Indonesia Easing Terms for Forestry CDM

By Barrie | October 18th, 2007 | No Comments

The government has expressed fears that Indonesia might not be able to tap into the financial benefits from carbon trading in forestry projects, saying the requirements are not feasible for the country. The Forestry Ministry has said that the government faces problems supplying data on land conversions over the last 50 years.

“The (Clean Development Mechanism or CDM) requirements for forestry projects are too complex. It is difficult for Indonesia to provide the data on forest conversions in the past 50 years,” Forestry Research and Development Agency head Wahjudi Wardojo said.
The Clean Development Mechanism allows developing nations to host projects aimed at reducing greenhouse gas emissions, including through energy-based schemes or forestry activities.
The Kyoto Protocol says only aforestation and reforestation projects are eligible for CDM in the forestry sector.

The protocol defines aforestation as conversion from land that has not been forested for a period of at least 50 years to be forested land through planting and seeding.

Reforestation is defined as the conversion of land to forested area after December 1989.

Wahjudi said that the government would raise the issue of forestry CDM during the climate change conference in Bali in December.

The United Nations Framework Convention on Climate Change Conference, the world’s highest level meeting on global warming issues, will be held from Dec. 3 to 14.

Meanwhile, a preparation meeting ahead of the conference will be held in Bogor, West Java, from Tuesday to Thursday.

“We will ask parties to the Kyoto Protocol to ease conditions on the CDM mechanism on forestry projects to enable us to propose our projects,” he said.

Indonesia currently has 120 million hectares of forest, the world’s third largest after Brazil and the Democratic Republic of Congo.

The government set up a commission in 2005 to approve CDM projects in the country. As of October, the commission has approved 24 carbon trading projects. All of them are related to the energy sector.

Nine Indonesian projects have been registered with the United Nations Executive Board for approval.

Once the UN approves the projects, the host of the projects will receive a certificate of emissions reduction (CER).

CERs can be traded with the 38 rich countries who have to cut their greenhouse gas emissions levels between 2008 and 2012 by 5.2 percent below their 1990 levels.

A ton of carbon dioxide (CO2) reduction is currently worth between US$5 and $10.

The Word Bank said that the global carbon market traded volume was worth less than $1 billion in 2004 but skyrocketed to $11 billion in 2005 and to over $30 billion last year.

Wahjudi said Indonesia would promote reduction emissions from deforestation in developing countries proposal during the Bali conference.

“With the scheme, the calculation of financial benefits are clearer
than on the CDM,” he said.

“We are still formulating the methodology to calculate the carbon stored in the forest.”

He predicted that a hectare of natural forest could store between 300 tons and 400 tons of CO2 while a hectare of rubber retained about 75 tons of CO2.

State Minister of the Environment Rachmat Witoelar earlier said that Indonesia could earn $10 per hectare of conserved forests.

“But we prefer the calculation based on ton of carbon in a hectare of forest,” he said.

The rapid destruction of Indonesia’s rain forests through practices such as burning for land clearing is regarded as one of the world’s leading causes of global warming.

Wetland International named Indonesia the world’s third largest greenhouse gas emitting country, after the United States and China, due to rapid deforestation.

Adianto P. Simamora