Taking stock of carbon rights in REDD+ candidate countries: Concept meets reality

Taking stock of carbon rights in REDD+

candidate countries: Concept meets reality

Lasse Loft (BiK-F), Krister Par Andersson (Univ. Colorado), Esther Mwangi (CIFOR)

ISEE Conference Iceland, August 15th 2014

Guiding questions & structure

15.08.2014 Loft, Andersson & Mwangi - Carbon Rights in Potential REDD+ Countries: Concept Meets Reality 2

Guiding questions• What are carbon rights?

• What is the status of carbon rights in selected REDD+ countries?

• Is there a need for carbon rights clarification in those countries?

Structure• Framing and defining carbon rights

• The role of carbon rights in REDD+ benefit and burden sharing

• Institutionalization of carbon rights

• Bundle of rights and obligations

• Conclusions

Regulatees: Subnat’l: e.g. Province AdminLocal: Land Stewards

MotivationChange in behaviour

REDD PolicyObjectives Instruments

Loft, Wong et al. A conceptual framework for assessing policy and intervention options for REDD+ benefit sharing mechanisms

3

Other Policies,e.g. Forest Policy

REDD PolicyObjectives Instruments

BSM

Admin. Measur.

Direct Regul.

Env.

Social

Econ.

Outcome

Env.

Social

Econ.

Land use

change

Regulatees: Subnat’l: e.g. Province AdminLocal: Land Stewards

MotivationChange in behaviour

Incentive

Distribution

1

Institutional Enabling Factors

InstitutionalCapacity & Structure

Property RightsDefinition &

Enforcement

Capacity

Building &

Responsibilities

2

3

Human induced and environmental pressures

Institutional Context Factors

Property Rights

InstitutionalCapacity & Structure

What are carbon rights?


Right to the good or service itself

Right to certified emissions reduction or credit

Right to the benefits for providing c-seq.

• Carbon sequestration and storage framed as ecosystem services• Need to differentiate contents of carbon rights:

Need for carbon rights clarification

1. Equity discourse on who should benefit: Those with ‘legal rights’

2. Int’l BSM - In case of market based mechanism: Who is responsible and liable?

Depends on whether forest stewards are directly involved:

• Nat’l approach no need

• Sub-nat’l & project need


National approachProject based

National accounting & sub-national implementation

Options for int’l BSM under UNFCCC

Need for carbon rights clarification


Legal rights discourse

BSM Other laws and policies with relevance for carbon rights

Brazil ✓ Nat’l accounting;Amazon Fund & State PES initiatives as BSM

E.g. Constitution - Indigenous peoples exclusive use rights, Law on the Management of Public Forests, Forest Law

Peru ✓ Nested approach with nat’laccounting and sub nat’limplementation, new PES law

National Forest Conservation Program, Protected Areas

Vietnam ✓ National fund combined with PES-like approach as potential BSM

Forest Protection and Development Law, Land Law, Decree on Payments for Forest Environmental Services

Indonesia ✓ Various options for REDD+ BS under debate including a trust fund for jurisdictional and local level benefit distribution

Government Regulation 3/2008 on Forest Systems and the Formulation of Forest Management,MoF Regulation 36/2009, GR 12/2014 on Types and Tariffs of Non-tax Government Revenue in MoF

Institutionalization of carbon rightsRules or laws on carbon rights: New specific legislation or implicitly following existing rules (sequestered carbon interpreted as e.g. natural resources or ecosystem services)

Nature of carbon right:


Independent proprietaryinterest

Or follows right to the tree Or follows right to the land

Current legal status of carbon rights in different countries

Specific Implicit Type of right Linked to

Brazil No (fed.)

Yes (some states)

Nat. resources /Env. Services

Right to property;Right to benefit, butburden to compensate

Right to c-property being linked to resource or land ownership;In Amazon states: ES providers

Peru No

New PES law

For PAs

Natural resource or ‘fruit’

C-seq as ES

Right to property, if ‘fruit’ also right to benefitRight to benefit

Right to transfer certificates

Right to natural resource i.e. forests

Right to use the land

SERNAP is title holder of C as a property

Vietnam No

PFES

Forest resources

Forest goods & services

Right to property;Right to benefit Right to benefit

Right to benefit is tight to land (use) rightRight to benefit is tight to ‘protection and

Indonesia Yes but disputed

C-seq & storage as ES

Right to property;Right to benefit

Right to land use

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Distribution of rights


Type of right Brazil Peru Vietnam Indonesia

Ownership State, Private Entities

State as patrimony of the nation

‘People’, but managed by the state

Nation, but managed by the state

Use Rights IndigenousPeople, Private Entities

‘Third parties’ Communities HH, Individuals

Individuals,Companies

Benefits & burdens

Obligations and liability

Rights to benefits come with burdens:• Obligation of sustainable provision of carbon stocks

• Liability in case of unintended deforestation


Brazil Obligations: Focus on C&C and law enforcementLiability: Not yet legally defined on federal level for BS; Assumed to rest with owner (Expert opinion)

Peru Obligations: “alternative” & “sustainable use” details not clarified (PES Law)Liability: “Remains unclear as the nat’l BS policy unfolds” (Expert opinion)

Vietnam Obligations: “land must be used economical, effective and environmentally protective” (Art. 11 Land Law)Liability: Currently overlooked in the debate. “Probably state will act on citizens interest. It is likely that the state itself will be held liable. Yet how this plays out in practice is unclear.” (Expert opinion)

Indonesia Obligations and liability not spelled out. But owner / concession holder can insure the project nationally or internationally

Conclusions


• In none of the studied REDD+ candidate countries rights and burdens that come along with carbon rights have explicitly been defined

• Most countries allow for (different) legal interpretations of existing laws

• High uncertainty about who is entitled to benefit from providing carbon sequestration and storage, what obligations come along and who bears the risks of none permanence

• While BSM designs are being discussed and implemented, the need for carbon rights clarification is only slowly being recognized

• There is a need to enact legislation that clarifies the obligations that come along with these rights, especially liability rules and insurance mechanisms

To stimulate investments, allow for equitable access to benefits, and to reduce risks it is important for carbon rights and obligations to be clarified in national regulations or through court rulings based on existing legislation in all four countries studied!

Thank you very much for your attention!

…and special thanks to:Maria Fernanda Gebara, Ashwin Ravikumar, Jazmin Gonzales,

Pham Thu Thuy and Daju Resosudarmofor their input!

Contact: [email protected]

Who holds carbon rights?


Source: Schlager and Ostrom (1992)

Examples of use rights:

• Conservation easements or concessions: the right to use the land of another for a specified purpose, as distinguished from the right to possess that land

• Profits-á-prendre: the right to enter a property in order to take some kind of biological resources

Taking stock of carbon rights in REDD+ candidate countries: Concept meets reality

Environment

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