USAID supports modeling of deforestation in Mindanao to launch carbon offset project

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June 15, 2021 (BANGKOK) –  The United States Agency for International Development (USAID) Green Invest Asia project supported Kennemer Eco Solutions (KenEco) to complete a spatial analysis of deforestation in the southern Philippines’ island of Mindanao, which assessed past and future deforestation drivers, as part of KenEco’s plan to create a forest restoration and protection program compliant with the Verified Carbon Standard (VCS) program.

The global carbon market has expanded more than five-fold since 2017, reaching a record high of $272 billion in 2020, according to the financial analysis company, Refinitiv. The market for carbon offsets is expected to become a lot bigger as companies and countries set ambitious goals for net-zero carbon emissions.

KenEco is developing a carbon fund – a vehicle to calculate, reduce and offset carbon footprints – that integrates climate finance into the business model of its parent company, the Philippine agribusiness Kennemer Foods International.  Once projects are developed and certified against rules of the Verified Carbon Standard, the world’s most widely used voluntary carbon offset program, interested companies can purchase tradable greenhouse gas credits called Verified Carbon Units (VCUs).  Those VCUs can then be sold on the open market and “retired,” or used by individuals and companies to offset their own emissions. The first step to participating in this global carbon finance market is conducting a baseline carbon stock analysis of a proposed project site.

“USAID’s support for the data-gathering and modelling training are concrete steps to scale up restoration and conservation  to landscape level, but also puts us one step closer to joining the global carbon market- a new business line for us,” said KenEco’s co-founder, Florian Reimer. “We are expanding from our focus on the farm to explore nature-based solutions like restoration and conservation. It’s good for the land. It’s good for forest communities who benefit from a forest-positive future.”

Over the next decade, KenEco’s Rural Transformation program aims to establish 14,000 hectares of new cacao agroforestry plots, restore 4,500 hectares of natural forest areas, and  protect remaining forests on more than 200,000 hectares.

Remote Sensing Solutions (RSS) was selected to provide KenEco estimated baseline carbon stock changes and greenhouse gas emissions from unplanned deforestation and wetland degradation for nearly the entire island of Mindanao. The study examined drivers of deforestation, mapped  historic deforestation, and estimated future locations of probable deforestation using geographic socio-ecological data and historical deforestation derived from satellite data.

“Through combining the latest Earth Observation systems, highly automated IT and processing capacities with VCS-conform geospatial modelling, we supported KenEco’s endeavor in this forest restoration and protection program,” said Jonas Franke, Managing Director of RSS. “Innovative big satellite data analysis provided data-driven evidence of the potential impact such a VCS-project can have in Mindanao.”

The analyses are helping KenEco to identify potential project areas including indigenous communities with Certificates of Ancestral Domain Title that have agreed to be part of the carbon accreditation program. With the baseline study, KenEco will now proceed with project design. The study must be renewed every decade after the start of the project, or 2030 next.

“We are pleased to support this innovative business model for an agribusiness like Kennemer to incorporate climate finance into their operations as we recognize the importance of the carbon market to incentivize reduction of GHG emissions. We hope KenEco can serve as a model to other businesses in the region so they can support climate action on a larger scale,” said Christy Owen, head of USAID Green Invest Asia.

USAID Green Invest Asia is a technical services project that provides technical and business advisory to established agribusiness, forestry and other land use companies in Southeast Asia, as well as to financial institutions, to help them mitigate risks and capitalize on investment opportunities that result in lowering greenhouse gas emissions from land use change.




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