BioCarbon Fund Status
BioCF Workshop, World Bank
February 5-8, 2008
Harnessing the carbon market to sustain ecosystems and alleviate poverty
World Bank Carbon Funds & Facilities
Total funds pledged = US$ 2.1 billion (16 governments, 67 firms)
 Prototype Carbon Fund. $180 million (closed). Multi-shareholder. Multi-purpose.
 Netherlands Clean Development Mechanism Facility. (closed). Netherlands Ministry of
Environment. CDM energy, infrastructure and industry projects.
 Community Development Carbon Fund. $128.6 million (closed). Multi-shareholder. Small-
scale CDM energy projects.
 BioCarbon Fund. $89.9 million (Tranche 1 closed @ $53.8 million; Tranche 2 open). Multi-
shareholder. CDM and JI LULUCF projects.
 Italian Carbon Fund. $155.6 million (closed). Multi-shareholder (from Italy only). Multipurpose.
 Netherlands European Carbon Facility. (closed). Netherlands Ministry of Economic affairs. JI
projects.
 Spanish Carbon Fund. $282.4 million (closed). Multi-shareholder (from Spain only).
Multipurpose.
 Danish Carbon Fund. $69.4 million (closed). Multi-shareholder (from Denmark only).
Multipurpose.
 Umbrella Carbon Facility. $737.6 million (Tranche 1 closed – 2 HFC-23 destruction projects
in China).
Carbon Fund for Europe. $65 million. Multi-shareholder. Multi-purpose. Managed with EIB.
BioCarbon Fund Goals
Provide access
to carbon market
annual volume (MtCO2-eq)
project-based emission reductions traded
400
Improve
livelihoods
350
300
250
200
150
100
50
0
1998
1999
2000
2001
2002
Remove CO2
from atmosphere
Adapt to climate
change
Restore
ecosystems
2003
2004
2005
1stQ06
Co-benefits


BioCF wants to buy “green carbon with human face”
Social: Improve livelihoods

People receive carbon payments
 New job creation
 Additional income from alternative activities
 Know-how

Environmental

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Conserve biodiversity
Expand natural habitat
Reconnect forest fragments
Protect soil against erosion
Protect savannah against fires
Fight against desertification
Moisture retention
Stabilize radionuclides in biomass
Two Windows
First Window
Second Window
• Meet Kyoto obligations
• No Kyoto credits
• “Kyoto-grade” credits
(tCERs, lCERs, ERUs)
• Exploration &
demonstration. Rules may
change after 2012
• CDM: Afforestation &
Reforestation
• JI: All LULUCF
• CDM: Revegetation,
Forest management, Soil
management
Portfolio – First Window
 Forest restoration
 Community forestry
 Agroforestry
 Bioenergy plantations
 Timber plantations
Portfolio – Second Window
 Forest
restoration &
conservation
 Reduced
tillage
 Revegetation
Tranche 1 Leading Projects
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Albania Assisted Natural Regeneration
China Pearl River Watershed Management
Colombia San Nicolas Agroforestry
Colombia Silvopastoral Rehabilitation
Costa Rica Coopeagri
Ethiopia Humbo Assisted Regeneration
Honduras Pico Bonito
India Improving Rural Livelihoods
Kenya Green Belt Movement
Madagascar Biodiversity Corridor
Mali Acacia Plantations
Moldova Soil Conservation
Nicaragua Precious Woods
Niger Acacia Community Plantations
Philippines Watershed Rehabilitation
Uganda Nile Basin Reforestation
How the Fund Works
Technology
$
Finance
Industrialized
Governments
and
Companies
Technology
$
Finance
EITs and
Developing
Countries
CO2 Equivalent
CO2 Equivalent
Emission Reductions
Emission Reductions
Several Tranches
Tranche 1
(operational since May 2004,
closed to new Participants)
Tranche 2
(open to new Participants,
operational March 13, 2007)
Tranche 3
(may be opened
in the future)
Tranche-Window Combination
Tranche 1
T1 W2
(operational since May 2004,
closed to new Participants)
T1 W1
T2 W2
Tranche 2
(open to new Participants,
operational March 13, 2007)
T2 W1
?
Tranche 3
(may be opened
in the future)
?
Participants
 Tranche 1 ($53.8 million)

Operational since May 2004

Okinawa Electric, Government of Canada, Government of
Italy, Tokyo Electric, Eco-Carbone, Agence Française de
Développement, Government of Spain, Government of
Luxembourg, Idemitsu Kosan, Sumitomo Joint Electric
Power Co., Sumitomo Chemicals, Japan Petroleum
Exploration, Japan Iron and Steel Federation, Suntory
 Tranche 2 ($36.1 million)

Operational since March 2007

Consensus Business Group, Government of Ireland,
Government of Spain, Natsource, Syngenta Foundation,
ZeroEmissions Carbon Trust

Open for contributions
Tranche 1 Achievements (1/2)
 Contracts signed
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16 ERPAs signed
4 more under negotiation
 Methodologies
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10 A/R methodologies approved
Tool for Afforestation and Reforestation Approved
Methodologies
Public domain
1 REDD methodology (in draft form)
 Project registration

First ever CDM A/R project registered (China)
 Capacity building

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22+ project entities have been trained
Countries have adopted forest definitions
Tranche 1 Achievements (2/2)
 Building up base of experience

Show that CDM rules can work in practice

On-the-ground experience beyond theoretical debate

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Suggest improvements in rules
Testing ground for post-2012, including on “avoided
deforestation”
 Inclusion

Rural world can participate in the CDM

Africa > 1/3 of portfolio
Improvements in a Future Regime
 Expand beyond Afforestation/Reforestation

Agriculture

Renewable biomass

Avoided deforestation
 Allow Afforestation/Reforestation to supply
more than 1% of Annex I 1990 emissions
 Allow A/R on land deforested after December
31, 1989, with “reverse additionality rule”
 Continue temporary crediting beyond 60 years
 Inclusion of AFOLU in EU ETS?
Beyond A/R
 BioCarbon Fund Window 2
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Tranche 1: Project-level “avoided deforestation”
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Tranche 2: Soil carbon management
 “Avoided deforestation” (REDD)
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Working with the Forest Carbon Partnership Facility
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Requests by developing and industrialized countries
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Capacity building + pilot purchases
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In line with UNFCCC process
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Launch at CoP13
www.carbonfinance.org
www.biocarbonfund.org