In 2007, Dorjee Sun was going to save the rainforests, stop climate change and make some money. Five years later, even the most panglossian REDD proponent would have to admit that Sun’s plans are not going too well.
Sun’s company, Carbon Conservation, set up a 770,000 hectare carbon trading project called Ulu Masen, in Aceh with Irwandi Yusuf, then-governor of Aceh and Fauna and Flora International. No carbon credits have been sold from the project and FFI has withdrawn its support. In a recent interview with REDD-Monitor, FFI’s Frank Momberg explained that FFI has “has no relationship at all with Carbon Conservation at this stage”.
Australian journalist Michael Bachelard recently wrote three excellent articles about the progress (or lack of progress) of REDD in Indonesia:
- Credits lost in tangle of Aceh’s forest, Sydney Morning Herald, 9 June 2012.
- Change in Aceh hinders carbon plan, Sydney Morning Herald, 9 June 2012.
- Indonesia’s Forests of Corruption, Sydney Morning Herald, 10 June 2012.
Bachelard travelled to Aceh to research his articles. This REDD-Monitor post focusses on what Bachelard found at the Ulu Masen project.
In 2008, Merrill Lynch promised to invest US$9 million in the Ulu Masen project. “That gave the project a lot more certainty,” Dorjee Sun told Time magazine. “It showed there was appetite from investment banks to buy these credits.” But at a side event at the UN meeting in Poznan in December 2008, Merrill Lynch’s Martin Berg acknowledged that, “It’s highly speculative to get involved.”
Sun now admits that he was over-optimistic about how easy it would be to set up a REDD carbon trade project at Ulu Masen. Sun told Bachelard,
“I did make a lot of promises to him [Irwandi Yusuf]. I painted a picture which, I guess, only a naive 29-year-old can do, which was, ‘Hey, Gov! Trust in this market which is going to happen and you will be paid for this forest protection’.”
Irwandi has become disillusioned by the lack of progress on REDD. In an interview in April 2012, he told The Age,
“The international community think our forest is a free toilet for their carbon. Every day they are saying they want clean air and to protect forests … but they want to inhale our clean air without paying anything.”
No carbon credits have been sold from Ulu Masen (or from any other REDD-type projects in Indonesia). FFI’s Frank Momberg echoes Irwandi’s frustration:
“I find it almost a disgrace that after five years we still have no carbon credit sales from Indonesia on the voluntary market. This is mainly due to massive bureaucratic hindrances. You need lots of recommendations from national and local authorities and if you want to stay clean and do the right thing, well, then you sit and wait.”
Villagers are also frustrated. “REDD? It’s like farting,” one villager in Ulu Masen told Bachelard. “It’s like selling air. It doesn’t make sense.” Anwar Ibrahim is a mukim living at the edge of the Ulu Masen project area. (A mukim is a leader of several villages, part of Aceh’s traditional governance system.) Since 2007, he has taken part in more than 30 meetings about REDD. He told Bachelard that,
“They invite people and then we all go and sleep in the Hermes [Banda Aceh’s only luxury hotel] and, after that, nothing happens … It’s useless. The story of REDD is just a lie.”
Bachelard reports on an area near the village of Kayee Lon, where peat forest has been recently cleared and burned. The clearing is “probably illegal” Bachelard writes. But workers told him that the land is owned by “high-ranking officials” from the police.
Last year, Sun sold half his company to East Asia Minerals, a Canadian goldmining company. East Asia Minerals hoped that their involvement in the Ulu Masen REDD project would help smooth the way for approval of its plans to expand its mining operations in Aceh’s forests. The company aims to convert a 6,000 hectare area of primary mountain forest into an open-pit gold mine.
Irwandi Yusuf is no longer governor of Aceh after losing elections in April 2012. Bachelard reports a spokesman for the new governor, Zaini Abdullah, as saying that “everything to do with Ulu Masen was now under review”.
Bachelard tracked down an Australian businessman, Jeff Carmichael, who has put a “seven-figure sum” of his own money into Ulu Masen. “Political risk” means that he might lose his investment, Carmichael told Bachelard.
“Subject to having a governor that confirms to us that he’s committed to seeing it through, we’re committed to staying with it. If he’s not, it probably comes to a stop. No point putting money into it. We would lose every penny that we’ve put into it, absolutely.”
Dorjee Sun’s solution to this mess is for the Australian government to pick up the tab.
“If Australia could step in and say, ‘Hey, we’re going to buy carbon from REDD, but we’re going to focus on bilateral arrangements’ … that could single-handedly give us a reason why the new governor of Aceh would step up and say … ‘We’re going to have Aceh-ready credits for export in a year’s time.”