind the growing emphasis on “landscape thinking” in climate finance.

Unpacking Warsaw, Part Three: COP Veterans Ask, ‘Where’s The Beef?’ explores the reaction of carbon traders to the Warsaw outcomes and offers a peek into the year ahead.

Further stories in this series will explore the impact of individual decisions within the rulebook, the role that the rulebook can play in helping existing projects nest in jurisdictional programs, and the impact of the rulebook on the private sector.

26 November 2013 | When climate-change negotiators convened in Warsaw two weeks ago, they came to the table with a nearly-complete “REDD Rulebook” for countries that want to use carbon finance to save endangered rainforest and reduce greenhouse gas emissions from deforestation and forest degradation (REDD). The talks were, it seemed, just a few sentences away from achieving the kind of clarity on REDD and REDD+ that would make it possible to direct billions of dollars in stalled finance to slow deforestation.

But then the gears jammed as they always seem to, and they only got unjammed late last Thursday night, when REDD negotiators signed off on a new set of institutional arrangements that Polish Environment Minister Marcin Korolec, acting in his capacity as President of the Conference of the Parties (COP), had drawn up earlier in the week. Those arrangements were approved by the entire COP late Friday, and they may end up preventing exactly the kind of logjam that led to their creation.

They do that by establishing a forum where high-level negotiators from REDD countries can compare notes and create recommendations an draft decisions that they submit directly to the COP, which is comprised of high-level negotiators, instead of putting them first through technical committees, which are often comprised of people who have very little room to negotiate. A separate decision on results-based finance creates a standing committee within the COP that can influence the rules being disseminated to the Green Climate Fund and all of the other bilateral, private-sector, and multilateral initiatives underway.

Why it Matters

At stake are billions of dollars that countries from Norway to the United States have set aside for REDD+. The money is dispatched from departments of state, forestry, and aid in the donor countries to multilateral organizations like the Forest Carbon Partnership Facility (FCPF), the United Nations Collaborative Initiative on Reducing Emissions from Deforestation and forest Degradation (UN-REDD), and the Forest Investment Program (FIP) before finding its way to countries as diverse as Peru, Ethiopia, and Indonesia. Once there, it has to work its way through another set of recipient agencies before finding its way to activities on the ground.

REDD countries looking to receive the money have to follow different rules depending on which multilateral agencies and donor countries they are working with. The criteria are often foggy; the rules, diverse – and the costs of applying, prohibitive.

“On top of this, you have voluntary markets doing something totally different involving the private sector, and California is doing something in another zone, also in the private sector,” says Kevin Conrad, Papua New Guinea’s Special Envoy and Ambassador for Environment & Climate Change and executive director of the Coalition for Rainforest Nations. “The [decision on institutional arrangements] is basically making it possible for the UNFCCC to now start giving recommendations to all of these bodies if they prove to be consistent with the rulebook that we created this year.”

The REDD “Rulebook”

The “Rulebook” is actually a collection of separate decisions that together provide clear guidance on how countries can harvest available scientific data to create reliable snapshots of their forests over time and to use these snapshots to create deforestation reference levels that will be recognized by the UNFCCC. The decisions govern, among other things, modalities for monitoring national forests, addressing the drivers of deforestation and forest degradation, and measuring, reporting and verifying activities designed to reduce greenhouse gas emissions.

It’s still, however, not clear what sort of payoffs that data will yield long-term, and for that there’s the work program for developing results-based finance in support of REDD and a new set of arrangements between the COP and the Green Climate Fund. The decisions also includes a mechanism for helping developing countries deal with loss and damage from climate change.

Where to From Here?

Before presenting their ideas in December, members of the new forum will meet together at least once – in Bonn, Germany, in June. There, barring an emergence of parliamentary drama, they will work out a method for organizing themselves and begin the formal process of formulating their proposals. After that, they will meet formally at least once each summer and informally throughout the year.

The aim, according to Conrad, is not to concentrate or control finance flows, but to recognize the current reality and create a level playing field.

“Donors can actually pick whichever country they want to, but they have to agree that they’ll use a consistent rule book,” he says. “That rule book will be consistent with the processes that the UNFCCC is setting up, and the process of coordination is designed to try and fill the gaps for countries that are doing good work but don’t have access to finance because they don’t happen to be the favorites of the bilateral community.”

He expects a clumsy period of transition, but believes the long-term effect will be less bureaucracy on the part of donors and more coordination.

“We’ll be encouraging the FCPF and UN-REDD to actually shorten the agenda of their meetings, remove the redundant issues that they cover, and coordinate meetings so that developing countries aren’t wasting money flying all over the world.”

In 2017, the Subsidiary Body for Implementation (SBI) will review the outcomes of the meetings and recommend a further steps to be considered by the COP.


Steve Zwick is Managing Editor of Ecosystem Marketplace. He can be reached at szwick@nullecosystemamrketplace.com.5>
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