Opportunity cost analysis of REDD+ at the district level: can REDD+ promote tropical forest rehabilitation?

Opportunities to reduce emissions from deforestation and forest degradation are substantial if
effective and efficient mechanisms can be established to offset real and legitimate opportunity
costs. The opportunity cost analysis aims to: (1) calculate opportunity cost for reducing
emissions from deforestation and forest degradation at the district level and (2) identify policy
and intervention options using estimated opportunity cost. Transaction and implementation costs
are not yet included in the analysis. The analysis incorporates the results of estimation of land
use, land use change and forestry (LULUCF) carbon emission with the result of profitability
analysis of dominant land uses in Berau district in East Kalimantan, Indonesia. Opportunity cost
of avoiding/reducing emission is estimated by calculating economic gain per ($/ton CO2-eq) unit
CO2-eg emitted. Significant proportion of emission from LULUCF are associated less than $ 5
increases overtime, from 44% in period of 1990-2000 to 59% in the most recent period (2005-
2008). Several polices and interventions options were identified, ie. ranging from reforestation
program, improving food security and law enforcement, and these options can be spatially linked
to Berau landscape. Integrating them into spatial planning process for sustainable development of
Berau should be promoted.