Reducing poverty in Nepal, through innovative and equitable carbon financing mechanism (REDD)

Summary
REDD is a concept by which reduction of emissions from deforestation and forest degradation can be compensated through payment of carbon credits. For a country like Nepal, REDD implementation can bring about huge benefits to the national government and the local communities who are in lead of conserving the forests. 

Providing financial incentives for forest carbon has the potential to make forest conservation more economically viable. REDD could potentially become one of the first large scale manifestations of payments for environmental services (PES) mechanisms, which are generally considered as relevant, yet extremely challenging to make functional. 

Recent analysis of remote sensing data shows an increase in forest cover and regeneration of grasslands in the corridors of Terai Arc Landscape (TAL). The project builds upon the long term benefits generated by an earlier project and successful forest conservation in order to qualify the restored forests for carbon trading.

Background
Forest resources in many developing countries play important roles in national economic development. In particular, they provide a source of income and fulfil customary uses among local people, which are often crucial, if not critical to local communities, especially in poor areas. 

In the context of global climate change, deforestation and forest degradation in developing countries contributes significantly to global CO2 emissions. It has been estimated that deforestation and forest degradation contributes at least 20% to overall CO2 emissions globally. 

Significant emission reduction could be made, however, if appropriate compensation mechanisms can be created. There have been some very limited incentives for local communities to conserve and ensure sustainable use of natural resources. While forests play a vital role in the mitigation of climate change, trading carbon stored by the standing forest can bring about numerous livelihood benefits to the local communities, who are also the forest stewards. 

The UN Climate conference in Bali has agreed to include forest conservation in future discussions on a new global warming treaty that would lead to the transfer of billions of dollars in the form of carbon credits from industrialized countries to tropical countries, for the purpose of slowing greenhouse gas emissions by reducing deforestation rates. Although REDD is still much somewhat controversial and the subject of much debate, researchers worldwide argue that forest protection could be one of the most cost-effective ways to address climate change. 

The proposed project links to the ongoing project Strengthening Restoration of Biological Corridor in the Terai Arc Landscape, Nepal supported by the government of Finland (2003-2008). The project has achieved significant success through community based anti-poaching operations, corridor restoration, capacity building, education and awareness and alternative energy promotion for livelihood improvement.

Partners

The partners are: Ministry of Environment, Science and Technology (MoEST), Department of National Parks and Wildlife Conservation (DNPWC), Department of Forest, National Trust for Nature Conservation (NTNC) and local communities including Buffer Zone (BZ) and Community Forestry Coordination Committees (CFCC).