Forest Carbon Partnership Facility
Linkages between different typesof REDD+ financing, including theFCPF Carbon Fund and the Forest
Investment Program
REDD+ Finance, International Seminar, Tokyo (VC)
February 3, 2015

The FIP and FCPF
Objectives of the different instruments:• FIP Design Document: “The FIP would not in itself provide theincentives presently necessary to significantly reduce forest related
GHG emissions, but would enable pilot countries to leverage suchincentives if established under a UNFCCC forest mechanism”• FCPF Charter objectives:• “To assist Eligible REDD Countries in their efforts to achieve Emission
Reductions from deforestation and/or forest degradation by providingthem with financial and technical assistance in building their capacity
to benefit from possible future systems of positive incentives forREDD;• To pilot a performance - based payment system for Emission
Reductions generated from REDD activities, with a view to ensuring
equitable benefit sharing and promoting future large scale positive
incentives for REDD”
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Food for thoughtIssue 1: Timing of REDD+ financing• Cancun identifies phases of REDD+ as• Development of national strategies or action plans, policies and measures andcapacity building• Implementation of national policies and measures and national strategies oraction plans that could involve further capacity-building, technology
development and transfer and results-based demonstration activities• Results-based actions that could be fully measured, reported and verified• However:• Slowing and ultimately halting deforestation and forest degradation will be a longprocess.
• Strategies and other components will need to be regularly updated and revised
to reflect changes in country circumstances and the drivers of deforestation.
• Strategies and other components may overlap or in turn be informed by
activities undertaken
4Evolution of thinking about the timing of REDD+
financingIn the beginning, REDD+ finance was seen as a linear process

Strategies andplans

Implementation

Monitoring ,reporting andverification

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Evolution of thinking about the timing of REDD+
financing (cont’)
Realization that there was an overlap between the different phases

Strategies andplans

Implementation

Monitoring ,reporting andverification
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Evolution of thinking about the timing of REDD+
financing (cont’)… but with the need to revise and update Readiness components, experience incountries is showing that REDD+ is actually more of a continuous cycle

Strategies andplans

Monitoring,
reporting andverification

Implementation

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Issue 2: Definition of emission reductions• The Charter of the FCPF defines Emission Reductions as “real andverifiable emission reductions generated from Emission Reductions
Programs”.
• Other types of financing might rely more on proxy approaches to do
an ex-ante estimation of emission reductions that might result fromcertain interventions.
• However the assumption for REDD+ is that emission reductions do notneed to be attributed to specific policies or actions• Hence the MRV systems are usually designed to provide the netemission reductions resulting from a set of policies and interventions.

8Issue 3: Size of financing needed• Many countries face barriers for implementing the national REDD+ policies
and measures• Significant and different types of funding are required to overcome some ofthese barriers.
• Helping countries to change their trajectory on the forest transition curve
which is very much related to general sustainable development9Issue 3: Size of financing needed• Many countries face barriers for implementing the national REDD+ policies
and measures• Significant and different types of funding is required to overcome some ofthese barriers.
• Helping countries to change their trajectory on the forest transition curve
which is very much related to general sustainable development

REDD+ trajectory?

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Issue 3: country example Ghana

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Issue 3: country example Ghana (cont’)• However, to succeed the ER Program will need to leverage and redirect other types of public and private finance that is often manytimes larger than climate finance

Annual turn-over of the cocoasector

FIP financing (country wide)

CF result based financing

12Current thinking within the FMT
It is likely that the finance package for the ER Program will change over time andother types of finance will need to be leveraged and redirected to support
sustainable land use
Result based climate financeAmountofFinance

Climate finance (investment)

General finance for sustainable
land use
General finance for activities
leading todeforestation/degradation
TATime13Current thinking within the FMT (cont’)
The Fund is interested in the long-term, cumulative emission reductions fromthe ER Program but these will be created and maintained from a different andcomplementary mix of different types of financeAmountofFinance

Cumulativeemission
reductions

Result based climate finance

Climate finance (investment)

General finance for sustainable
land use
General finance for activities
leading todeforestation/degradation
TATime14

Key points• Many countries face barriers for implementing the national REDD+
policies and measures and significant funding is required to overcome
some of these barriers.
• Need to leverage existing finance and redirect this to sustainable
land use (amount often many times larger than climate finance)• Long-term, cumulative emission reductions from the ER Program willbe created and maintained from a different financing mix• So far, the assumption for REDD+ has always been that emission
reductions do not need to be attributed to specific policies or actions• Going forward, it might be useful to think of REDD+ financing as
supporting the three crucial pieces required to make REDD+ work:
technical assistance, investments and RBF. These pieces are notdistinct phases, but rather a structured finance package to create
long-term emission reductions.
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THANK YOU!

www.forestcarbonpartnership.org

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