Despite Covid-19, climate change continues to be a priority
Updated: Jun 9, 2020
In April and May, The UN-REDD Programme hosted 6 webinars on key issues related to investments in nature-based solutions with a focus on forest conservation and restoration. Called “Charting our Carbon Future: opportunities for corporate mitigation action,” the webinar series led to important discussions and key messages summarized below.
By the time of the first webinar, Covid-19 was ravaging the world, with no clear end in sight. COP-26 had only recently been postponed to 2021. Nevertheless, the first online session brought together a group of prestigious speakers to discuss nature-based solutions and what to expect during the global pandemic. The overall message was that climate change continues to be a priority and that Covid-19 is presenting opportunities to “Build-Back-Better” if we commit to action now.
The remaining sessions explored a wide range of issues around the social, financial and environmental integrity of investments. It was generally agreed that while there is still a need for further clarity on the rules of the game, the current levels of uncertainty cannot be an excuse for inaction. Indeed, the increasing volume of private sector investment into Nature-Based Solutions (NBS) confirms that. Some specific take-aways include:
- The importance of science-based targets. Investments in NBS can be a tremendous force for good if they are part of mitigation strategies aligned with climate goals. The use of NBS-based offsets to give legitimacy to unsustainable business models should not be supported.
- Nationally Determined Contributions. In the short and medium term, the quality of NDCs will continue to pose a challenge for the determination of “additionality” of investments. We still have a long way to go before most countries provide clarity on what would be “additional,” and before NDCs are linked to a national carbon registry. It is of key importance to support countries in improving the ambition and quality of NDCs.
- Carbon rights. The issue of carbon rights is a sensitive one for several reasons. The first is that it can quickly turn into a discussion on benefit distribution. The second is that it has accounting implications if adjustments are required. And finally, some business models require a claim to owning the emission reduction, for example, when they offer customers the ability to offset emissions from the use of their products. That said, a full definition of ownership of emission reductions may not always be a necessary condition for investment. This reflects an emergent discussion on investments as a contribution to increasing ambitions of NDCs.
- Standards for validation and verification. While the development of both project-based and jurisdiction-based standards have evolved over the past 15 years, the field is decisively leaning towards the latter. Jurisdictional standards have clear advantages when dealing with issues of integrity in accounting and leakage. The best bet for existing REDD+ projects is to become nested into sub-national or national programs. If you are a company, you might want to avoid investing in stand-alone projects.
- Prices for emission reductions. There is a range of prices for emission reductions from the agricultural and forestry sectors, and the variation can be explained in terms of quality. Current nominal prices of about $5 US/tonne, which can be reduced by half after discounts and buffers, are wholly insufficient to spark a surge of investments in NBS in forest-rich developing countries. Current prices are also not enough to promote the surge in investments required for NBS to contribute the one-third of the CO2 reductions needed to close the carbon emission gap. If a decade is what we have to turn the situation around, prices should quickly increase to $15 US/tonne.
- Private sector and ambitious mitigation. The last session of the webinar series was all about inspirational ideas and plans, something necessary in light of these extraordinary times. The session brought together representatives from Microsoft, Salesforce, Natura and Ark2030 who showed that there is no shortage of ambitions, and the time for action is now.
You can access the whole webinar series at this link.
Team leader UN-REDD Programme