Institute for Sustainable Development and International Relations (IDDRI) & Centre d'Études et de Recherches sur le Développement International (CERDI)

The “compensated successful efforts” methodology put forward by IDDRI and CERDI aims to bypass methodological issues of baseline estimation used by other proposals.

The authors highlight thematic issues in calculating emissions reductions that rely on an ex-ante estimation or negotiation of a counterfactual value. They suggest that any such methodology could result in the generation of “fake” credits and misallocation of financial resources that would ultimately undermine the efficiency of any future REDD mechanism.

The proposal instead suggests that REDD funds support a country’s domestic policies and measures to avoid deforestation (called “successful efforts”). To identify the effectiveness of these efforts the authors use an econometric model that explicitly takes into account ex-post structural drivers of deforestation, thereby using their real values during the crediting period. Any effects which are not a result of structural drivers are assumed to be a result of domestic action and if positive can be used as criteria to help with further financing decisions.