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Financing BFCP REDDeX Discussion 14 July 2010 All numbers are draft and US$

Financing bfcp 14 july 2010 gt

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  • 1.Financing BFCP REDDeX Discussion
    14 July 2010
    All numbers are draft and US$

2. 2
Recap
One of four officially recognized REDD demonstration programs in Indonesia
BFCP is an innovative forest carbon demonstration program located in the District of Berau, East Kalimantan, Indonesia;
Multi-sectoral approach to addressing land use and deforestation
Spans a political jurisdiction Berau, East Kalimantan, Indonesia
Berau is 2.2m ha the size of Belize
Objectives
Develop the capacity of the Berau district government to manage a REDD program.
Achieve emissions reductions of 10-12.5 million tons of CO2e by 2015
Improve natural resource governance and biodiversity conservation while creating economic opportunities for forest communities and the private sector.
Key model for:
REDD & low-carbon development at provincial level
Pathway to a national program - Working with GOI/GON LOI Implementation
3. 3
Where Are We?
Development II
[Jan 2010 Dec 2010]
Development I
[Jan 2009 Dec 2009]
Demonstration
[Jan 2011 Dec 2015]
Scoping
[Apr-Dec 08]
Pilot-based strategies
Improved forest management
Protection forests
Oil palm
Land-use planning, policies & enforcement
Monitoring & verification
Adaptive management
Business Plan
Master Budget ($50m)
Initial budget
($12m)
Funding Plan Public/Other
Senior TNC buy-in
GOI Engagement (Draft MOU)
Donor Dialogue & Negotiation
Legal Structure
Comprehensive Agreements
Baseline scenario and modeling approach
Refined strategies for reducing deforestation and degradation
Stakeholder support
Political Support
Situation analysis/drivers
Rough program design
hypothesis
Identification of partners/
contractors
4. 4
Core Funding Requirement
Our original thinking on funding needs
Total Core Funding Requirement (Jan 2011 - Dec 2015)*
i.e. funding required upfront (committed to by y/e 2010) to supportresults and outcomes as articulated within business plan
BFCP$50m(this number originally closer to $65m)
TNC Global$10m
TOTAL$60m
Total Additional Funding Requirement (Jan 2010 - Dec 2015)
i.e. committed to over time (2011-2015) to support additional outcomes, and further support TNC programs
$ tbd
Lets focus on the core
* All numbers draft and US$
5. 5
Proposed BFCP Governance and Mgnt. Structure
6. 6
$50m Budget
7. 7
Core Suggested Financing Sources
Funding committed to by y/e 2010 to support core outcomes as articulated in the business plan
Its largely about public funding
8. 8
Fundraising Plan Approach
TNC and GOI will work together to launch a joint fundraising campaign for BFCP with the goal of $2m in private funds through TNC(TNCs capital contribution or skin in the game) and $48m in public funding.
Initially, unlikely to be appetite for corporate financing (via emission reduction purchase agreement) risks are many and several
TNC makes GOI aware that it will be soliciting $5m in public funding sources for its own direct costs to support BFCP
[TNC makes GOI aware that it will be soliciting additional private funding to support additional TNC program costs]
9. 9
Fundraising Plan Key Objectives
Fully fund all program costs
Tap into the strong interest among range of funders to support a majority of the overall costs.
Include a TNC contribution to the BFCP trust to demonstrate our commitment to the program, but limit the TNC commitment to what is needed to accomplish this goal so our philanthropic fundraising can also support TNC operational costs
Coordinate closely and ensure complete transparency with GOI partners regarding the overall funding plan and TNCs commitments and approach.
10. 10
Public Funding for REDD
Surely this is easy
In Copenhagen, December 2009, six nations committed $3.5 billion for REDD implementation from 2010-2013

  • Australia, France, Norway, Japan, U.K., U.S.

Norway has made a $1bn commitment to GOI
Additional global REDD funding sources include:

  • German Govt.

11. Australian Govt. 12. Japan Govt. 13. Forest Carbon Partnership Facility (World Bank) 14. Forest Investment Program (World Bank) 15. UN REDD 16. Additional funding commitments may stem from COP 16