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Laguna de Bay is one of the most vital inland bodies of water in the Philippines. It is surrounded by 24 sub-watersheds with an aggregate area of 2920 km. The Laguna de Bay watershed is considered a priority watershed for environmental sustainability. It was originally covered by dense tropical forest but was estimated in 2010 to have less than 5% forest cover. The area is characterised by grasslands, brush and abandoned agricultural areas that have less than 10% tree cover, thus, considered a priority for rehabilitation The Laguna Lake Development Authority’s carbon-forestry project, called the Laguna de Bay Community Watershed Rehabilitation Project, consists of two components: 1) Project 1, which covers an aggregate of 140 ha over 10 barangays within the Caliraya-Lumot Watershed. This is further subdivided into two sites (site 1 = 40 ha and site 2 = 100 ha); and 2) Project 2, which covers an aggregate of 217 ha located in four sites in Laguna province. Each site is equivalent to a small-scale forest-carbon project bundled into one project The project aims to develop an enabling environment for a carbon market for small-scale environmental interventions in the Laguna de Bay watershed. The key activities of the project are designed to: a) build the capacity of the Authority as an intermediary; b) pilot the implementation of carbon emissions reduction projects; and c) prepare set environmental projects for emission reduction credits. The project has the participation of local government units (Municipality of Tanay and Siniloan), an academic institution (University of Philippines Los Baños), a governmentcontrolled corporation (National Power Corporation) and private companies (CBK Power Company and San Pablo Water District), which have jurisdiction at each site to facilitate the project. As intermediary, the Authority was able to receive funding through a grant from the Japan Climate Change Initiative, which the World Bank implements for purchasing offsets for greenhouse gas emission reductions from small-scale Clean Development Mechanism (CDM) projects. Carbon financing is already mainstreamed in the project, which enabled the Authority to prepare a project design document following the CDM standard template. However, when submitted for validation, of the sites proposed for the forest-carbon development project, only one site—5 ha located in the municipality of Siniloan—satisfied the eligibility criteria under the CDM afforestation/reforestation framework. While continuing their reforestation activities, the Authority is currently looking for additional sites. The project design document is being revised and other market mechanisms are being explored.

Carbon-forestry projects in the Philippines: potential and challenges: the Quirino forest-carbon development project in Sierra Madre Biodiversity Corridor