CHALLENGE

What are the tools and practices available for financing nature protection in Southeastern Europe?    

Conforming to European environmental requirements and joining the ecologocial network "Natura 2000" requires better management of natural resources, new approaches for public and private collaboration, and a sustainable method to finance the expansion of protected areas.

Although the Croatian Government has identified a network of around 1,000 potential "Natura 2000" sites covering over 250 species and 70 regionally significant habitat types, resources are scarce. A review of best practices and alternative benefit valuation methods and revenue generating policy options could ensure an appropriate level of sustainable financing for Croatia’s protected areas in the future.

APPROACH

To improve the financial management of biodiversity conservation in transition and accession countries in Southeastern Europe (Croatia, Bosnia and Herzegovina, and Albania), PROFOR supported a synthesis of best practices in nature protection financing mechanisms and levels in Europe, Latin America and the Caribbean, with a primary focus on Croatia.

Valuation surveys were used in Croatia to estimate the willingness of visitors to pay to keep and improve these protected areas. The results, which are relevant for the entire sub-region, were presented at a regional workshop in February 2010.

MAIN FINDINGS

• Survey results indicated both Croatians and international tourists place a very high value on protected area services and are willing to pay more for both improved services and the preservation of natural site attributes. 
• The study used internationally recognized environmental economic techniques for eliciting use and non-use values of the parks.  Non-use values are the value people place on the protection of plant, animal, geological, cultural and landscape features of the site.  Use values include natural products and recreational services that the site provides. 
• The results will help define a nature protection investment program.
• Croatia could benefit from a more transparent and equitable share of revenues from large concessions operating in protected areas reinvested into conservation; better financial management systems; and training and education of park management in fundraising skills. 

These findings are expected to help Croatia become a regional benchmark for sustainable Protected Area management and inspire similar assessments in neighboring countries seeking EU accession.

CHALLENGE

According to the most recent forest assessment (FAO, 2005), the forest area in Lebanon is estimated at over 139,000 ha (13.3% of the country) with an additional 108,000 ha classified as Other Wooded Land (OWL). The FAO analysis shows that 85 % of the forest area in Lebanon is considered "disturbed", i.e. impacted by human activities, with about 14% of the forest area affected by past forest fires. About 60% of the forest area is privately owned, compared to 27% state-owned and 11% owned by municipalities and communities, with only 3% of the area designated as nature reserves.

Forests play two main roles in Lebanon: (i) they serve directly as income sources for rural livelihoods and (ii) they provide environmental services, mainly soil and water conservation, to rural populations particularly in hilly areas. However, war, uncontrolled urban expansion, and frequent forest fires have resulted in the total forest area declining from about 20% of the country to only 13% at present.

Lebanon is interested in reversing that trend. It is embarking on a large reforestation initiative with the goal to replant 70,000 ha, an increase of over 50% over the currently forested area. It is also investing in the extension of irrigation to increase income from high-value crops, including substantial investments in the construction of hill lakes to harvest rainwater. Without significant upstream reforestation, some of these hill lakes could become vulnerable to excessive silting and to flooding events that are likely to become more intense as a result of climate change. Such events could cause serious infrastructural damage to vulnerable lakes and reduce their storage capacity.

APPROACH

The proposed study aims to present best-fit reforestation practices so that local authorities and beneficiaries have the knowledge to choose successful reforestation practices that support their livelihoods and long-term resilience. Climate change scenarios will be applied to current knowledge of ecosystem and soil conditions, to understand potential impacts and develop recommendations for reforestation for resilience under changing ecological conditions.  Best fit practices will be defined based on two major criteria: a) social acceptability and ease of implementation and b) tree survival rates based on local ecosystems and experiences. These umbrella criteria will be further defined in discussion with the stakeholders and captured in the typology suggested during study implementation.

RESULTS

This activity is ongoing. Findings will be shared on this page when they become available. 

CHALLENGE

According to the most recent forest assessment (FAO, 2005), the forest area in Lebanon is estimated at over 139,000 ha (13.3% of the country) with an additional 108,000 ha classified as Other Wooded Land (OWL). The FAO analysis shows that 85 % of the forest area in Lebanon is considered "disturbed", i.e. impacted by human activities, with about 14% of the forest area affected by past forest fires. About 60% of the forest area is privately owned, compared to 27% state-owned and 11% owned by municipalities and communities, with only 3% of the area designated as nature reserves.

Forests play two main roles in Lebanon: (i) they serve directly as income sources for rural livelihoods and (ii) they provide environmental services, mainly soil and water conservation, to rural populations particularly in hilly areas. However, war, uncontrolled urban expansion, and frequent forest fires have resulted in the total forest area declining from about 20% of the country to only 13% at present.

Lebanon is interested in reversing that trend. It is embarking on a large reforestation initiative with the goal to replant 70,000 ha, an increase of over 50% over the currently forested area. It is also investing in the extension of irrigation to increase income from high-value crops, including substantial investments in the construction of hill lakes to harvest rainwater. Without significant upstream reforestation, some of these hill lakes could become vulnerable to excessive silting and to flooding events that are likely to become more intense as a result of climate change. Such events could cause serious infrastructural damage to vulnerable lakes and reduce their storage capacity.

APPROACH

The proposed study aims to present best-fit reforestation practices so that local authorities and beneficiaries have the knowledge to choose successful reforestation practices that support their livelihoods and long-term resilience. Climate change scenarios will be applied to current knowledge of ecosystem and soil conditions, to understand potential impacts and develop recommendations for reforestation for resilience under changing ecological conditions.  Best fit practices will be defined based on two major criteria: a) social acceptability and ease of implementation and b) tree survival rates based on local ecosystems and experiences. These umbrella criteria will be further defined in discussion with the stakeholders and captured in the typology suggested during study implementation.

RESULTS

This activity is ongoing. Findings will be shared on this page when they become available. 

CHALLENGE
Biochar is the carbon rich residue of heating biomass without oxygen, a process called pyrolysis, that also releases bio-oil and syngas with high energy content. There is growing interest from public and private investors in biochar as a method for removing vast amounts of atmospheric carbon (mitigation) and rebuilding soil fertility and resilience to drought (adaptation). Considering that the fate of tropical forests lies on the ability to produce more food and energy with less land, the soil fertility effect of biochar is also very relevant to the lasting reduction of deforestation and forest degradation.

CHALLENGE
Biochar is the carbon rich residue of heating biomass without oxygen, a process called pyrolysis, that also releases bio-oil and syngas with high energy content. There is growing interest from public and private investors in biochar as a method for removing vast amounts of atmospheric carbon (mitigation) and rebuilding soil fertility and resilience to drought (adaptation). Considering that the fate of tropical forests lies on the ability to produce more food and energy with less land, the soil fertility effect of biochar is also very relevant to the lasting reduction of deforestation and forest degradation.

CHALLENGE
Biochar is the carbon rich residue of heating biomass without oxygen, a process called pyrolysis, that also releases bio-oil and syngas with high energy content. There is growing interest from public and private investors in biochar as a method for removing vast amounts of atmospheric carbon (mitigation) and rebuilding soil fertility and resilience to drought (adaptation). Considering that the fate of tropical forests lies on the ability to produce more food and energy with less land, the soil fertility effect of biochar is also very relevant to the lasting reduction of deforestation and forest degradation.

CHALLENGE
Biochar is the carbon rich residue of heating biomass without oxygen, a process called pyrolysis, that also releases bio-oil and syngas with high energy content. There is growing interest from public and private investors in biochar as a method for removing vast amounts of atmospheric carbon (mitigation) and rebuilding soil fertility and resilience to drought (adaptation). Considering that the fate of tropical forests lies on the ability to produce more food and energy with less land, the soil fertility effect of biochar is also very relevant to the lasting reduction of deforestation and forest degradation.

CHALLENGE
Charcoal is one of the main sources of energy used in the production of pig iron for steel in Brazil. The vast majority of the current charcoal production is from unsustainable and often illegal harvest of native forests, leading to severe environmental degradation and deforestation. However, there have been successful business cases of forest plantation for charcoal production in Brazil, including one Clean Development Mechanism (CDM) project financed by the Prototype Carbon Fund in Minas Gerais. Expanding the area of forest plantations for charcoal on idle or degraded pasture land would reduce the pressure on native forests in Brazil.

However, barriers have prevented wide adoption of forest plantations for charcoal. Some of the barriers include:

• lack of credit to finance the initial production costs (first income revenue usually is generated after 7 years of plantation),
• difficult access to credit (forest plantations are often not accepted as collateral for loans),
• higher transaction costs relative to deforestation and coal production (planted forest activity has a cycle of 14-21 years of production, is labor intensive, and results in high costs of land management and environmental licensing),
• inefficient technologies for carbonization process (contributing to the emission of greenhouse gases (GHG), including methane),
• unclear agricultural and environmental regulatory framework to forest production,
• weak institutional arrangements, etc. 

With 62 pig iron mills, the state of Minais Gerais is Brazil's largest producer of steel and iron, responsible for 60% of the national production.  Minas Gerais approved a law which virtually bans the use of charcoal from deforestation by 2018. In order to supply the industry with charcoal from plantations Minais Gerais would need about 1.5 million ha under new plantations.

APPROACH
PROFOR and the BioCarbon Fund co-financed a study designed to identify institutional and financial arrangements required to mainstream forest plantation business models and promote the potential development of CDM projects aimed at reducing GHG emissions in the forestry and iron supply chains in the state of Minas Gerais.

The displacement of non-renewable charcoal by renewable charcoal by 2017 and the use of charcoal to produce up to 46% of the pig iron and steel by 2030, would potentially mitigate 62 Mt of CO2 between 2010 and 2030. This would represent 31% of all emissions reductions expected from the steel industry and contribute to Brazil's overall effort to reduce its GHG emissions by 39% by 2020.

RESULTS
The study's methodology and preliminary results were presented during a workshop "Identifying Financial and Institutional Arrangements for Scaling Up Renewable Charcoal Production" in Belo Horinzonte, Minas Gerais, in December 5, 2011. (A presentation from that workshop is available in Portuguese on this page). At completion, final reports with the technical work, datasets, and related links were shared with key counterparts within the government, private sector, and financial institutions.

The analytical work supported by this project was a key building block in the World Bank’s strategy for supporting Brazil’s move toward a low carbon economy as stated in the Brazil Country Partnership Strategy for 2012-2015, under Objective 4: Improving sustainable natural resource management and climate resilience. ("Helping the Federal government and the private sector to implement Brazil’s National Climate Change Plan, including through developing programs and financial mechanisms to promote sustainable land use, decrease deforestation, and increase energy efficiency and renewable energy.")

The Minas Gerais Development Policy Loan III ( P121590), to which this study contributed, is one of the deliverables of the new country strategy. The State has adopted measures to encourage forest plantation within its territory to supply raw input to industries within its territory.

CHALLENGE
Charcoal is one of the main sources of energy used in the production of pig iron for steel in Brazil. The vast majority of the current charcoal production is from unsustainable and often illegal harvest of native forests, leading to severe environmental degradation and deforestation. However, there have been successful business cases of forest plantation for charcoal production in Brazil, including one Clean Development Mechanism (CDM) project financed by the Prototype Carbon Fund in Minas Gerais. Expanding the area of forest plantations for charcoal on idle or degraded pasture land would reduce the pressure on native forests in Brazil.

However, barriers have prevented wide adoption of forest plantations for charcoal. Some of the barriers include:

• lack of credit to finance the initial production costs (first income revenue usually is generated after 7 years of plantation),
• difficult access to credit (forest plantations are often not accepted as collateral for loans),
• higher transaction costs relative to deforestation and coal production (planted forest activity has a cycle of 14-21 years of production, is labor intensive, and results in high costs of land management and environmental licensing),
• inefficient technologies for carbonization process (contributing to the emission of greenhouse gases (GHG), including methane),
• unclear agricultural and environmental regulatory framework to forest production,
• weak institutional arrangements, etc. 

With 62 pig iron mills, the state of Minais Gerais is Brazil's largest producer of steel and iron, responsible for 60% of the national production.  Minas Gerais approved a law which virtually bans the use of charcoal from deforestation by 2018. In order to supply the industry with charcoal from plantations Minais Gerais would need about 1.5 million ha under new plantations.

APPROACH
PROFOR and the BioCarbon Fund co-financed a study designed to identify institutional and financial arrangements required to mainstream forest plantation business models and promote the potential development of CDM projects aimed at reducing GHG emissions in the forestry and iron supply chains in the state of Minas Gerais.

The displacement of non-renewable charcoal by renewable charcoal by 2017 and the use of charcoal to produce up to 46% of the pig iron and steel by 2030, would potentially mitigate 62 Mt of CO2 between 2010 and 2030. This would represent 31% of all emissions reductions expected from the steel industry and contribute to Brazil's overall effort to reduce its GHG emissions by 39% by 2020.

RESULTS
The study's methodology and preliminary results were presented during a workshop "Identifying Financial and Institutional Arrangements for Scaling Up Renewable Charcoal Production" in Belo Horinzonte, Minas Gerais, in December 5, 2011. (A presentation from that workshop is available in Portuguese on this page). At completion, final reports with the technical work, datasets, and related links were shared with key counterparts within the government, private sector, and financial institutions.

The analytical work supported by this project was a key building block in the World Bank’s strategy for supporting Brazil’s move toward a low carbon economy as stated in the Brazil Country Partnership Strategy for 2012-2015, under Objective 4: Improving sustainable natural resource management and climate resilience. ("Helping the Federal government and the private sector to implement Brazil’s National Climate Change Plan, including through developing programs and financial mechanisms to promote sustainable land use, decrease deforestation, and increase energy efficiency and renewable energy.")

The Minas Gerais Development Policy Loan III ( P121590), to which this study contributed, is one of the deliverables of the new country strategy. The State has adopted measures to encourage forest plantation within its territory to supply raw input to industries within its territory.

CHALLENGE
Charcoal is one of the main sources of energy used in the production of pig iron for steel in Brazil. The vast majority of the current charcoal production is from unsustainable and often illegal harvest of native forests, leading to severe environmental degradation and deforestation. However, there have been successful business cases of forest plantation for charcoal production in Brazil, including one Clean Development Mechanism (CDM) project financed by the Prototype Carbon Fund in Minas Gerais. Expanding the area of forest plantations for charcoal on idle or degraded pasture land would reduce the pressure on native forests in Brazil.

However, barriers have prevented wide adoption of forest plantations for charcoal. Some of the barriers include:

• lack of credit to finance the initial production costs (first income revenue usually is generated after 7 years of plantation),
• difficult access to credit (forest plantations are often not accepted as collateral for loans),
• higher transaction costs relative to deforestation and coal production (planted forest activity has a cycle of 14-21 years of production, is labor intensive, and results in high costs of land management and environmental licensing),
• inefficient technologies for carbonization process (contributing to the emission of greenhouse gases (GHG), including methane),
• unclear agricultural and environmental regulatory framework to forest production,
• weak institutional arrangements, etc. 

With 62 pig iron mills, the state of Minais Gerais is Brazil's largest producer of steel and iron, responsible for 60% of the national production.  Minas Gerais approved a law which virtually bans the use of charcoal from deforestation by 2018. In order to supply the industry with charcoal from plantations Minais Gerais would need about 1.5 million ha under new plantations.

APPROACH
PROFOR and the BioCarbon Fund co-financed a study designed to identify institutional and financial arrangements required to mainstream forest plantation business models and promote the potential development of CDM projects aimed at reducing GHG emissions in the forestry and iron supply chains in the state of Minas Gerais.

The displacement of non-renewable charcoal by renewable charcoal by 2017 and the use of charcoal to produce up to 46% of the pig iron and steel by 2030, would potentially mitigate 62 Mt of CO2 between 2010 and 2030. This would represent 31% of all emissions reductions expected from the steel industry and contribute to Brazil's overall effort to reduce its GHG emissions by 39% by 2020.

RESULTS
The study's methodology and preliminary results were presented during a workshop "Identifying Financial and Institutional Arrangements for Scaling Up Renewable Charcoal Production" in Belo Horinzonte, Minas Gerais, in December 5, 2011. (A presentation from that workshop is available in Portuguese on this page). At completion, final reports with the technical work, datasets, and related links were shared with key counterparts within the government, private sector, and financial institutions.

The analytical work supported by this project was a key building block in the World Bank’s strategy for supporting Brazil’s move toward a low carbon economy as stated in the Brazil Country Partnership Strategy for 2012-2015, under Objective 4: Improving sustainable natural resource management and climate resilience. ("Helping the Federal government and the private sector to implement Brazil’s National Climate Change Plan, including through developing programs and financial mechanisms to promote sustainable land use, decrease deforestation, and increase energy efficiency and renewable energy.")

The Minas Gerais Development Policy Loan III ( P121590), to which this study contributed, is one of the deliverables of the new country strategy. The State has adopted measures to encourage forest plantation within its territory to supply raw input to industries within its territory.