Joanneum Research

The “corridor approach” submitted by Joanneum Research, Joanneum Research, UCS, WHRC, IPAM proposes the use of corridors - a range between upper and lower reference levels - to address issues of inter-annual variability in levels of deforestation. Countries would establish, through negotiation or otherwise, an upper and lower reference level for emissions, based on emissions over an agreed historical period.

If a country brings its emissions below the lower reference level, credits are generated. There are two ways to address emissions above and within the corridor. In variant 1 if a country’s emissions rise above the upper reference level, then a debit against future credit is initiated, as in the Brazilian proposal. For emissions within the corridor, credits could accrue but not be eligible for redemption or sale until emissions fall below the lower boundary. In variant 2 no debits accrue for emissions above the upper reference level. Emissions within the corridor would be discounted; credits per ton of emissions would increase from 0 at the upper reference level to 1 at the lower reference level.

The advantage of banking credits in variant 1 is that it avoids the potentially difficult negotiation of specific discount levels, as well as the possible perception that reductions within the corridor are second-rate. The advantage of discounting credits in variant 2 is that it would provide an earlier and potentially steadier financial incentive, as opposed to the time lag imposed by banking the credits until the lower reference level is reached.