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Finance and Carbon Markets (FCM)

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Countries and their relevant agencies and multilateral and bilateral institutions, along with both global private and public sectors, are rapidly expanding their engagement in the international voluntary, pre-compliance, and compliance REDD+ carbon markets with a focus on "pay-for-performance" compensation with a foundation of significant biodiversity and social co-benefits. Likewise, the long-term success of these same REDD+ activities depends on attracting and securing funding from the capital markets at significant speed and scale.

The FCMC team assists countries and their institutions build the enabling REDD+ finance and carbon markets frameworks needed to attract and engage funding from the capital markets through financial structures and institutions such as risk management products, loan guarantees, registries, settlement and clearinghouse activities, audit and verification, public and private debt issuance, public-private partnerships (PPP), equity markets, municipal finance, emission reduction purchase agreements (ERPAs), and donor-based support.

These services include collaborating with countries and their institutions to provide them a platform from which they can design national and sub-national REDD+ policies and programs, according to international finance best practices, that reduce risk while promote capital markets participation in REDD+ activities.

Furthermore, activities under the FCM task are closely related to other tasks. For example, robust SES standards and MRV systems are foundational to securing any investment in REDD+ activities, while LEDS provides leverage and diversification for climate friendly private sector engagement.

Even with the centrality of securing long-term financing to mitigate climate change, few national or sub-national REDD+ strategies address how national and sub-national REDD+ activities will be financed, either through bilateral and multilateral or market-based activities. This highlights the need for clearly defined financial models, plans, and supporting policy and investment-grade financial architecture. Building long-term funding at speed and scale requires that public and private funders are attracted to participating in REDD+ activities through long-term risk-adjusted competitive rates of return that are complementary to LEDS and integrated with and founded on the highest quality SES indicators and MRV "best practices."

Full List of FCM Documents Follow:

Final Report: Forest Carbon, Markets and Communities (FCMC) Program
Nov 20, 2015 · File

Final Report: Forest Carbon, Markets and Communities (FCMC) Program

Tetra Tech was awarded the three-and-one-half year Forest Carbon, Markets, and Communities Program (FCMC) Task Order (TO) by the United States Agency for International Development (USAID) in late March 2011. No-cost extensions enabled the program to continue through August 2015.…

REDD+ Supply and Demand 2015-2025
Apr 20, 2015 · File

REDD+ Supply and Demand 2015-2025

Forest loss in developing countries represents a significant contribution to global emissions along with significant climate change mitigation potential. How Reducing Emissions from Deforestation and Forest Degradation in Developing Countries; and the Role of Conservation, Sustainable Management of Forests, and…

Status of Climate Finance and REDD+ Under the UNFCCC
Apr 20, 2015 · File

Status of Climate Finance and REDD+ Under the UNFCCC

This paper provides an overview of relevant Conference of Parties (COP) decisions and the current status of negotiations on finance issues related to Reducing Emissions from Deforestation and Forest Degradation, conservation of forest carbon stocks, sustainable management of forests and…

Supporting Zero-Deforestation Cattle in Colombia
Apr 03, 2015 · File

Supporting Zero-Deforestation Cattle in Colombia

Colombia is among the world’s top cattle-producing countries, with more than 23 million head of beef and dairy cattle occupying approximately 38 percent of the total land area. It is challenging to clearly correlate deforestation with specific agricultural commodities in…

Incentivizing No-Deforestation Palm Oil Production in Liberia and the Democratic Republic of Congo
May 20, 2015 · File

Incentivizing No-Deforestation Palm Oil Production in Liberia and the Democratic Republic of Congo

The objective of this paper is to identify and develop options for actions that the U.S. Government could take to support a transition to the production and sourcing of zero-deforestation palm oil from countries in Africa that harbor large areas…

California Climate Legislation: Cap-and-Trade and International Forest Carbon Offsets
Mar 12, 2015 · File

California Climate Legislation: Cap-and-Trade and International Forest Carbon Offsets

Prepared in advance of a webcast held on the AB 32 law for institutional investors and the general public, this briefing paper summarizes the findings and analysis of the full report produced by FCMC.

California Cap-and-Trade and International Forest Carbon Offsets for Institutional Investors
Mar 12, 2015 · File

California Cap-and-Trade and International Forest Carbon Offsets for Institutional Investors

This report was prepared to help educate institutional investors about forest carbon markets in general, and more specifically, how forest carbon elements of the new AB 32 law in California may impact institutional investors. AB 32 and the cap-and-trade program…

Toward Zero-Deforestation Oil Palm in Peru: Understanding Actors, Markets, and Barriers
Jun 03, 2015 · File

Toward Zero-Deforestation Oil Palm in Peru: Understanding Actors, Markets, and Barriers

Large, commercial agriculture and timber enterprises are the principal agents of tropical deforestation in a number of countries, with four key commodities of soy, beef, palm oil, and pulp and paper being key drivers of tropical deforestation globally. TFA 2020…

Benefit Sharing and REDD+: Considerations and Options for Effective Design and Operation
May 28, 2015 · File

Benefit Sharing and REDD+: Considerations and Options for Effective Design and Operation

As Reducing Emissions from Deforestation and Forest Degradation, conservation of forest carbon stocks, sustainable management of forests and enhancement of forest carbon stocks (REDD+) implementation progresses, governments and communities alike are working to develop systems to manage payments and other…

Benefit Sharing and REDD+: Considerations and Options for Effective Design and Operation
May 28, 2015 · File

Benefit Sharing and REDD+: Considerations and Options for Effective Design and Operation

This report offers policy makers and stakeholders benefit-sharing design considerations that focus specifically on outcome-driven incentives—as opposed to benefit sharing for policy reforms or public sector programs—based on three different models: payments for services, managed funds, and collaborative resource management.…

Safeguards for REDD+ from a Donor Perspective
Mar 12, 2015 · File

Safeguards for REDD+ from a Donor Perspective

This paper was developed to provide a conceptual framing on the application of safeguards for transactions providing financial support for REDD+ actions. It seeks to provide an overview on the different safeguard approaches that bilateral donors currently apply, their applicability…

Safeguards in Bilateral REDD+ Finance
Mar 12, 2015 · File

Safeguards in Bilateral REDD+ Finance

This report consists of three papers produced as a followup to Safeguards for REDD+ from a Donor Perspective. These papers examine safeguards and results based payments, monitering and evaluation of safeguard implementation, and safeguards and donor coordination.

Colombia REDD+ Finance and Markets Assessment
Mar 12, 2015 · File

Colombia REDD+ Finance and Markets Assessment

In Colombia, there is a strong commitment at both the national and local levels to develop REDD+ activities. This report assesses and provides advice on Colombia’s preparedness for attracting private finance and participation in pay-for-performance and market-based mechanisms for REDD+.…

Emerging Compliance Markets for REDD+: An Assessment of Supply and Demand: Summary for Policymakers
Mar 12, 2015 · File

Emerging Compliance Markets for REDD+: An Assessment of Supply and Demand: Summary for Policymakers

This report summarizes the findings of the full FCMC Report, and provides abbreviated analysis and recommendations for policymakers.

FCPF Carbon Fund Methodological Framework
Mar 12, 2015 · File

FCPF Carbon Fund Methodological Framework

FCMC contributed to the development of a Methodological Framework by the Forest Carbon Partnership Facility's Carbon Fund with three issues papers on MRV, leakage, and financial and operational planning.

US Experiences with Results-based Finance
Mar 12, 2015 · File

US Experiences with Results-based Finance

Many countries view results-based payments as the principle mechanism that will provide 'positive incentives' for REDD+ results-based actions. This report summarizes some of the US government's experience with results-based finance domestically and in foreign aid, drawing lessons for REDD+. It…

US Government Investments and Policies to Facilitate Forest Carbon Finance and Markets
Mar 12, 2015 · File

US Government Investments and Policies to Facilitate Forest Carbon Finance and Markets

To support the need for private capital in REDD+ FCMC produced this report which provides guidance and recommendations to the US Government for catalyzing and facilitating these investments. The report analyzes current involvement in the REDD+ market among various agencies,…

Diagnóstico Sobre el Financiamiento y los Mercados de Carbono para REDD+ en Colombia
Mar 13, 2015 · File

Diagnóstico Sobre el Financiamiento y los Mercados de Carbono para REDD+ en Colombia

En Colombia, hay un compromiso fuerte al nivel nacional y local a desarrollar actividades de REDD+. Este informe tiene por objeto evaluar el estado de preparación en que se encuentra Colombia para atraer financiamiento privado y participar en los mecanismos…

Emerging Compliance Markets for REDD+: An Assessment of Supply and Demand
Mar 13, 2015 · File

Emerging Compliance Markets for REDD+: An Assessment of Supply and Demand

In response to the increasing relevance of compliance markets for REDD+, FCMC commissioned this study that analyzes the current trends in these market-based REDD+ mechanisms and their impact on international finance architecture and REDD+ project implementation.

Guidance and Best Practices for REDD+ Transactions Paper
Mar 13, 2015 · File

Guidance and Best Practices for REDD+ Transactions Paper

The 'Guidance and Best Practices for REDD+ Transactions Paper' was prepared by Terra Global through the FHI 360-managed FIELD-Support LWA and was designed to serve as a guide for REDD+ projects seeking guidance and best practices for REDD+ transactions, with…

Guidance for Jurisdictional and Nested REDD+ Program Design
Jun 16, 2015 · File

Guidance for Jurisdictional and Nested REDD+ Program Design

The objective of this document is to assist in the development of jurisdictional programs and nested projects, as well as to provide further background and context to the JNR Requirements. It provides high level advice on program design and development…

Orientación para el Diseño de Programas Jurisdiccionales y Anidados de REDD+
Jun 16, 2015 · File

Orientación para el Diseño de Programas Jurisdiccionales y Anidados de REDD+

El objetivo de este documento es prestar asistencia para el desarrollo de programas jurisdiccionales y proyectos anidados, al igual que ofrecer más antecedentes y un mayor contexto de los Requisitos de JNR. El mismo ofrece asesoría de alto nivel sobre…

Technical Guidance for Jurisdictional and Nested REDD+ Programs
Jun 16, 2015 · File

Technical Guidance for Jurisdictional and Nested REDD+ Programs

The objective of this document is to assist in the development of jurisdictional programs and nested projects, as well as to provide further background and context to the JNR Requirements. It provides technical advice on specific paragraphs of the JNR…

Orientación Técnica para Programas Jurisdiccionales y Anidados de REDD+
Jun 16, 2015 · File

Orientación Técnica para Programas Jurisdiccionales y Anidados de REDD+

El objetivo de este documento es prestar asistencia al desarrollo de programas jurisdiccionales y proyectos anidados, al igual que ofrecer más antecedentes y un mayor contexto de los Requisitos de JNR. El mismo ofrece asesoría técnica sobre párrafos específicos de…

Finance and Carbon Markets Lexicon
Mar 12, 2015 · File

Finance and Carbon Markets Lexicon

This lexicon encourages effective communication between government agencies and public and private sector institutions by providing detailed vocabulary, acronyms and references for REDD+ and finance terms. Based on international finance and carbon accounting best practices, it contains over 200 terms…

Léxico Financiero y de Mercados de Carbono
Mar 12, 2015 · File

Léxico Financiero y de Mercados de Carbono

Este léxico trata de fomentar la comunicación efectiva entre agencias de gobernación y las instituciones del sector privado y público como proveer el vocabulario detallado, acrónimos y referencias para términos del REDD+ y finanzas. Contiene más de 200 terminas y…

Supporting REDD+ in Developing Countries: A Review of Policy Options
Sep 21, 2015 · File

Supporting REDD+ in Developing Countries: A Review of Policy Options

The objective of this paper is to evaluate the potential of a range of market and non-market policy options available to developing countries willing to contribute to a global climate change solution by reducing emissions from deforestation and forest degradation,…

Apoyo a REDD+ en los países en desarrollo: Una revisión de las opciones de políticas
Sep 21, 2015 · File

Apoyo a REDD+ en los países en desarrollo: Una revisión de las opciones de políticas

El objetivo de este documento es evaluar el potencial que presentan diversas opciones de políticas, tanto de mercado como otras que no son de mercado, las cuales están disponibles en los países en desarrollo que estén dispuestos a contribuir a…

Apoio à REDD+ em países em desenvolvimento: uma análise de opções de políticas
Sep 21, 2015 · File

Apoio à REDD+ em países em desenvolvimento: uma análise de opções de políticas

Este documento tem como objetivo avaliar o potencial de diversas opções de políticas de mercado e não baseadas em mercado disponíveis para países em desenvolvimento dispostos a contribuir para se obter uma solução para a mudança climática global reduzindo emissões…

Appuyer la REDD+ dans les pays en développement : Examen des options en matière de politiques
Sep 21, 2015 · File

Appuyer la REDD+ dans les pays en développement : Examen des options en matière de politiques

L’objectif de ce document est d’évaluer le potentiel d’un éventail d’options de politiques de marché et hors marché à la disposition de pays en développement souhaitant contribuer à une solution mondiale face au changement climatique par la réduction des émissions…

Appuyer la REDD+ dans les pays en développement : Examen des options en matière de politiques
Sep 21, 2015 · File

Appuyer la REDD+ dans les pays en développement : Examen des options en matière de politiques

L’objectif de ce document est d’évaluer le potentiel d’un éventail d’options de politiques de marché et hors marché à la disposition de pays en développement souhaitant contribuer à une solution mondiale face au changement climatique par la réduction des émissions…

Incentivizing a Transition to Zero-Deforestation Commodities: Recommendations for Colombia, the Democratic Republic of Congo, Liberia, and Peru
Oct 30, 2015 · File

Incentivizing a Transition to Zero-Deforestation Commodities: Recommendations for Colombia, the Democratic Republic of Congo, Liberia, and Peru

To incentivize zero-deforestation commodity production in tropical forest countries, it is important to ensure that the key factors influencing commodity value chain dynamics align with reducing deforestation. This paper provides recommendations to achieve zero-deforestation commodity production in Africa (the Democratic…

 
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