by : Dr. Gun Mardiatmoko (email@example.com) (HP:+6281904227676)
Indonesian forest with mega biodiversity, is very potential for the implementation of carbon trading schemes, i.e. the Clean Development Mechanism (CDM) scheme, Reducing Emission from Deforestation and Degradation (REDD) scheme and Voluntary scheme. The Forestry CDM is a partnership between developed country and developing country to reduce Green House Gases (GHG) emission through forestry activity: afforestation and reforestation. Principally, carbon trading will assist in reconstruction of forest ecology and forest protection in Indonesia.
The actor of the Forestry CDM is called developer of afforestation & reforestation project under the CDM. This developer is a union of two institutions between investor from developed country (Annex I of the United Nations Framework Convention on Climate Change/UNFCC) and business sector by state or private company, cooperation or personal from developing country.
The Kyoto Protocol is a 1997 international treaty which came into force in 2005, which binds most developed nations to a cap and trade system for the six major green house gases. Emission quotas were agreed by each participating country, with the intention of reducing their overall emissions by 5.2% of their 1990 levels by the end of 2012. Under the treaty, for the 5-year compliance period from 2008 until 2012, nations that emit less than their quota will be able to sell emissions credits to nations that exceed their quota. It is also possible for developed countries within the trading scheme to sponsor carbon projects that provide a reduction in green house gas emissions in other countries, as a way of generating trade-able carbon credits. The Protocol allows this through Clean Development Mechanism (CDM), in order to provide flexible mechanisms to aid regulated entities in meeting their compliance with their caps. The UNFCC validates all CDM projects to ensure they create genuine additional savings and that there is no carbon leakage.
Carbon Trading is a market based mechanism for helping mitigate the increase of CO2 in the atmosphere. Carbon trading markets are developed that bring buyers and sellers of carbon credits together with standardized rules of trade. Any entity, typically a business, that emits CO2 to the atmosphere may have an interest or may be required by law to balance their emissions through mechanism of Carbon sequestration. These businesses may include power generating facilities or many kinds of manufacturers. Entities that manage forest or agricultural land might sell carbon credits based on the accumulation of carbon in their forest trees or agricultural soils. Similarly, business entities that reduce their carbon emission may be able to sell their reductions to other emitters. The legal aspect of carbon trading is Certificate of Emission Reductions (CERs).
Developer of afforestation & reforestation project under the CDM can obtain CERs if they make: (1) Project proposal of afforestation & reforestation project under the CDM and (2) Project Design Document for project activities under the CDM. Developer requirement of afforestation & reforestation project under the CDM in Indonesia, in general as below:
- Developer has license to use the product of forest wood at forest plantation/industrial forest plantation or to use environmental benefit from carbon trading.
- Developer has a letter of land information/recommendation for the CDM from regency at project area respective.
- Developer makes project proposal regarding the CDM and send proposal to the Ministry of Forestry of Republic of Indonesia.
by : Dr. Gun Mardiatmoko (firstname.lastname@example.org).