Cost Benefit Analysis of the Reducing Emissions from Deforestation and Forest Degradation Plus (REDD+) Project in Sebangau National Park, Central Kalimantan, Indonesia
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Institusion
Universitas Padjadjaran
Author
Wiharjo, Kartini Eko
Subject
Datestamp
2021-11-23 00:00:00
Abstract :
This study investigates the costs and benefits of the REDD+ project, which was started in 2009 and will end in 2039, in the Sebangau National Park (SNP) in Central Kalimantan province. Based on the cost benefit analysis (CBA), the possibility of the project to gain benefit over the total cost, as well as the proportion of each cost will be examined. The benefits are estimated from three sources: entrance fee, fire prevention cost, and the revenue from reducing carbon. By using three scenarios based on the price of carbon, the results show that the REDD+ project in SNP would give positive net future value. It reveals that the benefit cost (B/C) ratio is higher than one; so, the benefit of the SNP REDD+ project may exceed its cost. However, these positive findings are based on the assumption that the cost is stable over the term of the REDD+ project. In order to avoid any potential financial failure in the short term, the SNP may still require some financial provisions from both the central and local governments and support from the private sectors including the international non governmental organizations (NGOs). In the long term, the SNP will need support from the local communities to preserve its forests. Overall, this study suggests that the REDD+ project in SNP should proceed regardless of the financial costs and benefits it may reap.
This study investigates the costs and benefits of the REDD+ project, which was started in 2009 and will end in 2039, in the Sebangau National Park (SNP) in Central Kalimantan province. Based on the cost benefit analysis (CBA), the possibility of the project to gain benefit over the total cost, as well as the proportion of each cost will be examined. The benefits are estimated from three sources: entrance fee, fire prevention cost, and the revenue from reducing carbon. By using three scenarios based on the price of carbon, the results show that the REDD+ project in SNP would give positive net future value. It reveals that the benefit cost (B/C) ratio is higher than one; so, the benefit of the SNP REDD+ project may exceed its cost. However, these positive findings are based on the assumption that the cost is stable over the term of the REDD+ project. In order to avoid any potential financial failure in the short term, the SNP may still require some financial provisions from both the central and local governments and support from the private sectors including the international non governmental organizations (NGOs). In the long term, the SNP will need support from the local communities to preserve its forests. Overall, this study suggests that the REDD+ project in SNP should proceed regardless of the financial costs and benefits it may reap.
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