Climate Change & Compensation for Environmental Services
What is Climate Change & Compensation for Environmental Services?
Recognizing the strategic importance of environmental services mechanisms for implementing the UNCCD and the other Rio Conventions at local level, the GM’s CCES programme aims to facilitate the integration of CCES mechanisms at institutional and programmatic level, as one potential element for resource mobilization in the GM’s broader financial strategy for NAP implementation in identified countries and sub-regions.
CCES and UNCCD implementation
Sustainable natural resource management is increasingly focussing on the services provided by ecosystems, their value, and the growing willingness of stakeholders to compensate natural resources stewards for such services. If sustainable land management practices can indeed contribute to the provision of specific or a range of environmental services of recognized value for which compensation can be obtained, CCES can be used to address the principles of the CCD, contribute to its implementation and benefit the activities of other Multilateral Environmental Agreements (MEAs).
While not a panacea for rural poverty, CCES – when incorporated into broader development strategies geared towards expanding the whole basket of assets (natural, social-political, human, physical, and financial) in the hands of poor communities –can significantly contribute to improving the livelihoods of the rural poor and advancing environmental goals. CCES should therefore not be pursued in an isolated fashion or be seen as an end in itself, but should be integrated into broader sustainable development frameworks.
On the basis of the various initiatives developed to date, CCES mechanisms comprise carbon sequestration, biodiversity conservation, watershed protection; and conservation of scenic beauty. While carbon sequestration or greenhouse gas (GHG) mitigation markets are global, biodiversity protection services are traded globally and locally, watershed protection and scenic beauty are normally circumscribed within a local context. Moreover, these mechanisms can be adopted in rural landscapes affected or threatened by all forms of land degradation.
The GM and CCES
Against this backdrop and with a view to broadening the funding basis for UNCCD implementation, the GM is facilitating the process of identifying opportunities for resource mobilization through the use of mechanisms for CCES. This strategic approach is in line with the decisions and requests of the Conference of the Parties (COP) concerning mobilizing new sources of funding and enhancing cooperation between the Rio Conventions. It is also in keeping with the recommendations of GM evaluations related to tapping into non-traditional sources of funding.
The GM is currently supporting activities to investigate how to include the use of CCES mechanisms and approaches into UNCCD financing strategies. This work has focused on the LAC region to date and has been a valuable experience which has yielded concrete results that will benefit the development of similar initiatives in other regions. The GM intends to continue playing a leading and innovative role by embedding CCES into a combination of resource mobilization mechanisms and instruments available at national level. The GM’s added value lies in the fact that CCES is not generally considered as an income-generating opportunity for affected communities nor is it contemplated in the overall financing strategies for UNCCD implementation. The GM and its partners thus maintain that CCES can be used to mobilize additional resources for communities living and working in specific landscapes.
The approach
Given the innovative nature and the GM’s projected application of CCES, the Programme must be seen as dynamic process which will be fine-tuned as activities progress. Internal and external consultations will further define the Programme’s strategic elements and its activities, taking into account the changing modalities and emerging trends at the international level. Since CCES-related issues are of a cross-cutting nature, the approach will be to focus on:
- Developing and consolidating corporate approaches and methodological tools to demonstrate how the CCES Programme can add value to the GM's interventions and those of its partners at country level, and how it can complement other GM strategic programmes. This will entail the development of a common understanding amongst all stakeholders of the rationale for linking CCES with UNCCD resource mobilization efforts; the various compensation mechanisms that exist; and how these mechanisms have already been used in non-UNCCD contexts. It will also entail developing information material and fully documenting the GM’s experience of CCES to date, to support the clear and concise justification for engaging potential national and international partners in the process.
- Promoting mutually-beneficial public-private partnerships including multiple stakeholders - first and foremost communities, community-based organizations, local government, the corporate sector, bilateral and multilateral organizations, central government, and well-positioned and experienced NGOs. The GM is in developing partnerships with the members of its Facilitation Committee; Conservation International’s Andean Programme; international private sector organizations; and organizations with experience in eco-fund schemes.
- Facilitating the development of targeted CCES initiatives with partners in GM priority areas in Africa, Asia and Latin America and the Caribbean, by harmonizing approaches and formalizing operational partnerships. Initiatives are currently being developed in Ecuador and Nicaragua, and are being explored in Uganda, Morocco, Jordan and Central Asia.
- Contributing with relevant partners to the convergence of UNCCD and UNFCCC policy dialogue by developing conceptual arguments, particularly on issues related to adaptation and avoided deforestation, which are increasingly being addressed by UNFCCC constituencies. Financial mechanisms related to adaptation, such as existing funds, could serve as the common denominator for addressing UNCCD issues in the future – perhaps through a market-based trading mechanism.
The implementation process
The Programme will be implemented with the GM as a facilitator. The GM will not, therefore, develop extensive in-house expertise, but instead will make information, knowledge and advisory services available from sources outside the GM. The establishment of a network of partners including bilateral and multilateral donors, government institutions, research institutions, civil society organizations and private sector entities will be fundamental for integrating potential CCES opportunities into overall existing cooperation frameworks.
Current activities
To date, the GM has piloted its CCES Programme in selected countries in Latin America and the Caribbean, with special emphasis on carbon sequestration. The GM’s key partner in this process is EcoSecurities - the largest dedicated GHG advisory and trading firm in the world, which provides strategic advisory services related to GHG accounting, mitigation projects and emissions trading to the private, public and non-governmental sectors.
EcoSecurities is supporting the development of methodological approaches and tools for systematic and continued identification, design, negotiation and implementation of locally-owned CCES-related projects within the framework of the UNCCD and poverty alleviation, as a contribution to NAP implementation in Nicaragua and in support of the integration of UNCCD concerns into the Peru-Ecuador Bi-national Development Plan.
Outcomes to date
In close collaboration with national and international partners in Nicaragua, the GM-EcoSecurities partnership has supported the development of a comprehensive technical background paper on the identification of investment opportunities through CCES for the UNCCD, which will be published shortly.
In Nicaragua, specific outcomes have been: CCES can be understood as retribution for any human-induced action or effect that a group and/or an individual generates to the benefit of the environment, which in turn can be used by a third party - be it ta government, a community, a group of individuals or a private entity.
- enhanced coordination mechanisms between UNCCD Focal Point and Officials from the Designated National Authority (DNA) or Clean Development Mechanism (CDM) Office;
- diagnosis of the framework conditions and environmental services projects and markets in Nicaragua, including a proposal for the establishment of a national environmental services authority to support the implementation of the UNCCD NAP; and
- establishment of a multi-stakeholder platform on CCES to exchange information, and identify, design, and negotiate CCES project proposals for submission for financing from various public and/or private sector sources;
In the Peru/Ecuador trans-boundary area, results include:
- integration of UNCCD priorities into the framework of the Peru/Ecuador Bi-national Development Programme. In practice this has meant identifying investment opportunities through concrete CCES project proposals. EcoSecurities has complemented the GM’s work by providing targeted advisory services (e.g. supporting local partner organisations organizations in identifying projects, providing inputs on CCES/CDM market developments for a CCES/CDM guidebook and supporting technical analysis of project proposals to prepare them for further elaboration and implementation).
- establishment of operational coordination modalities between local expert organisations working on CDM in Peru (Fondo Nacional del Ambiente –FONAM), and in Ecuador (CORDELIM); and
- close interaction with UNCCD focal points to identify CCES opportunities within CCD priority areas in the common border area.
In all the countries concerned there has been:
- consultative processes and capacity development through meetings and workshops;
- identification and promotion of investment opportunities through feasible and viable CCES project proposals; and
- first steps to identify and contacts with potential buyers of environmental services.
For more information, please contact:
Mr Alejandro Kilpatrick, Programme Coordinator, Climate Change Environmental Services Strategic Officer
Tel. +39 06 5459 2524
a.kilpatrick(at) ifad.org
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