Name of Organization or Individual

Country

Ministry of Environment and Energy (MINAE)

Costa Rica

Costa Rican National Parks Foundation

Costa Rica

Centre Financial Products Ltd.

U.S.A.

Item

Organization

Name of organization (original language)or

Name of individual if unaffiliated with any organization

Ministerio de Ambiente y Energía

Name of organization (English)

Costa Rican Ministry of Environment and Energy

Acronym (original language)

MINAE

Acronym (English)

None

Department

Function(s) within the AIJ project activities

Project development, project administration, government regulation/oversight, monitoring

Street

City

San José

State

Post code

P.O. Box 1104-1000

Country

Costa Rica

Telephone

Fax

E-mail

World Wide Web-URL address

Administrative Officer Responsible for the Project

Surname

Odio Benito

First name, middle name

Elizabeth

Job title

Minister

Direct telephone

506-257-1417

Direct fax

506-257-0697

Direct e-mail

Contact Person for AIJ Activities (if different from the Administrative Officer)

Surname

Gorbitz

First name, middle name

Adalberto

Job title

General Manager—OCIC

Direct telephone

506-290-1283

Direct fax

506-290-1238

Direct e-mail

ocicgm@sol.racsa.co.cr

Item

Organization

Name of organization (original language)or

Name of individual if unaffiliated with any organization

Fundación de Parques Nacionales

Name of organization (English)

Costa Rican National Parks Foundation

Acronym (original language)

FPN

Acronym (English)

Department

Function(s) within the AIJ project activities

Project development, project administration, financing

Street

City

San José

State

Post code

P.O. Box 1108-1002

Country

Costa Rica

Telephone

Fax

E-mail

World Wide Web-URL address

Administrative Officer Responsible for the Project

Surname

Ceciliano

First name, middle name

Karla

Job title

Executive Delegate

Direct telephone

506-257-2239

Direct fax

506-222-4732

Direct e-mail

Contact Person for AIJ Activities (if different from the Administrative Officer)

Surname

First name, middle name

Job title

Direct telephone

Direct fax

Direct e-mail

Item

Organization

Name of organization (original language)or

Name of individual if unaffiliated with any organization

Centre Financial Products Ltd.

Name of organization (English)

(Same as above)

Acronym (original language)

Acronym (English)

Department

Function(s) within the AIJ project activities

Financing

Street

311 South Wacker Drive, Suite 1675

City

Chicago

State

Illinois

Post code

60606

Country

U.S.A.

Telephone

Fax

E-mail

World Wide Web-URL address

Administrative Officer Responsible for the Project

Surname

Walsh

First name, middle name

Michael

Job title

Direct telephone

312-554-3350

Direct fax

312-554-3365

Direct e-mail

Contact Person for AIJ Activities (if different from the Administrative Officer)

Surname

First name, middle name

Job title

Direct telephone

Direct fax

Direct e-mail

Item

Type of Project

Sector(s)

Land-use change and forestry.

Primary activity(ies)

Forest preservation; construction of a facility for public education, entertainment, and ecotourism.

Project Location

Country

Costa Rica

Exact location (city, state, region)

Land declared, but not registered, as National Parks and Biological Reserves throughout Costa Rica.

Key Dates and Current Stage of Project

Project starting date (month/year)

January 1998

Project ending date (month/year)

December 2022

Project lifetime (years)

25 years

Current stage of project

In progress

General Project Description and Technical Data

The Territorial and Financial Consolidation of Costa Rican National and Biological Reserves Project (also known as the Protected Area Project) will transfer to the Costa Rican Ministry of Environment and Energy (MINAE) primary forest, secondary forest, and pasture lands that have been declared National Parks or Biological Reserves but have not been registered in the National Property Registry as part of the Forest Patrimony of the State. These lands currently are (1) owned by non-governmental organizations and other private parties, (2) owned by government institutions (e.g., municipalities, ministries, and autonomous institutions) but designated for other uses, or (3) involved in administrative or judicial litigation or other processes in order to resolve property title or other disputes. Under Costa Rican law, these lands will remain under the management of their current owners and will be vulnerable to deforestation until property title disputes have been resolved, payments have been made by the State to the private property owners, and the lands have been registered.

The project team will survey, delimit, purchase and/or transfer, and register a total of 530,498 hectares (ha) of land, of which 422,800 ha are primary forest and 107,698 ha are secondary forest and pasture. Although this project comprises all of the unregistered National Parks and Biological Reserves in Costa Rica, this project will not claim GHG benefits for any areas that are accruing GHG benefits as a result of their involvement in other active AIJ projects. However, two previous USIJI projects, Project BIODIVERSIFIX and the protected area component of Project CARFIX: Sustainable Forest Management, have been incorporated into this project and no longer are reported as separate USIJI projects.

The project will generate GHG benefits by preventing the deforestation of primary forest, thereby preserving biomass carbon stocks, and by permitting biomass growth (i.e., carbon sequestration) in secondary forest and pasture. The consolidation phase of the project is anticipated to take nearly five years, and GHG benefits will accrue for 20 years after consolidation.

The project will also involve the construction of an Earth Center: a multidisciplinary development combining residential, commerce, and work activities to provide public education and entertainment and to promote ecotourism.

Methodology for Calculating Cost Data

In the project proposal, the developer estimated the direct costs of initiating and concluding the consolidation activities (which could include varying combinations of surveying, delimiting, purchasing, transferring, and registering land) on a per-hectare basis for 398 parcels of land comprising a total area of 530,498 ha. The Earth Council estimated that Earth Center construction would cost US$20,000,000.

The developer projected the flow of income based on (1) an initial contribution of US$376,241 from the Earth Council Foundation and the Costa Rican National Parks Foundation, and (2) an estimated US$156,728,922 to be generated by the sale of Certified Tradable Offsets (CTOs) as land is consolidated during the first five years of the project. Each CTO represents the certification of a specific number of units of GHGs (expressed in carbon-equivalent units) reduced or sequestered, or to be reduced or sequestered, by AIJ actions for which all phases of implementation have been completed. Each CTO will be guaranteed by MINAE for a period of 20 years, and will be verified by an independent third party. The overhead costs for managing the CTOs are estimated to total US$1,033,735.

The initial contribution of US$376,241 will be used to fund the purchase, transfer, and/or registration of the parcels of land that will generate the most CTOs per unit of cost. The revenue produced by the sale of CTOs as they are generated will be reinvested in the project to pay for (1) further land consolidation activities, which will generate additional CTOs, (2) construction of the Earth Center, and (3) project administration. A linear programming model was used to plot the optimal path of activities to maximize the net present value of CTO production. Using a discount rate of eight percent, the developer calculated the net present value of the project to be US$67,697,414 in 1997 dollars.

Year(s)

Item

Projected Amount

(US$)

Actual Amount

(US$)

Project Costs

1-5

Direct implementation costs

43,823,751

1-3

Construction of the Earth Center

20,000,000

1-2

Overhead for Managing CTOs

1,033,735

Subtotal

64,857,486

0

Project Revenues

1

Initial Contribution from the Earth Council Foundation and the Costa Rican National Parks Foundation

376,241

1-5

Sale of CTOs

156,728,922

Subtotal

157,105,163

0

Net Project Cost (Project Costs-Project Revenues)

-92,247,677

0

AIJ Project Implementation Costs: Annual Basis

Please specify: Year 1 = July 1997 to December 1997

AIJ Project Cost

in US$

Year

Projected

Projected

1

10,805,281

2

26,245,651

3

13,159,924

4

14,646,630

5

0

Total

64,857,486

Item

Party(ies) that will be monitoring project activities

Sistema Nacional de Areas de Conservacíon (SINAC–National System of Conservation Areas, an office under MINAE), and the Costa Rican National Parks Foundation

Party(ies) that will be externally verifying project results

SGS Forestry

Date when the monitoring plan became (or will become) operational (month/year)

November 1998

Types of data that will be collected

Satellite images of the project area and data on carbon storage in tree biomass, understory biomass, necromass, soil organic matter, and wood products

Description of Monitoring and Verification Activities and Schedule for Implementation

A monitoring plan was developed by SGS Forestry, which is accredited by the Forest Stewardship Council. The monitoring plan will be implemented by SINAC and the Costa Rican National Parks Foundation. Monitoring activities will include bi-annual field studies to estimate biomass stocks and biomass growth rates, and the analysis of satellite images of the project area to be taken every three years. The field studies will be conducted by professional staff from each of the conservation areas covered by the project. The rates of biomass carbon accumulation were determined based on studies by various research organizations, including the Centro Agrícola Tropical par la Investigación y la Enseñanza (CATIE–Tropical Agricultural Center for Research and Education), and the Costa Rican Institute of Technology. Carbon accounting software was customized by SGS Forestry and used to record carbon storage in tree biomass, understory biomass, necromass, soil organic matter, and wood products.

An initial assessment of the project design and verification of the baseline and project results were conducted by SGS Forestry. SGS Forestry will audit the use of the monitoring system at least once per year, and will sample randomly selected project sites for field validation of project implementation and monitoring. Based on the results of these audits, SGS Forestry will certify carbon offsets as CTOs.

Item

Please check one of the following.

This report is a first report.or

This report is an intermediate report.or

This report is a final report.

Please check one of the following:

This report is a joint report. Letter(s) of approval of this report from the designated national authority of the other Party(ies) involved in the activity is(are) attached in Section J, Annex.or

This report is a separate report.

Additional comments (if any):

Compatibility with Economic Development and Socioeconomic and Environmental Priorities

The letter of host country acceptance for this project states the following about this project’s compatibility with Costa Rica’s economic development and socioeconomic and environmental priorities:

• "It [the project] is consistent with the sustainable development policies and supports the mechanism of AIJ sustained by the [Costa Rican] government. It is consistent with national investment laws and regulations. It consolidates and insures the survival of 5% of [the] planet’s biodiversity. Through the protection of the forest’s aquifers it guarantees the country’s [sic] hydroelectric potential. It allows the country to externalize the costs of environmental service providing global benefits."

In addition, this letter states that the project’s financial mechanism is consistent with two agreements between the governments of Costa Rica and the United States: the Declaration of Intention between the Government of the United States of America and the Government of Costa Rica for the Cooperation in the Development of Verifiable and Transferable Means for Greenhouse Gas Compensation, and the Letter of Intention for Sustainable Development, Cooperation, and Joint Implementation of Measures to Avoid and Reduce the Emissions of Greenhouse Gases.

Non-Greenhouse-Gas Environmental Impacts of the Project

The non-GHG environmental impacts of the project include the conservation of biodiversity, the maintenance of Costa Rica’s hydroelectric potential through watershed protection, and an improved level of public education about environmental issues as a result of the Earth Center.

• In the proposal, the developer refers to the GRUAS Commission Report, which estimated that approximately five percent of the world’s biodiversity is represented in Costa Rica, and that 95 percent of Costa Rica’s biodiversity is represented in the National Parks and Biological Reserves. Protecting the National Parks and Biological Reserves from deforestation and fragmentation will help to preserve the habitat necessary to support this level of biodiversity.
• The developer estimates that almost 90 percent of Costa Rica’s aquifers are located in the National Parks and Biological Reserves. By protecting critical watersheds, this project will help to preserve Costa Rica’s hydroelectric potential, which offers a renewable source of energy that has not yet been fully developed.
• The Earth Center will educate both local residents and international tourists about the environmental and other benefits of preserving the National Parks and Biological Reserves.

Social/Cultural Impacts of the Project

The project will protect the natural and cultural resources represented by the National Parks and Biological Reserves. The educational activities conducted by the Earth Center will help to increase the public’s appreciation of these resources. The project will not involve the small Indian reserves around the La Amistad National Park. The autonomy of these reserves is protected under Costa Rican law.

Economic Impacts of the Project

The preservation of the National Parks and Biological Reserves and the construction of the Earth Center will strengthen Costa Rica’s ecotourism industry. The conservation of biodiversity may generate significant economic benefits as a result of biotropical pharmaceutical research. The protection of Costa Rica’s hydroelectric potential may also have significant long-term economic benefits.

Item

Site Designation

Site number (order of presentation in this report)

1 of 2

Site name/designation

Primary forest

Project sector

Land-use change and forestry

Reference Scenario

Primary activity(ies)

Deforestation

Has the reference scenario changed since the last report? (If yes, explain any changes below.)

Yes

No

This is the first project report.

Description:

Parcels of land comprising a total of 422,800 ha of primary forest throughout Costa Rica have been declared National Parks or Biological Reserves but have not been registered in the National Property Registry as part of the Forest Patrimony of the State. Under Costa Rican law, these lands will remain under the management of their current owners and will be vulnerable to deforestation until the payment and registration processes have been completed.

The reference scenario consists of the deforestation of individual parcels of this primary forest over a 20-year period at a variable rate that depends upon the forest type, location, and land tenure status of each parcel.

Predicted Project Scenario

Primary activity(ies)

Forest preservation

Description:

Under the project scenario, the 422,800 ha of primary forest currently threatened by deforestation will be registered in the National Property Registry as part of the Forest Patrimony of the State over a five-year period (1998 to 2002). The primary forest on each parcel of land will be protected from deforestation over a 20-year period following the date of registration of that parcel. Because the primary forest is assumed to be mature, zero net biomass growth is expected to occur during this time.

Actual Project

Primary activity(ies)

Forest preservation

Description:

Consolidation activities have been concluded for "NGO land ready to be transferred" in four parks: Amistad, Barbilla, Barra Honda, and Guanacaste.

Item

Site Designation

Site number (order of presentation in this report)

2 of 2

Site name/designation

Secondary forest and pasture

Project sector

Land-use change and forestry

Reference Scenario

Primary activity(ies)

Biomass removal at a rate equal to biomass growth

Has the reference scenario changed since the last report? (If yes, explain any changes below.)

Yes

No

This is the first project report.

Description:

Parcels of land comprising a total of 107,698 ha of secondary forest and pasture throughout Costa Rica have been declared National Parks or Biological Reserves but have not been registered in the National Property Registry as part of the Forest Patrimony of the State. Under Costa Rican law, these lands will remain under the management of their current owners and will be vulnerable to deforestation or degradation until the payment and registration processes have been completed.

Under the reference scenario, the rates of biomass removal and biomass growth on the parcels of secondary forest and pasture land will remain equal, resulting in zero change in net biomass stocks (and zero change in net carbon sequestration) on each parcel during a 20-year period.

Predicted Project Scenario

Primary activity(ies)

Forest preservation, pasture preservation

Description:

Under the project scenario, the 107,698 ha of secondary forest and pasture will be registered in the National Property Registry as part of the Forest Patrimony of the State over a five-year period (1998 to 2002). Each parcel of land containing secondary forest and pasture will be protected from clearing and degradation over a 20-year period following the date of registration of that parcel. As a result, net carbon sequestration from biomass growth will take place on each parcel during this 20-year period.

Actual Project

Primary activity(ies)

Forest preservation

Description:

Consolidation activities have been concluded for "NGO land ready to be transferred" in four parks: Amistad, Barbilla, Barra Honda, and Guanacaste.

GHG Emission/Sequestration Calculation Methodology

Site number

1 of 2

Project sector

Land-use change and forestry

Description of Calculation Methodology for the Reference Scenario

Under the reference scenario, CO₂ is emitted as a result of the deforestation of 422,800 ha of mature primary forest. The 422,800 ha of land are distributed among 398 parcels that are classified by their location, ecosystem type, and land tenure status. To calculate the area of primary forest within each project parcel in 1997, forest area data from the 1992 National Inventory of Sources and Sinks of Greenhouse Gases (the most recent comprehensive GHG inventory for Costa Rica) are adjusted to account for the deforestation that took place between 1992 and 1997. An average annual deforestation rate is used to make this data adjustment. This average annual deforestation rate is calculated based on the deforestation observed in the area surrounding each parcel (within a radius of 10 km) between 1979 and 1992. The deforestation rate assigned to each parcel is modified according to the parcel’s land tenure status, which affects the probability of deforestation (see Calculation #2 below).

The total GHG emissions under the reference scenario are calculated based on (1) the tree biomass carbon stocks per hectare on each parcel in 1997, (2) the projected rate of deforestation of the parcel, and (3) the annual emissions of CO₂ from each parcel as a result of deforestation over a period of 20 years. It is assumed that 100 percent of the carbon contained in tree biomass is released to the atmosphere at the time of deforestation.

(1) The 1997 biomass carbon stocks per hectare on each parcel of land are calculated using the following formula:

C_p = V_if * F_a * D_m * F_c * R_c, where

C_p = Metric tonnes of carbon per hectare of primary forest in 1997

V_if = Timber volume per hectare of primary forest

F_a = Adjustment factor to account for timber with a diameter below the minimum used in forest inventories

D_m = Timber density used to convert from the green timber volume (V_if) to a dry weight basis

F_c = Expansion factor to account for non-timber biomass (branches, foliage, and roots), estimated to be 1.6

R_c = Carbon content of biomass on a dry-weight basis, estimated to be 0.45

To calculate the timber volume per hectare (V_if) and the timber density (D_m), the parcels of land are categorized according to ten Life Zones defined by temperature, precipitation, and vegetation type. The maximum timber stock per hectare on a parcel of primary forest land is assumed to be equivalent to the timber stock on the nearest site (within the appropriate Life Zone) that has been inventoried.

(2) To calculate the projected rate of deforestation of each parcel throughout a 20-year period, the deforestation of the area surrounding the parcel (within a radius of 10 km) between 1979 and 1992 is converted to an average annual deforestation rate and modified according to the parcel’s land tenure status, which affects the probability of deforestation. The following formula is used to make this modification:

T_s = T_p * S/7, where

T_s = Average annual rate of deforestation weighted according to land tenure status

T_p = Peripheral deforestation rate

S = Factor to account for land-tenure status, defined as follows:

State lands = 0

NGO lands = 1

Other State institutions = 2

NGO lands pending procedures = 3

National Reserves = 4

In litigation = 5

Non-defined legal situation = 6

Private = 7

(3) The CO₂ emitted annually by each parcel over a period of 20 years is calculated using the following formulas:

A_y = A₀ (1 – T_s)^y

E_m = (A_y-1 – A_y) * C_p * 44/12, where

y = The year after parcel consolidation for which CO₂ emissions are being calculated (y = 1, 2, 3....20)

A_y = Area of primary forest in year y after parcel consolidation

A_y-1 = Area of primary forest in the previous year, y–1

A₀ = Area of primary forest in 1997

T_s = Average annual rate of deforestation weighted according to land tenure status (see Calculation #2 above)

E_m = Metric tonnes of CO₂ emitted in year y after parcel consolidation

C_p = Metric tonnes of carbon per hectare of primary forest in 1997 (see Calculation #1 above)

44/12 = Molecular/atomic weight ratio of 44 t CO₂/12 t C

The CO₂ emissions from each parcel are assumed to occur during a 20-year period beginning in the calendar year after which the parcel is consolidated into the National Parks and Biological Reserves under the project scenario.

Description of Calculation Methodology for the Project Scenario

Under the project scenario, the mature primary forest is preserved and there is no net change in biomass stocks during the course of the project. Therefore, the annual carbon emission estimate for the project scenario is zero.

Description of Calculation Methodology for the Actual Project

Annual carbon emission benefits will be calculated based on the results of monitoring activities using SGS Forestry carbon accounting software. The carbon storage pools to be evaluated have been expanded to include understory biomass, necromass, soil organic matter, and wood products in addition to tree biomass. Two primary assumptions have changed: (1) F_c, the expansion factor to account for non-timber biomass, has been changed from 1.6 to 1.75; and (2) R_c, the carbon content of biomass on a dry-weight basis, has been changed from 0.45 to 0.5.

SGS Forestry has certified that the consolidation activities undertaken during the project’s first year are projected to generate carbon benefits totaling 607,967.0 t C over a 20-year period starting in April 1998. Of the total, 339,331.2 t C will be for sale and 268,635.8 t C will be placed in a buffer to guard against uncertainties and risks.

GHG Emission/Sequestration Calculation Methodology

Site number

2 of 2

Project sector

Land-use change and forestry

Description of Calculation Methodology for the Reference Scenario

Under the reference scenario, there is no net change in biomass stocks in the secondary forest and pasture land during the course of the project. Therefore, the annual carbon emission estimate for the reference scenario is zero.

Description of Calculation Methodology for the Project Scenario

Under the project scenario, biomass growth on 107,698 ha of secondary forest and pasture land results in net carbon sequestration. The 107,698 ha of land are distributed among 398 parcels that are classified by their location, ecosystem type, and land tenure status. To calculate the area of secondary forest within each project parcel in 1997, forest area data from the 1992 National Inventory of Sources and Sinks of Greenhouse Gases (the most recent comprehensive inventory) are adjusted to account for the deforestation that took place between 1992 and 1997. An average annual deforestation rate is used to make this data adjustment. This average annual deforestation rate is calculated based on the deforestation observed in the area surrounding each parcel (within a radius of 10 km) between 1979 and 1992. The deforestation rate assigned to each parcel is modified according to the parcel’s land tenure status, which affects the probability of deforestation. (See Calculation #2 under the reference scenario discussion for Site #1.)

The carbon sequestration from biomass growth is calculated using a methodology developed by Tosi. The parcels of land are categorized according to ten Life Zones defined by temperature, precipitation, and vegetation type. Data on evapotranspiration (ETR) for each Life Zone are converted into a measurement of CO₂ uptake from biomass growth using the following formula:

CO₂ = ETR * 0.027 * 0.25 * R_c * 44/12, where

CO₂ = Uptake of CO₂ (t CO₂/ha-yr) on a parcel containing secondary forest or pasture

ETR = Evapotranspiration (mm)

0.027 = Factor from Tosi to convert from evapotranspiration to annual growth of biomass on a dry-weight

basis (t dm/ha-yr)

0.25 = Factor to adjust for soil degradation, availability of genetic material, and other limiting environmental factors

R_c = Carbon content of biomass on a dry-weight basis, estimated to be 0.45

44/12 = Molecular/atomic weight ratio of 44 t CO₂/12 t C

To calculate total CO₂ uptake per parcel per year, the uptake of CO₂ per hectare per year is multiplied by the area of secondary forest or pasture in that parcel. The uptake of CO₂ on each parcel is assumed to begin in the calendar year after that parcel is consolidated into the National Parks and Biological Reserves, and to continue for a total of 20 years. Therefore, it is assumed that the maximum carbon storage potential of the secondary forest and pasture is not exceeded before 20 years.

Description of Calculation Methodology for the Actual Project

Annual carbon emission benefits will be calculated based on the results of monitoring activities using SGS Forestry carbon accounting software. The carbon storage pools to be evaluated have been expanded to include understory biomass, necromass, soil organic matter, and wood products in addition to tree biomass. One primary assumption has changed: R_c, the carbon content of biomass on a dry-weight basis, has been changed from 0.45 to 0.5.

SGS Forestry has certified that the consolidation activities undertaken during the project’s first year are projected to generate carbon benefits totaling 1,057,382.7 t C over a 20-year period starting in April 1998. Of the total, 664,044.4 t C will be for sale and 393,338.3 t C will be placed in a buffer to guard against uncertainties and risks.

Projected Greenhouse Gas Benefits by Project Site

(Tonnes, Full Molecular Weight Basis)

Site Number: 1 of 2

Sector(s): Land-use change and forestry

Project Activity(ies): Forest preservation

Please specify: Year 1 = January 1998 to December 1998

Reference Scenario Emissions

Net GHG Benefits

(Reference Scenario - Project Scenario)

Cumulative GHG Benefits

(Reference Scenario - Project Scenario)

Year

CO₂

CH₄

N₂O

CO₂

CH₄

N₂O

CO₂

CH₄

N₂O

CO₂-

Equivalent

CO₂

CH₄

N₂O

CO₂-

Equivalent

1

0

0

0

0

0

0

2

0

0

0

0

0

0

3

385,532

0

385,532

385,532

385,532

385,532

4

937,838

0

937,838

937,838

1,323,370

1,323,370

5

1,825,333

0

1,825,333

1,825,333

3,148,702

3,148,702

6

2,199,971

0

2,199,971

2,199,971

5,348,673

5,348,673

7

2,177,061

0

2,177,061

2,177,061

7,525,734

7,525,734

8

2,154,889

0

2,154,889

2,154,889

9,680,623

9,680,623

9

2,133,369

0

2,133,369

2,133,369

11,813,993

11,813,993

10

2,112,407

0

2,112,407

2,112,407

13,926,400

13,926,400

11

2,091,940

0

2,091,940

2,091,940

16,018,339

16,018,339

12

2,071,898

0

2,071,898

2,071,898

18,090,237

18,090,237

13

2,052,244

0

2,052,244

2,052,244

20,142,481

20,142,481

14

2,032,954

0

2,032,954

2,032,954

22,175,435

22,175,435

15

2,013,983

0

2,013,983

2,013,983

24,189,418

24,189,418

16

1,995,316

0

1,995,316

1,995,316

26,184,734

26,184,734

17

1,976,938

0

1,976,938

1,976,938

28,161,672

28,161,672

18

1,958,821

0

1,958,821

1,958,821

30,120,493

30,120,493

19

1,940,961

0

1,940,961

1,940,961

32,061,454

32,061,454

20

1,923,346

0

1,923,346

1,923,346

33,984,801

33,984,801

21

1,905,963

0

1,905,963

1,905,963

35,890,763

35,890,763

22

1,888,806

0

1,888,806

1,888,806

37,779,570

37,779,570

23

1,540,700

0

1,540,700

1,540,700

39,320,270

39,320,270

24

1,071,499

0

1,071,499

1,071,499

40,391,769

40,391,769

25

311,032

0

311,032

311,032

40,702,801

40,702,801

Total

40,702,801

0

40,702,801

40,702,801

40,702,801

40,702,801

Projected Greenhouse Gas Benefits by Project Site

(Tonnes, Full Molecular Weight Basis)

Site Number: 2 of 2

Sector(s): Land-use change and forestry

Project Activity(ies): Forest preservation, pasture preservation

Please specify: Year 1 = January 1998 to December 1998

Reference Scenario Emissions

Project Scenario Emissions

Net GHG Benefits

(Reference Scenario - Project Scenario)

Cumulative GHG Benefits

(Reference Scenario - Project Scenario)

Year

CO₂

CH₄

N₂O

CO₂

CH₄

N₂O

CO₂

CH₄

N₂O

CO₂-

Equivalent

CO₂

CH₄

N₂O

CO₂-

Equivalent

1

0

0

0

0

0

0

0

2

0

-335,731

-91,563

335,731

335,731

335,731

335,731

3

0

-535,352

-146,005

535,352

535,352

871,083

871,083

4

0

-781,198

-213,054

781,198

781,198

1,652,281

1,652,281

5

0

-1,093,099

-298,118

1,093,099

1,093,099

2,745,380

2,745,380

6

0

-1,333,761

-363,753

1,333,761

1,333,761

4,079,141

4,079,141

7

0

-1,333,761

-363,753

1,333,761

1,333,761

5,412,902

5,412,902

8

0

-1,333,754

-363,751

1,333,754

1,333,754

6,746,656

6,746,656

9

0

-1,333,537

-363,692

1,333,537

1,333,537

8,080,193

8,080,193

10

0

-1,333,497

-363,681

1,333,497

1,333,497

9,413,690

9,413,690

11

0

-1,175,339

-320,547

1,175,339

1,175,339

10,589,029

10,589,029

12

0

-1,017,867

-277,600

1,017,867

1,017,867

11,606,896

11,606,896

13

0

-907,779

-247,576

907,779

907,779

12,514,674

12,514,674

14

0

-776,406

-211,747

776,406

776,406

13,291,080

13,291,080

15

0

-604,197

-164,781

604,197

604,197

13,895,277

13,895,277

16

0

-507,492

-138,407

507,492

507,492

14,402,769

14,402,769

17

0

-440,664

-120,181

440,664

440,664

14,843,433

14,843,433

18

0

-407,271

-111,074

407,271

407,271

15,250,704

15,250,704

19

0

-379,760

-103,571

379,760

379,760

15,630,465

15,630,465

20

0

-351,648

-95,904

351,648

351,648

15,982,113

15,982,113

21

0

-311,949

-85,077

311,949

311,949

16,294,062

16,294,062

22

0

-217,921

-59,433

217,921

217,921

16,511,983

16,511,983

23

0

-150,986

-41,178

150,986

150,986

16,662,969

16,662,969

24

0

-90,141

-24,584

90,141

90,141

16,753,110

16,753,110

25

0

-11,359

-3,098

11,359

11,359

16,764,469

16,764,469

Total

0

-16,764,469

-4,572,128

16,764,469

16,764,469

16,764,469

16,764,469

Projected Net Greenhouse Gas Benefits: All Project Sites

(Tonnes, Full Molecular Weight Basis)

Please specify: Year 1 = January 1998 to December 1998

Reference Scenario Emissions

Project Scenario Emissions

Net GHG Benefits

(Reference Scenario - Project Scenario)

Cumulative GHG Benefits

(Reference Scenario - Project Scenario)

Year

CO₂

CH₄

N₂O

CO₂

CH₄

N₂O

CO₂

CH₄

N₂O

CO₂-

Equivalent

CO₂

CH₄

N₂O

CO₂-

Equivalent

1

0

0

0

0

0

0

2

0

-335,731

335,731

335,731

335,731

335,731

3

385,532

-535,352

920,883

920,883

1,256,614

1,256,614

4

937,838

-781,198

1,719,036

1,719,036

2,975,650

2,975,650

5

1,825,333

-1,093,099

2,918,432

2,918,432

5,894,082

5,894,082

6

2,199,971

-1,333,761

3,533,732

3,533,732

9,427,814

9,427,814

7

2,177,061

-1,333,761

3,510,822

3,510,822

12,938,636

12,938,636

8

2,154,889

-1,333,754

3,488,643

3,488,643

16,427,279

16,427,279

9

2,133,369

-1,333,537

3,466,907

3,466,907

19,894,186

19,894,186

10

2,112,407

-1,333,497

3,445,904

3,445,904

23,340,090

23,340,090

11

2,091,940

-1,175,339

3,267,279

3,267,279

26,607,368

26,607,368

12

2,071,898

-1,017,867

3,089,764

3,089,764

29,697,133

29,697,133

13

2,052,244

-907,779

2,960,023

2,960,023

32,657,156

32,657,156

14

2,032,954

-776,406

2,809,360

2,809,360

35,466,515

35,466,515

15

2,013,983

-604,197

2,618,180

2,618,180

38,084,695

38,084,695

16

1,995,316

-507,492

2,502,808

2,502,808

40,587,503

40,587,503

17

1,976,938

-440,664

2,417,602

2,417,602

43,005,105

43,005,105

18

1,958,821

-407,271

2,366,093

2,366,093

45,371,198

45,371,198

19

1,940,961

-379,760

2,320,721

2,320,721

47,691,919

47,691,919

20

1,923,346

-351,648

2,274,994

2,274,994

49,966,913

49,966,913

21

1,905,963

-311,949

2,217,912

2,217,912

52,184,825

52,184,825

22

1,888,806

-217,921

2,106,727

2,106,727

54,291,552

54,291,552

23

1,540,700

-150,986

1,691,686

1,691,686

55,983,239

55,983,239

24

1,071,499

-90,141

1,161,640

1,161,640

57,144,879

57,144,879

25

311,032

-11,359

322,392

322,392

57,467,271

57,467,271

Total

40,702,801

-16,764,469

57,467,271

57,467,271

57,467,271

57,467,271

Indirect or Secondary GHG Impacts (Positive and Negative)

In the proposal, the project developer acknowledges the potential for this project to result in some displacement of the deforestation described in the reference scenario from the project area to other areas. To help prevent this displacement, the project is being implemented in conjunction with another national land-use initiative: the Private Forestry Project (PFP). The PFP will provide payments to private landowners in the "buffer areas" around the National Parks and Biological Reserves in return for the performance of environmental services such as GHG mitigation, watershed protection, biodiversity protection, and protection of their land’s aesthetic or recreational value. The PFP therefore offers incentives for private landowners to prevent the deforestation of their land.

Factors That Could Cause the Future Loss or Reversal of GHG Benefits

The project’s GHG benefits potentially could be lost or reversed if the consolidated land is not adequately protected against deforestation, poaching, and/or colonization by squatters, both throughout the project lifetime and after the project has ended.

Strategy for Reducing the Risk of Future Loss or Reversal of GHG Benefits

To ensure against the loss of GHG benefits during the project lifetime, the government of Costa Rica is providing a guarantee that the GHG benefits represented by each CTO will be achieved. If monitoring or third party verification reveal that the projected GHG benefits represented by a CTO are not achieved, the government will guarantee the provision of replacement offsets for the remaining life of the CTO. An excess pool of GHG offsets, as determined by SGS Forestry, will be maintained by the project developers for this purpose.

The registration of the project land as part of the Forest Patrimony of the State should guarantee its status as a Protected Wildlife Area "in perpetuity." A portion of the revenue generated by the sale of CTOs will be used to establish a trust fund for the administration and protection of project land.

Funding Source

Country of Funding Source

Amount ($US)

Percent of Total Funding (%)

Is This Funding Assured? (Y/N)

Earth Council Foundation (both US and Costa Rica)

Costa Rican National Parks Foundation

Costa Rica, U.S.A.

Costa Rica

376,241

0.24

Y

Sale of CTOs

Multilateral

156,728,922

99.76

N

Total

157,105,163

100.00

Current or Planned Activities to Obtain Additional Funding

As discussed in Section A.6.a. of this report, the funding for implementing the later stages of the project will be obtained by the sale of CTOs generated by the earlier stages of the project. Centre Financial Products Ltd. will serve as the broker for the sale of CTO bonds equivalent to the first 15 million tonnes of CO₂ (4 million tonnes of carbon) benefits produced by the project.

If the initial contribution provided by the Earth Council Foundation and the Costa Rican National Parks Foundation is not sufficient to generate 4 million tonnes of carbon benefits, then MINAE will work with the Earth Council Foundation and the Costa Rican National Parks Foundation to revise the amount of this contribution so that the generation of 4 million tonnes of carbon will be guaranteed. If these three parties cannot agree on the amount of the contribution, then the contract between these parties will be terminated.

Contribution to Capacity Building and Technology Transfer

One of the tenets of Costa Rica’s official commitment to sustainable development is exploring the use of market-oriented initiatives to mitigate climate change. The designation of CTOs as market instruments designed to attract foreign investments for carbon mitigation is a cornerstone of this approach. This project, which is fully banked on CTO revenues, is consistent with the legal and institutional frameworks for Costa Rica’s market approach to driving sustainable development.

Recent Project Developments

SGS Forestry certified that the Protected Area Project meets the requirements of the SGS Forestry Carbon Offset Verification Service. SGS Forestry also certified that the consolidation activities undertaken during the project’s first year are projected to generate carbon benefits totaling 1,655,352 tonnes of carbon over a 20-year period starting in April 1998. Of these carbon benefits, 1,003,375 tonnes are considered implementation risk free, and the remaining 651,977 have been placed in a buffer to guard against potential loss of CTOs in the future. These carbon benefits will be verified through annual monitoring.

Technical Difficulties and Other Obstacles Encountered

This information is not yet available.

Additional Information

None.

Country/Project Title

Name, Title, and Government Agency of the Designated National Authority

Date of Approval (day/month/year)

Territorial and Financial Consolidation of Costa Rican National Parks and Biological Reserves

Marco Antonio González, Vice Minister, Ministry of Environment and Energy (MINAE)

28 February 1997