Kalimantan Forests and Climate Partnership (KFCP) Design ...

8.0 ESTIMATED BUDGET AND STRATEGY FOR SCALING
UP DEMONSTRATION ACTIVITIES
8.1 BUDGETING APPROACH AND ASSUMPTIONS
A summary budget, covering the early implementation phase and FY 10 through 12 of KFCP
implementation is in Attachment 8. The KFCP has a total budget of AUD 30 million, with an
additional AUD 1.4 million for GHG estimation and monitoring funded from the AUD 10 million
package of the IAFCP.
8.2 SCALING UP AND MANAGING CONTRIBUTIONS FROM OTHER
PARTIES
Australia has committed to AUD 30 million over four years to support the KFCP, and aims to raise an
additional AUD 70 million through contributions in cash or in kind from public and private
organisations. The additional contributions would enable completion of the interventions required to
rehabilitate and stabilise the entire area of degraded peatland and protect remaining forest across the
whole peat dome; support readiness in Central Kalimantan; and help sustain emissions reductions well
beyond the period of the demonstration activity.
The total cost of initial on-site interventions is estimated to be AUD 60 million, of which 50% is
covered by the Australian contribution. With additional funds, the KFCP would complete the
rehabilitation of the peat dome in Block A – NW as outlined in Component 1. The additional AUD
40m is required to support readiness activities in Central Kalimantan and the realisation of further
emissions reductions, such as through protecting remaining forest cover in Block E; and supporting
reduced deforestation in other management units as outlined in the Master Plan developed in support
of Inpres 2/2007.
As an alternative to direct financial contributions, activities funded by other donors in parallel to the
KFCP could contribute to the attainment of the project goal and help to capture additional social
development and environmental co-benefits.
Contributions from official donors, private sector companies and NGOs are being sought.
Engagement of such partners would be on the understanding that the KFCP is a demonstration activity
aimed at the compliance market for certified emissions reductions, so that emissions reductions
generated by contributions from the private sector and NGOs would not be eligible for certification as
voluntary carbon credits.
8.3 PRACTICAL ACTION PLAN FOR ENGAGING OTHER FUNDING
PARTNERS
Government of Australia should actively seek additional financial contributions, with potential
funding partners to be identified with assistance from the Partnership Office. Ministerial engagement
in this effort would be highly beneficial, as high-level political contacts are important in securing
commitment for jointly funding activities through respective donors‘ country programmes.
In addition, the Partnership Office should continue to engage with other donors in Indonesia on a
regular basis to explore possibilities for joint funding, contributions in kind and to ensure good
coordination of activities. Materials prepared to explain what additional contributions would be used
for would assist these efforts.
The Partnership Office should also continue to discuss financial support from the Government of
Indonesia, through a contribution from the Reforestation Fund (Dana Rebosasi) or the Gerhan Fund.
An approach to the Government of Indonesia at the ministerial level, to seek support in securing the
engagement of other donors in the KFCP, could also be considered.
56 KALIMANTAN FORESTS AND CLIMATE PARTNERSHIP (KFCP) DESIGN DOCUMENT