Transcript Slide 1

BAPPENAS
REPUBLIC OF INDONESIA
Reducing carbon emissions from
Indonesia’s peat lands
Interim Report of a Multi-Disciplinary Study
Presented at Wetlands International Side Event
11 December 2009
COP 15, Copenhagen, Denmark
Reducing carbon emissions from Indonesia’s peat lands
COP15 December 2009
THE STUDY
• The objective of this analysis is to assess the potential for
reducing emissions from the country’s peat lands.
• The analysis assesses
– the present extent, land use and land cover of Indonesia’s peat lands,
– the magnitude of current peat land emissions,
– the possible carbon abatement potentials under the three different
policy scenarios,
– the economic costs and benefits of specific policy options and actions
to reduce emissions, and
– the potential application of national and international policy
instruments to achieve GHG emission reductions in Indonesia’s peat
land.
Reducing carbon emissions from Indonesia’s peat lands
COP15 December 2009
INDONESIA’S PEAT LANDS
Indonesia has around 21 million hectares of peat. Peat more than 3m
thick (around 8million hectares) is protected by law.
In 2006, more than 55% of peat land was forested. Other peat land
covers include cropland (14%) and shrub/grassland (20%)
Almost ¼ of Indonesia’s peatland is protected/conserved. About 3.3
million of this is still forested. As of 2006, forestry & plantation
licences on peat = 5.6 million hectares.
Agriculture, plantation timber & plantation crops cover more than 3
million hectares of land for development. Although protected by law,
more than 2.5million hectares of peat land over 3m deep is allocated
for development.
Reducing carbon emissions from Indonesia’s peat lands
COP15 December 2009
THE EMISSIONS OF PEAT LANDS
Indonesia has an average annual net emission of 903 Mt CO2 yr-1
between 2000 and 2006
This estimate is based on:
•Estimates of emissions from oxidation of 220 Mt CO2/yr using land use and land
cover data from 2000-2006 and previously published emissions factors.
•Loss of Above-Ground Biomass of 210 Mt CO2/yr based on past rates of
deforestation and carbon stock in peat swamp forests.
•Fire emissions estimate of 470 Mt CO2/y, based on published data and the Second
National Communication.
The majority of the peat emissions result from uncontrolled burning
(contributing 46% of total emissions), peat oxidation (25%) and
biomass removal (24%) with the main source regions being Sumatra
(44%) and Kalimantan (40%).
Reducing carbon emissions from Indonesia’s peat lands
COP15 December 2009
THE ECONOMICS of PEAT LAND
Peat land areas contribute to the national economy principally
through the forestry, plantations and agriculture sectors:
•Plantations & forestry sectors contributed 3% (USD12.6 billion)
[2007]
•Oil palm plantation sector contributed 0.85% of GDP & 3 million
jobs.
But highly carbon intensive:
•Peat land contributes approx USD1.06billion (or 0.26%) of
Indonesia’s total GDP yet accounts for almost 50% of emissions.
•Carbon intensity of the 7 “peat provinces” (90% of Indonesia’s
peat) is 22.1 kg of CO2 / US dollar of GRDP.
Reducing carbon emissions from Indonesia’s peat lands
COP15 December 2009
MITIGATION POTENTIAL
The BAU scenario assumes all peat areas currently allocated to
companies are developed with fire emissions continuing based on
historical emissions, which provides an estimated increase in
emissions to 1,387 Mt CO2 yr-1 by 2025.
The potential emissions under each of three main policy measures
are estimated and compared to the BAU scenario Up to 92 %
reduction on BAU is possible by 2025 through:
1. Legal compliance and best management practices in existing land
under production - 338 Mt CO2 or 24 % reduction
2. Peat land rehabilitation and prevention of uncontrolled fires - 430
Mt CO2 or 31 % reduction
3. Revision of land allocation, forest conservation and land swaps
that direct future development away from peat land - 513 Mt CO2 or
37 % reduction
Reducing carbon emissions from Indonesia’s peat lands
COP15 December 2009
MITIGATION POTENTIAL
Uncontrolled f ire emissions
Development zone (forest land f or conversion)
Development zone (production f orest and timber plantation)
Protection and conservation zone
Development zone (non-forestry use)
1.6
Emissions (Gt CO2)
1.4
19.5%
1.2
24.4%
55.1%
1.0
73.2%
0.8
87.4%
92. 4%
0.6
0.4
0.2
0.0
BAU
Miti-1
Miti-2
Miti-3
Miti-4
Miti-5
Miti-6
Miti-7
Reducing carbon emissions from Indonesia’s peat lands
COP15 December 2009
THE ECONOMIC OUTLOOK
Preliminary analysis of the opportunity costs of protecting
unlicensed peat, and shifting future development onto mineral
soil:
•There is a net positive benefit on GDP, and to a lesser extent
on tax revenues and local revenues
• In terms of macro impact, unlikely to involve opportunity cost
due to availability of land at national level.
•But an opportunity cost still exists at the local level, especially
in districts with little alternative land available. Here, the cost
will need to be borne by carbon revenue
Reducing carbon emissions from Indonesia’s peat lands
COP15 December 2009
NET POSITIVE BENEFIT OF REVISING LAND
ALLOCATION, PERMITS
40,000
GDP
Tax reveue
US$ million
30,000
Local revenue
20,000
10,000
0
Baseline
Action 5 =
Conserve forest
+ Action 6 = Protect
unlicensed peat
land
+ Action 7 = Land
sw ap existing new
licenses
Emission Scenario
Reducing carbon emissions from Indonesia’s peat lands
COP15 December 2009
THE BUSINESS OUTLOOK
(1)
Implementing Best Practices in Oil Palm on Peat
Comparison of a standard ‘business as usual’ model with a ‘best practice’
model:
•
Improving yields and financial performance reduces pressure to open
up new peat land.
•
The average regional GDP (GRDP) produced by a best practice
plantation is more than double that produced on a BAU plantation.
•
If 500,000 hectares of peat land plantations are upgraded to best
practice management, a further 500,000 hectares would not need to
be converted.
•
The costs of “best practice” are $1,405 per hectare (discounted at
15%). But the benefit is worth $4,626 – a return on investment of
over 22%.
Reducing carbon emissions from Indonesia’s peat lands
COP15 December 2009
THE BUSINESS OUTLOOK
(2) Land Swaps from Peat Land to Mineral Soils
Assessment of the economic viability of shifting planned plantations to
degraded mineral soils:
•
Net land available for oil palm expansion on degraded mineral soils is
8 million ha. Sufficient to cover planned increase in palm oil
production up to 2020.
•
Assuming a best practice management, degraded land offers superior
rates of return (18.6%) than either unforested (11.3%) or forested peat
land (12.9%).
A strong case to review and consider revised business models such as
enhanced community-business partnership models or innovative
community-based plantation models.
A key success factor for working on degraded mineral land will be Free, Prior
and Informed Consent (FPIC) for the participation of local communities
and farmers as business partners.
Reducing carbon emissions from Indonesia’s peat lands
COP15 December 2009
ENABLING LAWS AND INSITUTIONS
The current policy, institutional and legal environment regarding peat land
management in Indonesia is currently under review
Policies are already in place to regulate peat-land management including
limits on developing peat > 3 metres deep, zero burning, and water
management
But to reduce emissions at scale, there is still a need for:
•
A more effective institutional framework for peat and lowland, e.g. to
address overlapping mandates
•
A performance-based framework to promote best practice
•
A national strategy, plan and finance for peat land rehabilitation and
fire prevention in degraded peat lands
•
A comprehensive review of spatial planning e.g. to assess scope for
shifting future development onto mineral soil
•
A review of experience on land swaps and the potential to scale up
experience from pilots to a national scale policy and program
•
The development of peat land carbon policies and their articulation at
the international level
Reducing carbon emissions from Indonesia’s peat lands
COP15 December 2009
ACKNOWLEDGEMENTS:
This study is commissioned and led by the Indonesian
National Development Planning Agency (BAPPENAS), with
the support of experts from the Ministry of Forestry, the
Ministry of Agriculture, the Bogor Agricultural Institute
(IPB), and the Indonesian Centre for Environmental Law
(ICEL). The UK Department for International Development
and the Netherlands Ministry for Development Cooperation
have provided co-funding.
Reducing carbon emissions from Indonesia’s peat lands
COP15 December 2009
Thank you
Directorate of Forestry and Water Resources Conservation
[email protected]
Reducing carbon emissions from Indonesia’s peat lands
COP15 December 2009