Public Disclosure Copy The World Bank Implementation Status & Results Report Afforestation of Degraded Agricultural Land Proto-Carbon Project (P075959) Afforestation of Degraded Agricultural Land Proto-Carbon Project (P075959) EUROPE AND CENTRAL ASIA | Romania | Environment & Natural Resources Global Practice | Carbon Offset | Specific Investment Loan | FY 2004 | Seq No: 5 | DRAFT | ISR22537 | Implementing Agencies: Project Development Objectives Project Development Objective (from Project Appraisal Document) The Project has one main objective, namely (1) the reduction of greenhouse gas concentrations through carbon sequestration in planted trees and in soils. In the process of working towards this objective, the Project will also achieve two subsidiary objectives: (2) stabilization of degraded sandy agricultural lands through the planting of Robinia sp. and, conditions permitting, Quercus sp. anda number of minor species; and (3) ecological reconstruction of degraded lands in the lower Danube floodplain through planting of native broadleaf species, mostly Populus alba, Populus nigra and Salix sp. The Project will also enable Romania to enter andbenefit from the carbon market. (4) Beyond the carbon sales proceeds from the Prototype Carbon Fund, the Project should be able to keep earning revenues from other carbon buyers. (5) More strategically, Romania will garner trading experience and relations for thefuture, in the fields of forestry, but also energy. Being able to harness the carbon market will catalyze public and private investment flows to Romania. Furthermore, the Project contributes to (6) the transformation of the rural economy, from exploiting natural resources to acting as steward of natural resources. Has the Project Development Objective been changed since Board Approval of the Project Objective? No PHRPDODEL Key Dates Key Project Dates Bank Approval Date:26-Sep-2003 Effectiveness Date:02-Oct-2003 Planned Mid Term Review Date:-- Actual Mid-Term Review Date:-- Original Closing Date:31-Dec-2013 Revised Closing Date:31-Dec-2020 Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO  Moderately Satisfactory  Moderately Satisfactory Overall Implementation Progress (IP)  Moderately Satisfactory  Moderately Satisfactory Overall Risk Rating  --  Moderate Implementation Status and Key Decisions The Project was the first Joint Implementation project in Romania, and it was registered as Joint Implementation Track 1 project with UNFCCC in October 2009. The project area comprised 6,496 hectares (ha) of mostly state-owned degraded agricultural lowlands. Out of the 6,496 ha allocated for the Project, 730 ha were deemed to be at the lowest state of degradation, hence unsuitable for afforestation, by an ecological survey conducted by the National Forest Administration (NFA) - Romsilva. Consequently, the eligible project area was reduced to 5,766 ha, among which a small 3/24/2016 Page 1 of 3 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Afforestation of Degraded Agricultural Land Proto-Carbon Project (P075959) portion of about 450 ha is privately owned. The Project was financed by the NFA, however, it was expected to generate revenues from the sale of CO2 emission reductions (ER) achieved through sequestering carbon in above and below ground biomass and in soils. From the commissioning of the Project in 2002 through 2012 the NFA planted and/or replanted almost all of the Project area that was suitable for afforestation. By the end of 2012, a total area of about 5,766 ha was planted. The Project achieved stabilization of degraded sandy agricultural lands through the planting of robinia and quercus as well as a number of minor species. Ecological reconstruction of degraded lands in the lower Danube floodplain was achieved through planting of native broadleaf species. Additionally, the Project allowed Romania to garner experience and relations for the future in the fields of forestry and carbon finance. The second verification process for emission reductions generated between 2008 and 2012 was completed in 2015 by an accredited independent entity, TÜV-NORD. This verification also included 24 plots of land for which private landowners were identified and signed ERPA sub-agreements. In December 2015, an amount of 15,097 Emission Reductions evidenced in the NFA Annual Afforestation Reports for 2013-2014 was counted towards the Project Entity's obligation to deliver the Contracted ERs under the ERPA. The multiple Project's objectives that were proposed, including the afforestation of degraded land taken over, biodiversity conservation, and the local social effects assumed were fulfilled to a great extent. Approximately 95% of the area which was included in the Project is planted, although a part of the initially planted area needed to be restored several times as a result of the catastrophic floods and the effects of the drought. The biodiversity conservation objectives were met both by the planting of species appropriate to the ambient conditions, and by the conservation of steppe-like meadows within the forest fund or the natural vegetation in the Small Island of Brăila, and also in unplanted oases. In addition, periodical monitoring reflects the emergence of mammal and bird species specific to forest ecosystems in most plantations. The Project had added positive social effects by employing additional forest staff from the villages where plantations were made (one forest guard is responsible for approximately 200 hectares of forest, which means a total of 20 additional positions for forest guards). These benefits in job creation for the local population still continue concurrently with the plantations maintenance and management works. The project combines the rehabilitation of degraded soils and ecological reconstruction of the lower Danube floodplain with the opportunity to avail of measures under the Kyoto Protocol for the sale of emission reductions. All safeguards requirements are fulfilled and the Project has complied with the Environment Management Plan. No outstanding safeguards concerns exist, and no significant safeguard issues are anticipated during the remaining term of the ERPA. The Project is fully commissioned – all suitable area is already afforested. The Project generated ERs and Project Entity has adequate capacity and experience to conduct monitoring activities according to the ERPA. Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance  --  --  Substantial Macroeconomic  --  --  Moderate Sector Strategies and Policies  --  --  Low Technical Design of Project or Program  --  --  Moderate Institutional Capacity for Implementation and Sustainability  --  --  Moderate Fiduciary  --  --  Moderate Environment and Social  --  --  Moderate Stakeholders  --  --  Moderate 3/24/2016 Page 2 of 3 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Afforestation of Degraded Agricultural Land Proto-Carbon Project (P075959) Other  --  --  -- Overall  --  --  Moderate Related Project(s) There are no related projects. 3/24/2016 Page 3 of 3 Public Disclosure Copy