To be effective, carbon credits need to be unique, real, permanent, additional, measurable, and third-party verified. The FCPF Standard ensures all credits generated in FCPF programs meet this criteria. The FCPF Standard is a carbon crediting standard of the FCPF Carbon Fund for the monitoring, reporting, verification, quantification and accounting of greenhouse gas emission reductions and wider environmental and social benefits achieved by REDD+ programs at the jurisdictional (national and subnational) scale.  The FCPF Standard is applied to Emission Reduction generated and certified under the registered REDD+ programs, whether paid for by the World Bank through its ERPAs or by third-party buyers of excess ERs.  

The FCPF Standard is composed of a number of regulatory documents which include the FCPF Methodological Framework and its guidelines and the guidance documents and templates. FCPF requirements are developed by a multi-stakeholder working group that includes the World Bank, FCPF participants, REDD+ countries, and observers to the FCPF. The Methodological Framework was initially adopted in 2013 and subsequently revised in accordance with UNFCCC decisions. The FCPF requirements are consistent with UNFCCC decisions including the Paris Agreement, the Warsaw Framework, and the Cancún Safeguards. The World Bank-managed FCPF Standard allows buyers to invest in carbon credits with confidence. 

REDD+ has been developed at two different scales that differ in their approach and methodologies:

• Jurisdictional: Subnational and/or country-wide programs, often extending across several million of hectares and usually carried out by governments as part of wider national and sectoral policies, their interventions are shaped as policies, regulations, and investment programs, which are largely financed by public resources or concessional finance.  
• Project: Geographically demarcated areas within which an activity takes place, usually in the thousands of hectares. Projects are usually carried out by private sector actors (although sometimes in collaboration with governments), are financed by private investments and are designed to respond to the drivers and circumstances of a specific area (the project are and its surroundings).  

Although both approaches may complement and interact in different ways (described in the World Bank’s Nesting of REDD+ Initiatives : Manual for Policymakers), the World Bank, through the FCPF, supports implementation at the jurisdictional scale. Implementation at jurisdictional-scale is consistent with UNFCCC decisions related to the REDD+ framework (non-market mechanism), and it is supported by several entities (c.f. Tropical Forest Credit Integrity (TFCI) Guide and the WWF) as appropriate for carbon markets .  

REDD+ programs approved under the FCFP have been designed and implemented by REDD+ countries with the support from the World Bank and other entities. The World  
Bank has provided a comprehensive support package to countries that includes technical assistance, investments and result-based payments that provides incentives and rewards for countries to operationalize programs that deliver social and environmental outcomes, including high-integrity carbon credits.  Support to jurisdictional programs included:

• Provision of readiness support to governments to build national capacities and robust frameworks to enable the implementation of jurisdictional programs.  
• Support of the implementation of robust monitoring systems owned by national agencies and based on state-of-the-art ground-based and remote-sensing based measurements.  
• Support for the development of frameworks for the inclusion of Indigenous Peoples and women.
• Support for the implementation of safeguards – social and environmental – which are aligned to the World Bank safeguards.
• Support for the development of transparent and equitable benefit sharing arrangements that enables communities to benefit.
• Design of robust jurisdictional-scale programs that address the drivers of deforestation and forest degradation, enhance carbon stocks, and maximize non-carbon benefits, through well-defined mitigation and enabling environment activities.  
• Alignment and leverage of investments from the World Bank (IBRD/IDA) and other sources (e.g., Climate Investment Funds, Global Environmental Facility, Green Climate Fund) within jurisdictions.  
• Crowd-in of private sector investment by engagement and mobilization. 

Yes. Emission reductions from jurisdictional programs under the FCPF have environmental integrity as they are based on robust methodologies and third-party verification processes. Environmental integrity is ensured by:

• Additional emission reductions
• Real emission reductions
• Avoidance of double counting  
• Assured permanence
• Avoidance of leakage
• Accurate and conservative estimates

A carbon market-based mechanism has environmental integrity if the generation and transfer of credits through that mechanism leads to the same, or lower, aggregated global emissions. Integrity is ensured through accounting that avoids double-counting (double counting is when the same unit is used twice to offset emissions, e.g., when the same unit is issued as a credit more than once or the same unit is claimed by multiple entities), as well as through the quality of the ER estimates (e.g., baseline or reference level, additionality, permanence, leakage, and uncertainty). 

The FCPF Methodological Framework requires countries to select appropriate arrangements to avoid double counting, including double issuance, double selling/use, or double claiming, in order to track the emission reductions. This ensures that any ERs that have been generated, monitored, and verified under the FCPF ER Program and paid for by the Carbon Fund are not used a second time by any entity for sale, public relations, compliance, or any other purpose unless otherwise agreed by the parties to the ER Payment Agreement and, where relevant, consistent with any applicable guidance adopted under the Paris Agreement.  

World Bank assistance to countries has included the technical assistance to design and implement regulatory frameworks to clarify ER titles and mitigate the risk of double counting. As part of this regulatory framework, specific systems are put in place to avoid double counting, issuance, and claiming, including the national REDD+ Programs, Projects Data Management System, and an ER Transaction Registry. The ER Transaction Registry has capabilities to register, track, and as appropriate retire or cancel ER units generated under FCPF ER Programs.

The World Bank Carbon Asset Tracking System (CATS) provides a strong and reliable architecture to create, govern, store, and maintain data; guarantees operational transparency and security; and mitigates double-counting risks for the ER units generated under the World Bank. CATS will work with other global registry providers (e.g., ACR, Verra) to maintain the strict registry requirements that uphold the principles that avoid double counting. 

One concern around REDD+ is leakage, or the displacement of emissions (although this is not a concern exclusive to REDD+ or the forestry sector alone). Emissions in a specific area could be reduced by just displacing the activities that generate them out of that area, so emission reductions for which credits are issued would not be real.  

In most cases, leakage occurs as a consequence of poor program or project design. Under the FCPF Standard, deforestation and degradation drivers that may be impacted by the proposed ER Program measures are identified, and their associated risk for displacement is assessed, as well as possible risk mitigation strategies. ER programs are required to identify any residual risk of displacement out of the ER program area and to manage it accordingly through mitigation measures included in the program design and through monitoring of drivers of deforestation and degradation.

In jurisdictional REDD+ programs that cover an entire country, the issue of leakage or displacement is further addressed as the emissions are monitored and accounted for across the jurisdictional program area, so an activity`s emissions pushed from one area to another within the jurisdiction would be considered as part of the jurisdictional program´s emission estimates.  

Jurisdictional REDD+ programs under the FCPF must follow specific quality requirements for data and for uncertainty management. The residual uncertainty is taken into account through specific conservative discounts of emission reductions into an uncertainty buffer.

In the FCPF’s jurisdictional REDD+ programs, additionality is demonstrated by using a baseline that represents an average of historical greenhouse gas emissions and removals of activities within the jurisdiction over a period of 10 years. As emissions from the forest sector have historically had an upward trend prior to 2016, this is considered to be a conservative benchmark. If emissions are below this benchmark, they are automatically additional as they represent a reduction of emissions compared to the benchmark. This approach is simple, easy to understand, yet robust.  

Moreover, the FCPF Standard requires to demonstrate that the ER Program is ambitious and uses new or enhanced ER Program Measures to reduce emissions or enhance removals with regard to the baseline scenario.  

Yes, the FCPF Standard has been approved by the UN International Civil Aviation Organization (ICAO) to supply CORSIA Eligible Emissions Units for the 2021- 2023 compliance period (pilot phase).  

One of ICAOs mandates is the setting of environmental standards to address emissions from international aviation (domestic flights are covered under countries’ nationally determined contributions). CORSIA is the first industry-wide market-based measure to reduce emissions. It requires that emissions above 2020-levels must be offset. 70 countries, representing around 90% of international aviation emissions, participate in the voluntary phase (2021-2026), with additional countries joining in the mandatory phase (2027-2035).

It is estimated that around 2.5 billion tons of CO2-equivalent is to be offset between 2021-2035. Given the stringent requirements on FCPF ER Credits under the FCPF Standard, which ensure environmental integrity (additional and real ERs, avoidance of double counting, ensuring permanence, avoidance of leakage, and increased accuracy), FCPF ER Credits are eligible under CORSIA and can be purchased by airlines to offset emissions. 

Under the agreement with the FCPF, once a country has fulfilled all its contract ERs and the FCPF has either exhausted its call option or declined to exercise it, the ERs generated in excess to the ERPA (‘Excess ERs’) are available to the country. These excess ERs are fully owned by the country, and it is the country’s prerogative to determine what to do with these credits. Available options include usage against the REDD+ country’s Nationally Determined Contributions (NDCs) under the Paris Agreement, or the sale of ERs to third party buyers.  

While the credits are issued through the World Bank’s FCPF Standard, the World Bank is not directly involved in any sale and/or purchase of such excess ERs. At a country’s request, the FCPF can support them to understand, navigate, and facilitate the different avenues available for commercialization, including the use of auction providers. The World Bank does not provide legal counsel. 

As a requirement under the FCPF Methodological Framework, all FCPF emission reductions payment agreements have a corresponding benefit sharing plan that stipulates what is done with the payments received from the World Bank. These benefit sharing provisions apply under the ERPA and are also expected to be applied for excess ERs.

Each benefit sharing plan responds to the specific context of the country, but generally a small percentage is set aside to cover the cost of running the program, while the vast majority of the funds are allocated to the actors responsible for achieving the emission reductions. Examples include communities implementing forest protection plans, Indigenous communities protecting their ancestral forests, or farmer groups adopting low-carbon agroforestry initiatives.  

The World Bank’s Forest Carbon Partnership Facility (FCPF) is a global partnership of governments, businesses, civil society, and Indigenous Peoples' (IPs) organizations focused on reducing emissions from deforestation and forest degradation, forest carbon stock conservation, the sustainable management of forests, and the enhancement of forest carbon stocks in developing countries, activities commonly referred to as REDD+. Launched in 2008, the FCPF has worked with 47 developing countries across Africa, Asia, and Latin America and the Caribbean, along with 17 donors that have made contributions and commitments totaling US$1.3 billion.  

FCPF Programs

• Since 2008, the FCPF has provided technical assistance to 47 developing countries to prepare them to implement REDD+ at national level. This includes developing national REDD+ strategies, designing measurement, reporting, and verification systems, and setting up national REDD+ management arrangements, including proper environmental and social safeguards. Based on the progress made, 15 countries were selected to advance into the FCPF Carbon Fund to pilot results-based payments for verifiable emission reductions (ERs) in their forest and broader land-use sectors.

Emission Reductions Payment Agreements

• The World Bank’s FCPF Carbon Fund pays participant countries on a results basis in accordance with Emission Reductions Payment Agreements (ERPAs) for producing verified emission reductions. The FCPF’s 15 ERPAs are underpinned by ambitious emission reductions programs led by jurisdictions (provinces or states), with a total area of 111 million hectares – roughly the size of South Africa. These programs are aligned with World Bank investments to cover the necessary capacity and resource needs to design and implement these systems and emission reductions programs, known as the ‘missing middle’.

On top of reducing carbon emissions and improving governance across forests and land rich in tropical rainforests and biodiversity, the Carbon Fund program seeks to improve communities’ livelihoods and reduce poverty. The 15 ERPAs jointly aim to reduce 145 million tons of greenhouse gases while delivering US$721 million to the countries achieving these emission reductions.