Growing Money With Trees 

Luxembourg-based Althelia Climate Fund has invested $10 million in a Kenyan project that is part of a United Nations scheme to take a market-based approach to curbing destruction of forests in developing nations. The move is the latest sign of growing private sector investment into projects underlying the U.N.’s Reducing Emissions from Deforestation and forest Degradation (REDD) mechanism.

The 30-year project will protect 200,000 hectares of forest in Kenya, generating 1 million carbon credits annually that can be sold to companies looking to voluntarily offset their greenhouse gas emissions.

Deforestation accounts for almost a fifth of the world’s greenhouse gas emissions, blamed by scientists for causing dangerous climate change. Deforestation also impairs the planet’s ability to absorb carbon from the atmosphere.

Althelia was set up last June with backing from a number of funding agencies, including the European Investment Bank, Dutch development bank FMO and development finance company Finnfund. The Taita Hills project, developed and managed by California-based Wildlife Works, is the fund’s first investment.

Althelia Climate Fund is investing in ecosystems conservation and sustainable agroforestry, applying best-in-class social, environmental and governance (ESG) criteria. Returns are generated through the production and sale of real assets (in the form of sustainable agriculture and soft commodities such as certified cocoa and coffee, FSC timber etc.), as well as presently undervalued environmental assets (including carbon emission reductions and other payment for ecosystem services such as biodiversity and water) to several complementary high growth markets. In addition to strong financial returns, the Fund’s investments deliver substantial positive ESG impacts furthering social development, such as gender equity and economic improvement of communities whose livelihoods depend directly and indirectly on natural ecosystems. The Fund implements innovative financial approaches such as performance-based payments and advance market commitments.

All projects supported by the fund must demonstrate consent of the communities involved and have ensured meaningful dialogue, consultation and participation with stakeholders, verified by the application of the EIB Social Assessment Guidance Notes, as well as meeting the REDD+ Social and Environmental Standards. Projects must also comply with IFC Performance Standards (2012), meet Voluntary Carbon Standard (VCS) and Climate, Community and Biodiversity Alliance (CCB) certification standards.

climate change and deforestation

Sacred Seedlings is a global initiative to support forest conservationreforestationurban forestrycarbon capture, sustainable agriculture and wildlife conservation. Sustainable land management is critical to the survival of entire ecosystemsSacred Seedlings is a charitable division of Crossbow Communications.