Feasibility Study for BP Carbon Offset Project: Final Report

Abstract

The Paris Agreement governs global climate change mitigation efforts by the convention through 2030, which put countries in position as the responsible entity to foster efforts not to exceed 1.5⁰C global warming by 2030. Countries are invited to submit Nationally Determined Contributions (NDCs) which declare countries targets and commitment including policy and measures to adapt and mitigate climate change by 2030. A larger role of countries is to set out policy and regulation in their country. Indonesia as a country that ratified Paris Agreement has been taking several steps of policy and measures including submitting NDC, implementing REDD+ as the major climate change mitigation from forestry sector, and setting out domestic policy on carbon economic values (Nilai Ekonomi Karbon/NEK). Specific to the latter, many observers associate this policy with Article 6 of Paris Agreement which allows countries to voluntarily cooperate with each other to achieve emission reduction targets set out in their NDCs. This means that, under Article 6, a country (or countries) will be able to transfer carbon credits earned from the reduction of GHG emissions to help one or more countries meet climate targets, through the involvement of private sectors in buying carbon credits from elsewhere to compensate their emission reduction targets.

With a forest area of more than 120 million ha or more than 60 percent of its land area, Indonesia has a great opportunity to implement REDD+. Reducing emissions from deforestation and forest degradation, forest carbon conservation, sustainable forest management and increasing forest carbon stocks (REDD+) in developing countries are climate change mitigation actions according to the UNFCCC with an economic incentive mechanism. Implementing the REDD+ program to reduce GHG emissions from the forestry sector and land use is a strategy to achieve Indonesia’s NDC according to the Paris Agreement.