Pilot Project Case Study Improved Forest Management Climate

Pilot Project Case Study: Improved Forest Management Climate Protection Through Forest Conservation in the Pacific Islands Inception Workshop, 22 -24 November 2010 Suva, Fiji Dr Sean Weaver, Principal, Carbon Partnership sean. weaver@carbon-partnership. com www. carbon-partnership. com

Voluntary Carbon Market And Maori Indigenous Forests 64 m ha NZ Total Resource 2. 4 m ha Harvestable 614, 000 ha Maori Owned

Voluntary Carbon Market And Maori Indigenous Forests Resource Pre-1990 Forest Ineligible for carbon trading under the NZ ETS Eligible for carbon trading under the Voluntary Carbon Market 614, 000 ha Maori Owned

Key Factors Determining Voluntary Carbon Trading Eligibility: 1. Outside compliance carbon accounting 2. Project type eligible under a voluntary standard 3. Legal sanction for BAU emissions or sink activity 4. Commercial viability of BAU activities Eligible for carbon trading under the Voluntary Carbon Market 614, 000 ha Maori Owned

Case Study: SILNA Forest Land – Western Southland 614, 000 ha Maori Owned

Case Study: SILNA Forest Land – Western Southland R II/1 R IV/1 R IV/9 R IV/2 R IV/3 R II/7 R III/9 R IV/4 R IV 12 A V/2 Office of the Maori Trustee R IV 15 A VII 3, 4 R VII/3 Rowallan-Alton Incorporation

Unlogged

Logged

Two main activity categories: 1. Avoided or reduced emissions (stopping timber harvesting) 2. Enhanced carbon sequestration (carbon farming)

Particularly Suitable for Indigenous Forests CCB VCS

American Carbon Registry Standard Climate Action Reserve Protocols The Carbon. Fix Standard Clean Development Mechanism Chicago Climate Exchange Offsets Program Climate, Community, and Biodiversity Standard EPA Climate Leaders Offset Guidance Greenhouse Gas Services Standard Gold Standard Australian National Carbon Offset Standard ISO 14064 -2 Standard Plan Vivo Social Carbon TUV NORD Climate Change Standard VER+ Standard Voluntary Carbon Standard Supplier specific standards

American Carbon Registry Standard Climate Action Reserve Protocols The Carbon. Fix Standard Clean Development Mechanism Chicago Climate Exchange Offsets Program Climate, Community, and Biodiversity Standard EPA Climate Leaders Offset Guidance Greenhouse Gas Services Standard Gold Standard Australian National Carbon Offset Standard ISO 14064 -2 Standard Plan Vivo Social Carbon TUV NORD Climate Change Standard VER+ Standard Voluntary Carbon Standard Supplier specific standards

American Carbon Registry Standard Climate Action Reserve Protocols The Carbon. Fix Standard Clean Development Mechanism Chicago Climate Exchange Offsets Program Climate, Community, and Biodiversity Standard EPA Climate Leaders Offset Guidance Greenhouse Gas Services Standard Gold Standard Australian National Carbon Offset Standard ISO 14064 -2 Standard Plan Vivo Social Carbon TUV NORD Climate Change Standard VER+ Standard Voluntary Carbon Standard Supplier specific standards

American Carbon Registry Standard Climate Action Reserve Protocols The Carbon. Fix Standard Clean Development Mechanism Chicago Climate Exchange Offsets Program Climate, Community, and Biodiversity Standard EPA Climate Leaders Offset Guidance Greenhouse Gas Services Standard Gold Standard Australian National Carbon Offset Standard ISO 14064 -2 Standard Plan Vivo Social Carbon TUV NORD Climate Change Standard VER+ Standard Voluntary Carbon Standard Supplier specific standards

American Carbon Registry Standard Climate Action Reserve Protocols The Carbon. Fix Standard Clean Development Mechanism Chicago Climate Exchange Offsets Program Climate, Community, and Biodiversity Standard EPA Climate Leaders Offset Guidance Greenhouse Gas Services Standard Gold Standard Australian National Carbon Offset Standard ISO 14064 -2 Standard Plan Vivo Social Carbon Global Best Practice TUV NORD Climate Change Standard VER+ Standard Voluntary Carbon Standard Supplier specific standards

Project Sequence: 1. Select Voluntary Standard 2. Select or Develop Methodology 3. Project Description Documents 4. Project Validation 5. Registration Issuance Monitoring

Eligible Project Types: 1. Afforestation, Reforestation, & Revegetation (ARR) 2. Improved Forest Management (IFM) 3. Reducing Emissions from Deforestation and Degradation (REDD) Project Sequence: 1. Select Voluntary Standard 2. Select or Develop Methodology 3. Project Description Documents 4. Project Validation 5. Registration Issuance Monitoring

Eligible Project Types: IPCC category: ‘Forest remaining 1. Afforestation, Reforestation, & as forests’ Revegetation (ARR) 2. Improved Forest Management (IFM) 3. Reducing Emissions from a. Reduced Impact Logging (RIL) Deforestation and Degradation b. Converting Logged to Protected (REDD) Forest (Lt. PF) c. Extending Rotation Age (ERA)

Eligible Project Types: IPCC category: ‘Forest remaining 1. Afforestation, Reforestation, & as forests’ Revegetation (ARR) 2. Improved Forest Management (IFM) 3. Reducing Emissions from a. Reduced Impact Logging (RIL) Deforestation and Degradation b. Converting Logged to Protected (REDD) Forest (Lt. PF) c. Extending Rotation Age (ERA)

Particularly relevant in NZ because forest degradation Eligible Project Types: is illegal Case study helps to test commercial viability of carbon at low volumes IPCC category: ‘Forest remaining 1. Afforestation, Reforestation, & as forests’ Revegetation (ARR) Avoided SFM Timber harvesting 2. Improved Forest Management (IFM) 3. Reducing Emissions from a. Reduced Impact Logging (RIL) Deforestation and Degradation b. Converting Logged to Protected (REDD) Forest (Lt. PF) Original forest = old growth c. Extending Age (ERA) Project Rotation Carbon Stocks Baseline Carbon Stocks Project management period Time

Particularly relevant in NZ because forest degradation Eligible Project Types: is illegal Case study helps to test commercial viability of carbon at low volumes IPCC category: ‘Forest remaining 1. Afforestation, Reforestation, & as forests’ Revegetation (ARR) Avoided SFM Timber harvesting Original forest = regenerating 2. Improved Forest Management (IFM) 3. Reducing Emissions from a. Reduced Impact Logging (RIL) Deforestation and Degradation b. Converting Logged to Protected (REDD) Forest (Lt. PF) c. Extending Rotation Ageck(ERA) o s t S n o arb C t c e j o Pr Baseline Carbon Stocks Project management period Time

Eligible Project Types: 1. Afforestation, Reforestation, & Revegetation (ARR) 2. Improved Forest Management (IFM) 3. Reducing Emissions from Deforestation and Degradation (REDD) 1. Select Voluntary Standard 2. Select or Develop Methodology 3. Project Description Documents 4. Project Validation 5. Registration Issuance Monitoring

1. Follow VCS Guidance Why all this detail? 2. Project Eligibility Criteria Because we are creating a new commodity that you cannot see 3. Boundary Determination 4. Baseline Scenario 5. Project Scenario 6. Additionality 2. Select or Develop Methodology 3. Project Description Documents 7. Leakage 8. Risk & Permanence 9. Ancillary Impacts 10. Monitoring

Case Study: SILNA Forest Land – Western Southland Populate methodology template with data from this case study 3. Project Description Documents

Case Study: SILNA Forest Land – Western Southland R II/1 R IV/1 R IV/9 R IV/2 R IV/3 R II/7 R III/9 R IV/4 R IV 12 A V/2 Office of the Maori Trustee R IV 15 A VII 3, 4 R VII/3 Rowallan-Alton Incorporation

Define Eligible Area Calculate baseline emissions Calculate Project GHG benefits Additionality, Leakage Non-Permanence Risk Monitoring

Define Eligible Area Preliminary Calculations For Carbon Benefits: Calculate baseline emissions Calculate Project GHG benefits 1, 400 ha Additionality, Leakage Non-Permanence Risk 7, 000 t. CO 2 per yr x 50 years = 350, 000 t. CO 2 Monitoring 350, 000 x US$6 = US$2. 1 million (if forward sold) If the baseline activity is high intensity (unsustinable) logging: Ø the Baseline emissions are much higher and Ø the carbon revenues much higher

Define Eligible Area Preliminary Calculations For Carbon Benefits: 1, 400 ha Calculate baseline emissions Calculate Project GHG benefits Additionality, Leakage Non-Permanence Risk 7, 000 t. CO 2 per yr x 50 years = 350, 000 t. CO 2 Monitoring 350, 000 x US$6 = US$2. 1 million (if forward sold) Two sale options: Ø Forward sale (futures market) ex ante Ø Standard (after carbon benefits are delivered) ex post

1. Select Voluntary Standard 2. Select or Develop Methodology US$0 – US$40 k 3. Project Description Documents US$40 US$60 k 4. Project Validation 5. Registration Issuance Monitoring US$20 k US$10 k 5 -yearly (US$40 k) (If new methodology)

Phased approach: Phase 1: Scoping Exercise (e. g. US 10 k) Phase 2: Draft PDD & Data Gap Analysis (e. g. US$40 k) Phase 3: Complete Path To Market 1. Select Voluntary Standard 2. Select or Develop Methodology 3. Project Description Documents 4. Project Validation 5. Registration Issuance Monitoring