Benefitting from Forest Conservation

REDD+ Benefit Sharing Mechanism in Nepal's Community Forest

In partnership with the Federation of Community Forest Users of Nepal (FECOFUN) and the , the International Centre for Integrated Mountain Development (ICIMOD) piloted a pioneering REDD+ project in the community forests of three watersheds in Nepal from 2009 to 2013. The project, supported by the Norwegian government,  explored and tested options for the governance and financial transparency of community-based REDD+ initiatives. It trained local communities and provided them incentives to conserve and enhance local forests by establishing a community-managed Forest Carbon Trust Fund (FCTF). This community based model allowed for REDD+ benefits to reach the poorest and most disadvantaged communities. This is one of the world’s first carbon offset projects that involve local communities in monitoring carbon in their forests. The project therefore offers valuable lessons on how to build the capacity of local stakeholders for implementing carbon offset programmes and reaching poor, forest-dependent households and indigenous people.

Combating the Problem  

Though Community Forest Management (CFM) has been successful in Nepal in rejuvenating degraded forests, more is needed to halt deforestation and forest degradation trends at the national level. According to the FAO Country Report 2005, the annual deforestation rate in Nepal from 1990 to 2005 was -1.63 percent, which is higher than in most other countries. During the same period, shrubland increased by 4.05 percent annually, indicating a conversion of forested land to degraded forests. Nepal’s emission from deforestation and forest degradation rates are the highest amongst non-tropical countries. This project involves the local people in the sustainable management of forests and links incentive mechanisms with livelihood options. It has achieved the following promising outcomes.
The project has built the capacity, awareness, and confidence of local communities, district stakeholders and national civil society organizations through various trainings, orientation, cross visits and workshops. Local communities have gained the capacity for institutionalizing REDD+ activities, including measuring and monitoring forest carbon. They have been able to improve the forest governance system and handle REDD+-related finances in a transparent and effective way. This has helped promote social inclusion and improve livelihoods. A REDD+ Network formed at the watershed level is supporting local people and compiling carbon data from Community Forest User Groups (CFUGs) and reporting to the Project Management Unit (PMU). The carbon data sent by each watershed is reviewed, analysed, and archived on the project webpage <>. An institutional framework and mechanism for REDD+ monitoring, verification, and reporting (MRV) was developed at the sub-national level to ensure that greenhouse gas (GHG) emission reductions under the REDD+ programme are real, measurable and transparent. As part of this project, a Forest Carbon Trust Fund (FCTF) was established in 2011 to institutionalize the REDD+ payment mechanism, and the first carbon payments were disbursed in 2011.
Since the CFUGs received seed grants as carbon payments, communities have been using the funds for local development activities. These carbon fund expenditures made at the community level are ultimately channelled to the households in the form of improved knowledge and skills for forest management, the use of more fuel efficient cooking technologies, employment, incremental income, improved community infrastructures, etc. More than 50 hectares of watershed areas have been planted with 35,700 seedlings selected by the community. A satellite-based forest fire monitoring system is being used to detect forest fires. Community people have constructed forest firebreaks to reduce fire incidents and adopted a rotational grazing system to reduce livestock grazing pressure. These interventions have led to enhanced biomass (an annual average of 3.53 tonnes per hectare) and improved forest status in all three watersheds. 
A total of 616 households have benefited from alternative energy technology (521 improved cook stoves and 94 biogas) co-financed by the project. From 2012 to 2013, carbon emission reduced in the project sites ranged from 216 to 753 tonnes of CO2 equivalent, depending on the different rates estimated by different researchers. Similarly, the carbon saved from the improved cook stove programme ranged from 627 to 2,039 tonnes of CO2 equivalent.
Based on the claim against  carbon stock, three watersheds in pilot districts received a total sum of USD 95,000 under the first-ever Forest Carbon Trust Fund in Nepal. One hundred and five CFUGs in the three watersheds spent the second payment from seed grant on various activities agreed upon by the CFUG, in compliance with FCTF guidelines.
The project has made significant contributions to poverty reduction for target groups, especially Dalits, women and indigenous people. Figures from 2012 show that more than half of the second REDD payment has been spent on livelihood improvement activities (51%), benefiting mostly poor and marginalized households. A considerable amount of money (9%) was spent on capacity building activities that targeted women and marginalized people.
The pilot project has garnered a wealth of knowledge and experiences on REDD+. These lessons have been used to develop a knowledge package on REDD+, which has contributed in the formulation of Nepal’s National REDD Strategy. Many REDD+ projects in the country are modelled on the pilot project and involve the local forest user groups. ICIMOD, ANSAB, and UNIQUE Forestry Germany signed a contract with the World Wide Fund for Nature (WWF) for the assessment of forest carbon stock in the Chitwan Annapurna Landscape (CHAL) for REDD+. In addition, one of the national partners from the pilot project in Nepal, the Federation of Community Forest Users-Nepal, is using the experiences from the field to help shape a national REDD+ policy framework. The Government of Nepal is ready to incorporate key outputs and learning from this project in the National REDD strategy. The other national partner, the Asian Network for Sustainable Agriculture and Bioresources, is using the methodology in other project sites in Nepal and the Philippines. Pakistan began a series of district-level consultations on REDD+ at the end of 2012. ICIMOD is providing guidance to a similar project in Bhutan.


  •  Average annual increment of forest carbon in pilot area is 3.53 tonnes per hectare.
  • The reduced amount of carbon emitted from biogas in the project sites ranges from 216 to 753 tonnes. 
  • 105 Community Forest User Groups of three watersheds received a total sum of USD 95,000 under the Forest Carbon Trust Fund (FCTF)
  • Livelihoods of the poor enhanced
  • Institutional framework strengthened
  • The learning and experiences of the REDD+ project have been scaled up nationally and internationally.


With thanks I would like to acknowledge receipt of two copies of the video ‘REDD+ for Green Communities: Lessons from a pilot project in Nepal’. The video would be of great use for our division as we are also in the initial phase of REDD+ programme in Bhutan.” 

Tsering Gyeltshen, Offtg. Chief, Watershed Management Division, MoAF Bhutan