- The Minister of Environment and Forestry ("Minister") has issued Decree No. SK. 1027/MENLHK/PHL/KUM.1/9/2023 (Decree 1027/2023), which establishes a carbon trading roadmap for the forestry sector. The new roadmap sets out both general and specific criteria that address the disaggregation of emissions baselines and emissions reduction targets, as well as the implementation of plans, targets and strategies in order to achieve said targets.
- Two key schemes will be implemented separately under Decree 1027/2023, specifically: 1) An emissions trading mechanism, through which businesses will establish Technical Approvals for Upper Emissions Limits (PTBAE) in order to reduce greenhouse gas (GHG) emissions, with each business being allocated a specific emissions upper limit; and 2) A carbon offset mechanism, which involves emissions reduction trading after the implementation of actions aimed at the mitigation and control of climate change. Initial mitigation actions will require the validation of practices or technologies in order to determine baseline emissions, and these will be subsequently evaluated through the MRV (Measurement, Reporting and Verification) process.
- Decree 1027/2023 has been in force since 22 September 2023.
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