REDD+ and Carbon Markets: The Ethiopian Process

Abstract

In 1997, the Parties to the UNFCCC (United Nations Framework Convention on Climate Change) adopted the Kyoto Protocol to operationalise the UNFCCC by committing countries included in its Annex 1 (industrialised countries and countries with economies in transition) to emissions reductions targets and establishing mechanisms to achieve those targets. A new commodity was created in the form of emission reductions or removals. Carbon (carbon dioxide) is now tracked and traded like any other commodity. Carbon markets are means by which contracts of sale of emission reductions of greenhouse gases (GHGs) are exchanged. Complexity in the operation of these carbon markets has been increasing day by day, with different mechanisms, programs and assets. REDD + mechanism (Reducing emissions from deforestation and forest degradation and the role of conservation, sustainable management of forests and enhancement of forest carbon stocks in developing countries) incentivizes a trend change from historic increasing deforestation rates and greenhouse gases emissions. Through REDD+ mechanism developing countries are financially granted for any emissions reductions achieved associated with a decrease in the conversion of forests to alternative land uses. With more than 18 million hectares of forests (including woodlands, Ethiopian Mapping Agency 2013) covering approximately 16 % of its land area, Ethiopia has a huge potential and is among the countries partnered with FCPF (Forest Carbon Partnership Facility) to implement REDD+. The REDD+ process is framed in the Ethiopia’s Climate Resilience Green Economy (CRGE) Strategy that sets out that by 2025, Ethiopia will become a middle-income country, resilient to climate change impacts and with a zero net increase in greenhouse gas (GHG) emissions over 2010 levels. REDD+ strategy contributes to the achievement of the CRGE targets through improved management of forests and agricultural areas. This strategy will be followed by a comprehensive action plan that elaborates the required activities to address the drivers of deforestation and forest degradation. The action plan will be incorporated into the Growth and Transformation Plan (GTP II) and implemented by the relevant sectors in line with existing sectoral policies and strategies.