Deforestation releases about 1.6 GtCO 2 (gigatons or billion metric tons of CO 2 ) annually, about 17% of all annual anthropogenic greenhouse gas (GHG) emissions. Critics object to relying heavily on REDD for GHG reductions. The allowance value could be used in two ways: (1) to build capacity (e.g., develop a deforestation baseline and acquire monitoring technology) for countries to reduce deforestation and to participate in markets for international offset credits, and (2) to directly reduce deforestation emissions and supplement emissions reductions from non-REDD activities. The bills differ in (1) which agency is assigned to administer REDD provisions; (2) the conditions placed on developing countries eligible for capacity building and supplemental emissions reductions; and (3) the types of activities, the implementation standards, and the monitoring and reporting requirements. S. 1733 contains similar requirements for carbon offsets, but not for supplemental emissions reductions. Types of Activities

The types of REDD activities that can be funded with allowances are defined in H.R. 2454 , but not in S. 1733 . H.R. H.R. H.R. (There are provisions that discuss penalties for offset reversals.) Overall, both H.R. 2454 . 2454 , but several criteria are the same. Types of Activities Authorized

For international offsets associated with REDD, three categories of activities would qualify in both bills: (1) national level activities under developing countries that meet eligibility requirements; (2) state or province level activities within developing countries that meet certain requirements; and (3) program and project level activities in a developing country that is responsible for less than 1% of global GHG emissions, and less than 3% of global forest-sector and land use change emissions. 2454 . Eligibility requirements for these activities vary between the bills, although both would require that eligible states or provinces follow guidelines for REDD offsets set under national level emissions. H.R. Both bills would phase out the project or program level activities after a certain period. Under the offset program, both bills would direct EPA to ensure the establishment and enforcement of legal regimes, processes, standards, and safeguards that (1) give due regard to the rights and interests of local communities, indigenous peoples, forest-dependent communities, and vulnerable social groups; (2) promote consultations with, and full participation of, forest-dependent communities and indigenous peoples during the design, planning, implementation, and monitoring and evaluation of activities; and (3) encourage equitable sharing of profits and benefits derived from international offset credits with local communities, indigenous peoples, and forest-dependent communities. Potential Issues Affecting REDD Offsets in Both Bills

There are numerous concerns about REDD offsets. These concerns include verifiability (measuring, monitoring, and reporting), additionality, leakage, and permanence. Some developing countries may not have the capacity to address concerns about REDD offsets—particularly the ability to enforce laws and land tenure (ownership), to prevent illegal logging and other activities, and to measure and monitor forest carbon levels. While the REDD allowances described above can be used to build capacity, allowance funding might be focused on achieving the supplemental emissions reductions, and not provide sufficient funding to build governance capacity in developing countries to allow them to participate in the REDD offset markets. The two primary climate change bills, H.R. 2454 and S. 1733 , generally include similar processes to reduce emissions from deforestation and forest degradation (REDD). Both would use allowances for capacity building in developing countries and for supplemental emissions reductions. Both contain a reserve to stabilize carbon offset prices and possibly supplement REDD efforts. 2454 generally contains more details on the implementation of these programs; S. 1733 leaves more of the details to be determined in regulation. 2454 would use the U.S. Environmental Protection Agency as the primary federal administrator of these REDD-related programs; S. 1733 would rely substantially on the U.S. Agency for International Development for implementation. However, concerns persist about offsets generally and about REDD offsets in particular. In addition, the bills allow for project level or state level REDD activities, with a transition to national programs, but the process for making the transition is largely undefined.
Deforestation releases substantial amounts of carbon dioxide, about 17% of all anthropogenic greenhouse gas (GHG) emissions. Legislation has been proposed for U.S. targets to reduce GHG emissions. The two primary bills, H.R. 2454 and S. 1733, include provisions that would reduce emissions from deforestation and forest degradation; these activities are referred to as REDD. Both bills would use allowances to build capacity in developing countries and supplement U.S. emissions reductions; both would allow offsets for U.S. industries; and both contain a reserve to stabilize carbon prices.
The bills are generally similar on allowances for REDD activities, but significant differences exist. H.R. 2454 would rely on the U.S. Environmental Protection Agency for implementation; S. 1733 would use the U.S. Agency for International Development. H.R. 2454 contains eligibility criteria and implementation standards for the supplemental emissions reductions, and identifies the types of activities that could be funded. S. 1733 would rely on federal agencies to issue regulations for these details. H.R. 2454 also contains more details on monitoring and reporting.
The bills are similar on REDD offsets, although H.R. 2454 generally contains more details for implementation. Both would limit the quantity of international offsets—1 gigaton or billion metric tons (GtCO2) in H.R. 2454, and 0.5 GtCO2 in S. 1733—but would allow some additional international offsets if domestic offsets are insufficient. Both contain guidelines that require agreements with the developing country, and national baselines and strategic forest plans by the developing country. However, neither defines the types of REDD activities that qualify. Both would allow project level and state or regional level REDD offsets, and both would phase-out such offsets to encourage national level REDD offsets, but neither bill describes how the transition from project level or state level REDD offsets to national offsets is to proceed. Both bills also address the rights and needs of indigenous peoples and forest-dependent communities, requiring due regard to indigenous and local rights and directing consultations with and the participation of indigenous peoples and forest-dependent communities.
There are several concerns about REDD allowances in the bills. H.R. 2454 provides significant details for supplemental emissions reductions, but eligible forests are undefined and the criteria and standards might be insufficient for effective implementation. The bills contain no penalties or consequences for failures to achieve the overall anticipated reductions in carbon release or to measure and monitor the activities. Both bills would use allowances for building capacity (e.g., personnel and equipment) to measure, monitor, and enforce REDD activities in developing countries, but neither bill defines capacity-building activities that could be funded, nor allocates funds between capacity building and supplemental emissions reductions.
There are also concerns about REDD carbon offsets. There are issues for carbon offsets generally—their verification (measuring, monitoring, and reporting carbon sequestration), their additionality (activities not already occurring or required), their permanence, and leakage (merely shifting deforestation to other locations). These issues are exacerbated for REDD offsets, because many developing countries do not have the capacity to address these concerns. In addition, many are concerned that REDD offsets may inhibit developing countries from committing to GHG reductions and from evolving to low-carbon economies.