A France-headquartered nature-based project developer is piloting biodiversity credits in a large area in the Peruvian Amazon rainforest to boost funding towards conservation efforts, as it expects the first transactions to happen by the end of the year.

Fronterra is developing the project in the Sierra del Divisor National Park in partnership with the national agency for protected areas, SERNANP, in a bid to implement control and surveillance, monitoring, and research in cooperation with local communities.

Through this initiative, the company will pilot a scheme being developed by France-based Organisation for Biodiversity Certificates (OBC).

The park was declared a protected area back in 2015 during the UN Paris climate summit, and it hosts one of the largest rainforest conservation projects in the world, covering 1.35 million hectares.

Juan Carlos Gonzalez Aybar, Fronterra’s founder and CEO, told Carbon Pulse that the first units will be purchased by French prototype biodiversity fund Restore, launched this year by natural capital entrepreneur Sylvain Goupille.

Gonzalez Aybar said the units have not been designed yet, since the OBC methodology is still being developed, but he expects them to be activity-based.

The price of each unit for the transaction with the Restore fund will be calculated to cover the cost of the project implementation, including the certification costs.

The scheme will involve a third-party verification body to ensure the transparency and clarity of each transaction, he added.

PLANNED ACTIVITIES

Fronterra recently won a public bidding project for the administration of the area for the next 20 years, and is now supporting the national agency for protected areas in the preservation efforts within the park, along with local NGOs Cima, Cedia, and Jardin Botanico de Missouri-Peru.

“Under the project, we will first monitor biodiversity to establish a baseline, and then restore the areas that have been destroyed through assisted natural regeneration and agroforestry, in addition to protection activities and the implementation of sustainable value chains with communities,” said Gonzalez Aybar.

Agroforestry is one of the key aspects of the project, with Fronterra planning to support local communities in cultivating native cocoa plantations under the shade of native trees.

Agroforestry projects have been widely used to generate carbon credits, and now the practice is drawing attention in the biodiversity space, with several researchers piloting biodiversity credit methodologies for agroforestry at smallholder farms in Latin America.

According to recent estimates, the market has the potential to reach a value of $200 million by 2030.

“We will also support the park rangers in their efforts to reduce encroachment and preserve the area from deforestation,” Gonzalez Aybar said.

Since its creation, the Sierra del Divisor National Park has been funded with around $100,000 per year – an amount that, according to Gonzalez Aybar, is insufficient.

“You can’t finance all the initiatives you need to halt deforestation and biodiversity loss with such a poor amount of money,” he said.

“We want to generate biodiversity credits to bridge this gap and mobilise additional funds.”

Furthermore, the company said it is working with the Peruvian government through SERNANP and the ministry of environment on the development on a legal framework beyond the voluntary scheme.

“We hope a legal framework will support the market and make it scalable,” said Gonzalez Aybar.

However, according to Fronterra’s CEO, companies and developers shouldn’t wait for a scheme to be in place to take action on biodiversity protection.

Earlier this week, Fronterra and Adryada, a co-founder member of OBC, announced the launch of a separate joint initiative aimed at scaling up nature-based solutions in Latin America, seeking to generate both carbon and biodiversity credits.

Within their partnership, the firms are working on shaping the units and outlining a roadmap to pilot the OBC approach in other countries, including Guatemala, Colombia, and Brazil.

By Giada Ferraglioni – giada@carbon-pulse.com

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