Carbon payments in Mexican forests: insights from the national program and a flagship project
Dr Esteve CorberaSchool of International Development, University of East Anglia
Tyndall Centre for Climate Change [email protected]
Market-based instruments and Payments for Environmental Services in forestry: a real solution?Auditori de la Fundació Catalana per la Recerca i la Innovació
Barcelona, December 17, 2009
Talk outline
• Forests in Mexico
• Mexico and Payments for Environmental Services (PES)
• An overview of the federal PES programs
Talk outline
• Forests in Mexico
• Mexico and Payments for Environmental Services (PES)
• An overview of the federal PES programs
• Analysis of the carbon program and the Scolel Té project
Talk outline
• Forests in Mexico
• Mexico and Payments for Environmental Services (PES)
• An overview of the federal PES programs
• Analysis of the carbon program and the Scolel Té project
• Conclusions
Forests in Mexico
• 56.9 million ha of forested ecosystems (26.4 to 33.1 million of natural tropical forests) - 35% of the country’s territory
Forests in Mexico
• 56.9 million ha of forested ecosystems (26.4 to 33.1 million of natural tropical forests) - 35% of the country’s territory
• Protected Areas National Commission (CONANP) manages over 23 million ha of national territory (increase of almost 70% in the last decade)
Forests in Mexico
• 56.9 million ha of forested ecosystems (26.4 to 33.1 million of natural tropical forests) - 35% of the country’s territory
• Protected Areas National Commission (CONANP) manages over 23 million ha of national territory (increase of almost 70% in the last decade)
• 59% of forestlands owned by rural communities (25% with management plan); 33.5% private forestlands; 7.5% public forestland
Forests in Mexico
• 56.9 million ha of forested ecosystems (26.4 to 33.1 million of natural tropical forests) - 35% of the country’s territory
• Protected Areas National Commission (CONANP) manages over 23 million ha of national territory (increase of almost 70% in the last decade)
• 59% of forestlands owned by rural communities (25% with management plan); 33.5% private forestlands; 7.5% public forestland
• 512,000 ha/year deforested and 457,700 ha/year degraded (1993-2002) (FCPF R-PIN Mexico, 2008)
12th with highest net annual forest loss
• Ten percent of the country’s overall emissions come from land-use change
Mexico and PES
• Early development of watershed/carbon forestry projects in the late 1990s
- Scolel Té carbon project in the state of Chiapas - 1997
- Coatepec voluntary watershed project (1998) and FIDECOAGUA (2002)
Mexico and PES
• Early development of watershed/carbon forestry projects in the late 1990s
- Scolel Té carbon project in the state of Chiapas - 1997
- Coatepec voluntary watershed project (1998) and FIDECOAGUA (2002)
• Payments for Hydrological Services (2003) (Muñoz-Piña et al., 2008)
- Earmarked portion of federal revenues from water fees -Mexican Law of Rights-
- Forest conservation in ‘critical’ watersheds (>50% of of forest cover)
- 5-year flat payment/ha (higher for cloud mountain forests)
- Finance for technical assistance in project implementation
Mexico and PES
• Early development of watershed/carbon forestry projects in the late 1990s
- Scolel Té carbon project in the state of Chiapas - 1997
- Coatepec voluntary watershed project (1998) and FIDECOAGUA (2002)
• Payments for Hydrological Services (2003) (Muñoz-Piña et al., 2008)
- Earmarked portion of federal revenues from water fees -Mexican Law of Rights-
- Forest conservation in ‘critical’ watersheds (>50% of of forest cover)
- 5-year flat payment/ha (higher for cloud mountain forests)
- Finance for technical assistance in project implementation
• Key issues:
- Emphasis put on supporting poor regions and communities
- ‘Low additionality’ - only in 2007 deforestation taken into account
- Preliminary research shows reduction in deforestation rates where payments accrue
- Subsidy-like payments - forest cover as ‘proxy’ for environmental service
Mexico and PES
Source: Muñoz, 2009
Outreach in critical watersheds Water, poverty and conservation criteria in
Mexico and PES
Source: Muñoz, 2009
Deforestation risk + Indigenous Commission Funds ‘Regional balance’
Mexico and PES• Payments for Carbon, Biodiversity and Agroforestry Services (2005)
- Design/implementation of forest conservation/reforestation projects
- Biodiversity conservation through specific forest management activities
- Enhancing forest cover management in shadow-coffee systems
Mexico and PES• Payments for Carbon, Biodiversity and Agroforestry Services (2005)
- Design/implementation of forest conservation/reforestation projects
- Biodiversity conservation through specific forest management activities
- Enhancing forest cover management in shadow-coffee systems
PES modality Average payment (US$/ha)* Technical assistance (US$/ha)
Watershed conservation 163 1,719 (<500 ha) - 4,528 (>1,000 ha)
Biodiversity 179 1,719 (<500 ha) - 4,528 (>1,000 ha)
Agroforestry (shadow-coffee systems) 164 1,719 (<500 ha) - 3,123 (<1,000 ha)
CarbonPayments only for project design (except for 2005/2006 rules) 12,361 (<1,500 ha) - 17,391 (>3,000 ha)
* Payments are split in 5 years, after monitoring and verification* Payments are split in 5 years, after monitoring and verification
• Key issues:
- Funding varied over time - Congress + Commission Development Indigenous Peoples
- Projects unevenly distributed, biodiversity applications steady and more numerous
- 5-year payment + technical assistance
PES federal programs• PES numbers:
- Over 4,600 communities and and private right-holders
- 3,933 projects under implementation - 2.24 million ha; US$327 million
PES federal programs• PES numbers:
- Over 4,600 communities and and private right-holders
- 3,933 projects under implementation - 2.24 million ha; US$327 million
• Forest Environmental Services Project (WB -US$45 mill.; GEF -US$15 mill.)
- Matching grant scheme - development of financially sustainable state/local projects
- 7 matching grant programs - 26,000 ha; US$5 million
- Biodiversity fund - ‘marketing’ biodiversity hotspots
Carbon program overview
• Participation of rural communities in international carbon markets
- Payments for project design and implementation (10US$/ton/5 years) in 2005-2006
- Payments for preparation of CDM-like projects (<18,000 US$/project)
Carbon program overview
• Participation of rural communities in international carbon markets
- Payments for project design and implementation (10US$/ton/5 years) in 2005-2006
- Payments for preparation of CDM-like projects (<18,000 US$/project)
• High rejection rates in applications and project design proposals
- Missing documentation, non-fulfilment of eligibility criteria, and lack of ‘additionality’
- Seven projects for implementation and 14 for CDM-like design (out of >450)
- 6,962 ha under implementation (0.3% of total PES area)
- Payments delivered according to forest cover and planting rates - leakage?
Carbon program overview
• Participation of rural communities in international carbon markets
- Payments for project design and implementation (10US$/ton/5 years) in 2005-2006
- Payments for preparation of CDM-like projects (<18,000 US$/project)
• High rejection rates in applications and project design proposals
- Missing documentation, non-fulfilment of eligibility criteria, and lack of ‘additionality’
- Seven projects for implementation and 14 for CDM-like design (out of >450)
- 6,962 ha under implementation (0.3% of total PES area)
- Payments delivered according to forest cover and planting rates - leakage?
• Funding for ES intermediaries and lost in unsuccessful proposals
Carbon program overview
• Participation of rural communities in international carbon markets
- Payments for project design and implementation (10US$/ton/5 years) in 2005-2006
- Payments for preparation of CDM-like projects (<18,000 US$/project)
• High rejection rates in applications and project design proposals
- Missing documentation, non-fulfilment of eligibility criteria, and lack of ‘additionality’
- Seven projects for implementation and 14 for CDM-like design (out of >450)
- 6,962 ha under implementation (0.3% of total PES area)
- Payments delivered according to forest cover and planting rates - leakage?
• Funding for ES intermediaries and lost in unsuccessful proposals
• Research at project-level shows:
- Interest in forest management and future timber revenues
- Household income increase varies depending on community and project size
- Collective action strengthened and new skills gained
• Scolel Té Project in the Mexican states of Oaxaca and Chiapas, selling carbon offsets in voluntary markets
Scolel Té project
• Scolel Té Project in the Mexican states of Oaxaca and Chiapas, selling carbon offsets in voluntary markets
Scolel Té project
• Scolel Té Project in the Mexican states of Oaxaca and Chiapas, selling carbon offsets in voluntary markets
Scolel Té project
• Scolel Té Project in the Mexican states of Oaxaca and Chiapas, selling carbon offsets in voluntary markets
Scolel Té project
• Single farmers plant trees on household plots and rural communities plant or protect community forests - “Plan Vivo” management system
677 plantation/conservation sites, 7,500 hectares
• Scolel Té Project in the Mexican states of Oaxaca and Chiapas, selling carbon offsets in voluntary markets
Scolel Té project
• Carbon buyers/sold:
International Automobile Federation, Carbon Neutral Company, Tetra Pak...
Up-front payments (2.7-10.38 US$/tCO2) - 154,000 tCO2 sold to date
• Single farmers plant trees on household plots and rural communities plant or protect community forests - “Plan Vivo” management system
677 plantation/conservation sites, 7,500 hectares
• Scolel Té Project in the Mexican states of Oaxaca and Chiapas, selling carbon offsets in voluntary markets
Scolel Té project
• Carbon buyers/sold:
International Automobile Federation, Carbon Neutral Company, Tetra Pak...
Up-front payments (2.7-10.38 US$/tCO2) - 154,000 tCO2 sold to date
• Single farmers plant trees on household plots and rural communities plant or protect community forests - “Plan Vivo” management system
677 plantation/conservation sites, 7,500 hectares
• Project developer funds plantation establishment and development with 60% of total sequestration value of each contract - 40% covers management costs
Landholders maintain rights over future timber revenues
Carbon liability falls upon the project developer (buffer fund)
• Scolel Té Project in the Mexican states of Oaxaca and Chiapas, selling carbon offsets in voluntary markets
Scolel Té project
• Carbon buyers/sold:
International Automobile Federation, Carbon Neutral Company, Tetra Pak...
Up-front payments (2.7-10.38 US$/tCO2) - 154,000 tCO2 sold to date
• Single farmers plant trees on household plots and rural communities plant or protect community forests - “Plan Vivo” management system
677 plantation/conservation sites, 7,500 hectares
• One single external audit/verification in 2002 - Annual reports reviewed by Plan Vivo Foundation - Monitoring systems verified by Rainforest Alliance 09
• Project developer funds plantation establishment and development with 60% of total sequestration value of each contract - 40% covers management costs
Landholders maintain rights over future timber revenues
Carbon liability falls upon the project developer (buffer fund)
• Analysis of project’s origins, management approach and impacts at community level during 2002-2003 (Brown and Corbera, 2003; Nelson and de Jong, 2003; Corbera et al., 2007; Corbera and Brown, 2008)
Scolel Té - management outcomes
• Analysis of project’s origins, management approach and impacts at community level during 2002-2003 (Brown and Corbera, 2003; Nelson and de Jong, 2003; Corbera et al., 2007; Corbera and Brown, 2008)
Scolel Té - management outcomes
• Apparent trade-offs between environmental & development objectives
Biodiversity: seedlings delivery bottleneck
Enhanced inequalities in access to carbon funding due to land endowments
Insufficient knowledge transfer
Increasing prioritisation of forest management skills
• Analysis of project’s origins, management approach and impacts at community level during 2002-2003 (Brown and Corbera, 2003; Nelson and de Jong, 2003; Corbera et al., 2007; Corbera and Brown, 2008)
Scolel Té - management outcomes
• Limits imposed by the carbon market
Insufficient carbon funding
Networks/complementary funding critical
• Apparent trade-offs between environmental & development objectives
Biodiversity: seedlings delivery bottleneck
Enhanced inequalities in access to carbon funding due to land endowments
Insufficient knowledge transfer
Increasing prioritisation of forest management skills
• ‘Individual’ carbon
Lack of collective action - property rights historical changeAccess/participation influenced by:
- Legitimacy of rural organisation- Property rights fears: “I don’t want to sell my land to foreigners”- Household land endowment
Gendered nature of productive spaces and resource use not considered
Scolel Té - community development
• ‘Individual’ carbon
Lack of collective action - property rights historical changeAccess/participation influenced by:
- Legitimacy of rural organisation- Property rights fears: “I don’t want to sell my land to foreigners”- Household land endowment
Gendered nature of productive spaces and resource use not considered
Scolel Té - community development
• ‘Individual’ carbon
Lack of collective action - property rights historical changeAccess/participation influenced by:
- Legitimacy of rural organisation- Property rights fears: “I don’t want to sell my land to foreigners”- Household land endowment
Gendered nature of productive spaces and resource use not considered
Scolel Té - community development
• ‘Collective’ carbon
Strong collective action (commons conservation)Access/participation influenced by:
- Rural organisation seen as legitimate- Property rights conflicts with neighbouring communities- Carbon investment in collective goods
Very limited understanding of project activitiesGendered nature of the commons ignored
Conclusions
• Mexico’s experience with PES is mounting, and national programs have improved government/local technical capacities over time
Conclusions
• Mexico’s experience with PES is mounting, and national programs have improved government/local technical capacities over time
• PES programs based on weak causal relationships and more a subsidy than a reward
- Sustainability subject to actual local/regional markets
- REDD to become a sustainable funding source for PES?
- PES reduce deforestation > 600 < 46,800 ha/year (González Guillén et al, 2008)
Conclusions
• Mexico’s experience with PES is mounting, and national programs have improved government/local technical capacities over time
• PES programs based on weak causal relationships and more a subsidy than a reward
- Sustainability subject to actual local/regional markets
- REDD to become a sustainable funding source for PES?
- PES reduce deforestation > 600 < 46,800 ha/year (González Guillén et al, 2008)
• Carbon program shifted towards project design and marketable offsets, but has proved to be the least successful and more challenging
- Early funded/designed projects may become in sub-national REDD/CDM projects (if they count with adequate technical/marketing support)
- Carbon (and PES) projects are not ‘neutral’ - they change access relations over land, resources and ecosystem services; they can generate positive and contested outcomes
ReferencesBrown K, Corbera E, 2003, “Exploring equity and sustainable development in the new carbon economy” Climate Policy 3(S1) 41-56.CONAFOR, 2009, “Programa de Pago por Servicios Ambientales” Séptima Expo Forestal, 24-26 de Septiembre, Ciudad de México.Corbera E, et al, 2007, “The equity and legitimacy of markets for ecosystem services” Development and Change 38(4) 587-613.Corbera E, Brown, K, 2008, “Building institutions to trade ecosystem services: Marketing forest carbon in Mexico” World Development 36(10): 1956-1979.Corbera E, et al, 2009, “Institutional dimensions of Payments for Ecosystem Services: An analysis of Mexico’s carbon forestry programme” Ecological Economics 68 743-761.González Guillén MJ, et al, 2008, “Evaluación externa de los Apoyos de Servicios Ambientales” Colegio de Posgraduados, CONAFOR. Muñoz-Piña C, 2009, “Programa de Pago por Servicios Hidrológicos de los Bosques” D.G. Investigación en Economía y Política Ambiental. Instituto Nacional de Ecología INE, SEMARNAT.Muñoz-Piña C, et al, 2008, “Paying for the hydrological services of Mexico’s forests: Analysis, negotiations and results” Ecological Economics 65 725-736.Nelson KC, de Jong BHJ, 2005, “Making global initatives local realities: carbon mitigation projects in Chiapas, Mexico” Global Environmental Change 13 19-30.