Avoided Deforestation (REDD) and Indigenous ... - Amazon Fund

These goals can be mandatory (established by national legislations as a form of compliance with
Kyoto Protocol stipulations for Annex I countries) 6 or voluntary. Therefore, the carbon market
is divided into the “official” and the “voluntary” carbon market, determined by the two types of
carbon credit demands, depending on whether companies have the legal obligation to reduce
emissions or whether companies voluntarily assume reduction goals without being obligated to
do so by their governments.
A carbon credit is nothing more than a certificate, issued by an authorized organization,
verifying that a particular activity led to a reduction in GHG emissions or to the capture of GHGs.
This certificate is able to circulate as a credit title and its ownership may be ceded to third parties,
subject to, or free of, charges.
In the Kyoto Protocol and official markets, these certificates are called Certificate of
Emission Reductions (CERs) and are issued by the Executive Board of the Clean Development
Mechanism (CDM), which is organized under the United Nations (UN) system. The CERs represent
the removal or non-emission of one metric ton of carbon dioxide equivalent by a particular
undertaking that may be generated by: 1) a change in technology that leads to less fossil fuel
consumption or to less GHG emissions, or 2) forestation and reforestation activities.
On the voluntary market, other certificate types can serve as a transaction unit, namely
Voluntary Emission Reductions (VERs). These credits can be generated by activities that contribute
to avoided deforestation and forest degradation in developing countries, as will be discussed in
relation to the REDD mechanism below. On the voluntary market, credit acquisition aims either
to neutralize GHG emissions or to reach the goals voluntarily set for the companies or countries
not included in Annex 1.
REDD Mechanism: Reduced Emissions from Deforestation
and Forest Degradation
Despite the fact that deforestation is responsible for approximately 15% of the world’s
GHG emissions and that it primarily occurs in developing countries like Brazil, 7 the Kyoto Protocol
6 Kyoto Protocol of the United Nations Framework on Climate Change (adopted December 11, 1997 and entered
into effect on February 16, 2005), Art.2 and Annex I.
7 It has been calculated that 58% of all GHG emissions coming from Brazil originate from deforestation. According
to the National Emission Inventory published in 2006, 1.2 GtCO e are released annually into the atmosphere
2
caused by fires to open up plantation areas, from carbon used for metallurgy, or to provide raw material
for wood products. Pathways to a Low-Carbon Economy for Brazil, McKinsey & Company, 2009, p. 9.
Av o i d e d d e f o re s t A t i o n (redd) A n d i n d i g e n o u s p e o p l e s: experiences, chAllenges A n d o p p o r t u n i t i e s in t h e A m A zo n c o n t e x t 77