The V Executive Board Meeting included a specific session to discuss scaling up REDD+ finance as a necessary, though not sufficient, condition to achieve forest mitigation ambitions. Bringing deforestation and forest degradation down to zero by 2030 could avoid the release of about 3 gigatons (Gt) of CO2 per year. Forest ecosystem restoration could remove an additional 2 Gt CO2, for a combined annual mitigation potential of 5 Gt, an amount greater than the total emissions from the European Union in 2017. The task is not minor. It would involve preventing about 10 million hectares per year from being converted primarily to agriculture, while taking into account increasing demand for food.
International collaboration, as facilitated by the UN-REDD Programme, will be essential to achieving net zero emissions from forests by 2030. Experience to date shows that costs associated to conserve forests are significant, and involve investments in a number of transformational changes in the way we manage land resources and in the associated production systems. Some studies have estimated the costs to be as high as 5.5 percent of the national GDP for tropical countries.
It is unlikely that forest countries will have themselves the fiscal space to invest this volume of funds. Therefore, the scale of international co-funding required will amount to several tens of billions of dollars yearly between now and 2030. This would also help to address the claim of the global south on strengthening means of implementation. These investments will generate significant benefits for local and global economies and livelihoods, such as contributing to maintaining the productivity and resilience of food productions systems.
Scaling up ex-post and upfront forest finance
While REDD+ readiness will continue to be necessary, the bulk of finance will need to support the implementation of actions that reduce emissions and increase carbon capture from forests. In the end, the implementation of domestic policies is what will ultimately drive change on the ground.
These policies, however, will carry a significant price tag. While development finance in the form of grants for specific projects and programs will still play an important role in supporting implementation of REDD+, it is unlikely to provide the billions required and therefore it has limited potential to give forest countries the fiscal resources necessary to meet ambitious targets.
It is also open to question whether in the face of competing claims and unmet social needs, forest countries will choose to significantly increase national debt to finance forest conservation and restoration policies. The bulk of REDD+ finance may come in the form of results-based payments and transforming these payments into a continuum of upfront finance will be a key condition of success. The UN-REDD Programme will dedicate time and resources to support countries on this important area of work.
Setting ambitious targets
Achieving the full mitigation potential of forest by 2030 will be a gradual process and intermediate milestones will be needed. UN-REDD and partners launched in November 2020 the Green Gigaton Challenge, an effort to mobilize resources to finance one gigaton of high-quality emission reductions by 2025. Failure to achieve this intermediate milestone will pose serious doubts as to whether the 2030 goal is at all feasible.
Scaling up ex-post and upfront REDD+ finance will require contributions from national budgets, the participation of a broad range of donor governments and a growing number of private sector partners driven by the momentum for net zero. A recent step in that direction is the LEAF Coalition which, launched this year with support from the US, UK, Norway and private companies, has made an initial $1 billion commitment to pay for 100 million tons at a minimum price of $10 per ton. UN-REDD has been involved early on, leveraging its unrivaled expertise in readiness preparation to assist countries in the LEAF call for proposal and beyond.
The Way Forward
The funding provided by LEAF is not minor; yet it is still a fraction of what is needed. In the short run, well before 2025, we must scale up this level of funding by at least an order of magnitude. This goal is within the domain of the feasible though diverging views exists on a number of issues including the price of forest carbon, the volume of financing made available, participation of private sector in REDD+, the quality of emission reductions, the delivery mechanisms and the use of standards to validate and verify emission reductions.
These differences can and should be reconciled soon. As the recent UN-REDD Executive Board meeting in September noted, UN-REDD, building on the expertise of FAO, UNDP and UNEP, is uniquely qualified to assist in facilitating a process of dialogue and consensus building that could close half the gap in the Paris Agreement pledge. The political momentum built up by World Environment Day, CBD COP-15, UNFCCC COP-26, UNEA-5 and Stockholm+50 is poised to provide the opportunity to reach consensus on how to scale up funding and ambitions for forest conservation and restoration.