12 Innovative Financing for Peatland Restoration in Indonesia
249
mainly because there is no other alternative value for the peatlands other than being
utilized as farmlands (MOEF 2018a, b).
Emissions of climate change-inducing greenhouse gases are especially of big
concern. Under the 2015 Paris Agreement of the United Nations Framework Convention on Climate Change (UNFCCC), Indonesia has committed itself to an unconditional emission reduction of 26 and 29% from its business as usual trajectories by
2020 and 2030, respectively, and 41% reduction is fledged when overseas financial
assistance is made available in those years. Of the unconditional target, almost 90
and 60% of the emission reductions in 2020 and 2030, respectively, will come from
the reduction of deforestation and degradation of forests and peatlands. Peatlands
contain rich carbon concentration (e.g. Jaenicke et al. 2010). They contain about onethird of about 550 G t C of the world’s land-based carbon stocks (Murdiyarso et al.
2017a, b; Parish et al. 2007). Indonesia’s peatlands may contain between 28.1 G t C
(Warren et al. 2017) and 33.6 G t C (Suryadiputra et al. 2018).
The 2015 catastrophic forest and peatland fires put Indonesia as the fourth largest
greenhouse gas emitting country (1.62 G t C) (Harris et al. 2015a). In a number of
days of the fire period, Indonesia’s daily emissions were even larger than those in
the United States (Harris et al. 2015b). The local impacts of peat degradation are
also significant. The World Bank estimates that the 2015 forest fires burned around
2.6 Mha of Indonesia’s forests, costing the country more than US$16 billion (World
Bank 2016). The 1998–1999 fires were estimated to cost the country approximately
US$8.5 billion (Tacconi 2003).
In the meantime, avoiding emissions from restoring degraded peatlands has
become a strategic action to reduce emissions in Indonesia. In Indonesia’s NDC,
the forestry sector contributes 17 out of 29% of the unconditional emission reduction commitment below its BAU trajectory by 2030, or 23% out of the conditional
commitments. Emissions from peat may increase by almost 13% due to decomposition and 30% due to fires by 2030, compared with 253.6 and 307 M t CO 2 in 2010
(e.g. GoI 2016a).
To address peatland degradation and its resulting emissions, hence, newly elected
President of the Republic of Indonesia, Joko Widodo, issued Presidential Regulation
No. 1 of 2016 concerning the establishment of Badan Restorasi Gambut (Peatland
Restoration Agency). This ad hoc governmental agency is tasked to coordinate and
facilitate the implementation of peatland restoration activities in seven provinces,
namely Riau, South Sumatra, Jambi, West Kalimantan, Central Kalimantan, South
Kalimantan, and Papua, with total area targeted of 2.0 Mha during the period of
2016–2020 (Peatland Restoration Agency 2016). However, having re-examined and
synchronized the maps on fire burnt area, artificial drainage networks, concessions
permit areas, and conservation as well as remaining pristine peat forest cover areas
(see Table 12.1), BRG came up with even bigger peatland restoration target (almost
2.5 Mha) in the seven provinces. Additionally, four districts (kabupatens) consist of
Pulang Pisau in Central Kalimantan, Musi Banyuasin and Ogan Komering Ilir in
South Sumatera, and Meranti in Riau have explicitly mentioned in the Presidential
Regulation as priority districts of peatlands restoration (e.g. GoI 2016b).
249
mainly because there is no other alternative value for the peatlands other than being
utilized as farmlands (MOEF 2018a, b).
Emissions of climate change-inducing greenhouse gases are especially of big
concern. Under the 2015 Paris Agreement of the United Nations Framework Convention on Climate Change (UNFCCC), Indonesia has committed itself to an unconditional emission reduction of 26 and 29% from its business as usual trajectories by
2020 and 2030, respectively, and 41% reduction is fledged when overseas financial
assistance is made available in those years. Of the unconditional target, almost 90
and 60% of the emission reductions in 2020 and 2030, respectively, will come from
the reduction of deforestation and degradation of forests and peatlands. Peatlands
contain rich carbon concentration (e.g. Jaenicke et al. 2010). They contain about onethird of about 550 G t C of the world’s land-based carbon stocks (Murdiyarso et al.
2017a, b; Parish et al. 2007). Indonesia’s peatlands may contain between 28.1 G t C
(Warren et al. 2017) and 33.6 G t C (Suryadiputra et al. 2018).
The 2015 catastrophic forest and peatland fires put Indonesia as the fourth largest
greenhouse gas emitting country (1.62 G t C) (Harris et al. 2015a). In a number of
days of the fire period, Indonesia’s daily emissions were even larger than those in
the United States (Harris et al. 2015b). The local impacts of peat degradation are
also significant. The World Bank estimates that the 2015 forest fires burned around
2.6 Mha of Indonesia’s forests, costing the country more than US$16 billion (World
Bank 2016). The 1998–1999 fires were estimated to cost the country approximately
US$8.5 billion (Tacconi 2003).
In the meantime, avoiding emissions from restoring degraded peatlands has
become a strategic action to reduce emissions in Indonesia. In Indonesia’s NDC,
the forestry sector contributes 17 out of 29% of the unconditional emission reduction commitment below its BAU trajectory by 2030, or 23% out of the conditional
commitments. Emissions from peat may increase by almost 13% due to decomposition and 30% due to fires by 2030, compared with 253.6 and 307 M t CO 2 in 2010
(e.g. GoI 2016a).
To address peatland degradation and its resulting emissions, hence, newly elected
President of the Republic of Indonesia, Joko Widodo, issued Presidential Regulation
No. 1 of 2016 concerning the establishment of Badan Restorasi Gambut (Peatland
Restoration Agency). This ad hoc governmental agency is tasked to coordinate and
facilitate the implementation of peatland restoration activities in seven provinces,
namely Riau, South Sumatra, Jambi, West Kalimantan, Central Kalimantan, South
Kalimantan, and Papua, with total area targeted of 2.0 Mha during the period of
2016–2020 (Peatland Restoration Agency 2016). However, having re-examined and
synchronized the maps on fire burnt area, artificial drainage networks, concessions
permit areas, and conservation as well as remaining pristine peat forest cover areas
(see Table 12.1), BRG came up with even bigger peatland restoration target (almost
2.5 Mha) in the seven provinces. Additionally, four districts (kabupatens) consist of
Pulang Pisau in Central Kalimantan, Musi Banyuasin and Ogan Komering Ilir in
South Sumatera, and Meranti in Riau have explicitly mentioned in the Presidential
Regulation as priority districts of peatlands restoration (e.g. GoI 2016b).