The Forest Carbon Partnership Facility (FCPF) has played a strategic role in channeling donor efforts around new initiatives to stimulate climate action. With support from a wide range of development partners, FCPF is piloting results-based climate and carbon finance mechanisms that deliver payments upon verified high-integrity emission reductions, or carbon credits, generated through sustainable management and protection of forests. Trade in these credits in carbon markets is considered a game changer, and the FCPF is helping countries signal their market readiness.
The FCPF has helped 47 countries put in place the complex mechanisms for reducing emissions from deforestation and forest degradation and enhancing carbon stocks (REDD+), including establishing emission reference levels and measuring, reporting, and verification systems. Fifteen countries, including Viet Nam have since signed emission reductions payment agreements with the FCPF that are expected to pay out a total of $720 million in results-based climate finance for the reduction of 144 million tons of greenhouse gas emissions through REDD+ activities, equivalent to taking 31 million cars off the road for one year. In March 2024, Viet Nam received $51.5 million, which is the largest single payment to any country by the FCPF for verified emissions reductions.
The new Scaling Climate Action by Lowering Emissions (SCALE) umbrella program builds on the Bank Group’s two decades of experience in the results-based and carbon finance space, driven almost entirely by pioneering legacy trust funds like the FCPF. SCALE will provide results-based payments to stimulate decarbonization efforts across a broad range of sectors and support countries in generating and trading high-integrity, socially inclusive carbon credits.
The activities in this story were implemented with the generous support of the following development partners:
Development partners of the FCPF:
Australia, BP Technology Ventures Inc., Canada, Denmark, European Commission/European Commission, Finland, France, Germany, Japan, Italy, The Nature Conservancy, the Netherlands, Norway, Spain, Switzerland, United Kingdom, United States.
Development partners of SCALE:
United States
For more information on how trust funds help coordinate, innovate and catalyze development action, please see the World Bank Group’s FY24 Trust Fund Annual Report.
