The BioCarbon Fund was set up as a public-private sector initiative managed by the World Bank. The fund supports projects that generate “multiple revenue streams, combining financial returns from the sale of emission reductions (i.e., carbon credits) with increased local incomes and other indirect benefits from sustainable land management practices”. The fund comprises over 20 projects divided into two categories: the UNFCCC Clean Development Mechanism projects and the Verified Carbon Standard projects. The first two tranches of the BioCarbon Fund were founded in 2004 and 2007 and are now closed to new fund participation.
In 2013, the BioCarbon Fund launched a new initiative to support forest landscapes, namely the Initiative for Sustainable Forest Landscapes (ISFL). ISFL is capitalised via a new tranche of funding from the BioCarbon Fund. The initiative supports developing countries’ efforts to reduce emission through testing jurisdictional approaches that integrate reducing deforestation and degradation, sustainable forest management with the climate smart agricultural practices to green supply chains. The ISFL funds large-scale programmes that aim to enable countries and the private sector to adopt changes in the way farmers work on the ground, as well as informing policies made at the international level.
|Name of the Fund||BioCarbon Fund|
|Official Fund Website||http://www.biocarbonfund.org/
(ISFL website: http://www.biocarbonfund-isfl.org/)
|Proposed Life of Fund||Multi-year – undetermined.|
|Objectives||The BioCarbon Fund is devoted to land use. Its objective is to restore and protect ecosystems and to support land transformation. Moreover, the fund aims to create new revenue streams and improve the livelihood of rural communities.
For the ISFL, “[t]he objective is to work alongside private firms that can provide capital, innovation, operational resources as well as technical expertise to accelerate the greening and securing of their supply chains.” Specifically, to:
ISFL’s overarching aim is to catalyse the development of a low-carbon rural economy that will result in livelihood opportunities for communities and an overall reduction in land-based emissions.
|Financial inputs and fund size||The first two tranches of the BioCarbon Fund have a total commitment of USD 90 million. The contributors include six governments and public entities and eleven private companies. The full list of investors is available at: https://www.biocarbonfund.org/node/38
ISFL is a multilateral fund supported by donor governments. The fund’s capital amounts to about USD 355 million and its contributors are: Germany, Norway, Switzerland, United Kingdom, and USA.
No information is available regarding the degree to which these financial inputs are classified as official development assistance (ODA).
|Activities Supported||The BioCarbon Fund activities include environmental restoration, reforestation for fuel wood, afforestation activities, REDD+ activities, sustainable agricultural land management, fast-growing tree plantations for timber.|
|Secretariat or Administrative Unit||The fund is managed by the World Bank. The World Bank’s Carbon Finance Unit handles the day-to-day operation of the BioCarbon Fund which is housed in the organisation’s Climate Change Fund Management Unit.|
|Trustee||The World Bank is the permanent trustee of the BioCarbon Fund.|
Fund Finance and Access Modalities
|Conditions and Eligibility Requirements||Eligibility covers forest countries which are World Bank’s Borrower Members and goes beyond ODA eligible countries.|
|Accessing the Fund||
|Safeguards, Gender and Indigenous Peoples||
|Decision Making Structure||
|Participation of Observers and Stakeholders||The World Bank Group’s tools for stakeholder engagement apply to BioCarbon Fund projects. These tools include World Bank and IFC operational and safeguard policies, Strategic Environmental and Social Assessment, Environmental and Social Management Framework, Operational Policy 4.10 on Indigenous Peoples, and Performance Standard 7.
The BioCarbon Fund declares that it engages stakeholders throughout design and implementation through “studies; consultations; in-country missions and field visits; regular engagement with recipient governments; and steering committees, user groups, secretariats, working groups, and existing platforms.” In addition, participants are involved in the review of proposed annual activity reports and annual budget and business plans.
|Transparency and Information Disclosure||The World Bank Group’s Policy on Disclosure of Information applies.
BioCarbon Fund’s knowledge centre provides a wide range of documents including monitoring and evaluation reports, workshops and presentations.
|Other Issues Raised||Broadly speaking, the BioCarbon Fund’s role in selling emissions reductions to offset voluntary emissions reductions has been criticised by some civil society organisations. The BioCarbon Fund’s experimentation with “avoided deforestation” that assign monetary values to the capacity of standing forests to serve as carbon sinks was also criticised.
A BioCarbon Fund sponsored reforestation project in Guangxi, China was forced to suspend implementation in 10% of affected communal lands due to tenure and resource disputes.
The BioCarbon Fund “JK Papermill project” has been criticised for putting a financial burden on poor farmers involved in the project, whose financial situations have worsened considerably as they have not been able to repay loans provided to buy seedlings and other supplies needed for plantation forestry intended for paper production.