Indonesia releases revenue sharing rules for REDD forest carbon projects

July 13, 2009

Indonesia has released revenue sharing rules for forest carbon projects, reports Reuters.

According to a document released by the forestry ministry in Bahasa Indonesia (Indonesian) at dephut.go.id, the revenue-sharing depends on the type of forest ownership or permit, ranging from 10 to 50 percent for the government, 20 to 70 percent for local communities, and 20 to 60 percent for developers. Projects in areas classified as "protected forest" would see 50 percent go to the government, 20 percent to local communities, and 30 percent to developers, while for projects in indigenous forest the breakdown would be 10% to the government, 70 percent to the community, and 20 percent to the developer.

Dipterocarp tree in the Sumatran rainforest
The government's take is split: 40 percent for the central government in Jakarta, 20 percent for the provincial government, and 40 percent for the district government.

The rules were released to help increase the transparency of carbon transactions in the country, which stands to earn hundreds of millions of dollars a year under a proposed climate change mitigation scheme known as REDD (Reducing Emissions from Deforestation and Degradation) that would compensate tropical countries for leaving forests standing. Indonesia released guidelines for REDD projects in May but uncertainty in revenue-sharing rules were a source of concern to some developers.

Deforestation accounts for nearly 20 percent of greenhouse gas emissions from human activities, a share larger than all the world's cars, trucks, planes, and ships combined.

Indonesia has the world's second highest annual rate of forest loss after Brazil. Emissions from deforestation and degradation of peatlands, carbon dense ecosystem increasingly targeted for development of oil palm plantations, exceed 2 billion tons of carbon dioxide, or more than 6 percent of global emissions, in some years.

Revenue-sharing for forest carbon projects in Indonesia
NoPermit holders/forest typeGovernmentCommunityDeveloper
1IUPHHK-HA 20%20%60%
2IUPHHK-HT 20%20%60%
3IUPHHK-RE 20%20%60%
4IUPHHK-HTR 20%50%30%
5Hutan Rakyat (Forest)10%70%20%
6Hutan Kemasyarakata 20%50%30%
7Hutan Adat (Indigenous forest)10%70%20%
8Hutan Desa (Community forest)20%50%30%
9KPH 30%20%50%
10KHDTK 50%20%30%
11Hutan Lindung (Protected forest)50%20%30%

Sunanda Creagh. Indonesia issues first forest-carbon revenue rules. Reuters Fri Jul 10, 2009

[The rules apply to revenue sharing, not-profit sharing]

mongabay.com (July 13, 2009).

Indonesia releases revenue sharing rules for REDD forest carbon projects.