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Mr Vu Tan Phuong, director RCFEE Mr Vo Nguyen Dai, vice-chairman DPC A Luoi

Reducing greenhouse gases through reforestation Use of CDM in the forestry sector – The Vietnam experience. Mr Vu Tan Phuong, director RCFEE Mr Vo Nguyen Dai, vice-chairman DPC A Luoi Presentation based on cooperation between: FSIV, District A Luoi, JICA, VFU, MARD and SNV.

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Mr Vu Tan Phuong, director RCFEE Mr Vo Nguyen Dai, vice-chairman DPC A Luoi

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  1. Reducing greenhouse gases through reforestationUse of CDM in the forestry sector – The Vietnam experience Mr Vu Tan Phuong, director RCFEE Mr Vo Nguyen Dai, vice-chairman DPC A Luoi Presentation based on cooperation between: FSIV, District A Luoi, JICA, VFU, MARD and SNV

  2. Introduction of CDM How CDM works in the forestry sector Potential in Vietnamese forestry sector Readiness of the Government CDM projects- focus on poverty reduction and biodiversity- under construction: Hoa Binh project by FSIV, VFU, MARD and JICA Rung Vang project in TTHue by DPC A Luoi and SNV Outline of the presentation

  3. Definition: The Clean Development Mechanism is the mechanism to quantify and sell greenhouse-gas emissions reduced in developing countries to industrialized countries that have to comply with international conventions Framework: UNFCCC (1992) Kyoto Protocol (1997) Characteristics: Reduction of greenhouse gases is secondary, project have other primary objectives Price for reduction based on international market Always on project basis (no national CDM program) Prove reduction is additional Before international registration, approval by Vietnam is needed Use of UNFCCC approved methodology for reduction calculations Introduction of CDM

  4. How does it work in forestry? In case of Vietnam, definitions of forest are (1) An area of at least 0.5ha; with (2) A minimum crown cover of 30%; and (3) A minimum tree height of 3m at maturity For Vietnam most relevant: reforestation of land that is not qualified as forest according the definition since 1990 Afforestation/reforestation activity fulfill forest definition. That is why it is called AR-CDM by human-induced planting

  5. How does it work in forestry?

  6. 2 projects under development in Hoa Binh and Thua Thien Hue No forestry project in Vietnam yet registered under UNFCCC Potential for Vietnam shown on: http://www.csi.cgiar.org/encofor By national CDM strategy quantified as 52,000,000 tCO2 equivalent until 2010 Potential in Vietnam

  7. The Government ratified UNFCCC and KP in Nov. 1994 and Sep. 2002, respectively (KP entered into force in Feb. 2005) MONRE was assigned as a national authority for implementing UNFCCC & KP ICD of MONRE was assigned as Designated National Authority (DNA) for CDM in Mar. 2003 DNA approves CDM projects CDM National Executive & Consultative Board (CNBCB) was established in Apr. 2003. CNBCB is composed of 12 members from concerned ministries/agencies. It evaluates CDM projects based on criterion and endorses them to DNA Readiness of the Government

  8. Approval Procedure PIN Project developer has to prepare PIN (Project Idea Note) if investors request certification from DNA. Project Developer CNA (DNA) CNECB Others Approving procedure of PIN Prepare PINand other relevant documents Review and examine legal status and documents Deliberate PIN by all members 25 days Re-consider and issue a letter of endorsement by Minister of MONRE Letter of endorsement Comments Source: MONRE Circular No:10/2006/TT-BTNMT dated 12th December 2006

  9. Approval Procedure of PDD All CDM Projects must prepare PDD (Project Design Document) Project Developer CNA (DNA) CNECB Others Approving procedure of PDD Energy and non-energy technical expert group Prepare PDD and relevant documents Examination of PDD and other documents Technical review Consider PDD by members 50 days Meeting and evaluation (Presentation by project developer and vote by all members) Re-consider and issue a letter of approval by Minister of MONRE Letter of approval Source: MONRE Circular No:10/2006/TT-BTNMT dated 12th December 2006

  10. JICA, DOF/MARD, VFU and RCFEE have implemented a Study on Capacity Development for AR-CDM Promotion in VN since Oct. 2006. About 300 ha of reforestation sites were selected in two communes, Cao Phong district, Hoa Binh province. The team will start formulation of a small-scale AR-CDM project (pilot project) in May 2007 and complete preparation of draft PDD by Nov. 2007. The team intends to implement the pilot project using public and private funds in order to encourage development of AR-CDM projects in VN referring to the experiences of the pilot project. Hoa Binh Project <Background>

  11. Hoa Binh project <Site Location> 【5 sites selected】 Xuan Phong com.：3 sites Bac Phong com.：2 sites 【Sites rejected】

  12. Xuan Phong commune (Lake area) Xuan Phong commune Yen Lap commune

  13. Xuan Phong commune (North area)

  14. Xuan Phong commune (Northeast area)

  15. Bac Phong commune (West area) Characteristic Vegetation (Lao Lach)

  16. Bac Phong commune (East area – lake area)

  17. Hoa Binh Project <Preliminary Plan>-subject to discussions with communities-

  18. A Luoi Project Patchwork land use in A Luoi district

  19. A Luoi Project-history of project- • A Luoi district has a lot barren land with forest use classification due to American-Vietnam war and subsequent unsustainable land use • DPC A Luoi decided to experiment with CDM and do a pilot project: “the Golden Forest” and learn from the experience. 38 ha reforested with 3 models; a dry-run exercise to calculate the amount of GHG reductions that could be realised. • See publication: Downloadable at:www.snvworld.org • (Forests/ SNV publications)

  20. A Luoi Project-project development- • September 2006 end of pilot and start of initiative to combine all reforestation efforts in the district in one program: the 5000 ha reforestation program 2006-2010 and attach a CDM component to it • Already 700 ha reforested in 2006 • District People’s Committee is project developer • Project finances by individual bank loans, ADB (CRILP), 661, smaller donors • Capacity building CDM component: SNV Netherlands Development Organisation and Mitsubishi Securities • Steering Committee and Working Group set-up in April 2007

  21. A Luoi Project-area: facts & figures- • North-Central Vietnam - Thua Thien Hue province • A Luoi District • Forest land is allocated to private owners (mainly households) • Total project area: 5000 ha ≈ 3000 households • 80% People belong to ethnic peoples Ta oi, Ca Tu and Pa Co • 35% People live under the poverty line • Average land area 0.8 -2.5 ha per farmer • Mixed native species and fast-growing exotic species (Acacia) • Farmer decides on tree species

  22. Local people in A Luoi district

  23. A Luoi Project-reforestation activity- CER CER CER 5 10 15 20 25 30

  24. A Luoi Project-financing- tCER BUYER CASH tCER A LUOI CARBON UNIT % tCER REVENUE tCER TAX TIMBER SALE CASH CARBON SALE GRANT (to poor families) LOAN REPAYMENT LOAN CASH TIMBER SALE TRADER OR PAPER-MILL CDM process costs (DOE/UNFCCC) DPC/OARD A lUOI SMALL-HOLDER PLANTATION OWNER tCER PLANTATION TIMBER AND NTFP BANKS PAYMENT BY SMALL-HOLDER INCOME TO SMALL-HOLDER OTHER FINANCAL OR PRODUCT FLOW

  25. A Luoi Project-CDM component: calculations- Baseline scenario • Use of approved Methodology: ARNM0010 “Reforestation of Degraded Land” • Included Carbon Pools: above and below ground biomass of living trees. Excluded Carbon Pools: soil carbon and carbon in herbs/shrubs • Baseline scenario: Continuing of the extensive slash-burn low input agriculture. No standing trees in the baseline; baseline = 0 Project scenario • Stratification of planted models: 3-5 models of mixed system of Acacia with indigenous species based on site-suitability and farmer choice • Actual calculation based on actual monitoring (carbon accounting by farmer, checked by independent research organisation) • Provisional calculation of Certified Reduction Emissions that can be realised per hectare/year: 10 ton CO2 equivalents (=10 CER/ha/yr)

  26. A Luoi Project-Current status and future planning- CNA (DNA) CNECB Others Project Developer Approving procedure of PIN Prepare PINand other relevant documents Review and examine legal status and documents Deliberate PIN by all members Re-consider and issue a letter of endorsement by Minister of MONRE Letter of endorsement December 2007 Technical review Prepare PDD and relevant documents Examination of PDD and other documents Approving procedure of PDD Consider PDD by members 50 days Re-consider and issue a letter of approval by Minister of MONRE Letter of approval Meeting and evaluation (vote by all members) February 2008

  27. A Luoi Project-benefits-

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