Low-Emissions Oil Palm Development (LEOPALD)

Context

The primary greenhouse gas emissions from palm oil production are carbon emissions from land use change on the farm level (deforestation and peat decomposition) and methane emissions from the effluents produced by the mills. The level of the emissions follows the level of production which is driven by the growing global demand and, in the case of Indonesia, by the decentralisation policy where national government transfer the agricultural permitting function to district government. Global palm oil consumption in 2017 was almost six times as high as it had been in 1990 and is estimated to grow about 2.5 million tonnes per annum in the time from 2015 to 2025. Most of the expansions of national oil palm area (76 per cent) happened after 2001, which was the first year the decentralisation policy in Indonesia was started. The same case occurred in Berau District, East Kalimantan, of which 91 per cent of the plantation area (dominated by oil palm) as of 2017 was developed after the year 2000. 

Indonesia is currently the top palm oil producer worldwide (53 per cent) and ranked second in con-sumption (14 per cent) after India. Although the focus of the intervention must be at district level, transforming the sector into a sustainable one requires consolidated efforts in the multi-level jurisdic-tions covering national, provincial, and district governments. District governments need to have the capacity to reconcile the multiple stakeholder interests on land use (socio-economic, ecology) while at the same time collaboratively work with local community groups and the private sector in the supply chain to improve the production practices of the large-scale producers as well as that of smallholders.

Objective

A coalition of government, business and community actors understands and applies tools, approach-es, incentives and policy frameworks for sustainable palm oil development and pilots implementation towards a district-level low-emission oil palm development in Berau.

Approach

The low-emissions oil palm development (LEOPALD) project focuses its intervention into the lowering emission by saving forests (land use change) from conversion to plantation. It applies the landscape approach with the focus on district jurisdiction. The project strengthens the capacity of Berau District Government in performing the critical functions in land use governance and plantation management; they are planning, monitoring, and licensing. It also works with five villages on land use and develop-ment planning while also creating the capacity of the stakeholders for developing partnerships and resolving conflicts between communities and palm oil companies. The project supports the East Ka-limantan Province Government—particularly the East Kalimantan Province Estate Crops Agency and East Kalimantan Province Development Planning Agency Bappeda)—to provide tools and data to help districts in performing the critical functions. In addition, the project works with the Indonesian Ministry of Finance to explore possible fiscal incentives for regional governments, companies, and communities to implement sustainable palm oil approaches at a site-specific or jurisdictional level.

Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH implements the project under a collaboration with The Nature Conservancy (TNC) and Climate Policy Initiative (CPI) on behalf of the German Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU). The leading implementation partner is the Indonesian Ministry of National Development Planning (Bap-penas). At the sub-national level, the project works with the East Kalimantan Province Government as well as the Berau District Government.  
 

Results

Together with other development partners, LEOPALD has supported the East Kalimantan Province Government in creating two critical policies on low-emissions oil palm development in the jurisdiction of East Kalimantan Province (Berau is one of the ten districts and municipalities in the province).

The first is the Joint Declaration on Sustainable Plantation Development, which was signed by the governor and district heads/secretaries in September 2017. The declaration’s signatories committed to saving up to 640,000 hectares of forests in areas earmarked for estate crop development.

The second is the 2017 East Kalimantan Provincial Regulation on Sustainable Plantation Develop-ment, which stipulates the obligation for growers to identify, protect, and manage high conservation value areas.

The two policies do not only aim to save the forests but also to encourage the growers to prioritise productivity improvements rather than area expansion. And when new development is necessary, the two policies direct the activities into low-carbon stock areas (mineral soil without forest) by prioritising smallholders to carry out in the production activities through sustainable supply chain partnerships with palm oil companies. These policies will reduce greenhouse gas (GHG) emissions and maintain other environmental services vital for local people—such as the hydrological system—by saving the forests while also improving the local economic development at village and district level. 

The project supports East Kalimantan Government with developing a Web Geographic Information System (WebGIS) and electronic reporting tools. The tools help to collect and manage the data that are necessary for plantation and land use planning and monitoring. The trial version of the tools to-gether with some of the required data is available on the East Kalimantan Province Estate Crops Agency’s official website.