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Republic of Indonesia

Forest Carbon Partnership Facility (FCPF), BioCarbon Fund Initiative for Sustainable (BioCF ISFL)

for Forest Landscapes Portfolio

Aide Memoire – Preparation and Supervision Mission

January 11–19, 2016

1. A World Bank Team1 visited Indonesia from January 11-19, 2016, to undertake a combined preparation and supervision mission for those forest-related activities implemented by the Government of Indonesia

(GoI) under the landscape program (“Recipient-Executed forest activities”). The mission met with: the

Governor of East Kalimantan; authorities and technical staff from the Ministry of Environment and

Forestry (MoEF), including the Secretary General (Acting), Forest Research Development and Innovation Agency (FORDIA), the Directorate General (DG) for Climate Change (DG-CC), Planning

Bureau and International Cooperation Bureau (KLN); Ministry of Finance (MoF); Ministry of Planning

(Bappenas), provincial agencies for agriculture, environment, estate crops, forestry, mining, and planning (Bappeda); and key Development Partners including Embassy of Norway, GIZ (FORCLIME),

UK Climate Change Unit, USAID, Canadian Embassy, French Development Agency (AFD), UN-

REDD, and TNC.

2. The mission wishes to thank the GoI, and in particular, Honorable Awang Faroek Ishak, Governor of

East Kalimantan, Dr. Henry Bastaman, Director General, FORDIA, MoEF, and their teams for the

hospitality, cooperation and support for the successful completion of the mission. The mission agenda

and a detailed list of participants are included in Annexes A and B, respectively.

3. The overall objective of the mission was to jointly agree with the GoI, through MoEF, the initial

activities to be included in the Sustainable Landscapes Program (see Paragraph 27). The specific

objectives of the mission were to: (i) assess the progress to-date in achieving REDD+ Readiness, and outline areas for further action; (ii) further define the critical issues to be addressed by the Forest

Partnership Carbon Facility (FCPF) Program (FCPF Readiness Program and Carbon Fund), including

proposed technical assistance and financial support for investments; (iii) discuss potential partnership

arrangements; and (iv) discuss the BioCarbon Fund Initiative for Sustainable Forest Landscapes (BioCF ISFL) and discuss how these potential funding resources can be most strategically used to

effectively support MoEF’s highest priorities.

4. This Aide Memoire summarizes the principal conclusions of, and agreements reached during the mission.

Principal Conclusions

5. Overall Assessment of Progress on REDD Implementation: While the transition process following the 2014 elections, supported by the Presidential Decree No. 16-2015 including the restructuring of MoEF,

resulted in delayed implementation of many Readiness activities, important progress has recently been

made through the consolidation of institutional responsibilities for REDD+. This has created

opportunities to further advance and align donor- and government-supported activities going forward. The Mission noted the significance of Indonesia’s reaffirmed commitment to REDD+ at COP21 in

Paris last December, which has been followed up with the January announcement of the creation of the

1 Ann Jeannette Glauber (FCPF/ Biocarbon Fund ISFLTTL), Alexander Lotsch (Senior Carbon Finance Specialist), Dinesh Aryal

(Senior Natural Resources Management Specialist), Tini Gumartini (Forest Policy Specialist), Azis Khan (Forestry Specialist), George Henry Stirrett (Environmental and Natural Resources Specialist), Emile Jurgens (Forestry Specialist/Consultant), I Gusti Ngurah Wijaya Kusuma (Financial Management Specialist), Budi Permana (Procurement Specialist), and Agustina Eviani (Team Assistant).

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Peatland Restoration Agency, and the leadership exhibited at the national and sub-national levels. The

mission noted that the new institutional arrangements for REDD+ place leadership firmly within MoEF under the DG-CC, and integrate numerous related functions under a single unit. However, such

arrangements still represent an institutional challenge in addressing those drivers of deforestation and

degradation that relate to non-forest sectors (e.g. agriculture). At the same time, it is important to now

demonstrate swift and effective progress on REDD+ implementation and delivery of results. This will require near-term decisions to clarify and assign institutional responsibility for strategically important

activities to proceed. At the sub-national level, the Mission was pleased to note the outstanding

leadership, awareness and ownership on REDD+, which will form a strong basis for implementation going forward.

FCPF Readiness Fund:

6. Existing REDD+ Readiness Grant: The mission reviewed the status of existing Readiness Grant work

program and its implementation, and congratulated the government for successfully implementing most of the activities. However, the mission cautioned the need to expedite the implementation of on-going

activities to ensure their completion before the current closing date of the Grant Agreement, i.e.,

November 30, 2016. The mission informed that the closing date of the existing grant will not be extended and all deliverables under the grant must be finalized and submitted prior to November 30,

2016. Accordingly, it was agreed that the Government prioritize: (i) completion of safeguards

instruments (see Paragraph 20); and (ii) finalization of the ER-PIN and critical upstream analyses and technical preparation of the Emission Reduction Program Document (ER-PD). If funds are available,

additional activities could be supported. Other work program activities will be included in the

Additional Funding (see Paragraph 23). It was agreed that a revised work plan along with an updated

procurement plan for the reminder of the existing Readiness Grant will be submitted to the Bank by Feb 5, 2016. It was agreed that such a work plan should include a column motivating for each activity,

including a strong justification in the context of ensuring REDD+ Readiness. Furthermore, the mission

reviewed activities under the GA including their execution status (see Annex C). It was agreed that the Bank would inform the status of the Bank-executed activities by March 26, 2016.

7. Disbursement Status: Based on the Client Connection per January 15, 2016, the Bank has disbursed USD 2,934,150 for TF099721 including USD 299,989 in the Designated Account. The accounted

project expenditure is USD 2,634,161, or 82% of the total grant. A total of up to $562,267 may be

available for project activities.

8. Additional REDD+ Readiness Grant Funding: At the fourteenth FCPF Participant's Committee (FCPF

PC) Meeting, in Lima, Peru, in July 2014, the FCPF PC allocated up to US$5m for Additional Funding

for Readiness to Indonesia. Subject to a request from the GoI, such funds would be made available to support achievement of the Readiness Grant's Development Objective, e.g., is to contribute to the

development of Indonesia's capacity to design a sound national REDD+ strategy, develop national and

sub-national reference scenarios, and establish a forest monitoring and carbon accounting system, all consistent with local, regional and national conditions and circumstances. It was agreed that MoEF,

through the MoF, would by February 15, 2016, submit a letter to the World Bank Country Director for

Additional Funding of Readiness activities.

9. The mission discussed the initial activities proposed for Additional Funding and agreed that MoEF

would: 1) undertake a quick gap analysis of achievements to-date on Readiness; and 2) prioritize

activities to be supported with Additional Funding to strategically fill key gaps. Once such activities

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are clear, it was agreed that MoEF would develop a work plan along with a procurement plan, and

submit them to the Bank by no later than February 15, 2016. The mission also discussed that a finalized "Readiness Package," outlining the up-to-date progress on Readiness activities, submitted to and

endorsed by the FCPF PC, is a prerequisite for ER-PD approval. The World Bank provided information

on the content of said Readiness Package.

10. The mission was informed that if it were a new Grant Agreement (GA), and not an extension of/amendment to the existing GA, there are several internal approval steps. It was therefore agreed that

by February 15, 2016, the MoEF would inform the World Bank of the mandatory steps and timeline

for approval of: 1) a new GA; and 2) an amended GA.

11. Regarding the implementation arrangements for Additional Funding, the mission discussed possible

options including implementation by the DG-CC or continuation by FORDIA. It was agreed that by

February 15, 2016, MoEF would inform the Bank of the final proposed implementation arrangements for the Additional Funding.

12. In terms of timing, the mission emphasized the need to expeditiously process the Additional Funding

to ensure there will not be a gap between the closing of the existing grant (on November 30, 2016) and

effectiveness of Additional Funding.

FCPF Carbon Fund:

13. Emission Reduction - Program Idea Note (ER-PIN): GoI presented an Emission Reduction Program

Idea Note (ER-PIN) to the FCPF Carbon Fund Participants at their eleventh meeting in October 2014 in Washington, D.C. Carbon Fund Participants requested substantive revisions to the proposal,

including the geographic consolidation into a single contiguous area. At the thirteenth meeting of the

Carbon Fund in October 2015, the GoI presented an update on the revisions and communicated the decision to focus the program on the province of East Kalimantan. Toward that aim, MoEF submitted

an ER-PIN to the FCPF FMT on December 17th 2015 for preliminary review.

14. The proposed ER Program focuses on East Kalimantan province and is closely aligned with the existing

provincial REDD+ Strategy. The mission congratulated the team at MoEF and East Kalimantan on delivering a robust document, and made a number of suggestions for improvement. The main areas for

strengthening the ER-PIN include: enhancing the alignment of the Reference Level with the CF's

Methodological Framework; and restructuring the program description around the priority drivers of deforestation. Detailed comments are attached in Annex E. The GoI welcomed the feedback, and agreed

to provide a revised ER-PIN for virtual review by Carbon Fund Participants by February 29, 2016. Part

of the remaining FCPF Readiness funds will be used to support the completion of the ER-PIN (see

Paragraph 9).

15. Letter of Intent: It is expected that the revised ER-PIN can be selected into the CF pipeline in May 2016

subject to Carbon Fund Participants providing their consent on the revisions. This will authorize the

World Bank to negotiate and sign a Letter of Intent (LoI) on behalf of the FCPF Carbon Fund. Such negotiations will require a clear counterpart and a decision on the Program Entity that is authorized to

sign the LOI and prepare the program and eventually sign an Emission Reduction Payment Agreement

(ERPA). The Mission stressed the importance of GoI to carefully consider the institutional arrangements going forward to ensure a smooth transition from program preparation to implementation.

16. Emission Reduction - Program Document (ER-PD): After the selection of the ER-PIN and the signing

of the LoI, MoEF would begin developing the ER-PD which sets out the detailed program design to

achieve emissions reductions. While the financing provided through the FCPF CF are for emissions reductions, the mission discussed the need to align such efforts with the provincial development

objectives, specifically those associated with sustainable forest management and associated economic

development. In that vein, the mission discussed possible an initial Project Development Objective and associated outcome indicators (see Annex D).

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17. Preparation of the ER-PD will require specific documents and mechanisms including a land tenure

assessment, a Feedback and Grievance Redress Mechanism, a Benefit Sharing Plan, and a Safeguards Plan. The mission discussed a number of preliminary studies that could be completed using part of the

remaining funds from the FCPF Readiness Fund. These include finalization of the Reference Level,

analysis of potential emissions reductions, preliminary assessment of land and tenure issues,

identification of specific investment opportunities, and identification of Development Partners and investment sources. Based on experience in other countries, the detailed program preparation and

implementation planning is expected to take 12-18 months. An ER-PD that meets the technical

requirement of the Carbon Fund Methodological Framework as well as those by the World Bank would form the basis for a decision to negotiate and sign and ERPA.

18. Complementary World Bank Support: The mission noted that the FCPF Carbon Fund (FCPF CF)

includes limited complementary resources to be executed by the World Bank. These resources would be targeted to leverage World Bank expertise toward objectives of the FCPF CF. One area of potential

engagement could be to support the GoI in completing an inventory of degraded lands in East

Kalimantan.

19. REDD Support Facility: The mission informed about the status of REDD Support Facility which is a fund executed by the World Bank. The fund supports the REDD readiness processed in Indonesia. The

work planning for this fund is agreed in an annual basis with GOI (through the former REDD+ Agency),

World Bank and donors. The mission requested the GOI to inform the Bank by February 19, 2016 which GOI agency would be responsible for working with the Bank and donors in under this Facility.

Cross-Cutting Issues

20. Safeguards: There has already been significant attention and strong performance in developing

environmental and social safeguard instruments for Indonesian REDD+ activities. However, several safeguard instruments and frameworks (i.e. SIS-REDD+) have been developed to comply with

UNFCCC safeguard principles, but not specially addressing World Bank safeguard policy

requirements. The FCPF PC calls for Emission Reduction Programs to meet the World Bank’s environmental and social safeguard standards, in addition to supporting UNFCC REDD+-related

safeguard guidance. In that vein, the FCPF Grant Agreement calls for completion of a Strategic

Environmental and Social Assessment (SESA) and an Environmental and Social Management

Framework (ESMF), including a resettlement policy framework, an indigenous peoples’ planning framework, a pest management framework, and guidelines and procedures for the development of

environmental and social management plans, resettlement action plans, indigenous peoples’

development plans, pest management plans and physical cultural resources management plans. Hence, there is an urgent need to complete both the SESA and ESMF as soon as possible.

21. The mission agreed that: 1) by March 31, 2016, MoEF would document the status of SESA work to-

date, including consultations and outcomes (World Bank safeguards staff are available to assist); and 2) MoEF would undertake preparation of the ESMF, incorporating relevant Indonesian laws and

regulations; pertinent parts of SIS-REDD+, PRISAI, and East Kalimantan (and possibly other)

provincial guidelines (i.e., SES-Kalimantan); and the applicable World Bank safeguard policies to

ensure that emission reduction projects are designed and implemented in accordance with Indonesian, UNFCCC, and World Bank environmental and social requirements. The mission suggests that the

ESMF prepared for FIP is a good starting point for the FCPF ESMF; and the analysis of gaps between

Bank safeguards policies and Indonesian legislation and REDD+ instruments that is a necessary part of the ESMF preparation process will identify the additional work to be done. Members of the Bank FCPF

team have offered to meet with MOEF team to assist in preparation of an ESMF work plan that should

be ready by March 31, 2016. These activities need to have the highest priority with the remaining

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Readiness Grant funds not only to ensure compliance with the Grant Agreement, but also to ensure

safeguard documents do not result in delays for the preparation of the entire ER Program.

22. Financial Management: Overall the mission rates the financial management performance of the

ongoing FCPF Readiness preparation grant (TF99721) as Moderately Satisfactory. The mission noted

some of the good financial management practices including: i) timely submission of financial reports;

ii) clean audit opinion regarding the project's financial statement; and iii) documentation available to support reported expenditures. However, the following actions are needed to be taken by the

implementing agency to support 2016 project implementation:

To immediately finalize the 2016 project budget and include it in the 2016 DIPA. The 2016 DIPA is expected to be effective no later than March 15, 2016;

To process the issuance of commitment maker's decree (SK PPK) as an official authorized to

initiate payment request. This is expected to be done no later than February 1, 2016; and To complete the follow up of the audit report, no later than April 30, 2016.

23. As for the proposed Additional Funding for the FCPF Readiness Grant, as the implementation

arrangements and detailed activities to be funded have not yet been determined, it was not possible to advance with FM capacity assessment. Once determined, the Bank will update the financial

management capacity assessment including identification of potential risks for the Additional Funding

and proposed mitigation actions.

24. Procurement Management: The mission reviewed FY2015 procurement activities and discussed the

proposed Additional Funding. Details of the review are included in Annex E. In summary, the mission

was informed that there were no new procurement activities in FY2015. The mission noted that there was a delay on the issuance of government budget (DIPA) for the Readiness Grant due to government

internal issues, with final DIPA issuance in August 2015. The mission requested MoEF revise the

Procurement Plan to incorporate agreed changes for FY2016 and submit for the Bank’s prior review

by February 15, 2016.

25. As with Financial Management, until the implementation arrangements and detailed work plan are in

place for the proposed Additional Funding for FCPF Readiness Grant, the Bank will update the

procurement capacity assessment and assist the Implementing Agency(s) in preparing the Procurement Plan and provide training as needed.

BioCarbon Fund ISFL

26. BioCarbon Fund: Indonesia was selected by the BioCarbon Fund donors as a candidate country for the Initiative for Sustainable Forest Landscapes (ISFL). This decision was communicated previously to

Pak Heru Prasetyo, Head of BP-REDD, by the World Bank’s Indonesia Country Director, Rodrigo A.

Chaves, in August 2014, and the potential scope and location were initially discussed with GoI prior to the institutional transition. The mission discussed the ISFL’s overall objectives -- including the

effective engagement with the private sector and the focus on agricultural commodities -- and presented

examples of potential jurisdictions on the basis of an earlier feasibility assessment. The mission noted that the BioCarbon Fund provides a flexible financing mechanism, which includes funds for program

development, grant finance for investments, and payments for results. The specific respective funding

allocation will be determined as part of the development of a program concept note.

27. The mission noted that an important next step is for GoI to respond to the World Bank with a decision

on the preliminary geographic scope of the program and a responsible counterpart for subsequent

program development and implementation. The mission was informed that this decision will be made at the level of DG CC and agreed that GoI would respond on this matter as part of the next mission

(April 18 to 27, 2016) to allow for a formal identification mission to take place. The findings of the

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identification mission will form the basis for the development of a formal program concept note and

the release of program preparation funds. As in other ISFL countries, the International Finance Corporation (IFC) – the private sector arm of the World Bank Group – can play an integral part in the

development and implementation of the program, including potentially through its own investments.

Other Issues

28. MoEF Priorities for Addressing Sustainable Landscape Management: The mission discussed the

importance of promoting integrated sustainable landscape management as a precondition for achieving REDD+. The World Bank presented their new Country Partnership Framework for Indonesia, covering

activities in 2016-2020, noting the core focal area on Sustainable Landscapes Management, which aims

to support activities and policies to improve land and forest management outcomes in all land-based sectors. It was noted that existing and planned World Bank support for Sustainable Landscape

Management with a focus on REDD+, in addition to the US$3.6 million (m) readiness grant under

implementation by MoEF (FORDIA), includes another approximately US$180 m is preliminarily

allocated to Indonesia in support of REDD+ activities. MoEF management noted that their overall priorities include a focus on reducing deforestation and land degradation, as well as reducing poverty

among forest dependent-communities. The mission agreed that programming of World Bank-supported

Sustainable Landscapes support should be specifically designed to support these MoEF priorities.

29. IEQ Results: The mission presented the World Bank’s most recent Indonesia Economic Quarterly

(IEQ), published in December 2015, which assessed the economic costs to Indonesia of the forest fires which took place between June and October of last year. The study, which was done jointly with BNPB

and BPS, found that those fires, which affected 2.6m ha of land, incurred approximately $16.1 billion

in damage and losses to the Indonesian economy, representing about 1.9% of total GDP. The mission

shared copies of the assessment, which can provide important background data and analysis for preparation of the FCPF Additional Funding and CF as well as the BioCF ISFL.

30. Link with FIP, DGM and GEF: The mission noted that one of the main challenges for the ER Program implementation is the need for available investment finance as the FCPF Carbon Fund does not provide

upfront investment to support the priority actions that will lead to the achievement of emission

reduction. Therefore to achieve this, the program needs to be coordinated and linked with other

activities financed by the government and development partners. For example the mission informed that the WB Task Teams for FIP, DGM, GEF and FCPF/BioCarbon Fund supported projects have been

coordinating and encouraged the government to do the same. Furthermore, the mission encouraged the

government to leverage these resources more effectively to achieve the emission reduction objective.

31. Meeting with Development Partners (DPs): A meeting with Development Partners active on REDD+

was hosted by MoEF to update on the progress of REDD+ implementation with a focus on FCPF implementation and development. Development Partners expressed appreciation for the briefing on the

preparation process, and the finalization of the East Kalimantan reference emission level. They also

expressed unanimous support for the proposed FCPF CF Program, with many partners highlighted the large degree of synergy with their existing climate change, forestry, and landscape programs. The

Government, World Bank, and other Development Partners expressed commitment to close

collaboration in the preparation of the FCPF CF Program and more broadly, to the achievement of

Indonesia’s climate change commitments. Given the performance based nature of the FCPF CF, it was recognized that a significant risk to the program’s success in East Kalimantan is the absence of secured

investment financing to support necessary activities to counter deforestation and degradation.

Development Partners welcomed a joint partnership, where all existing or proposed activities in East Kalimantan that contribute toward REDD+ objectives would be coordinated.

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32. Next Mission: The mission agreed that the next combined preparation and supervision mission would

tentatively take place in April 18 to 27, 2016.

33. Disclosure: Under the World Bank’s Access to Information Policy introduced on July 1, 2010, the Aide

Memoire may be made public, if the client and the World Bank agree. The disclosure of this Aide Memoire was discussed and agreed to with project counterparts at the closing meeting at FORDIA

Offices in Bogor, chaired by Dr. Henry Bastaman, Director General, FORDIA, MoEF on January 19,

2016. The client and the World Bank agreed that the Aide Memoire would be classified as Public.

Table 1: Agreed Action Plan

Action By When? Responsible Party Remarks2

A revised work plan along with an

updated procurement plan for the reminder of the existing

Readiness Grant will be

submitted to the Bank.

Feb 15, 2016 FORDIA Submitted on Feb 18

Inform re status of Bank-executed activities under the existing

Readiness Grant.

Feb 19, 2016 WB Revised to March 31 in

formal communication

A letter wold be submitted to the

World Bank Country Director for Additional Funding of

Readiness activities.

Feb 15, 2016 FORDIA Revised to March 31 at

request of GOI

REDD Readiness Additional Funding work plan along with

a procurement plan would be

submitted to the Bank.

Feb 15, 2016 DG-CC

Agreed to submit prior to and discuss during

upcoming mission in

mid-April 2016

For REDD Readiness Additional Financing, MoEF would

inform the World Bank of the

mandatory steps and timeline for approval of: 1) a new GA;

and 2) an amended GA.

Feb 19, 2016 FORDIA Revised to March 31

MoEF would inform the Bank of

the final proposed implementation arrangements

for the Additional Funding.

Feb 15, 2016 DG-CC

Agreed to submit prior

to and discuss during upcoming mission in

mid-April 2016

A revised ER-PIN for virtual

review by Carbon Fund Participants would be

submitted to the World Bank.

Feb 29, 2016 FORDIA Completed.

The GOI to inform the Bank regarding which GOI agency

would be responsible for

working with the Bank and

Jan 20, 2016 DG-CC Completed

2 Following the FCPF coordination meeting held on February 29 these agreed action plan has been revised due to the

needs for additional time for internal discussion among the MOEF team.

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donors under the REDD

Support Facility.

MoEF would document the status

of SESA work to-date,

including consultations and outcomes.

March 15, 2016 DG-CC Revised to March 31

MOEF will work with WB to

identify ways to strengthen

FIP ESMF to serve as ESMF for Readiness activities

March 31, 2016 DG-CC

The decision on the preliminary

geographic scope of the

BioCarbon program and a responsible counterpart will be

made and the World Bank will

be informed.

Mar 22, 2016 DG-CC

Agreed to discuss

during upcoming mission in mid-April

2016

The MoEF will send comments on

the safeguards related progress

and agreed next steps.

Feb 19, 2016 DG-CC Revised to March 18

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Annexes:

Annex A: Agenda

Annex B: List of Participants

Annex C: Status of activities implemented under current Grant Agreement of FCPF Readiness Grant

Annex D: Initial Project Development Objective and associated outcome indicators

Annex E: Detailed comments from FCPF FMT on the Revised ER-PIN (submitted on December 17, 2015)

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Annex A: Agenda

Monday, January 11

Time Venue Agenda Responsible/Team Composition

08:30 - 09:00 PPI Formal opening of mission. Review of agenda.

Lead: Henry Bastaman (Director General of FODIA)

Participants: FORDIA, DG CC, KLN

09:00 – 10:00 Presentation and discussion on the status and priority of the national REDD+ implementation

Emma Rahmawati (DC CC)

10:00 – 10:15 Coffee break

11:30 - Leave for Balikpapan, East Kalimantan Garuda Air GA 568 JKT – BLP 3:30 – 6:45 PM. Travel to Samarinda and Check in at Aston Hotel

Tuesday, January 12

Time Venue Agenda Responsible/Team

Composition

09:00 – 12:00 Guvernor Office, Samarinda

a. Discussion with relevant stakeholders involved in the ER-PIN preparation

Lead: DDPI Participants: WB, MoEF,

DDPI, partners

12:00 – 12:30 b. Meet with governor and key stakeholders to understand key challenges in reducing deforestation and degradation.

12:30 – 17:30 c. Visit selected field sites (Bukit Soeharto) and discussion on sites to understand challenges being addressed by ER-PIN

Wednesday, January 13


Composition

09:00 – 10:00 Selyca Mulia Hotel, Samarinda

FCPF Carbon Fund a. Presentation on the status, process

and progress to date, including potential priority activities


DDPI, partners Presentation: Zahrul

Muttaqin (MoEF)

10:00 – 10:30 b. Presentation on example of jurisdiction approach currently implemented by TNC in Berau, East Kalimantan

Niel Makinuddin (TNC)

11:00 – 12:00 c. Presentation on timeline Alex Lotsch (WB)

12:00 – 13:00 Lunch

13:00 – 17:30 d. Focus group discussion: PDO and outcome indicators

Thursday, January 14

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Composition

08:30 – 10:00 Selyca Mulia Hotel, Samarinda

Discussion on Reference Emission Level Presentation: main feedback from FMT on

the revised ER-PIN (submitted on Dec 17, 2015)


DDPI, partners Presentation: Alex Lotsch

(WB)

09:00 – 12:00 FORDIA office, Bogor

Parallel discussion on procurement and Financial Management

FM and Procurement Specialist from WB and FORDIA

12:00 - Travel to Airport Depart: GA BLP – JKT 3:55 – 5 PM

Friday, January 15


Composition

08:00 – 09:00 Secretariate General Room Manggala Wanabakti

Meeting with the Secretary General: a. Presentation on WB support to

REDD+ implementation and sustainable landscapes

b. Strategic priorities for MOEF with the WB REDD+ financing

Lead: Agus Justianto Presentation: AJ Glauber Participants: FORDIA, DG CC,

KLN

09:00 – 09:30 Presentation on field visit findings, relevance to ER-PIN development Subarudi (FORDIA)

09:30 - 10:30 FCPF Readiness Fund Reporting on the country progress

monitoring framework, including: a. status and update of the project b. project achievement to-date (for

each Component) c. status of project implementation

(disbursement, procurement) d. main lessons learned, issues and

challenges e. Implication from the project

restructuring (activities, implementation arrangement)

Lead: Sri Murniningtyas Presentation: Tri Wahyudiyati

(FORDIA)

10:30 – 11:30 FCPF Additional Financing Presentation and discussion on proposed

scope and implementation arrangements

Niken Sakuntaladewi (FORDIA)

11:30– 13:30 Lunch and Friday Praying

13:30 – 17:30 Cont. discussion on FCPF Readiness Fund – review status of activities per focus area and discuss priority activities for the remaining budget, next steps and timeline

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Monday, January 18


Composition

08:30 – 10:00 Manggala Wanabakti (tbd)

Meeting with Development Partners: Discussion on an ongoing/potential

complementary activities and co-financing

Lead: Bambang Tri Hartono (FORDIA)

Participants: DPs, MoEF, Bappenas, MoF

10:00 – 10:30 Coffee break

10:30 – 11:00 Bio Carbon Fund ISFL a. Presentation and discussion on the

BioCarbon Fund

Alex Lotsch (WB)

11:00 – 11:30 b. Presentation on the result of feasibility assessment

George Stirrett Wood (WB)

11:00 – 12:30 Discussion on the preliminary objective and initial thoughts from the GoI on: geographical scope; Implementation arrangement; linkages to GoI's emerging priorities

Lead: FORDIA Participants: FORDIA,

DG CC, MoF,

12:30 – 13:30 Lunch

13:30 – 14:30 Discussion on next steps and timeline for program preparation

14:30 – 16:00 Presentation and discussion on safeguards a. progress to date to finalize

SESA/ESMF at national level

Novia Widyaningtyas

(DG CC)

Tuesday, January 19


Composition

10:00 - 12:00 FORDIA, Bogor Wrap-up meeting Lead: Henry Bastaman (DG of FORDIA)

Participants: FORDIA, DG CC, MoF, Bappenas

12:00 – 13:00 Lunch + technical discussion on REL

13:00 – 15:30 Cont. wrap up meeting (finalizing the draft Aide Memoire

15:30 – 17:00 Discussion on priority activities under FCPF Additional Financing

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Annex B: List of Participants

World Bank

1 Ann Jeannette Glauber World Bank 081219458102 [email protected]

2 Alexander Lotsch World Bank [email protected]

3 Dinesh Aryal World Bank +12024468982 [email protected]

4 George Henry Stirrett Wood World Bank 081286063144 [email protected]

5 Tini Gumartini World Bank 081221229873 [email protected]

6 Azis Khan World Bank

7 Emile Jurgens World Bank

8 Budi Permana World Bank 08128226432 [email protected]

9 ID W. Kusuma World Bank 081511889341 [email protected]

10 Jeffry Anwar World Bank 08129603171

11 Anita Kendrick World Bank 08129530448 [email protected]

13 Fajar Argo Djati World Bank

Government of Indonesia

No Nama Instansi HP E-Mail

Ministry of Environment

and Forestry

Forest Research Development

and Innovation Agency

(FORDIA)

Henry Bastaman P3SEKPI 08181135225 [email protected]

Bambang Tri Hartono P3SEKPI 081392608482 [email protected]

Niken Sakuntaladewi P3SEKPI

mailto:[email protected]

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Tri Wahyudiyati P3SEKPI 0811053558 [email protected]

M. Zahrul Muttaqin P3SEKPI

Galih Kartika Sari P3SEKPI

Retno Maryani P3SEKPI 081310797717 [email protected]

Subarudi P3SEKPI

Haruni Krisnawati P3SEKPI 081315662519 [email protected]

Sri Sulawati P3SEKPI

Mohammad Iqbal P3SEKPI

Indartik P3SEKPI

Ratna Widyaningsih P3SEKPI

Mirna Aulia Pribadi P3SEKPI

Retno Wijaya P3SEKPI

Deden Djaenudin P3SEKPI

Iis Alviya P3SEKPI

Directorate General of

Climate Change

Emma Rachmawaty Dir. of Climate Change

Mitigation

081585302888 [email protected]

Novia Widyaningtyas Dir. of Climate Change

Mitigation


Idham Cholik Dir. of Climate Change

Mitigation

085292344567

Suyitno Dir. of Climate Change

Mitigation


Haryo Pambudi Dir. of Climate Change

Mitigation


Wawan Gunawan Dir. of GHG Inventory ad

MRV


Secretariat General

Agus Justianto SAM, Natural Resource

Economics

15 | P a g e

Sri Murniningtyas International Cooperation

Bureau

5701114

Tri Jatmiko International Cooperation

Bureau


Dino International Cooperation

Bureau

Tri Jatmiko International Cooperation

Bureau


Arfan Adhi K Planning Bureau 081333216085 [email protected]

Tri N Planning Bureau 081260664458 [email protected]

Eka Febriyanti Planning Bureau 085728966093 [email protected]

Deden S Biro Umum

Rokhmiati Setjen 081315174775

Jamaludin Biro Umum

Agus Hm Biro Umum

Didi S Biro Umum

Joko M Biro Umum

Suradi Biro Umum

Gede Y.P Biro Umum

Lawin Bastian KLHK 081212242520

Rudi Karyono TU

Heri Nofian INHUT 081804962525 [email protected]

Anjar Yogie INHUT 081322123301 [email protected]

Yadi Mulyadi Sekretariat

Riska Dian A IPSDH planologi 08563716480

Eko S.W Putro ISDH/Planologi 08121551106 [email protected]

Rasito

Vida

Darto

Ministry of Finance

16 | P a g e

Adisty Badan Kebijakan Fiskal,

Kemenkeu


Djoko Hendratto Direktur PPK

BLU/Kemenkeu

Ari Wahyuni Direktur SMI/Kemenkeu

Ismed Dit SMI/Kemenkeu

Dwi A Dit PPK BLU/Kemenkeu

BAPPENAS

Pungky Widiaryanto BAPPENASS 081578056455 [email protected]

Provincial Government, East Kalimantan

No Nama Instansi HP Email

Awang Farouk

11 Daddy Ruchyat DDPI

15 Yosua Naibaho DDPI 081347249271 [email protected]

22 Nela Mariana DDPI 08125522147 [email protected]

30 Dina Riska DDPI 081350031982 [email protected]

31 Reski Udayanti DDPI 085250804443 [email protected]

33 Soeyitno S DDPI E 0811585649

19 Dedi PDKLLL 08133279822 [email protected]

44 Sopian Noor BLH Provinsi East

Kalimantan


6 Erwinsyah 081346255852 [email protected]

8 D Momo Dinas Kehutanan Provinsi 085247151961 [email protected]

12 Hadi Wardoyo Dinas Kehutanan Provinsi 08125512688

13 Sutrisno Hardadi Dinas Kehutanan Provinsi 081269838111

12 Hadi Wardoyo Dinas Kehutanan Provinsi 08125512688

9 Anwar Saleh Dinas Kehutanan Provinsi 081347719010

32 Chairil Anwar Dinas Kehutanan Provinsi

17 | P a g e

12 Wilma Dinas Kehutanan Provinsi 08125851826

11 Henny H Dinas Perkebunan

Provinsi

082072225165

18 Aspianur A FAuzi POKJA REDD+ 082157093089

12 Wilma Dinas Kehutanan

Provinsi

08125851826

9 Henny Hendiyanto Dinas Perkebunan East

Kalimantan

082172225165

10 Ujang Rachman Bappeda Provinsi [email protected]

19 Nurani Citra A Bappeda Provinsi 081253110694 [email protected]

17 Nurani Citra Bappeda Provinsi 081253110694

16 Fachrudin BLH Provinsi

20 Syahrial BLH Provinsi 081283078139

44 Sopian Noor BLH Provinsi 081347080819 [email protected]

17 Djulson S Kapuangan Dinas Pertambangan

Provinsi


34 Isabella SP Setda Provinsi

20 Pathur Rahman As’ari Biro Perekonomian Setda

Provinsi


21 Istiko Tj Biro Perekonomian Setda

Provinsi

081347312006

24 Sutan Alamsyah UPTD Pengeola THR

Bukit Soeharto

08138050463

25 Rusmadi UPTD Pengelola THR

Bukit Soeharto


18 FX. Sumary UPTD Bukit Soeharto 082254540861

27 Tabroni Balai Besar Dipterocarpa 081219300505 [email protected]

21 Farida h Susanty Balai Besar Penelitian

Dipterocarpa


29 Ahmad Gadang P Balitek KPA Samboja 082190019695 [email protected]

38 Anggi Arindya Protokol Gubernur 08115572020


18 | P a g e

39 Ade Almeira Protokol Gubernur

36 Azhar Rahman Biro Humas 081253741529

37 Aji Enny Rivim Biro PPWK

40 Arwindya Dini Biro PPWK

41 Iskaridan Biro PPWK

35 Siti Masithah Biro PPWK 081952474779

18 Aspianur A FAuzi POKJA REDD+ 082157093089

19 Dedi PDKLLL 08133279822 [email protected]

x6 Erwinsyah 081346255852 [email protected]

Non-Governmental Organization/Universities, East Kalimantan


1 Pajar Gumilar BIOMA 085250501166 [email protected]

2 Alfan Subekti GIZ FORCLIME 08125425059 [email protected]

3 Lenny Christy GIZ Gelamai 08115804417 [email protected]

4 Daru Widyatmoko GAPKI 08136602323 [email protected]

5 Ismail Arrasyid AMAN 081350180166

6 Delon Marthinus TNC 08111180262 [email protected]

7 Niel makinuddin TNC 0811552624 [email protected]

8 M. Fadli Yayasan Bumi 082158168061 [email protected]

9 Dyah Catur Global Green

GrowthInstitute/GGGI


10 Herliati Rahmi GGGI 08125872584 [email protected]

11 Agus Budi GAPKI 081358675701 [email protected]

12 Akas P. Sujalu UNTAG 1945 082157612433

13 Deddy Akdriyaksa C3S-UNMUL 0811555051

14 Erina APHI 085387747442 [email protected]

14 Delon Marthinus TNC 08111180262 [email protected]

16 Niel Makinuddin TNC 0811552624



19 | P a g e

Development Partners


1 Adam Gerrand FAO/UN-REDD [email protected]

2 Peter Oksen ESP3/DANIDA 8577981005

3 Taswin Munir ESP3 085772020117 [email protected]

4 Tom Owen Edmund British Embassy/UKCCU [email protected]

5 Dwi Puji Lestari FAO 082337853982 [email protected]

6 Marthien Lux UNDP 08119200930 [email protected]

7 Rini Astuti UNDP 082136033699 [email protected]

8 Nadyhda Yegay Canadian Embassy 08191000064 [email protected]

9 Erik Streed USAID 08118437953 [email protected]

10 Ovind Dahz Norway EMbassy 08118052028 [email protected]

11 Georg Badihol GIZ/FORCLIME 08118117205 [email protected]

12 Jean-Hugues de Fanl-reault AFD 081210648624

13 Wahjudi Wardojo TNC 08118890894 [email protected]

14 Herlina Hertanto TNC 08118118923

15 Tian Partiani ITTO

16 Elisda Damayanti ITTO


20 | P a g e

Annex C: Status of activities implemented under current Grant Agreement of FCPF Readiness Grant

ANNUAL WORK PLAN FOREST CARBON PARTNERSHIP FACILITY (FCPF) GRANT No. TF.99721-ID

10 Juni 2011 - 30 November 2016

NO Sources of Funds : 2011-2016

Implementing Agency

Status up to 2015

cummulative

Sources of Funds :

The World Bank

34,489,372,865

Total Sources of Funds

34,489,372,865

Uses of Funds :

Focus Area 1: Analytical Works

1 1.1

Analyze drivers of deforestation from a development perspective, land use demands, and demographic development

World Bank Done?

2 1.2 Identity priority investments needed to reduce deforestation and forest degradation

World Bank Done

3

1.3 Identifity Activities Within the country that result in reducing emision and increasing removal

770,564,544

PUSPIJAK Done

4 1.4 Stakeholder coordination comprehensive mitigation action for REDD+

162,467,800

PUSPIJAK Done

Focus Area 2: Management of readiness process

2.1 Institutional setting and legal framework for REDD Impementation:

5

2.1.1 Stakeholder process to review existing regulatory framework and formulate an integrated REDD Regulation

178,603,000

PUSTANLING Done

6

2.1.3 Develop guidance for effective engagement of indegenous people and local communities (DKN)

72,100,000

PUSPIJAK Done

21 | P a g e

7

Develop guidance for effective engagement of indegenous people and local communities (DKD Maluku)

543,407,250

PUSPIJAK Done

8

2.2 Capacity building of institution and stakeholders involved in the implementation of REDD activities : ToT on carbon accounting and monitoring (ground check and spatial data analysis) at sub-nat levels.

1,996,724,250

PUSTANLING Done

9 2.2.2 Training of trainers on carbon accounting and monitoring at central level

148,154,150

PUSPIJAK Done

10 2.4.2

Dissemination of information throguh website and printed publication (rephrased to become "Dissemination of information of FCPF REDD+ readiness preparation")

2,025,602,500

PUSPIJAK has change to P3SEKPI

Will be continued in

2016

11 2.4.3

Workshop to develop guidance for effective engagement of indigenous people and local communities

334,735,000

PUSPIJAK Done

12

2.4.4 1. WS/dialogues on drivers of deforestation from a development perspective, land use and demands, demographic development

937,821,700

PUSTANLING Done

2.4.4 2. workshop on investment

priority to reduce deforestation

WORLD BANK Done

13

2.4.4 3. Consultation to identify activities within the country that result in reduced emissions and increased removals, and stabilization of forest carbon stocks

1,095,644,450

PUSTANLING Done

14 2.4.5 Public consultation in Jakarta on

institutional setting and legal framework

478,514,500

PUSTANLING Done

15

2.4.6 Finalize National REDD WG--> direvisi mjd : Establishment of Information System of Safeguards

166,901,000

PUSTANLING Done

16

2.4.6 Public consultation to facilitate establishment of REDD WG at sub-national level

383,458,000

PUSTANLING Done

17

2.4.7 Outreach on management of data and lessons on readiness activities / DA

590,713,800

PUSTANLING Done

22 | P a g e

18 2.4.9 Workshop PSP to discuss and

strategy of future maintenance of PSP

1,458,830,200

PUSPIJAK Done

19 2.4.10 Workshop on MRV 539,030,150

PUSPIJAK Done

20 2.4.12 Stakeholder analysis: Workhsop DA

100,637,600

PUSPIJAK Done

21

2.5 Management of data, lessons , and funding partner coordination, including periodic review of demonstration activities

666,426,100

PUSTANLING Done

22

2.6 Development of SESA : direvisi menjadi : Development of SESA Encourage and strengthen the implementation of safeguards national policies and framework for the implementation of REDD+ in Indonesia

1,342,847,000

DKN, revised to DG-CC


2016

-Facilitation for preparation (targeted process of incentive result-based payment mechanism for REDD+ small activities

DG-CC

-Initial Process for bio carbon

fund preparation DG-CC

23

Encourage Safeguards National Polices In Implementation Of REDD+ In Indonesia : Delivers of National Forestry Cpuncil (DKN) side views about safeguards and formulate next strategic movement

PUSPIJAK

Focus Area 3 : Reference Emission Level (REL) and Measurement Reporting and Verification (MRV)

24 3.2

Development of a time series analysis of the primary social economic and policy aspects of land use change

986,491,800

PUSPIJAK Done

25 3.3

Reenumeration of the new PSPs and reenumeration of the existing PSPs direvisi menjadi : Establishment of Permanent Sampl Plots (PSPs) for ground-based foret carbon monitoring (for estimating forest related GHGs emissoins by sources and removals by sinks and monitoring forest carbon stock change), maintenance

3,512,282,849



2016

23 | P a g e

the PSPs that have been developed (enumeration of the new PSP and re-enumeration of the existing PSPs)

26 3.3.1 Development of Suistanable monitoring forest carbon application system

1,494,252,800

PUSPIJAK Done

27

Forest Carbon Monitoring Database to Support National Forest carbon Monitoring System (NFMS)

511,364,200

PUSPIJAK Done

Focus Area 4: Regional Data Collection and Capacity Building

-

28

4.1 1.Capacity building and studies to set up REDD+ framework at selected area (locatios : South Kal., West Papua, South Sul., Musi Rawas Distrit, South Sum., NAD) (being revised: capacity building to develop and improve REDD+ Framework at selected area, with mainstreaming/combining both climate change adaptation and mitigation ( sub national level in Eastern part of Indonesia)

2,320,356,000

PUSTANLING revised to DG-CC


2016

29

2.Capacity Building and study to set up REDD+ Framework including developing socio economic and biophysical baseline data

1,003,193,344

PUSPIJAK PUSPIJAK

30

3.Developing baseline data of socio economics and biophysics

263,647,400

PUSPIJAK PUSPIJAK

31

- Preparation and submission of ERPIN carbon fund (being revised: Facilitation for finalizing ER-PIN)

936,571,070



2016

32

- Facilitation for preparing ERPD :

1,397,660,000



2016

- Study on how to effectively

address the drivers of deforestation

- mainstreaming CF based

emissons reduction program in the distric development plan

- Calculating cost of ER

Programs in Kaltim and volume of carbon emissions that can be

24 | P a g e

reduced by each prioritised activity

33

- Public consultation to facilitate establishment facilitation of REDD+ working group at sub national level

539,310,000



2016

34 Procurement Plann ( Repository,Mebeler and website, plann buy to vehicle, travels)

341,956,350

PUSPIJAK PUSPIJAK

35 Facilitation for Supporting the Focus Areas (SFA) ; Travels, Meetings, Honorarium, Outsourcing)

7,189,104,058



2016

Total

34,489,372,865

25 | P a g e

Annex D: Initial Project Development Objective and associated outcome indicators

Summary of two groups (national and sub national level) discussed about the initial project development objective with associated outcome indicators.

Group 1: National level

PDO: To achieve sustainable forest management

Intervensi Tolak Ukur

Fisik/Ekologi Sosial Ekonomi

Restorasi Ekosistem

(policy beda ijin

usaha, kemudahan

ijin)

Tutupan meningkat

Riap meningkat

Biodiversity

meningkat (flora dan

fauna)

Partisipasi

masyarakat

meningkat

Multifier effect

kesejahteraan

masyarakat

HPH

(policy harga pasar) Tutupan meningkat Konflik

menurun

Perambahan

menurun

PNBP meningkat

Pajak meningkat

Multifier effect

kesejahteraan

masyarakat

Hutan Tanaman

(policy harga pasar) Tutupan tetap

Produktivitas

Konflik

menurun

Perambahan

menurun

PNBP meningkat

Pajak meningkat

Multifier effect

kesejahteraan

masyarakat

Sosial Forestry Tutupan meningkat Konflik

menurun

Perambahan

menurun

Penghasilan meningkat

APL Berhutan (policy perubahan

status kawasan)

Tutupan tetap Perambahan

menurun

Ada

pengelolanya

(ownership)

Jasa lingkungan

Hutan Lindung Tutupan tetap

Biodiversity

Konflik

menurun

Perambahan

menurun

Jasa lingkungan

Multifier effect

Hutan Konservasi Tutupan tetap

Biodiversity

meningkat

Konflik

menurun

Perambahan

menurun

Jasa lingkungan

Ecotourism

Multifier effect

Pertambangan di

kawasan hutan Tutupan meningkat

Biodiversity

meningkat (flora dan

fauna)

Partisipasi

meningkat

Penghasilan

meningkat

26 | P a g e

Key Partners Responsibility Support Needed

Nasional KemenLHK Koordinator

pelaksanaan kegiatan

pengurangan emisi

Penguatan

koordinasi

Kemenkeu Financial policy Technical assistant

BAPPENAS Mengintegrasikan

pembangunan rendah emisi

ESDM Tambang ramah

lingkungan

Penilaian

rehabilitasi tambang (teknikal aspek)

Pertanian/

perkebunan

Perkebunan ramah

lingkungan (policy)

Sub Nasional

Propinsi DDPI Koordinator Kelembagaan (finansial

support) Dinas Kehutanan Teknikal aspek

BAPPEDA RPJP, pendanaan

BLH Teknikal aspek

Dinas Pertambangan Teknikal aspek (tambang)

Dinas Perkebunan Teknikal aspek

Dinas Tanaman Pangan Teknikal aspek

KPH Pengelolaan hutan, SFM

NGO Pendampingan, advokasi

DKD Pendampingan

Distrik Dinas Kehutanan Teknikal aspek Kelembagaan (finansial

support) BAPPEDA RPJP, pendanaan

BLH Teknikal aspek

Dinas Pertambangan Teknikal aspek (tambang)

Dinas Perkebunan Teknikal aspek

Dinas Tanaman Pangan Teknikal aspek

KPH Pengelolaan hutan, SFM

NGO Pendampingan, advokasi

27 | P a g e

Tapak Masyarakat Pelaksana kegiatan

pengurangan emisi

Kelembagaan

Pemegang ijin Pelaksana kegiatan

pengurangan emisi

Kelembagaan

Group 2: Sub national level

Project expected to achieve by 2024 (PDO):

Penurunan deforestasi dan Degradasi:

Untuk bisa berkontribusi terhadap INDC 29%, Kaltim harus menurunkan laju deforestasi dari

78.944 ha/tahun menjadi 54.000 ha/tahun di tahun 2024

Penurunan Emisi:

Emisi Kaltim 2024: 39 juta ton CO2/tahun

Target 29% INDC untuk Kaltim : 11,4 juta ton CO2/tahun

Ekspektasi di tahun 2024 : 27,6 ton CO2/tahun SFM:

• HCV, RIL, HCS, HVC, Social Forestry

Mining : Tidak ada ijin baru

Plantation: 100% ISPO Other:

Provincial Strategic Area (HoB, Danau Semayang, Jempang, melintang)

Success Indicators:

1 Laju deforestasi Kaltim 54.000 ha/tahun

2 Emisi Kaltim 27,6 ton Co2/tahun

3 Perkebunan yang telah memiliki kelas kebun telah mencapai ISPO 100% 4 SFM dari 76 HPH, (mininal 50% RIL)

5 Tidak ada ijin baru untuk Pertambangan

Who will implement the Project:

Implementing agency : Pemerintah Provinsi Kalimantan Timur (DDPI)

Key partners for project

implementation

Responsible What support needed

(Technical

Assistance,

Funding)

National • KLHK (Dirjen PPI dan

Balitbang)

• Kementan (Dirjen Bun)

• ESDM (Dirjen Minerba)

• Kemendesa, PDT dan

transmigrasi

• Koordinasi

dan

implementasi

• Support legislasi

REDD+ fund untuk

program ( misal Peta

masyarakat adat)

28 | P a g e

• Kementrian Agraria dan Tata Ruang

• Kemenkeu

• BNPB

• Pembiayaan

Province Pemerintah Provinsi

District Pemerintah Kabupaten

NGOs/communities TNC, WWF, GIZ, GGGI, BIOMA, Bumi, Asosiasi

(APHI, GAPKI, Apkasindo,

APBBI, GPPI, Asosiasi

Petani Kelapa Sawit, Masyakarat Peduli Api,

Kelompok Tani Peduli Api)

• Advokasi dan

fasilitasi • Pendanaan

• Capacity

Building

Parking lot:

Standart apa yang digunakan untuk memverifikasi penurunan emisi

Bagaimana mekanisme memilih verifikator penuruan emisi

Siapa yang membiayai proses verifikasi penurunan emisi FREL apakah akomodatif terhadap kegiatan logging

29 | P a g e

Annex E: Comments on Indonesia Draft ER-PIN (version 17.12.2015)

Section 2: Political Commitment This section could be made considerably more concise. The last two paragraphs, dealing with project

partners could be moved to section 4.

Section 3: Strategic Context and Rationale of the ER Program The ER Program, in terms of activities and funding, is derived from East Kalimantan’s Action Plan on

Reducing Greenhouse Gases (RAD GRK) and the provincial medium term development plan. In

Section 3, and in the ER-PIN overall, there is room for making this connection more explicit by highlighting how these documents were developed including the relevant consultation processes, the

supporting analytical work, and by describing the implementation progress to date. There should be a

discussion of how the finance from the Carbon Fund complements the existing plans and activities.

Section 4: ER Program Location and Lifetime The background section on East Kalimantan should include a highlight of the value of the province’s forest

resources. This would be part of the justification for locating the ER Program in the province, and for

the ER Program overall. The description should include a summary of East Kalimantan’s forest cover broken down by forest type, and the social and economic values associated with the forests. The former

is also relevant to the section on reference levels, and the latter to the sections on non-carbon benefits

and possibly tenure.

Table 1 on KPH needs to be better integrated into the text. If KPH are playing an important role in the

program, that role should be clearly defined.

The current date for the ERPA may be overly ambitious: following the signing of the LOI, it is expected

that there will be an 18-month exclusivity period, followed by a 6-month negotiation period. The ERPA should not be expected before mid-2018. The implementation period of the CF has been extended to

the end of 2025, which means that the accounting period can include the year 2024, and the final MRV

could be in December 2024. A reasonable timeline is as follows3:

Action Responsible Entity Expected Date

ER-PIN Submitted GOI/MOEF February 2016

ER-PIN Reviewed and Selected into

Pipeline

CF Participants and WB March/April 2016

Letter of Intent Signed GOI/MOEF and WB July 2016

FCPF R-Package Submitted and

Endorsed by FCPF Participants

GOI/MOEF February 2017

Draft ER Program Document Prepared MOEF with technical

support from WB

June 2017

ER Program Document Submitted GOI/MOEF October 2017

ER Program Document Reviewed and

Selected

CF Participants and WB November 2017

ERPA Negotiation CF Participants and WB and GOI/MOEF

(approx. 6 months)

ERPA Signed May 2018

(18 months after LOI)

Implementation, Verification, Payments CF Participants and GOI/MOEF

July 2018- December 2024

3 https://www.forestcarbonpartnership.org/carbon-fund-0

https://www.forestcarbonpartnership.org/carbon-fund-0

30 | P a g e

Section 5: Activities and Interventions

Table 2 provides a long list of policies to address deforestation in East Kalimantan. It should be clarified whether these are planned policies or whether they are currently being implemented, and how they are

linked to the ER Program.

Current activities proposed in the ER-PIN are those that are described in the RAD-GRK. To the extend that

this is an ongoing and clearly funded program this could compromise the additionality aspect of the ER Program. If on the other hand the RAD-GRK program is not clearly funded, this should be noted in the

section on financing. The CF primarily addresses additionality through conservative approaches to

setting Reference Levels (e.g., including existing and clearly funded programs or activities within the Reference Level). The ER-PIN should aim to demonstrate how the CF is supporting the implementation

of the RAD-GRK.

Section 6: Stakeholder Information Sharing, Consultation and Outreach The section on previous stakeholder engagement, besides discussing consultations on the ER-PIN should

also describe the consultation process related to the RAD-GRK since that largely constitutes the actual

program. The section on planned outreach and consultation could be strengthened.

Section 7: Operational and Financial Planning (Institutional Arrangements) Currently the only included funding source for the ER Program is the national and subnational budget

allocation for the RAD-GRK program. There should be some discussion of how secure that funding is,

and how established the implementation of the RAD-GRK is (see also note on additionality). Additional effort should be made to identify program partners and include additional funding sources.

Examples of likely program partners include TNC, WWF, and private sector companies.

Section 8: Reference Level and Expected Emissions Reductions The method for developing the Reference Level should be clearly presented so that stakeholders can

understand how the RL was constructed. This requires, among other things, a clear description of how

the emissions from peat decomposition were calculated. Also the table on carbon stocks of various land

covers (Table 6) should be better explained- how were these numbers derived and do they match IPCC submissions? If possible it would be good to show which drivers have been responsible for how much

of the emissions. Also whether there has been a trend in the emissions during the Reference Period and

beyond. Similarly, a short analysis of emissions related to peatland fires could be performed to assess the significance of these emissions. The description of such analyses could be placed in a short annex.

The design of the Reference Level deviates in several aspects from the requirements set out in the

Methodological Framework (MF).

The definition of forest used in the construction of the Reference Level should be specified (Indicator 12.1).

According to Indicator 11.2, the start-date for the Reference Period should be about 10 years before the

end-date, and the start date should not be more than 15 years before the end-date. However, the

Reference Period used in the draft is from 1990 to 2012 (22 years). This can be fixed by excluding the years 1990 and 1996 from the calculation of the Reference Level.

According to Indicator 13.1, the Reference Level may not exceed the average annual historical emissions

over the Reference Period (Note that Indonesia’s ER Program does not qualify for adjustment of the Reference Level above average annual historical emissions.). However, the current Reference Level

includes a significant increase in emissions in a number of land use planning categories that have been

allocated for development, and this substantially raises the Reference Level above the average

emissions level for the Reference Period. This should be fixed.

Given that the RL needs to be a simple historical average, the usefulness of the Transition Probability

Matrix (TPM) and the division into separate land use classifications could be re-assessed.

31 | P a g e

As indicated by the draft ER-PIN, it is expected that planned development in East Kalimantan will lead to

(BAU) emissions over the program period that are significantly higher than the average annual historical emissions over the Reference Period. Using the historical average emissions as a reference

level (as required by the MF) will therefore reduce the amount of saleable ERs that can be achieved.

Following the recalculation of the RL, it will be important to evaluate the feasibility of reducing

emissions below the RL, and the impact on the level of revenue from the sale of ERs to the CF.

Section 9: Forest Monitoring System

The ER Program should ensure that consistent methods and Accounting Area are to be maintained between

estimation of emissions in the Reference Period and during the Term of the ERPA. Similarly, the focus of Section 9.2 needs to be on the consistency (or explanation of differences) with the monitoring

approach at the national level.

Sections 10 and 11: Leakage and Reversals The current draft proposes a buffer of 40% to account for the risk of displacement and reversal. The CF is

currently developing a guideline which links the size of buffers to the estimated risks of

reversal/displacement, with buffers ranging from around 10% to 40%. The ER-PIN should include

some discussion of how the 40% was derived. A 40% buffer could be appropriate if there is a significant risk of reversal, for example through fire.

Section 12: Expected Emissions Reductions

Table 13 shows an expected ER of 24% every year but there is no calculation of how this number was derived. The ER estimate should be made using a bottom-up approach, ideally beginning with the ERs

attributed to each of the major drivers of deforestation, and linking Program activities to specific drivers

and to specific ER estimates.

Section 14: Land and Resource Tenure

More information on issues specific to East Kalimantan would help strengthen this section. In addition,

there could be a discussion of how the ER Program may help resolve ongoing land and resource tenure

challenges.

Section 15: Benefit Sharing

Some of the discussion seems more relevant to the channeling of funds for program implementation, than

to distribution of proceeds from ER sales.

Editorial and Style Issues

There are a number of sections that could be made more compelling by for example tightening the language,

removing unnecessary or irrelevant information, and improving the fit with the overall storyline. There

are some inconsistencies in the dates mentioned that need to be revised.

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