Chitwan-Annapurna Landscape REDD+ Pilot — Community Forest Carbon Trust Funds (Nepal)

Between 2009 and 2013, ANSAB, ICIMOD and FECOFUN piloted Nepal's first sub-national REDD+ payment scheme with 112 community forest user groups across three watersheds — Charnawati (Dolakha district), Kayarkhola (Chitwan district) and Ludikhola (Gorkha district) — covering over 10,000 hectares and reaching more than 16,000 households and roughly 89,000 forest-dependent people. A $100,000 seed grant from Norway's development agency (Norad) established Nepal's first Forest Carbon Trust Funds, with nested district monitoring committees and a central advisory committee overseeing disbursement.

Test whether Nepal's community forestry system — which already manages roughly a third of the country's forests — could administer performance- and equity-based carbon payments transparently down to the household level, informing Nepal's national REDD+ readiness process.

Local forest user groups were trained to run annual carbon inventories across 570 permanent plots, following IPCC 2006 methodology and covering above- and below-ground biomass, litter and soil carbon. Trust funds disbursed payments using a formula weighting only 40% to measured carbon performance (24% stock, 16% enhancement) and 60% to social-equity criteria: indigenous populations (10%), Dalit households (15%), women (15%) and poor households (20%).

Between 2010 and 2013 the three watersheds registered a combined carbon dioxide saving of 343,339 tonnes, with annual increments averaging 2.62-3.53 tonnes per hectare. The trust funds disbursed $285,000 in total over the three years, including $95,000 in the final year alone (Dolakha $45,535, Gorkha $27,560, Chitwan $21,905).

A 2014 peer-reviewed case study in the journal Forests flagged an unresolved "additionality" question — the community forests were already gaining carbon before the project began — and cautioned that payment-based incentives of this kind work only where payments exceed communities' additional management costs. A separate 2020 Environmental Research Letters assessment characterised the pilot's measured impact as incremental rather than transformative. The pilot nonetheless demonstrated that Nepal's community forestry system can administer performance- and equity-based carbon payments transparently, a model since referenced in Nepal's national REDD+ readiness process.