Norway–Indonesia REDD+ partnership: the 2010 Letter of Intent, payments made and Indonesia's 2021 termination
- Government and regulators Government of Indonesia: Indonesia had met all requirements for payment for a 2016/2017 reduction of 11.2 million tonnes CO2e that an international organisation verified; the payment "hasn't been made by Norway". Mongabay
- Government and regulators Government of Norway: Talks on a legal agreement for the transfer were ongoing and constructive; Norway praised Indonesia as a world leader in combating tropical deforestation. Mongabay
- Press and investigations Development Today, via REDD-Monitor: Indonesia's 2016/2017 figures excluded peatland emissions; if they had been counted there might be no basis for payment at all. REDD-Monitor
- Press and investigations Mongabay (2020): Indonesia's own initial estimate was 4.8 million tonnes CO2e without peat fire emissions; Norway factored them in during verification to reach 11.23 million. Mongabay
- Government and regulators Ministry of Environment and Forestry (Ruandha Agung Sugardiman): Credited ministry policies with significant results in cutting deforestation. REDD-Monitor
- Communities and civil society Rainforest Foundation Norway (Øyvind Eggen): Credited transparency in forest-industry licensing and monitoring; said forest-conversion licences routinely destroy primary rainforest. Mongabay
- Researchers Arief Wijaya, World Resources Institute: Falling and fluctuating palm oil prices and COVID-19 also slowed industry and likely affected deforestation. REDD-Monitor
- Researchers Groom, Palmer and Sileci (PNAS, 2022): The moratorium gave a modest dryland effect and no peatland effect, a 3 to 4% annual contribution to Indonesia's NDC commitment. Proceedings of the National Academy of Sciences
In a Letter of Intent signed on 26 May 2010, Norway agreed to pay Indonesia up to US$1 billion based on its performance in cutting greenhouse gas emissions from deforestation and forest degradation. Norway agreed a first results-based payment of NOK 530 million (about US$56 million) for 2016–2017 results, Indonesia reported that nothing had been transferred when it ended the Letter of Intent effective 10 September 2021, and a US$56 million contribution agreement followed in October 2022.
As stated by Mongabay and REDD-Monitor; the payment is conditional on results. Norad's 2017 table lists the pledge as NOK 6,000,000,000 at US$1 = NOK 6.00 and NOK 1,294,690,398 disbursed to the end of 2016.
Status As of October 2022: Indonesia ended the 2010 Letter of Intent in September 2021; a US$56 million results-based contribution agreement with Norway was reported on 21 October 2022; no source reviewed reports payments after that date.
- Indonesia — Received Norwegian disbursements to the end of 2016 (NOK 1,294,690,398 per Norad); no results-based payment transferred by September 2021 according to its deputy minister Norad Evaluation Department
- Indonesia — Its government said the agreed payment had not been made and gave this as a reason for ending the Letter of Intent Mongabay
- Indonesian peatland forests — The PNAS study found the moratorium had no effect on carbon-rich peatland forest in 2011–2018 Proceedings of the National Academy of Sciences
What happened
Norway and Indonesia signed a Letter of Intent (LoI) on 26 May 2010 on cooperation to reduce greenhouse gas emissions from deforestation and forest degradation. Indonesia's Ministry of Environment and Forestry wrote in 2019 that "In general, the Government of Kingdom of Norway will provide payment to Government of Indonesia, based on the performance of reducing green house gas emissions from deforestation and forest degradation." Mongabay and REDD-Monitor reported that Norway agreed to pay up to US$1 billion. The ministry's 2019 report places results-based payment in the third phase of the LoI and records an MRV protocol agreed at a final meeting on 7 February 2019, with set-asides of 20% of reported reductions for uncertainty, 0% for leakage and 15% to reflect Indonesia's ambition. Norad's 2017 synthesis table lists the pledge as NOK 6,000,000,000, calculated at US$1 = NOK 6.00, and NOK 1,294,690,398 disbursed to the end of 2016.
Norway agreed a first results-based payment of NOK 530 million, reported as about US$56 million, for a reduction of 11.23 million tonnes of CO2e in 2016–2017. Mongabay (2021) and Eco-Business dated the agreement to 2019; Mongabay reported in May 2020 that Norway's ambassador announced the payment, that Indonesia's own initial estimate had been 4.8 million tonnes and that peat fire emissions were factored in during verification to reach 11.23 million. REDD-Monitor, citing Development Today, wrote that Indonesia's 2016/2017 figures excluded peatland emissions and that if they had been counted "there might be no basis for payment at all." The money was to go through the Indonesian Environment Fund (BPDLH), launched in October 2019, and Mongabay reported that disbursement would wait until the fund was operational.
On 10 September 2021 Indonesia's Ministry of Foreign Affairs ended the LoI by Note Verbale under Article XIII, citing "the lack of concrete progress" on Norway's obligation to pay for the 2016/2017 reduction and pointing to the lowest deforestation rate in 20 years. Indonesia's Deputy Environment and Forestry Minister said Indonesia had met all requirements and "What I know is that [the payment] hasn't been made by Norway." Norway's NICFI said discussions on a legal agreement to transfer the payment to the Indonesian Environment Fund were ongoing and, "in Norway's view constructive and progressing well", called Indonesia "a world leader in combatting tropical deforestation" and said it stood ready to continue support. The Jakarta Post reported on 21 October 2022 that Norway and Indonesia had signed a contribution agreement, following a memorandum of understanding agreed in September 2022, under which Norway would deliver a first results-based contribution of US$56 million to support Indonesia's Forest and Land Use Net Sink 2030 operational plan through BPDLH.
Independent assessments cover the programme's design and one of its policy elements. Norad's Evaluation Department synthesis report 8/2017 (written by AECOM) found that where REDD+ had been integrated into national policy the role of Norwegian funding "has mainly been supportive of existing political commitments to reducing deforestation and forest degradation rates (Brazil or Indonesia) rather than acting as a 'game changer'." A peer-reviewed study in PNAS (Groom, Palmer and Sileci, 2022) evaluated Indonesia's moratorium on forest concessions over 2011–2018 and found that inside the moratorium areas dryland forest kept at most about 0.65% more forest cover than comparable areas, that carbon-rich peatland forest was unaffected, and that the avoided dryland deforestation implied an effective carbon price below Norway's US$5 per tonne. Mongabay's 2020 report added that deforestation remained above Indonesia's climate commitment ceilings according to the NGO Madani, and that a WWF Germany study found Indonesia lost over 130,000 hectares of forest in the first three months of 2020.
- 2010Letter of Intent signed (26 May); Norway agrees to pay up to US$1 billion on performance
- 2011Start of the 2011–2018 period analysed in the PNAS study of Indonesia's moratorium on forest concessions
- 2015President Widodo disbands BP REDD+ and moves its duties to the Ministry of Environment and Forestry; severe fires slow progress (Mongabay)
- 2016Norad table: NOK 1,294,690,398 disbursed to the end of 2016 against a pledge of NOK 6,000,000,000
- 2019MRV protocol agreed (7 February); Indonesia's ministry issues its emission reduction report (May); Norway agrees a first results-based payment of NOK 530 million for 2016/2017 results
- 202027 May: Norway's ambassador announces the payment at a virtual press conference; funds to go through BPDLH
- 202110 September: Indonesia ends the LoI by Note Verbale, saying no payment has been made; Norway says talks are constructive
- 2022PNAS study of the moratorium published (24 January); MoU agreed in September and contribution agreement for US$56 million reported 21 October
What was said
“In general, the Government of Kingdom of Norway will provide payment to Government of Indonesia, based on the performance of reducing green house gas emissions from deforestation and forest degradation.”
“the lack of concrete progress”
“What I know is that [the payment] hasn't been made by Norway.”
“in Norway's view constructive and progressing well”
“a world leader in combatting tropical deforestation”
“have started to bear fruit”
“there might be no basis for payment at all”
“carbon-rich peatland forest was unaffected by the moratorium”
Where accounts differ
Each party's account, side by side, with its source. The record does not settle these points; it shows them.
Indonesia had met all requirements for payment for a 2016/2017 reduction of 11.2 million tonnes CO2e that an international organisation verified; the payment "hasn't been made by Norway".
MongabayTalks on a legal agreement for the transfer were ongoing and constructive; Norway praised Indonesia as a world leader in combating tropical deforestation.
MongabayIndonesia's 2016/2017 figures excluded peatland emissions; if they had been counted there might be no basis for payment at all.
REDD-MonitorIndonesia's own initial estimate was 4.8 million tonnes CO2e without peat fire emissions; Norway factored them in during verification to reach 11.23 million.
MongabayCredited ministry policies with significant results in cutting deforestation.
REDD-MonitorCredited transparency in forest-industry licensing and monitoring; said forest-conversion licences routinely destroy primary rainforest.
MongabayFalling and fluctuating palm oil prices and COVID-19 also slowed industry and likely affected deforestation.
REDD-MonitorThe moratorium gave a modest dryland effect and no peatland effect, a 3 to 4% annual contribution to Indonesia's NDC commitment.
Proceedings of the National Academy of SciencesHow it looked
Shown
- The payment presented as the first results-based payment under the REDD+ partnership, for 11.23 million tonnes CO2e of avoided emissions in 2017.Norway, as reported by Mongabay · Mongabay
- Indonesia presented the termination as unrelated to its climate commitments, pointing to the lowest deforestation rate in 20 years and fewer forest fires.Indonesia's Ministry of Foreign Affairs · REDD-Monitor
- The October 2022 contribution described as supporting the FOLU Net Sink 2030 operational plan.Minister of Environment and Forestry Siti Nurbaya, as quoted by the Jakarta Post · The Jakarta Post
Recorded
- No results-based payment under the LoI had been transferred when Indonesia ended it on 10 September 2021, according to Indonesia's deputy environment minister and the sources reviewed; Norway said transfer talks were continuing.
- Norad's 2017 table records NOK 6,000,000,000 pledged and NOK 1,294,690,398 disbursed to the end of 2016 for Indonesia.
- The PNAS study found dryland forest inside the moratorium areas retained at most about 0.65% more cover and no effect on peatland forest, 2011–2018.
- A US$56 million results-based contribution agreement with BPDLH was reported on 21 October 2022.
In nature's name
Promised
- “In general, the Government of Kingdom of Norway will provide payment to Government of Indonesia, based on the performance of reducing green house gas emissions from deforestation and forest degradation.” — Indonesia's Ministry of Environment and Forestry, describing the Letter of Intent (May 2019) Ministry of Environment and Forestry, Republic of Indonesia
- “stand[s] ready to continue supporting” — Norway's International Climate and Forest Initiative, on Indonesia's efforts (10 September 2021) Mongabay
Money moved in nature's name
| What | Kind | Amount | Period |
|---|---|---|---|
| Norway's commitment under the 2010 Letter of Intent Government of Norway Mongabay | Pledged | $1bn | 2010–2021 |
| Norway's pledge as tabled by Norad Government of Norway Norad Evaluation Department | Pledged | 6bn NOK | 2010–2016 |
| Norway's disbursements to Indonesia to the end of 2016 Government of Norway Norad Evaluation Department | Paid out | 1.3bn NOK | to end of 2016 |
| First results-based payment agreed for 2016/2017 results Government of Norway Mongabay | Pledged | 530m NOK | 2019 |
| First results-based contribution under the October 2022 agreement Government of Norway The Jakarta Post | Pledged | $56m | 2022 |
What was measured
A peer-reviewed study in PNAS (2022) found a benefit of the moratorium on forest concessions in dryland forest (at most about 0.65% more forest cover, 2011–2018) and none in peatland forest; the authors are university researchers and declare no competing interests. Whether Indonesia's 2016/2017 emission reduction of 11.23 million tCO2e, the basis of the payment, was correctly measured is disputed between sources. Indonesia's own emission reduction report is the programme's own figure, not an independent measurement.
Operation Ended · Indonesia ended the Letter of Intent effective 10 September 2021; a new contribution agreement was reported in October 2022. Mongabay
Findings on record
- Peer-reviewed study Groom, Palmer and Sileci, PNAS (2022-01-24) · Carbon emissions reductions from Indonesia's moratorium on forest concessions are cost-effective yet contribute little to Paris pledges: “carbon-rich peatland forest was unaffected by the moratorium” Proceedings of the National Academy of Sciences
- Official audit Norad Evaluation Department (AECOM), synthesis report 8/2017 (2017-10) · Norway's International Climate and Forest Initiative: Lessons learned and recommendations: “has mainly been supportive of existing political commitments to reducing deforestation and forest degradation rates (Brazil or Indonesia)” Norad Evaluation Department
Who gained
Reached nature or the ground
Gained elsewhere
Responses on record
- Government of Indonesia (10 September 2021): The foreign ministry cited "the lack of concrete progress" on Norway's payment obligation for 11.2 million tonnes of CO2e in 2016/2017 and said the termination did not affect its climate commitments; the deputy environment minister said Indonesia had "not received a single cent". · REDD-Monitor
- Government of Norway (10 September 2021): NICFI said discussions on a legal agreement for the transfer were ongoing and, "in Norway's view constructive and progressing well", praised Indonesia's deforestation reductions and said Norway stood ready to continue supporting Indonesia's forest and peatland efforts. · Mongabay
- Indonesian Environment Fund Management Agency (BPDLH) (October 2022): Its president director signed the 2022 contribution agreement with Norway's ambassador, according to the Jakarta Post. · The Jakarta Post
In court and with insurers
Lawsuits and rulings
Insurers
What nature saw
Nature's report opens this page. Below: further outcomes measured on the ground.
What we don't know
Nature
- Not measured Harm to nature: The record holds no measurement of harm to nature.
- Disputed Whether Indonesia earned the 2016/2017 payment
- Disputed Why deforestation fell
Record
- Disputed Disputed: whether peat emissions were counted in the 2016/2017 reduction. Mongabay (2020) reported that peat fire emissions were factored in by Norway during verification to reach 11.23 million tonnes; REDD-Monitor (2021), citing Development Today, wrote that Indonesia's 2016/2017 figures excluded peatland emissions.
- Disputed Disputed: when the payment was agreed. Mongabay (2021) and Eco-Business date the agreement to 2019; Mongabay (2020) reports the announcement at a press conference on 27 May 2020.
- None on record None on record: the total Norway disbursed to Indonesia between 2010 and 2021 under the LoI; the sources reviewed give only the Norad figure to the end of 2016 (NOK 1,294,690,398), which does not say how much was results-based.
- None on record None on record: Norway's own published reasons for the delay beyond the NICFI statement that talks on a legal agreement were continuing.
- None on record None on record: the verifier of the 11.2 million tonne reduction; Indonesia's foreign ministry said an international organisation verified it, and Mongabay said Norway's government verified it.
- Not measured Not measured: the effect of the 2022 contribution agreement on forest or emissions; the sources reviewed end at its signing.
- Insufficient Insufficient: a measurement of the Letter of Intent's other elements (institution building, safeguards); the PNAS study covers the moratorium only.
Did the harm stop?
The sources reviewed do not report that harm stopped. Mongabay (2020) cited a WWF Germany finding of over 130,000 ha of forest lost in Indonesia in the first three months of 2020, and Madani's statement that deforestation remained above Indonesia's climate commitment ceilings.
Who paid?
Norway paid NOK 1,294,690,398 to the end of 2016 under the partnership (Norad table); the first results-based payment of NOK 530 million agreed for 2016/2017 results had not been transferred by September 2021 according to Indonesia; a US$56 million contribution agreement was reported in October 2022.
Sources
Government and regulators
- Emission Reduction Report for the Indonesia-Norway PartnershipMinistry of Environment and Forestry, Republic of Indonesia · 2019-05
- Norway's International Climate and Forest Initiative: Lessons learned and recommendations, Evaluation Synthesis Report 8/2017 (AECOM, for Norad)Norad Evaluation Department · 2017-10
Press and investigations
- Indonesia terminates agreement with Norway on $1b REDD+ schemeMongabay · 2021-09
- Indonesia aborts agreement with Norway on US$1b REDD+ schemeEco-Business · 2021-09-13
- Indonesia to get first REDD+ payment from NorwayMongabay · 2020-05
- Norway to provide $56m to support Indonesia's carbon sink goalThe Jakarta Post · 2022-10-21
Communities and civil society
- Indonesia scraps US$1 billion REDD deal with NorwayREDD-Monitor · 2021-09
Researchers
- Carbon emissions reductions from Indonesia's moratorium on forest concessions are cost-effective yet contribute little to Paris pledges (Groom, Palmer, Sileci), PNAS 119(5):e2102613119Proceedings of the National Academy of Sciences · 2022-01-24 · Archived copy
Connected cases
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