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Doc. No. C-56 May2010

Validation AssessmentReport for:

Bosque Sustentable’s, ‘Carbon Sequestration in Communities of Extreme Poverty in the Sierra

Gorda of Mexico’


Validated by:

65 Millet St. Suite 201Richmond, VT 05477 USA

Tel: 802-434-5491Fax: 802-434-3116

www.rainforest-alliance.org

Carbon Forestry Validation AuditManaged by:Adolfo Lemus

Regional ManagerRainforest Alliance/ SmartWood Program

8a Avenida 15-62, Zone 10Guatemala, GuatemalaTel: (502) 2383 - 5757Fax: (502) 2383 - 5788

Contact person: Adolfo LemusEmail: [email protected]

Date Final Report Issued: 22 June 2011Date Draft Final Report Issued: 10 June 2011Date Draft Report Issued: 24 March 2011Audit Dates: 07 March 2011 to 23 March 2011Lead Auditor: Adam GibbonSecond Audit Team Member: William Arreaga, Edwin AlpizarSenior Internal Reviewer: Jeffrey HaywardAudit Standard: VCS, 2007.1, Nov 2008

Voluntary Carbon Standard Program Update 21 January 2010VCS, Tool for AFOLY Methodological Issues, Nov 2008VCS, Guidance for AFOLU Projects, Nov 2008VCS, Program Guidelines, Nov 2008VCS, Tool for AFOLU Non-Permanence Risk Analysis and Buffer Determination, Nov 2008VCS Program updates.

Validation Code(s): RA-VAL-VCS-014502Validation Statement Issued: 22 June 2011

Project Latitude/Longitude: -99.477/ 21.205

Project Proponent Contact: David RossProject Proponent Address: Ave. La Presa S/N, Col. Barrio El Panteón,

Jalpan de Serra, Querétaro 76340Mexico

http://www.rainforest-alliance.org/

Voluntary Carbon Standard 2007Validation Report Template

19 November 2007

Validation Report:

Name of Verification company: Date of the issue:Rainforest Alliance 22 June 2011Report Title: Approved by:VCS Validation Audit of Carbon Sequestration in Communities of Extreme Poverty in the Sierra Gorda of Mexico

Jeffrey Hayward

Client: Project Title:Bosque Sustentable Carbon Sequestration in Communities of Extreme

Poverty in the Sierra Gorda of MexicoSummary:


Bosque Sustentable’s, ‘Carbon Sequestration in Communities of Extreme Poverty in the Sierra Gorda of Mexico’ consists of 90 small scale plantings (0.5 – 4.32 ha) in parcels dispersed throughout the Sierra Gorda Biosphere Reserve and its area of influence. The land which is planted belongs to farmers who plant under contract, and receive carbon payments for maintaining the plantation through the crediting period. The planted areas will not be subject to rotational harvesting. This is a grouped project which expects to add 40 more hectares per year in the same region. Criteria for future site selection were provided. The project uses the CDM methodology, ““Simplified baseline and monitoring methodology for small-scale A/R CDM project activities implemented on grasslands or croplands with limited displacement of pre-project activities AR-AMS0001 / Version 06” and various other associated CDM tools.” The previous land use and baseline was shown to be cropland or pasture.

Rainforest Alliance conducted a field assessment, visiting a sample of 23% of the parcels. The field audit and associated document assessment resulted in 10 corrective actions being issued. The Project Proponent addressed the 10 corrective actions that were issued via the submission of additional evidence and revised documentation. The Project was found to be in conformance with the VCS standard 2007.1. The project’s risk assessment determined that it was a low risk project, with a buffer corresponding to 20%.

Work carried out by: Number of pages:Rainforest Alliance: Adam Gibbon, William Arreaga, Edwin Alpizar

54

Table of Contents1 Introduction.........................................................................................................................................................................5

1.1 Objective.......................................................................................................................................................................51.2 Scope and Criteria........................................................................................................................................................51.3 VCS project Description...............................................................................................................................................51.4 Level of assurance.......................................................................................................................................................6

2 Methodology.......................................................................................................................................................................72.1 Description of the Audit Process..................................................................................................................................72.2 Audit team....................................................................................................................................................................92.3 Stakeholder Consultation Process...............................................................................................................................92.4 Review of Documents.................................................................................................................................................102.5 Follow-up Interviews...................................................................................................................................................132.6 Resolution of any material discrepancy......................................................................................................................14

3 Validation Overview..........................................................................................................................................................153.1 Validation summary....................................................................................................................................................153.2 Corrective Action Requests........................................................................................................................................153.3 Observations..............................................................................................................................................................20

4 Field Audit Validation Findings.........................................................................................................................................254.1 Project Design............................................................................................................................................................25

4.1.1 Project title, Purposes and Objectives................................................................................................................254.1.2 Type of GHG project...........................................................................................................................................254.1.3 Project Location...................................................................................................................................................254.1.4 Technology used.................................................................................................................................................274.1.5 Project duration, crediting time and project start date.........................................................................................274.1.6 Ownership/Proof of Title/Right of Use.................................................................................................................284.1.7 Double counting and whether the project participated in another emission trading programme........................294.1.8 Project applicability to the VCS for projects rejected under other GHG programme (if applicable)....................294.1.9 Whether the project is eligible under the VCS....................................................................................................294.1.10 Chronological plan for project initiation and monitoring......................................................................................304.1.11 Roles and responsibilities....................................................................................................................................304.1.12 Observation of local laws and regulations...........................................................................................................31

4.2 Baseline......................................................................................................................................................................31


4.2.1 Conditions prior to project initiation.....................................................................................................................314.2.2 Approval of the baseline methodology................................................................................................................314.2.3 Application of methodology deviations or revisions (if applicable)......................................................................324.2.4 Conformance with methodology applicability conditions.....................................................................................324.2.5 Correct application and justification of selected baseline methodology..............................................................334.2.6 Appropriate setting of baseline scenario.............................................................................................................344.2.7 Assessment and demonstration of additionality should be summarised in this section......................................34

4.3. Monitoring Plan...........................................................................................................................................................374.3.1. Approval of the monitoring methodology.............................................................................................................374.3.2. Correct application and justification of selected monitoring methodology...........................................................384.3.3. Conformance with VCS specific criterion relating to monitoring (VCS 2007.1 section 5.11 and Tool for AFOLU Methodological Issues Step 6)..........................................................................................................................................404.3.4. Whether the monitoring plan provides detailed information related to the collection and archiving of all relevant data 41

4.4. Calculation of GHG Emissions...................................................................................................................................414.4.1. The appropriateness of the source, sink and reservoir (pools)...........................................................................414.4.2. The correctness and transparency of formulas and factors used.......................................................................424.4.3. Calculation of emissions/sequestration in the baseline scenario (ex-ante estimate)..........................................424.4.4. Calculation of emissions from project activities (ex-ante estimate).....................................................................434.4.5. Calculation of emissions reductions or avoided emissions due to the project (ex-ante estimate)......................434.4.6. Calculation of emissions from leakage (ex-ante estimate)..................................................................................464.4.7. Calculation of net VCUs to be issued (ex-ante estimate)....................................................................................464.4.8. The assumptions made for estimating GHG emission reductions......................................................................474.4.9. Uncertainties.......................................................................................................................................................47

4.5. Environmental Impact.................................................................................................................................................474.5.1. Requirements for and approval of an Environmental Impact Assessment (if applicable)...................................474.5.2. Comments by stakeholders.................................................................................................................................474.5.3. Negative environmental and socio-economic impacts of the project..................................................................48

5 VCS Risk Assessment......................................................................................................................................................494.6. Risk factors applicable to all project types.................................................................................................................494.7. Risk factors applicable to ARR projects.....................................................................................................................50

5.1.1 Default buffer withholding percentages for ARR projects...................................................................................526 Validation Conclusion.......................................................................................................................................................53Appendix A: Company Details.................................................................................................................................................54

6.1 Contacts.....................................................................................................................................................................546.2 On-line Certification Contact.......................................................................................................................................54


1 Introduction

1.1 Objective

The purpose of this report is to document the conformance of ‘Carbon Sequestration in Communities of Extreme Poverty in the Sierra Gorda of Mexico’ Project with the requirements of the Voluntary Carbon Standard (VCS) validation standards. The project was developed by Bosque Sustentable, hereafter referred to as “Project Proponent”. The report presents the findings of qualified Rainforest Alliance auditors who have evaluated the Project Proponent’s systems and performance against the applicable standard(s). Section 6 below provides the audit conclusions.

The Rainforest Alliance’s SmartWood program was founded in 1989 to certify forestry practices conforming to Forest Stewardship Council (FSC) standards and now focuses on providing a variety of forest auditing services. In addition to being an ANSI ISO 14065:2007 accredited verifier and validator with VCS, Rainforest Alliance SmartWood program is also a member of the Climate, Community, and Biodiversity Alliance (CCBA) standards, and an approved verification body with a number of other forest carbon project standards. For a complete list of the services provided by Rainforest Alliance see http://www.rainforest-alliance.org/climate.cfm?id=international_standards.

Dispute resolution: If Rainforest Alliance clients encounter organizations or individuals having concerns or comments about Rainforest Alliance / SmartWood and our services, these parties are strongly encouraged to contact the SmartWood program headquarters directly.

1.2 Scope and CriteriaScope: The scope of the validation audit is to assess the conformance of Bosque Sustentable’s Reforestation project in Sierra Gorda Biosphere Reserve, Mexico, and area of influence, against the VCS 2007.1 standard. The objectives of this audit included an assessment of the project’s conformance with the VCS 2007.1 requirements and any additional requirements of VCS AFOLU projects. In addition, the audit assessed the project with respect to the baseline scenarios presented in the project design document. The project covers an area of 93.2 ha (with an additional 160 ha expected to be added over the next 4 years) The land was pasture and crop land. The forest type is pine and some cedar. The project has a lifetime of 41 years, and estimates it will remove 81,506 tCO2e over the course of the project lifetime. The audit will assess the GHG assertions and baseline estimates made by the project against agreed validation criteria of the VCS.

Standard criteria: Criteria from the following documents were used to assess this project: Voluntary Carbon Standard, 2007.1, Nov 2008 Voluntary Carbon Standard, Tool for AFOLU Methodological Issues, Nov 2008 Voluntary Carbon Standard, Guidance for Agriculture, Forestry and Other Land Use Projects, Nov 2008 Voluntary Carbon Standard, Program Guidelines, Nov 2008 Voluntary Carbon Standard, Tool for AFOLU Non-Permanence Risk Analysis and Buffer Determination, Nov 2008 Voluntary Carbon Standard Program Normative Document - Double Approval Process v1.1 Applicable Voluntary Carbon Standard Program Updates (http://www.v-c-s.org/policyannounce.html) Applicable VCS Association Policy Announcements (http://www.v-c-s.org/policyannounce.html)

Materiality: All stocks and emissions equal to or greater than 5% of the total GHG assertion as defined in section 7.3.1 of the VCS 2007.1 standard.

1.3 VCS project Description

Taken from the VCS PD:

“In 1987, Grupo Ecológico Sierra Gorda (Grupo Ecológico) began reforesting degraded lands in the Sierra Gorda Queretana in eastern-central Mexico. Between 1997 and 2001, Grupo Ecológico planted 52.6 hectares, in parcels greater than 0.5 hectares, with the intention of using the revenues from the sale of the carbon sequestered to support landholders and the organization’s environmental activities.Following restructuring of Grupo Ecológico in 2001, Bosque Sustentable A.C. has continued as the partner organization of Grupo Ecológico focusing on reforestation and the sale of carbon credits. Since the restructuring, Bosque Sustentable has planted an additional 93.2 hectares through 2009 in parcels greater than 0.5 hectares, with the expressed goal of using the


http://www.v-c-s.org/policyannounce.html

http://www.v-c-s.org/policyannounce.html

http://www.rainforest-alliance.org/climate.cfm?id=international_standards

http://www.rainforest-alliance.org/programs/forestry/smartwood/index.html

revenues from the sale of the carbon sequestered to support landholders and the organization’s activities in forest management and biodiversity protection. Bosque Sustentable has a target to plant an additional 40 hectares per year from 2010 to 2013 for this project activity.The purpose of the project is to reforest areas that require restoration while providing an alternative productive activity to hundreds of landowners and landholders in conditions of severe poverty while capturing carbon at the same time. The project is primarily designed to overcome the financial barrier to landholder participation. Bosque Sustentable provides the landholders with incentives to follow the forest management plan proposed by Bosque Sustentable.”(p3)

1.4 Level of assuranceThe GHG assertion will be validated to a reasonable level of assurance. Based on the audit findings, a positive validation statement reasonably assures that the project GHG assertion is materially correct and is a fair representation of the GHG data and information. Additionally, the GHG assertion is prepared in accordance with the VCS 2007.1 standard.


2 Methodology

2.1 Description of the Audit Process

The audit was conducted in a two step process. The first step consisted of a pre-validation assessment, conducted through a remote desk audit of the Project Design (Doc #4), and all corresponding annexes (See list on section 2.4 below). The purpose of the pre-validation assessment is to identify any major gaps within the project design document, and to determine if the project is ready for a field visit. As part of the pre-validation audit, two minor gaps were identified, and the Project Proponent was notified of these findings on December 17th, 2010 with the submission of the pre-validation report. This process offers the Project Proponent a minimum of three weeks to address any gaps identified in the pre-validation assessment prior to the arrival of auditor for the field audit.

The second step consisted of the validation of the "Carbon Sequestration in Communities of Extreme Poverty in the Sierra Gorda of Mexico’ Project. In total, 90 land parcels were included in the VCS scope. The field audit consisted of a total of five days, visiting both of the project strata (Zone 1 and Zone 2) located in Queretaro and San Luis Potosí, México. The auditors were able to visit 21 of the project sites, representing 23% of the parcels, and 22% of the total project area (see table below for details). Stakeholders interviews were conducted at all farms visited, including interviews of small landowners (project participants), and key personnel of Bosque Sustentable.

The audit team was divided to cover more area in three groups; the following is a list of places visited including field visit, stakeholder consultations and documentation review:

Location/Facility Date(s) Length of Audit

Auditor(s)

Stakeholder consultation in Queretaro city 7 Mar 11 5 hours Adam Gibbon, William Arreaga, Edwin Alpizar

Field visit to reforestations 8 Mar 11 8 hours William Arreaga

Field visit to reforestations 8 Mar 11 7 hours Edwin Alpizar

Field visit to reforestations 8 Mar 11 7 hours Adam Gibbon

Documentation review and consultation in Bosque Sustentable office, Jalpan de Serra, Qro.

9 Mar 11 8 hours William Arreaga, Adam Gibbon

Field visit to reforestations 9 Mar 11 8 hours Edwin Alpizar

Field visit to reforestations 10 Mar 11 8 hours William Arreaga, Adam Gibbon

Documentation review and consultation in Bosque Sustentable office, Jalpan de Serra, Qro.

10 Mar 11 8 hours Edwin Alpizar


Table to show the reforestation sites visited:

Clave Municipio LocalidadAño de

plantación Participante% de

Sobrevivencia Has. X YVCS Area

2004-10 Pinal de Amoles Puerto Escanelilla 2004 Hermelinda Alcala 83.26 0.5 440387 2346368 0.5

2006-18Landa de Matamoros Cerro de San Agustin 2006 Otilio Torres Ramos 90 0.5 491900 2348774 0.5

2004-33 Pinal de Amoles Puerto Escanelilla 2004 Salomón Ibarra Rivera 78.31 0.6 439578 2345602 0.6

2006-19Landa de Matamoros Cerro de San Agustin 2006 Sixto Hernandez Garay 80 0.6 492134 2349208 0.6

2004-34 Pinal de Amoles El Ranchito 2004 Jose Aguilar Bravo 77.41 0.6 442073 2337525 0.62003-36 Pinal de Amoles Agua Amarga 2003 José Audencio Resendíz Hernández 75.00 0.7 440025 2336522 0.72003-6 Pinal de Amoles Puerto Escanelilla 2003 Salomón Ibarra Rivera 92.71 0.7 440369 2346251 0.72004-8 Pinal de Amoles Agua Amarga 2004 Pedro y Salomon Resendiz Muñoz 84.00 0.7 438905 2336632 0.72005-5 Aquismon Octojub Temapatz 2005 Nabor Santiago Luis 99.01 0.7 487999 2384486 0.72006-7 Aquismon Octojub Temapatz 2006 Jose Isidro Lucas Rosa 78.76 0.8 490096 2385025 0.82006-6 Aquismon Octojub Temapatz 2006 Odilon Perez Gonzalez 87.76 0.8 489715 2384307 0.82005-4 Aquismon Octojub Temapatz 2005 Ma. Guadalupe Santos Santiago 100 0.8 489101 2383925 0.82006-5 Aquismon Octojub Temapatz 2006 Juan Francisco Perez Catarina 92.26 0.9 489848 2384659 0.9

2006-2Landa de Matamoros Cerro de San Agustin 2006 Eduardo Rubio Torres 75 0.9 492010 2348826 0.9

2005-13 Aquismon Octojub Temapatz 2005 Santos Dionisio Santiago Dolores 90.01 0.9 487232 2383824 0.92008-18 Aquismon Octojub Temapatz 2008 Ancelmo Hernandez Josefa 80 1.0 489613 2384507 1.02004-6 Pinal de Amoles Puerto Escanelilla 2004 Silvino Paulino Vazquez Reséndiz 90.91 1.0 438993 2345807 1.02006-8 Aquismon Octojub Temapatz 2006 Jose Marcelino Guadalupe 84.38 1.0 488951 2384081 1.02005-12 Aquismon Octojub Temapatz 2005 Alejandro Perez Gonzala 84.38 1.4 489684 2384399 1.4

2007-1Landa de Matamoros Aguazarca 2007 Alfredo Rubio Rubio 70 3.1 488716 2346448 3.1

2004-2 Pinal de Amoles Agua Amarga 2004 Ginn Carreon 70.00 3.3 439510 2337711 3.3

Finally, in response to the Draft Audit Report, the Proponent submitted revised documentation in order to address the Corrective Action Requests that were open. The documentation was assessed via a desk review between 06 and 11 June.


2.2 Audit teamAuditor(s) QualificationsAdam Gibbon Adam’s role as Technical Specialist in Rainforest Alliance’s Climate Program involves being a lead

auditor for REDD+ projects and methodologies in the voluntary carbon market, providing training on REDD+ and climate change to a broad range of groups worldwide, and providing technical input into on adaptation and mitigation for agriculture and forestry projects.

Adam has led the technical climate change evaluation of over ten CCBA validations. He has also led five VCS methodology assessments, three VCS validations and one Plan Vivo verification. Adam is a qualified lead auditor for the Climate Action Reserve, has been appointed to the Plan Vivo Technical Advisory panel and is a VCS AFOLU expert in REDD.

Adam has trained over 150 people in Indonesia, Nicaragua, Rwanda, Spain, UK, and Vietnam in REDD+ project auditing and project development. Recipients of the training included Rainforest Alliance auditors, government officials, private consultants and NGO representatives.

Adam has been the lead author of recent Rainforest Alliance publications such as, “Guidance on coffee carbon project development using the (CDM) simplified agroforestry methodology”, and “Forest Carbon Project Feasibility Study in Quang Tri Province, Vietnam”. He has also had published work in peer reviewed scientific journals, for example; Gibbon et al., 2010; Ecosystem Carbon Storage Across the Grassland–Forest Transition in the High Andes of Manu National Park, Peru.

Before joining Rainforest Alliance Adam worked at Oxford University as a researcher. His research emphasized the potential of carbon markets to finance sustainable management of forest resources. Adam earned a distinction on the Environmental Change and Management MSc. Program at Oxford University. He was awarded the Sir Walter Raleigh Scholarship at Oriel College, Oxford. He graduated with a first class degree from Durham University, with a BSc in Natural Sciences, specializing in Geology, Chemistry & Geography.

William Arreaga William is a Rainforest Alliance Lead Carbon Auditor.

Guatemalan; Forester, Central American SmartWood Office. Forestry degree from the Escuela Nacional Central de Agricultura, and an engineering degree from USAC; in 2002 he received an M.Sc. in Tropical Forest Management and Biodiversity Conservation from CATIE (Costa Rica). His work has been focused in plantations and natural forests managed in Central America. He also has experience in carbon storage and carbon flows in natural forests and plantations. In 2007, he spent two months at Winrock International as a fellow. William has participated as auditor and lead auditor in various VCS, CCBA, CFS validation and verification processes.

Recently, he obtained a certificate of EMS Lead auditor (ISO 14001:2004).

Edwin Alpizar Costa Rican, Forestry Engineer from Instituto Tecnológico de Costa Rica, around 30 years of experience working as a consultant in Latin America. His most recent experience in carbon projects consisted of a development of a carbon protocol to implement the Climate Module in Agroforestry Systems; identification of scenarios of mitigation impacts in El Salvador, and Costa Rica; GEI National Inventory of El Salvador; evaluation of projects against CDM, and others. Edwin has participated with SmartWood/Rainforest Alliance as VCS auditor in two processes in the Central America region.

2.3 Stakeholder Consultation Process

The audit team implemented a stakeholder consultation process in order to identify the strengths and weaknesses of the project, based on opinions and inputs from people directly or indirectly involved with the reforestation project and the Project Proponent itself. The process started before the field visit with a 30 day consultation period, corresponding to the other standard the project is also validated against (CCBA). This period of consultation resulted in favourable communications from regional


organizations, the audit team considered appropriate to discuss the comments directly via Skype. The audit plan was designed to achieve a balance between visits and fieldwork. As a result, during the site visit the audit team interviewed representatives from local organizations and agencies such as SEMARNAT, CONAFOR, Forestry Department, but also landowners, neighbours and representatives of local communities. 2.4 Review of Documents

The following documents were viewed in the production of the first assessment report:

Ref Title, Author(s), Version, Date Electronic Filename1 See right, Authored by Bosque

Sustentable1) PDD for CCB Validation Sierra Gorda Reforestation Project Mar 4, 2011 FINAL.pdf

2 See right, Authored by Bosque Sustentable

2) PDD for CCB Validation Sierra Gorda Reforestation Project Mar 4, 2011 FINAL changes marked.pdf


3) Carbon calculations for CCB PDD March 4 2011 FINAL.xls


4) PDD for VCS Validation Sierra Gorda Reforestation Project March 4, 2011 FINAL.pdf


5) PDD for VCS Validation Sierra Gorda Reforestation Project March 4, 2011 FINAL changes marked.pdf


6) Carbon calculations for VCS PDD March 4, 2011 FINAL.xls


7) Annex 3, Inventory and projections March 4 2011 FINAL CONFIDENTIAL.xls


8) Annex 4 for CCB and VCS PDDs, Contrato modelo Sierra Gorda CONFIDENCIAL June 29 2010 FINAL.pdf


9) Annex 5 for CCB and VCS PDDs , 1 of 4, Requisitos para entrar el programa de captura de carbono January 31 2011 FINAL.pdf


10)Annex 5 for CCB and VCS PDDs, 2 of 4, Solicitúd de participación programa de captura de carbono January 28 2010 FINAL.pdf


11) Annex 5 for CCB and VCS PDDs, 3 of 4, Formato de información de plantación March 2 2011 FINAL.pdf


12) Annex 5 for CCB and VCS PDDs, 4 of 4, Formato de monitoreo de campo, March 2 2011 FINAL.pdf


13) Annex 6 for CCB and VCS PDDs, Additional information for CCB Validation Mar 4, 2011 FINAL.pdf


14) Annex 6 for CCB and VCS PDDs, Additional information for CCB Validation Mar 4, 2011 FINAL changes marked.pdf


15) Annex 7 for CCB and VCS PDDs, AFOLU Non-Permanence Risk Analysis and Buffer Determination March 4 2011 FINAL.pdf


16) Annex 8 for CCB and VCS PDDs, Plan de prevención y mitigación de riesgos para el personal del proyecto March 2 2011.pdf


17) Annex 9 for CCB and VCS PDDs, Biodiversity Monitoring Plan March 2 2011 FINAL.pdf


18) Leakage survey results and calculations PDDs March 4 2011 FINAL CONFIDENTIAL.xls


19) Approval of project by director of SGBR FINAL.jpg


20) CCB comments of Fundación Gonzalo Río Arronte.pdf


21) CCB comments of World Land Trust.pdf


22) Control de transacciones y pagos 5 marzo 2011 FINAL.xls


23) Inventory_-_Final.xls


24) Programa de Manejo Reserva de la Biosfera Sierra Gorda.pdf


25) Proyección financiera reforestaciones 4 marzo 2011 FINAL para auditores CONFIDENCIAL.xls



26) Formato de Registro de Asistencia Técnica.doc

27 Stakeholder Consultation Notes, Bosque Sustentable

Agenda Taller Mayo 2010.docx20 de febrero de 2009, acta de dudas y comentarios, 1 de 3.jpg20 de febrero de 2009, acta de dudas y comentarios, 2 de 3.jpg20 de febrero de 2009, acta de dudas y comentarios, 3 de 3.jpg20 de febrero de 2009, lista de asistencia, 1 de 4.jpg20 de febrero de 2009, lista de asistencia, 2 de 4.jpg20 de febrero de 2009, lista de asistencia, 3 de 4.jpg20 de febrero de 2009, lista de asistencia, 4 de 4.jpg20 de mayo de 2010, apoyo para transporte, 1 de 3.jpg20 de mayo de 2010, apoyo para transporte, 2 de 3.jpg20 de mayo de 2010, apoyo para transporte, 3 de 3.jpg21 de agosto de 2009, lista de asistencia, 1 de 4.jpg21 de agosto de 2009, lista de asistencia, 2 de 4.jpg21 de agosto de 2009, lista de asistencia, 3 de 4.jpg21 de agosto de 2009, lista de asistencia, 4 de 4.jpg6 de noviembre de 2009, lista de asistencia, 1 de 3.jpg6 de noviembre de 2009, lista de asistencia, 2 de 3.jpg6 de noviembre de 2009, lista de asistencia, 3 de 3.jpg


pasos de implementación captura de carbono actualizado 29 octubre 2010.xls


responsabilidades captura de carbono en reforestaciones 3 febrero 2011.xls


Ruta_critica DRAFT.docx

31 Reforestation Location Maps, March 2011, Bosque Sustentable

AquismonLocations.jpgArroyoSecoLocations.jpgArroyoSecoLocations2.jpgLandaLocations.jpgPinal Jalpan Locations 2.jpgPinal Jalpan Locations.jpgThumbs.dbXilitlaLocations.jpgXilitlaLocations2.jpg

32 Simplified baseline and monitoring methodologies for small-scale afforestation and reforestation project activities under the Clean Development Mechanism implemented on grasslands or croplands AR-AMS0001 Version 04.1

AR-AMS001 v4.1

33 Guidelines on conditions under which increase in GHG emissions attributable to displacement of pre-project crop cultivation activities in A/R CDM project activity is insignificant‖ (Version 01)

On CDM Website: http://cdm.unfccc.int/methodologies/SSCAR/approved

34 Guidelines on conditions under which increase in GHG emissions related to displacement of pre-project grazing activities in A/R CDM project activity is insignificant‖ (Version 01)


35 Tool for the identification of degraded or degrading lands for consideration in implementing CDM A/R project activities‖ (Version 01)


36 Estimation of the increase in GHG emissions attributable to displacement of pre-project agricultural activities in A/R CDM



http://cdm.unfccc.int/methodologies/SSCAR/approved




project activity‖ (Version 01)The following documents were viewed in the production of the second assessment report:

Ref Title, Author(s), Version, Date Electronic Filename1b See right, Authored by Bosque

Sustentable1) PDD for CCB Validation Sierra Gorda Reforestation Project May 23, 2011 with changes marked.pdf

1b See right, Authored by Bosque Sustentable

1) PDD for CCB Validation Sierra Gorda Reforestation Project May 23, 2011.pdf


3) Carbon calculations for CCB PDD May 20, 2011.xls


4) PDD for VCS Validation Sierra Gorda Reforestation Project May 23, 2011 with changes marked.pdf


4) PDD for VCS Validation Sierra Gorda Reforestation Project May 23, 2011.pdf


6) Carbon calculations for VCS PDD May 20, 2011.xls


7) Annex 3, Inventory and Projections May 22, 2011 CONFIDENTIAL.xls


11) Annex 5 for CCB and VCS PDDS, 3 of 4, ejemplo formato de información de plantación May 23, 2011.JPG


14) Annex 6 for CCB and VCS PDDs, Additional information for CCB Validation May 23, 2011 with changes marked.pdf


14) Annex 6 for CCB and VCS PDDs, Additional information for CCB Validation May 23, 2011.pdf


17) Annex 9 for CCB and VCS PDDs, Initial Biodiversity Monitoring Plan May 23, 2011.pdf


18) Leakage survey results and calculations May 22, 2011.xls


23) Inventory_-_Final con corrección.xls


25) Proyección financiera reforestaciones May 22, 2011 CONFIDENTIAL.xls


27) Ventura 2008.pdf


28) CONANP 2008.pdf


29) Revised information for 6.2 of VCS report and page 17 of CCB report May 23, 2011.doc


30) Revision of Section 2.5 and page 31 of VCS report, page 16 and appendix C of CCB report May 23, 2011.doc


31) Testimonio de uso de fuego 18 abril 2011.pdf


32) GEF 2000.pdf


33) Vela, Plaza and Muench 2009.pdf


34) Galimidi and Olsen 2007.pdf


35) UNDP 2002.pdf


36) GEF Evaluation Office 2009.pdf


37) Policy on credit retirement and avoidance of double-counting adopted March 17, 2011.jpg


38) Premium carbon credits retired May 23, 2011.JPG


39) Conservación de humedad de las plantas 12 mayo 2011.pdf


40) Procedimientos para la resolución de conflictos 3 mayo 2011.pdf

41b See right, Authored by Bosque 41) GESG 2006.pdf


Sustentable42b See right, Authored by Bosque

Sustentable42) GESG 2010a.pdf


43) GESG 2010b.pdf


44) GESG 2010b Anexo.xls


45) GESG 2011.pdf


46) Procedures for Determining Project Areas and Locations May 18, 2011.pdf


47) Project area polygons in KML file May 20, 2011.kmz


48) Suzán et al 2011 BORRADOR CONFIDENCIAL.pdf


49) Whitestone 2007.pdf


50) Assessment of Land Condition Suitability Sheets May 20, 2011 zipped.zip (contained 138 files)


51) Responses to draft validation reports and additional evidence May 24, 2011.xls


52) List of reforestations checked in the field following the site visit


53) VCS project area polygons in KML file June 9, 2011.kmz


54) 2007-7 Antonio Miguel Hernandez.jpg

2.5 Follow-up InterviewsThe following is a list of the people interviewed as part of the audit. The interviewees included those people directly, and in some cases indirectly, involved and/or affected by the project activities.

Audit Date Name Title9 March 11 Roberto Pedraza Muñoz Legal Representative, Grupo Ecológico Sierra Gorda7-11 March 11 Martha Ruiz Corzo General Director, Grupo Ecológico Sierra Gorda8-9 March 11 Laura Pérez-Arce Fund Raising and Public Relations Coordinator, Grupo

Ecológico Sierra Gorda 9 March 11 Roberto Pedraza Ruiz Technical Assistant, Grupo Ecológico Sierra Gorda /

landowner9 March 11 Gabriel Domínguez Technical Director Bosque Sustentable8-10 March 11 Marco Antonio Miguel Forestry engineer Bosque Sustentable8-10 March 11 Leonor Jiménez Sánchez Supervisor Bosque Sustentable8-10 March 11 Quirino Sánchez Hernández Reforestation promoter 2 Bosque Sustentable8-10 March 11 Francisco Sarabia Sánchez Reforestation promoter 3 Bosque Sustentable7-11 March 11 David Ross Independent Consultant, contracted by Bosque

Sustentable8-10 March 11 Avram Primack Peace corps volunteer / Environmental and GIS expert

Neil Bird / Jacob Olander Consultant, Woodrising Consulting, contracted by Bosque Sustentable

25 feb 11 Roger Wilson / Ruth Canning World Land Trust7 March 11 Gerardo Serrato Federal Delegate, Querétaro Delegation, Ministry of

Environment and Natural Resources (SEMARNAT)7 March 11 Raúl Rodríguez Franco Manager, Forestry Department, Queretaro Ministry of

Agriculture Development (SEDEA)7 March 11 Arturo Ortiz Assistant General Director / Delegate, State of

Querétaro, Office of Federal Attorney General for Environmental Protection (PROFEPA)

7 March 11 Miguel Angel Gómez García Sub-secretary (Vice-Minister) of the Environment, Querétaro Ministry of Sustainable Development (SEDESU)


9 March 11 Heriberto Pedraza Director of Municipal Services and Ecology, Municipality of Jalpan de Serra

9 March 11 Mario Martín Flores Ramos Manager of Agriculture Area (Jalpan), Querétaro Ministry of Agriculture Development (SEDEA)

9 March 11 Jesús Mota Director of Natural Resources, Municipality of Pinal de Amoles

9 March 11 Raúl Espinoza Manager, Department of Financial Analysis of Forest Carbon Projects, National Forestry Commission (CONAFOR)

2.6 Resolution of any material discrepancyIn response to the Corrective Action Requests issued, the Proponents submitted revised documentation as described in section 2.4 above.


3 Validation OverviewBased on Project’s conformance with VCS requirements, the auditor makes the following recommendation:Draft Report Conclusions

Validation approved:No CARs issued

The Project Proponent has 30 days from the date of this report to revise documentation and provide any additional evidence necessary to close the open corrective action request. If new material is submitted the auditor will review the material and add updated findings to this report and close CARs appropriately. If no new material is received before the 30 day deadline, or the new material was insufficient to close all open CARs the report will be finalised with the CARs open, and validation will not be achieved. If all CARs are successfully addressed, the report will be finalised and proceed towards issuance of a validation statement.

Validation not approved:Conformance with CAR(s) required

Draft Final Report ConclusionsValidation approved:No CARs issued

The Project proponent has 7 days from the date of this report to submit any comments related to the factual accuracy of the report or the correctness of decisions reached. The auditors will not review any new material.Validation not approved:

Conformance with CAR(s) requiredFinal Report Conclusions

Validation approved:No CARs issuedValidation not approved:Conformance with CAR(s) required

3.1 Validation summaryBosque Sustentable’s, ‘Carbon Sequestration in Communities of Extreme Poverty in the Sierra Gorda of Mexico’ consists of a number of small scale plantings (0.5-4.32 ha) in parcels dispersed throughout the Sierra Gorda Biosphere reserve and its area of influence. The land which is planted belongs to farmers who plant under contract, and receive carbon payments for maintaining the plantation through the crediting period. The planted areas will not be subject to rotational harvesting. This is a grouped project which expects to add 40 more hectares per year in the same region. Criteria for site selection were provided. The previous land use and baseline was shown to be cropland or pasture. The Project Proponent addressed the 10 Corrective Actions that were issued in the draft report via the submission of additional evidence and revised documentation. The Project was found to be in conformance with the VCS standard 2007.1. The project’s risk assessment determined that it was a low risk project, with a buffer corresponding to 20%.

3.2 Corrective Action Requests


Note: A non-conformance is defined in this report as a deficiency, discrepancy or misrepresentation that in all probability materially affects carbon credit claims. Corrective Action Request (CAR) language uses “shall” to suggest its necessity but is not prescriptive in terms of mechanisms to mitigate the CAR. Each CAR is brief and refers to a more detailed finding in the appendices.

CARs identified during draft validation reports must be successfully closed by the Project Proponents before Rainforest Alliance submits the final validation report and opinion to the VCS. Any open CARs will result in a negative validation statement which lists: (a) all corrective action requests, (b) rationale for each request, and (c) impact of each material finding on GHG assertion. Qualified validation statements are not accepted by VCS.

CAR: 01/11 Reference Standard & Requirement: 4.1.3 Project LocationNon-conformance: A sample of verifications found that not all reforestations that were included in the VCS

project were accurately mapped in terms of their location and area.

Corrective Action Request: Bosque Sustentable shall document and execute a procedure (including quality control checks) for determining project areas and locations. The results shall also be presented to the auditors.

Timeline for conformance:

Prior to the validation.

Evidence to close CAR: In response to CAR 01/11 procedures for determining project areas and locations have been documented in, ‘46) Procedures for Determining Project Areas and Locations May 18, 2011’.

The results are presented in 7) Annex 3 Inventory and Projections May 22, 2011 CONFIDENTIAL. Maps are provided in Section A.4.2 of the PDD, in a KML file and in Assessment of Land Condition/Suitability Sheets prepared for each reforestation parcel. Corresponding adjustments to carbon calculations and other numbers have been incorporated into the final version of the PDD and its annexes.

The revised procedures, provide appropriate guidelines for field staff to collect data to the highest levels of accuracy possible given the constraints of the equipment (GPS accurate to 3m), and environment (steep slopes and trees). It is stated in section 1f of the document that suspicious parcels have been revisited.

Those parcels which were found to have issues with the mapping were remapped according to the new process as declared in document number 52, and checked in the database and in the eligibility sheets. The parcel 2008-18 has been removed from the project.

The PD in section A.2 states that there are 93.2 ha planted since 2002 (in addition to the 52.6 planted between 1997 and 2001). In section A4.2 it is stated that the project boundary includes 90 parcels totalling 93.2 ha (this is down from 98.1 ha in 96 parcels from the first submission).

The areas and parcel numbers have changed in response to a quality checking and remeasurement exercised by the project proponent in response to CAR 01/11. In total 15 parcels were remapped.

The spreadsheet, “7) Annex 3, Inventory and Projections May 22, 2011 CONFIDENTIAL” was interrogated. The data on parcels planted was found to have been correctly summed on the first tab and passed correctly to the second and third tabs. The spreadsheet was thus found to be internally consistent. Each of the parcels listed on the tab 1997-2009 has a KML polygon.

The spreadsheet, “7) Annex 3, Inventory and Projections May 22, 2011 CONFIDENTIAL” shows the area of VCS parcels to be 93.15ha. Summing the data in the KML files, the area of VCS parcels is 93.66ha. Analysis of the numbers shows that the reason for the slight discrepancy is that the KML values for each parcel are, on average, slightly larger (in no one parcel is the difference more than 1.4%). This slight discrepancy was found to be acceptable within the limits of accuracy possible with GIS measurements. In addition, the project is claiming for a smaller area than the KML file indicates, so the discrepancy is conservative.


Google Earth has a high resolution image that covers most of the project areas. The images are from 2007 or 2008. Therefore, parcels reforested after these respective dates should not have tree coverage and those planted before should show signs of coverage. Nine parcels were checked on Google Earth and none were found to be forested (in addition, a general flyover was done). In addition, the shape of 9 parcels were compared to the Land Suitability sheets the project prepared. The areas were all found to be the same and the shapes matched. All Land suitability sheets were inspected and all were found to be complete and to have reached logical conclusions.

CAR Status: CLOSED.Follow-up Actions: N/A.

CAR: 02/11 Reference Standard & Requirement: 4.1.3 Project LocationNon-conformance: KML files of the project areas have not yet been presented to the auditors for inspection.

Corrective Action Request: Bosque Sustentable shall provide KML files of all the project areas.Timeline for conformance:


Evidence to close CAR: The Proponents submitted a KML file with all the polygons in. This closes CAR 02/11.CAR Status: CLOSED.Follow-up Actions: N/A.

CAR: 03/11 Reference Standard & Requirement: 4.1.7. Double counting and whether the project participated in another emission trading programme.

Non-conformance: The Project Proponent has a draft policy to explain how double counting would be avoided when VCUs are issued, and throughout the organisation everyone was aware that double counting would need to be avoided. However, this draft is not yet an official policy of the project.

Corrective Action Request: Bosque Sustentable shall formalise the system employed to avoid double counting.Timeline for conformance:


Evidence to close CAR: The Proponent has issued a formal double counting policy (document number 34). The policy was found to be adequate.


CAR: 04/11 Reference Standard & Requirement: 4.1.9 Whether the project is eligible under the VCSNon-conformance: It was found that ‘eligibility sheets’ had not been made for all parcels. It was also found

that not all parcels had had their eligibility proven. It appeared that whilst there was a process for accepting parcels into the VCS project, it had been circumvented due to numerous people having access to the databases and their not being adequate quality control.

Corrective Action Request: Bosque Sustentable shall demonstrate eligibility for every land parcel included within the project area through a suitable documented process.Timeline for conformance:


Evidence to close CAR: The project proponent has executed the quality control process described in ‘46) Procedures for Determining Project Areas and Locations May 18, 2011’ and have provided


a sheet demonstrating eligibility for each parcel in ‘50) Assessment of Land Condition Suitability Sheets May 20, 2011 zipped’. The files were checked and the land parcels were found to be eligible according to the criteria required.


CAR: 05/11 Reference Standard & Requirement: 4.1.11 Roles and responsibilitiesNon-conformance: A description is presented in Section G.4. of the Appendix 6 (CCB additional information).

Here it is stated that, “The project proponent is the Sierra Gorda Alliance for Conservation.” However, the PD does not describe SGAC in this role. The PD also refers numerous times to project proponents in the plural, perhaps implying there is more than one. The documentation does not match the explanation given to the auditors that Bosque Sustentable is the Project Proponent.

Corrective Action Request: Bosque Sustentable shall clearly and consistently identify the Project Proponent in the project documentation.Timeline for conformance:


Evidence to close CAR: The PD now in all cases identifies Bosque Sustentable as the project proponent. Please see page 45 of ‘14) Annex 6 for CCB and VCS PDDs, Additional information for CCB Validation May 23, 2011 with changes marked’ for an example. This correlates to what the auditors witnessed during the audit.


CAR: 06/11 Reference Standard & Requirement: 4.2.2 Approval of the baseline methodology; 4.3.1. Approval of the monitoring methodology

Non-conformance: Section B.1. of the PD states that the project uses, “Simplified baseline and monitoring methodologies for small-scale afforestation and reforestation project activities under the Clean Development Mechanism implemented on grasslands or croplands AR-AMS0001 Version 04.1”.

The CDM website states that version 4.1 is, “Valid from 10 Aug 07 to 16 Oct 08, Requests for registration can be submitted until 16 Jun 2009 23:59:59 GMT”. Therefore the methodology is not valid for use at this time.

Corrective Action Request: Bosque Sustentable shall use a VCS approved and valid methodology.

Timeline for conformance:


Evidence to close CAR: The project now uses current version of the methodology “Simplified baseline and monitoring methodology for small-scale A/R CDM project activities implemented on grasslands or croplands with limited displacement of pre-project activities AR-AMS0001 / Version 06”.This is the current version of the methodology.



CAR: 07/11 Reference Standard & Requirement: 4.2.3 Application of methodology deviations or revisions

Non-conformance: The PD contains deviations from the methodology that are not transparently explained in the PD.

Corrective Action Request: Bosque Sustentable shall transparently document any deviations from the methodology and explain them fully.Timeline for conformance:


Evidence to close CAR: The PD now clearly identifies deviations from the methodology in section B.2, these deviations meet the VCS definition of a deviation.


CAR: 08/11 Reference Standard & Requirement: 4.2.5 Correct application and justification of selected baseline methodology & 4.4.3. Calculation of emissions/sequestration in the baseline scenario (ex-ante estimate).

Non-conformance: The PD is not clear about which of the methodology options, 6 a, b, or c was chosen. However, following a discussion with the Project Proponent it was explained that a guidance document, “Annex 16 Guidance On Conditions Under Which The Change in Carbon Stocks in Existing Live Woody Vegetation Are Insignificant (Version 01)” was used. They explained that within this guidance document they were using condition (ii) (2% of 465 tree per ha at the end of the crediting period = 9.3% so this is why the <ten trees per ha, or < 10% cover).

The lack of transparent documentation of how the methodology and tools are used makes the PD difficult to follow and assess without extra explanations.

Corrective Action Request: Bosque Sustentable shall completely and transparently explain how the methodology was followed, including the use of any additional tools or guidance documents that are used in place of some methodology sections.Timeline for conformance:


Evidence to close CAR: Section B.6 of the PD has been revised to clearly explain the procedure for determining insignificance of existing carbon stocks. The approach taken is to use, “Annex 16 Guidance On Conditions Under Which The Change in Carbon Stocks in Existing Live Woody Vegetation Are Insignificant (Version 01)”. The use of the tool is well documented.


CAR: 09/11 Reference Standard & Requirement: 4.3.2. Correct application and justification of selected monitoring methodology.

Non-conformance: Table 1 in the methodology contains a list of things that must be monitored.

The PD does not include plans to gather the following data from the table:

- Ai - Size of the areas where the project activity has been implemented for each type of strata.

- Location of the permanent sample plots.

Corrective Action Request: Bosque Sustentable shall document a monitoring plan that contains all the elements


contained within the methodology.Timeline for conformance:


Evidence to close CAR: The tables in Section B.8.1.1.1 and B.8.1.2.1 of the PD have been updated and now contain all the required data.


CAR: 10/11 Reference Standard & Requirement: 4.3.4. Whether the monitoring plan provides detailed information related to the collection and archiving of all relevant data.

Non-conformance: The monitoring plan contained in the PD does not contain detailed information related to the collection and archiving of all relevant data. During interviews the use of a server was mentioned, but there were no official procedures in place.

VCS 2007.1, 5.13 states,

“The project proponent shall keep all documents and records in a secure and retrievable manner for at least two years after the end of the project crediting period.” (p18)

Corrective Action Request: Bosque Sustentable shall provide detailed information related to the collection and archiving of all relevant data, in compliance with the VCS specific rules on data storage.Timeline for conformance:


Evidence to close CAR: Section B8,4 has been added to the PD. It describes a data collection and archiving procedure that is in conformance with the VCS standards.


3.3 Observations

Note: Observations are issued for areas that the auditor sees the potential for improvement in implementing standard requirements or in the quality system; observations may lead to direct non-conformances if not addressed. Unlike CARs, observations are not formally closed.

The Project Proponent, in document 53, provided responses to OBS which is where quotes found below were taken from.

OBS 01/11 Reference Standard & Requirement: 4.1.4 Technology usedDescription of findings leading to observation: During field visits to the reforestations, observations were made with regards to sub-optimal practices being conducted that could have been remedied by the following of a well designed management plan.Observation: Bosque Sustentable should design and implement a Forest Management Plan (FMP) to make sure the management techniques are implemented to improve the growth and development of the plantations. Side documents should be designed as well, such as pruning or thinning manuals.

Update (10 June 2011): Text has been added to Section A.5.4 of the PDD regarding the development of Forest Management Programs for the two zones of the project.


OBS 02/11 Reference Standard & Requirement: 4.1.6 Ownership/Proof of Title/Right of UseDescription of findings leading to observation: There was slight potential for confusion in the contracts with regards to the contract length.Observation: Bosque Sustentable should include a specific clause in the contract with the landowners where the duration of the contractual relation is clearly explained.

Update (10 June 2011): The Proponent explained that, “Clause 12 of the contract specifically explains the duration of the contractual relationship. The end date will be set to 2042 to correspond with the final date of the project.”

OBS 03/11 Reference Standard & Requirement: 4.1.7 Double counting and whether the project participated in another emission trading programme

Description of findings leading to observation: It was observed that the Proponent’s system for handling the allocation of credits to donors was functioning well and transparent, but that as donations and parcel numbers increased the manual nature of it would mean that errors would be likely.Observation: Bosque Sustentable should upgrade to a more sophisticated/flexible carbon credit tracking system.

Update (10 June 2011): The Proponent stated that “agree with this recommendation and will be working with CONAFOR to upgrade its carbon credit tracking system.”

OBS 04/11 Reference Standard & Requirement: 4.2.5 Correct application and justification of selected baseline methodology

Description of findings leading to observation: In section B.6. a calculation is done which shows the carbon stock of the grass to be 4.9% of the expected removals from the project. In this calculation there appears to be a typo. The paragraph states that the net primary production of grassland is being used. However, this does not seem to be the value taken from the quoted tables and the units of t d.m. ha-1 do not match the units of net primary productivity which are a ‘per year’ value.Observation: Bosque Sustentable should use the correct description of biomass when calculating the significance of pre-project grasslands.

Update (10 June 2011): The Proponent corrected the PDD to clarify that it was the standing biomass of tropical grasslands that was used.

OBS 05/11 Reference Standard & Requirement: 4.3.2. Correct application and justification of selected monitoring methodology.

Description of findings leading to observation: Section B.8 of the PD describes the monitoring activities that will be undertaken. Overall, the monitoring plan was found to be adequate. However, the section does not make clear links back to the methodology’s steps or equations. This could cause difficulties when it comes to verification and the Proponents are required to show how their monitoring results and execution of ex-post calculations have complied with the methodology.Observation: Bosque Sustentable should clearly document a monitoring plan that aligns with the steps in the methodology.

Update (10 June 2011): Section B.8 has been restructured to clearly follow the methodology’s steps.



Description of findings leading to observation: Page 35 of the PD explains the approach to sampling, but there is not yet a decided upon design. The PD does state that “the monitoring will follow the processes outlined in Márquez, 2009 or Pearson et al, 2005”.

Not defining the sampling strategy in detail now does not allow the auditors to assess whether or not it is adequate, which will increase the risk of issues at project verification. The methodology does not have detailed requirements, so therefore the outline that the PD provides at this stage is sufficient.Observation: Bosque Sustentable should define a more detailed sampling and monitoring plan.

Update (10 June 2011): The Proponent stated that, “The development of a more detailed sampling strategy is in process. When completed, the sampling strategy will be shared for external review to ensure that it meets the requirements and to reduce the risk of issues at project verification.”


Description of findings leading to observation: The PD includes equation 5, which is to determine the root biomass. The equation is not referenced, but the auditors found that it is in the methodology and is thus appropriate.Observation: Bosque Sustentable should label all sources of data and equations.

Update (10 June 2011): The equation has been revised and renumbered to correspond to the equation found in the methodology.

OBS 08/11 Reference Standard & Requirement: 4.4.1. The appropriateness of the source, sink and reservoir (pools)

Description of findings leading to observation: In the PD the project proponent states that it has selected ‘above ground’ and ‘below ground’ carbon pools. The wording used does not align with that in the methodology, “2. Carbon pools to be considered by these methodologies are above- and below-ground tree and woody perennials biomass and below-ground biomass of grasslands (i.e. living biomass).” (p1) or the VCS 24th May program update that distinguishes from above-ground tree and non-tree. However, the meaning becomes clear because only trees are discussed later in the methodology, as the carbon pool on which calculations of net emissions reductions are executed.Observation: Bosque Sustentable should use the appropriate and official language according to VCS, to describe the carbon pools.

Update (10 June 2011): Section B,4 has been revised to use the offical language, according to VCS, to describe the carbon pools.

OBS 09/11 Reference Standard & Requirement: 4.4.3. Calculation of emissions/sequestration in the baseline scenario (ex-ante estimate)

Description of findings leading to observation: Whilst at the present time it was easy to distinguish planted trees from pre-existing trees, over time this may become more difficult. The project had no method for identifying pre-existing trees. This could lead to future inaccuracies in carbon stock estimates.Observation: Bosque Sustentable should devise a method in the monitoring plan to identify and track pre-existing trees.

Update (10 June 2011): A section on "Ensuring that pre-existing trees are not counted during future monitoring" has been added to Section B.6 of the PD. In addition, the following field format has been modified to include the


registration of pre-existing trees and their coordinates.

OBS 10/11 Reference Standard & Requirement: 4.4.5. Calculation of emissions reductions or avoided emissions due to the project (ex-ante estimate)

Description of findings leading to observation: In general the PDs approach does not link clearly back to the methodology steps for how to make an ex-ante estimate of the project scenario.Observation: Bosque Sustentable should link the steps in the PD where the ex-ante estimates are made, to the appropriate steps in the methodology.

Update (10 June 2011): Section C of the PD has been revised to include references to the corresponding steps of the methodology, as well as associated guidelines.

OBS 11/11 Reference Standard & Requirement: 4.4.6. Calculation of emissions from leakage (ex-ante estimate)

Description of findings leading to observation: The Project used two CDM tools and two guideline documents in place of the ex-ante leakage section of the methodology.

“Estimation of the increase in GHG emissions attributable to displacement of pre-project agricultural activities in A/R CDM project activity” (Valid)

It was not clear to the auditors that the tools were appropriate for use on small scale projects because they allow the dismissal of leakage as insignificant if displacement is < 50 ha. For small projects this could still be a significant area. However, using the tools/guidance the project is able to show that leakage is insignificant by:- “Guidelines on Conditions Under Which Increase in GHG Emissions Related to Displacement of Pre-Project

Grazing [Cultivation] Activities in A/R CDM Project Activity Is Insignificant”: III.4.A: The leakage survey shows the area displaced is expected to be less than 50ha.

- “Guidelines on Conditions Under Which Increase in GHG Emissions Related to Displacement of Pre-Project Grazing [Cultivation] Activities in A/R CDM Project Activity Is Insignificant”: III.4.B: Activities are being displaced to land already classed as degraded for grazing, and that croplands were already under crop usage.

- In addition point 28 of the methodology allows a zero ex-ante estimate of leakage when there is no expected deforestation (as evidenced by the leakage survey).

In conclusion, the zero ex-ante estimate of leakage is justified; however, the PD could be clearer in explaining which steps of which tools were used to arrive at this conclusion.Observation: Bosque Sustentable should transparently and completely document how they derive the zero leakage estimate using CDM tools.

Update (10 June 2011): Section C of the PD has been revised to include references to the corresponding steps of the methodology, as well as associated guidelines.

OBS 12/11 Reference Standard & Requirement: 4.4.7. Calculation of net VCUs to be issued (ex-ante estimate)

Description of findings leading to observation: Since the CDM calculates credits in a different way to VCS (CDM issues temporary credits and has no buffer); it would benefit the project to calculate VCUs now in order to demonstrate the VCS system for credit calculation.Observation: Bosque Sustentable should produce an ex-ante estimate in the PD for the number of VCUs they will receive at each monitoring period.

Update (10 June 2011): Section C.6 has been added to the PDD to provide an ex ante estimate of the number of


VCUs to be issued at each monitoring period.

A corresponding worksheet has been added to 6) Carbon Calculations for VCS PDD May 20, 2011.

OBS 13/11 Reference Standard & Requirement: 4.4.8. The assumptions made for estimating GHG emission reductions

Description of findings leading to observation: The most important assumptions made for estimating removals are: a) The plantations density is the same, 1100 trees per hectare. However, this is not the case in the fields,

the density varies significantly in some farms. b) A general allometric equation is used for all the species.c) Plantation densities will not vary during the Project. There is a growth model based on this assumption.

It was concluded that the assumptions were not transparently documented in the PD. Whilst the assumptions were not accurate in all cases, any errors would likely cancel out.Observation: Bosque Sustentable should document transparently all the steps that led to the ex-ante prediction and any assumptions involved.

Update (10 June 2011): Section C.2 has been revised to transparently document the steps that led to the ex ante prediction and the assumptions involved.

OBS 14/11 Reference Standard & Requirement: 4.7. Risk factors applicable to ARR projectsDescription of findings leading to observation: The areas are planted as reforestation areas for nature, not for harvesting. This is clear in the contracts signed by landowners. The auditors observed that a risk was present that there may be commercial value in the timber after a number of years and some landowners may be tempted to harvest, even against the advice of the Project Proponent.Bosque Sustentable explained that to prevent the harvest at the end of the contract, multiple meetings had been held with the project participants. However, during the interviews, people do not seem to manage a clear objective of the plantations.Observation: Bosque Sustentable should increase efforts to explain the long term management plans of the reforested areas to all those involved.

Update (10 June 2011): The Proponent has stated that they are, “in agreement with this recommendation and will increase its efforts to explain the long-term management plans of the reforested areas to all those involved.”


4 Field Audit Validation Findings

Please note that the findings related to CARs and OBS are reported in section 3.2 and 3.3 above.

4.1 Project DesignThe conclusions regarding (as required by VCS 2007.1, Section 5.7 PDD requirements):

project title, purpose(s) and objective(s); Type of GHG project; project location, including geographic and physical information allowing for the unique identification and delineation of

the specific extent of the project;

The conclusions regarding (as required by VCS 2007 Validation Template, Section 3.1): the technology used project duration, crediting time and project start date Ownership

o Proof of titleo Double counting and whether the project participated in another emission trading programme

Project applicability to the VCS for projects rejected under other GHG programme (if applicable) Whether the project is eligible under the VCS Any relevant findings relating to the project should be summarised in this section.

4.1.1 Project title, Purposes and ObjectivesFindings from Review on 23 March 2011The project title is, “Carbon Sequestration in Communities of Extreme Poverty in the Sierra Gorda of Mexico”. This title reflects the project activities.

Section A.2. of the PD states,

“The purpose of the project is to reforest areas that require restoration while providing an alternative productive activity to hundreds of landowners and landholders in conditions of severe poverty while capturing carbon at the same time.

The project is primarily designed to overcome the financial barrier to landholder participation. Bosque Sustentable provides the landholders with incentives to follow the forest management plan proposed by Bosque Sustentable.” (p3)

The purposes and objectives correlate with the project activities.Conformance Yes No N/A CAR/OBS No CARs or OBS raised.

4.1.2 Type of GHG projectFindings from Review on 23 March 2011The project is an afforestation/reforestation project. This is an approved VCS AFOLU project type.Conformance Yes No N/A CAR/OBS No CARs or OBS raised.

4.1.3 Project LocationFindings from Review on 23 March 2011The PD, in section A.4.1.3., describes the project areas as being dispersed across two zones:

“Zone 1: Sierra Gorda Biosphere Reserve:Municipalities of Pinal de Amoles, Jalpan de Serra, Landa de Matamoros and Arroyo Seco in the state of Querétaro


Zone 2: San Luis Potosí:Municipalities of Xilitla and Aquismón in the state of San Luis Potosí”

Figures 1-9 in The PD provides orientation and maps the locations of the reforestation sites. The project area is made up 96 small parcels of land, and an additional 160 ha of land are expected to be added over the coming four years. Therefore the project is classed as a grouped project. The Project Proponent has designed and implemented a standard procedure (Annex 5, Doc# 9) to establish clear participation of new potential reforesters. The procedure was clearly explained to the audit team during the field visit. Key points to meet are: that the potential land must be located in communities with similar social, economic and environmental conditions; a requirement that lands are in agriculture or livestock use prior to the establishment of the plantation; and a requirement that any individual who would establish a plantation without the administrative and technical assistance of the project proponent is not eligible. All project data is managed by one central management system. The auditors determined that the project was therefore in conformance with grouped project rules.

The Proponent also demonstrated how the criteria for projects with less than 80% control of their area were met. This was not required, but is a useful indicator that the approach to grouping will not impact the integrity of the project;

A. Demonstrate that the differing area (i.e., whether under control now or in the future) does not affect the outcome of the additionality test.

The Project Proponent has designed and implemented a standard procedure (Annex 5, Doc# 9) to establish clear participation of new potential reforesters. The procedure was clearly explained to the audit team during the field visit. Key points to meet are: that the potential land must be located in communities with similar social, economic and environmental conditions; a requirement that lands are in agriculture or livestock use prior to the establishment of the plantation; and a requirement that any individual who would establish a plantation without the administrative and technical assistance of the project proponent is not eligible.

B. Assure that if the area is eventually smaller than intended, there are provisions that increased emissions attributable to the project activity in the areas that at verification have not come under control of project shall be considered as leakage. This requires the selection of the appropriate methodology beforehand for the eventuality that this may happen.

The project was demonstrated to have no likelihood of activity shifting leakage. As such, this is not a concern.

C. Design a monitoring plan that is flexible enough to deal with changes in the size of the Project.

The monitoring plan is already designed to cope with multiple dispersed parcels. The sampling intensities can be altered to suit the addition of additional parcels.

D. Verify the project within five years of validation.

This was confirmed via a line in the budget (25) Proyección financiera reforestaciones 4 marzo 2011 FINAL para auditores (CONFIDENCIAL) which shows a verification scheduled for 2014.

In section A.5.2 of the PD an accurate description of the project zone’s elevation, climate, soils, hydrography, ecosystems and endangered species is provided. A vegetation map is also provided in Figure 10. This was confirmed by the auditors through observations and comparison to published information on the region.

During the audit, the auditors were able to visit 21 of the project sites, representing 22% of the parcels, and 22% of the total project area. GPS points were taken at a sample of these and compared to the polygons defined on the project’s GIS system. A number of parcels were found not to be at the location specified. In addition, an eligibility check was conducted on 11 parcels, by attempting to trace their eligibility from the inventory spreadsheet (Ref 23) to the GIS database. During this check 2 parcels (18%) had incorrect polygons, as evidenced by the polygons being smaller than the value in the inventory


(2000-8), or being in an unexpected location (2002-12).

In addition, at one project area visited (2008-18), the project area appeared to have more than the eligible 10 pre-existing trees per ha. It was explained that this was a mapping error and that the parcel should not have contained this area. The parcel’s polygon has not been checked by the auditors, so this is not confirmed.

It was explained that the process of parcel data gathering had occurred over many years, but that checks were in place to spot potentially bad parcels. However, this was not clearly documented and appeared not to be functioning satisfactorily.

(CAR 01/11)

Although the file type is not specified in the VCS documentation, or on the VCS website, the VCS require that KML files of the project areas are submitted at the time of validation (personal communication, VCS). These files, for the correct areas, have not yet been provided. (CAR 02/11)Conformance Yes No N/A CAR/OBS CAR 01/11: Bosque Sustentable shall document and execute a procedure (including quality control

checks) for determining project areas and locations. The results shall also be presented to the auditors.

CAR 02/11: Bosque Sustentable shall provide KML files of all the project areas.

4.1.4 Technology usedFindings from Review on 23 March 2011Section A.5.3 of the PD states that the following species will be used (p19),“Pinus patula Pinus gregii Cupressus sp. Liquidambar sp.”

This was confirmed via observations in the field.

The forest management techniques to be employed are described in section A.5.4 of the PD, this includes descriptions of site preparation and reforestation maintenance. These are very basic techniques and according to the professional judgment of the audit team, are enough for the first years of the project. There is one main point to highlight, the management techniques in regards to the maintenance: if there is any loss of trees, the project participants are encouraged to replant the areas. However, during the field visits the audit team found over population due to the fact that the landowners decided to replant more trees than the number which had died, this could prevent a proper development and growth of the plantation. To avoid this, the Project Proponent should design and implement a Forest Management Plan (FMP), definitively in accordance with the General Management Plan of the Biosphere Reserve.(OBS 01/11). Conformance Yes No N/A CAR/OBS OBS 01/11: Bosque Sustentable should design and implement a Forest Management Plan (FMP) to make

sure the management techniques are implemented to improve the growth and development of the plantations. Side documents should be designed as well, such as pruning or thinning manuals.

4.1.5 Project duration, crediting time and project start dateFindings from Review on 23 March 2011In section A.9. of the PD it is stated that the crediting period is 01 January 2002 to 31 December 2042 (a period of 41 years). It is also stated in A.9. that the operational life of the project is 41 years. This was found to be in conformance with VCS rules for project length and crediting period. The calculations presented also cover this period.

The sample contract (between BS and farmers) in annex 4 runs from 2010 to 2039, a period of 30 years. Other contracts


checked were found to be consistent with the project length and crediting period.Conformance Yes No N/A CAR/OBS No CARs or OBS raised.

4.1.6 Ownership/Proof of Title/Right of Use Findings from Review on 23 March 2011As it is stated in the PD, in section A.4.1.3., the Project Proponent describes the project areas as being dispersed across two zones:

“Zone 1: Sierra Gorda Biosphere Reserve:Municipalities of Pinal de Amoles, Jalpan de Serra, Landa de Matamoros and Arroyo Seco in the state of Querétaro Zone 2: San Luis Potosí:Municipalities of Xilitla and Aquismón in the state of San Luis Potosí”

Then, in section A.4.2. of the PD, the project boundary is defined as follows: “… includes 96 reforestations totaling 98.1 hectares established from 2002-2009 and is projected to increase by approximately 40 hectares each year from 2010-2013.”

During the field visit, the audit team interviewed different institution representatives including Mr. Mario Martín Flores the representative of Secretaría de Desarrollo Agropecuario, and also interviewed staff responsible of the legal papers of the land and contracts. It was explained in detail the three forms legally recognized that the land can be owned in México. Among the 96 reforestations, two kind of forms or ownership are mostly represented: private property (zone 1) and community possession of land (zone 2).

Being so, the Project Proponent (as Bosque Sustentable) does not own any of those farms by itself, all the farms belong to the project participants (farmers, in this case), but there is a contract signed by the two parties (Project Proponent and Project Participant) where the rights and obligations of the parties are stated. The contract was written in Spanish and explained by the promoters/staff to the landowners before they signed it, this way both parties were aware of the terms and conditions.

The general parts of the contract includes: a) The general specifications of the land: location, carbon project area (Ha), objective of the reforestation, UTM

coordinates, neighbours and limits. b) A statement where the landowner recognizes that the land is not under any conflict with a neighbour or with pending

payments of tenure taxes.Some specific clauses includes:

a) Objective: to work together in the carbon project.b) Actions, such as the landowner recognizes to Bosque Sustentable as the project coordinator/leader, and therefore

transfers the right of use of the carbon credits generated by the project during the project crediting period. Bosque Sustentable will offer technical assistance and the landowner will be responsible for the maintenance of the reforestations, and based on that a donation will be given.

c) Verification: The landowner is enforced to give free access to field verifications performed by the Project Proponent promoters/staff and/or the validator body.

d) Duration of the contract: the Clause 12 of the contract format (Vigencia y Modificaciones) mentions that the duration of the project will start the next day after the contract is signed and the finalization will be on year 2039 (example of contract provided by the Project Proponent, Annex 4). Even though it is implicit that the duration of the project is more than 30 years, it could be better for the landowner that the contract clearly states the number of years and a clause related with a time expansion of the contract duration. Moreover, based on interviews with key staff, it was said that the contract will cover no more than 30 years, therefore there seems to be some ambiguity around the length of the contract (OBS 02/11).

During the field visit, land tenure documents for project areas were provided. Then a sub-sample of these documents was


thoroughly reviewed by auditors. A sub-sample of the contracts was also provided. According to interviews with staff, the same template of the contract and procedures to socialize the content will be followed with the new areas included in the VCS project boundary. In summary, the audit team considers that the Project Proponent meets the VCS 2007.1 (section 5.7) requirement.Conformance Yes No N/A CAR/OBS OBS 02/11: Bosque Sustentable should include a specific clause in the contract with the landowners

where the duration of the contractual relation is clearly explained.

4.1.7 Double counting and whether the project participated in another emission trading programmeFindings from Review on 23 March 2011During interviews with stakeholders it was explained that the project has previously sold credits.

The Project Proponent explained the system in place to record the ex-ante credits already sold to ‘donors’. The spreadsheet, ‘22) Control de transacciones y pagos 5 marzo 2011 FINAL’ is used. It records the ex-ante estimate of credits that a given land parcel (identified by a unique code) will generate based on the growth and yield estimates and the land area. When a donor purchases a credit, a serial number is assigned to the tonnes that are allocated to that donor. The auditors sampled a number of the transactions and found no errors in calculations.

The Project Proponent did have a draft policy to explain how double counting would be avoided when VCUs are issued and throughout the organisation everyone was aware that double counting would need to be avoided. However, this policy was not yet an official policy of the project. The PD does not include a description of how double counting of these sales is avoided (if it is necessary). (CAR 03/11)

It was observed that the Proponent’s system for handling the allocation of credits to donors was functioning well and transparent, but that as donations and parcel numbers increased the manual nature of it would mean that errors would be likely. (OBS 03/11)Conformance Yes No N/A CAR/OBS CAR 03/11: Bosque Sustentable shall formalise the system employed to avoid double counting.

OBS 03/11: Bosque Sustentable should upgrade to a more sophisticated/flexible carbon credit tracking system.

4.1.8 Project applicability to the VCS for projects rejected under other GHG programme (if applicable)Findings from Review on 23 March 2011The project proponent stated that the project had not been rejected under any other GHG program. It is not listed on the CDM’s website of rejected projects: http://cdm.unfccc.int/Projects/rejected.html. It has not been rejected by Plan Vivo or CarbonFix, as confirmed through discussions with the standards bodies.Conformance Yes No N/A CAR/OBS No CARs or OBS raised.

4.1.9 Whether the project is eligible under the VCSFindings from Review on 23 March 2011The project is a tree planting project that falls within the VCS’s ARR category.

Section I.4.a (p1) of the methodology states that the project must use appendix A of the methodology to demonstrate the eligibility of land areas for an A/R project. Appendix A does not contain requirements but references the requirement to check for new procedures. In Section A.7 of the PD, it is stated that, “Procedures to Demonstrate the Eligibility of Lands for Afforestation and Reforestation Project Activities (Version 01)” is used1.

Section A.7. of the PD describes how the eligibility requirements are met.

1 http://cdm.unfccc.int/Reference/Procedures/methAR_proc03.pdf


http://cdm.unfccc.int/Reference/Procedures/methAR_proc03.pdf

http://cdm.unfccc.int/Projects/rejected.html

Whilst it is stated that remote sensing and interviews were used to determine eligibility, no details are provided in the PD. Section B.8. is referenced for more details. Here, a detailed description of the process to determine the past use of sites is provided. This would be adequate for determining eligibility. The project had produced eligibility sheets for parcels to show, through the available satellite data that the eligibility criteria around past forest coverage was met. This involved the use of Landsat images from 1989, 1996 and 1999, as well as a higher resolution aerial photo from 1996. The auditors analysed the sheets, as well as the GIS database of parcels to check for eligibility (by comparing with remotely sensed images). The operators GIS ability was sufficient to conduct the tasks necessary and adequate data had been gathered. The method used, which was to allow only parcels that were not forested from 1989 to 1999 is appropriate for meeting the methodologies requirements. Parcels with old trees were allowed so long as the definition of forest was not adjudged to have been met. However, it was found that eligibility sheets had not been made for all parcels. It was also found that not all parcels had had their eligibility proven. It appeared that whilst there was a process for accepting parcels, it had been circumvented due to numerous people having access to the databases and their not being adequate quality control. (CAR 04/11) The Mexican DNA’s definition of a forest has been recorded correctly in the PD2.

In addition, the VCS has an eligibility rule applicable to ARR projects. VCS 2007.1, section 3.4 specifically states that,“AFOLU projects that convert native ecosystems to generate carbon credits are not eligible under the VCS. Documented evidence shall be provided in the VCS PD that no ARR or ALM project areas were cleared of native ecosystems within the ten year period prior to the proposed Project Start Date.”

The Landsat images above date back far enough (to 1989) to ensure that no forest was present on the land parcels 10 years prior to the start data of 2002.Conformance Yes No N/A CAR/OBS CAR 04/11: Bosque Sustentable shall demonstrate eligibility for every land parcel included within the

project area through a suitable documented process.

4.1.10 Chronological plan for project initiation and monitoring Findings from Review on 23 March 2011VCS 2007.1 (section 5.7) states that VCS PD must contain,"a chronological plan for the date of initiating project activities, date of terminating the project, frequency of monitoring and reporting and the project period, including relevant project activities in each step of the GHG project cycle.” (p.15)

The PDD contains the required information and this was well understood by project staff.Conformance Yes No N/A CAR/OBS No CARs or OBS issued.

4.1.11 Roles and responsibilitiesFindings from Review on 23 March 2011A description is presented in Section G.4. of the Appendix 6 (CCB additional information). Here it is stated that, “The project proponent is the Sierra Gorda Alliance for Conservation.” However, the PD does not describe SGAC in this role. The PD also refers numerous times to project proponent in the plural, perhaps implying there is more than one. The documentation does not match the explanation given to the auditors that Bosque Sustentable is the Project Proponent. (CAR 05/11)

The auditors were provided with a spreadsheet, “responsabilidades captura de carbono en reforestaciones 3 febrero 2011” that outlines the roles and responsibilities of the various actors involved in the project. These corresponded to the roles understood by the staff members audited.Conformance Yes No N/A CAR/OBS CAR 05/11: Bosque Sustentable shall clearly and consistently identify the Project Proponent in the project

documentation.

2 http://cdm.unfccc.int/DNA/index.html


http://cdm.unfccc.int/DNA/index.html

4.1.12 Observation of local laws and regulationsFindings from Review on 23 March 2011According to interviews with key staff and representatives of local institutions and agencies such as SEMARNAT, the reforestation project can be considered as part of the official government approved management program of the Sierra Gorda Biosphere Reserve. As such, these institutions had worked together with the Project Proponent to make sure the reforestation project is based on a solid national and international legal framework.

The project participants (small landowners) received basic information by Bosque Sustentable promoters even before signing the contract. Training sessions have been implemented to train the promoters also, so they can spread the concepts among the small landowners. Obviously, the general idea is that the project satisfies applicable planning and regulatory requirements.

A list of all relevant national/international and local laws and regulations can be found in Annex 6, the key staff have a hard and an electronic copy of the most important such as: Regulations and Law of Federal Public Administration; General Regulations and Law of Ecologic Equilibrium and Protection of the Environment; General Regulations and Law of Sustainable Forestry Development; General Regulations and Law of Wildlife; National Waters Law and Regulations; Convention on Biological Diversity; UNFCCC, Kyoto Protocol. A copy of the laws and regulations are available at the library.Conformance Yes No N/A CAR/OBS No CARs or OBS raised.

4.2 Baseline

The conclusions regarding (as required by VCS 2007.1, Section 5.7 PDD requirements):

Conditions prior to project initiation

The conclusions regarding (as required by VCS 2007 Validation Template, Section 3.2): Correct application and justification of selected baseline methodology, Approval of the baseline methodology, Application of methodology deviations or revisions (if applicable), Conformance with methodology applicability conditions (added by Rainforest Alliance to aid reporting clarity) Appropriate setting of baseline scenario, and Assessment and demonstration of additionality should be summarised in this section.

4.2.1 Conditions prior to project initiationFindings from Review on 23 March 2011Annex 6, section G1.2 contains a description of the previous landuse, croplands and grasslands. These descriptions were consistent with neighbouring parcels seen by the auditors.Conformance Yes No N/A CAR/OBS No CARs or OBS.

4.2.2 Approval of the baseline methodologyFindings from Review on 23 March 2011Section B.1. of the PD states that the project uses, “Simplified baseline and monitoring methodologies for small-scale afforestation and reforestation project activities under the Clean Development Mechanism implemented on grasslands or croplands AR-AMS0001 Version 04.1”.

The CDM website states that version 4.1 is, “Valid from 10 Aug 07 to 16 Oct 08, Requests for registration can be submitted until 16 Jun 2009 23:59:59 GMT”. Therefore, the methodology is not valid for use at this time. (CAR 06/11)

A quick check was done to see what changes were made to get to the current version, 6.0. The changes were small and hence it is still worthwhile for the audit team to assess the execution of V4.1.


Conformance Yes No N/A CAR/OBS CAR 06/11: Bosque Sustentable shall use a VCS approved and valid methodology.

4.2.3 Application of methodology deviations or revisions (if applicable)Findings from Review on 23 March 2011The PD does not mention any deviations from the methodology. However, please see section 4.2.4 of this report where a deviation from the methodology, through the addition of extra clauses to the applicability conditions are made, but not explained in the PD. (CAR 07/11) Conformance Yes No N/A CAR/OBS CAR 07/11: Bosque Sustentable shall transparently document any deviations from the methodology and

explain them fully.

4.2.4 Conformance with methodology applicability conditionsFindings from Review on 23 March 2011Section B.2. describes how the project meets the methodology. The boxes below describe the auditors’ findings.

Applicability Condition FindingA) Project activities are

implemented on grasslands or croplands;

Through the leakage survey and interviews with landowners, the auditors were able to confirm that the previous land use of project areas was grasslands or croplands.

B) Project activities are implemented on lands where the area of the cropland within the project boundary displaced due to the project activity is less than 50 per cent of the total project area;

In the PD, the following text has been added to the methodologies applicability condition when it is repeated in the PD,

“or where it can be shown that loss of crop land will not cause deforestation.”

The project provides evidence through the leakage survey of the lack of deforestation caused by any displaced crop or grazing activities. This was confirmed by the auditors through observations in the field and farmer interviews.

After consultation with the VCS, it was decided that such a deviation was allowed under 2007.1, as it meets the VCS 2007.1 definition of a deviation.

“Methodology Deviations shall be project specific.

Methodology Deviations shall not be permitted where they result in changes to theconservativeness of the:• baseline scenario;• additionality determination;• included project GHG sources, sinks and reservoirs.Methodology Deviations shall be permitted where they do not impact negatively on the conservativeness of the VCS Program approved methodology’s criteria and procedures to quantify data leading to GHG emission reductions or removals” (p12)

C) Project activities are implemented on lands where the number of displaced grazing animals is less than 50 per cent of the average grazing capacity3 of the project area;

In the PD, the following text has been added to the methodologies applicability condition when it is repeated in the PD,

“or where it can be shown that loss of crop land will not cause deforestation.”

The project provides evidence through the leakage survey of the lack of deforestation caused by any displaced crop or grazing activities. This was

3 See Appendix D.


confirmed by the auditors through observations in the field and farmer interviews.

After consultation with the VCS, it was decided that such a deviation was allowed under 2007.1, as it meets the VCS 2007.1 definition of a deviation.

D) Project activities are implemented on lands where 10% of the total surface project area is disturbed as result of soil preparation for planting.

The PD includes calculations which demonstrate the disturbance to soil is significantly less than 10%. This was confirmed by field observations.

Conformance Yes No N/A CAR/OBS No CARs or OBS raised.

4.2.5 Correct application and justification of selected baseline methodologyFindings from Review on 23 March 2011Please see boxes below for findings.

Baseline Determination Step Findings

5. The most likely baseline scenario of the small-scale A/R CDM project activity is considered to be the land-use prior to the implementation of the project activity, either grasslands or croplands.

Please see section 4.2.7 below. The auditors confirmed that the most likely scenario was the continuation of grasslands or croplands.

6. The project participants shall provide documentation from literature and/or expert judgment, to justify which of the following cases occurs: (a) (b) (c). (regarding changes to carbon stocks in the baseline)

The PD is not clear about which of the options, a, b, or c was chosen. However, following a discussion with the Project Proponent, it was explained that a guidance document, “Annex 16 Guidance On Conditions Under Which The Change in Carbon Stocks in Existing Live Woody Vegetation Are Insignificant (Version 01)” was used. They explained that within this guidance document they were using condition (ii) (2% of 465 tree per ha at the end of the crediting period = 9.3 so this is why the <ten trees per ha, or < 10% cover).

The lack of transparent documentation of how the methodology and tools are used makes the PD difficult to follow and assess without extra explanations. (CAR 08/11)

7. The project area should be stratified for purpose of the baseline calculation into: (a) (b) (c) (d).

Section B.5. explains the baseline stratification. Only one strata was chosen:

(b) Area of grassland with changes in the carbon stocks in the living biomass pool of woody perennials and in below-ground biomass of grasslands expected not to exceed 10% of ex ante actual net GHG removals by sinks multiplied by share of the area in the entire project area;

In section B.6. a calculation is done which shows the carbon stock of the grass to be 4.9% of the expected removals from the project. In this calculation there appears to be a typo. The paragraph states that the net primary production of grassland is being used. However, this does not seem to be the value taken from the quoted tables and the units of t d.m. ha-1 do not match the units of net primary productivity which are a ‘per year’ value. (OBS 04/11)

This stratification was found to be appropriate based on observations of similar land in the area.


8. Baseline carbon stocks will be determined by Eqn 1

The baseline carbon stocks are considered to be zero and unchanging.

9-14 are more detailed steps on baseline carbon quantification

The use of steps 9-14 depends on the outcome of part 6 above. This was not clearly documented in the methodology. (CAR 08/11)

Conformance Yes No N/A CAR/OBS CAR 08/11: Bosque Sustentable shall completely and transparently explain how the methodology was

followed, including the use of any additional tools or guidance documents that are used in place of some methodology sections.OBS 04/11: Bosque Sustentable should use the correct description of biomass when calculating the significance of pre-project grasslands.

4.2.6 Appropriate setting of baseline scenarioFindings from Review on 23 March 2011The VCS standard has a number of specific requirements for baselines as stated in the VCS Tool for AFOLU Methodological Issues; Step 4. However, none of these apply to the ARR project type. Please see section 4.2.7 below for findings related to the use of the baseline and additionality tool.Conformance Yes No N/A CAR/OBS No CARs or OBS issued.

4.2.7 Assessment and demonstration of additionality should be summarised in this section.Findings from Review on 23 March 2011Section I.4.a of the methodology requires that projects use appendix A of the methodology to demonstrate additionality. Section B.7. of the PD demonstrates the project’s additionality. Section B.7. states that,

“The steps outlined in the A/R Methodological tool ―Combined tool to identify the baseline scenario and demonstrate additionality in A/R CDM project activities (Version 01), but applying only the barrier analysis as per AR-AMS001, shall be followed to demonstrate that a proposed A/R CDM project activity is additional and not the baseline scenario. The steps to demonstrate the additionality are outlined below.” (p29)

The methodology does not explicitly state that the combined tool is used; however, this is a useful way of structuring the approach to completing appendix A.Additionality Demonstration Step FindingsSTEP 0. Preliminary screening based on the starting date of the A/R project activity7. If project participants claim that the afforestation or reforestation CDM project activity has a starting date after 31 December 1999 but before the date of its registration, then the project participants shall: • Provide evidence that the starting date of the A/R CDM project activity was after 31 December 1999, and • Provide evidence that the incentive from the planned sale of CERs was seriously considered in the decision to proceed with the project activity. This evidence shall be based on (preferably official, legal and/or other corporate) documentation that was available to third parties at, or prior to, the start of the project activity.

The PD states that the project activities started in 2002. Four separate documents are referenced which date back to 1997 to demonstrate that the project was set up as a carbon project.

STEP 1. Identification of alternative land use scenarios to the proposed A/R CDM project activity

Sub-step 1a. Identify credible alternative land use scenarios to the proposed CDM project activity

The PD identifies the following 4 scenarios;

“1. The land-use prior to the implementation of the project activity, either grasslands or croplands; 2. Natural regeneration;


9. Identify realistic and credible land-use scenarios that would have occurred on the land within the proposed project boundary in the absence of the afforestation or reforestation project activity under the clean development mechanism (CDM)

The scenarios should be feasible for the project participants or similar project developers taking into account relevant national and/or sectoral policies and circumstances, such as historical land uses, practices and economic trends. The identified land use scenarios shall at least include: • Continuation of the pre-project land use; • Forestation of the land within the project boundary performed without being registered as the A/R CDM project activity;

If applicable, forestation of at least a part of the land within the project boundary of the proposed A/R CDM project at a rate resulting from:o Legal requirements; or o Extrapolation of observed forestation activities in the geographical area with similar socio-economic and ecological conditions to the proposed A/R CDM project activity occurring in a period since 31 December 1989 as selected by the PPs.

3. Planting trees for commercial gain by landholders without the incentives from the carbon market (project activity); and 4. Planting trees for forest restoration or commercial gain by some other organization.” (p30)

The identified scenarios comply with the requirements of step 9.

10. For identifying the realistic and credible land-use scenarios; land use records, field surveys, data and feedback from stakeholders, and information from other appropriate sources, including Participatory rural appraisal (PRA) may be used as appropriate. If the baseline approach selected is 22b or c, then the project shall perform a survey of local experts or land owners/users on their plans for land management/investments during the period to the project start.

The scenarios are supported by evidence gathered from stakeholders. The stakeholders consulted on these matters include landowners: María Maqueda, Casimiro Martínez, Nabor Santiago, Ancelmo Hernández; and also local institution representatives such as Heriberto Pedraza, Mario Martín Flores, Jesús Mota and Gerardo Serrato.

11. All identified land use scenarios must be credible. All land uses within the boundary of the proposed A/R CDM project activity that are currently existing or that existed at some time since 31 December 1989 but no longer exist, may be deemed realistic and credible. For all other land use scenarios, credibility shall be justified. The justification shall include elements of spatial planning information (if applicable) or legal requirements and may include assessment of economical feasibility of the proposed alternative land use scenario.

All the scenarios were deemed credible after consultation with local stakeholders.

Sub-step 1b. Consistency of credible alternative land use scenarios with enforced mandatory applicable laws and regulations

12. Apply the following procedure:

• Demonstrate that all land use scenarios identified in the sub-step 1a: are in compliance with all mandatory applicable legal and regulatory requirements;

• If an alternative does not comply with all mandatory applicable legislation and regulations then show that, based on an examination of current practice in the region in which the mandatory law or regulation applies, those applicable mandatory legal or regulatory requirements are systematically not enforced and that non-compliance with those requirements is widespread, i.e. prevalent on at least 30% of area of the smallest administrative

The PD states that all scenarios identified are allowable by applicable laws and regulations. This was confirmed via stakeholder interviews.


unit that encompasses the project area;

• Remove from the land use scenarios identified in the sub-step 1a, any land use scenarios which are not in compliance with applicable mandatory laws and regulations unless it can be shown these land use scenarios result from systematic lack of enforcement of applicable laws and regulations.STEP 2. Barrier analysisSub-step 2a. Identification of barriers that would prevent the implementation of at least one alternative land use scenarios 13. Identify realistic and credible barriers that prevent realization of the land use scenarios identified in Sub-step 1b. The barriers should not be specific for the project participants, but should apply to the proposed A/R CDM project activity as such, even if similar project developers would have developed the project activity. Such barriers may include [Those seven barriers listed in appendix A]

The PD uses the barriers listed in appendix A. This is acceptable.

Sub-step 2b. Elimination of land use scenarios that are prevented by the identified barriers

14. Determine which land use scenarios identified in the Sub-step 1b are prevented by at least one of the barriers listed in sub-step 2a. Substantiate, that the barrier identified as preventing realization of a land use scenario is valid and conclusive in the context of the land use scenario in question. The assessment of a barrier may take into account the level of access to and availability of information, technologies and skilled labour in the region where the planned A/R CDM project activity is located. Eliminate these scenarios from further consideration.

The PD provides explanations of barriers faced by each of the identified scenarios. These are summarised in Table 2. Stakeholder interviews were used to determine that these barriers were credible.

15. If the land within the boundary of the proposed of the A/R CDM project activity was at least partially forested since 31 December 1989 and the land is not a forest at the project start, identify reasons/actions/incentives that allowed for the past forestation and demonstrate that the current legal/financial or other applicable regulations or socio-economical or ecological or other local conditions have changed to the extent that allows for conclusion that repetition of the forestation performed without being registered as the A/R CDM project activity is not possible.

The lands were not forested after 1989, as evidenced by the remote sensing data.

16. Include all land use scenarios that were identified in the Sub-step 1b and were not eliminated in the Sub-step 2b into the list of land use scenarios that are not prevented by any barrier.

This step is done in the PD step B.7.

17. In applying sub-steps 2a and 2b, provide transparent and documented evidence, and offer conservative interpretations of this documented evidence, as to how it demonstrates the existence and significance of the identified barriers. Anecdotal evidence can be included, but this alone is not sufficient proof of barriers. The type of evidence to be provided may include: • Relevant legislation, regulatory information or environmental/natural resource management norms, acts or rules;• Relevant (sectoral) studies or surveys (e.g. market surveys, technology studies, etc) undertaken by universities, research institutions, associations, companies, bilateral/multilateral institutions, etc;

The evidence provided in the PD, although well supported through stakeholder interviews, is not supported by the level of transparent and documented evidence required by this step. However, it was not mandatory to use this tool, and the barrier analysis in Appendix A of the methodology does not have such strict rules on evidence documentation levels. Therefore, no more action is required by the Project Proponent.


• Relevant statistical data from national or international statistics; • Documentation of relevant market data (e.g. market prices, tariffs, rules); • Written documentation from the company or institution developing or implementing the A/R CDM project activity or the A/R CDM project developer, such as minutes from Board meetings, correspondence, feasibility studies, financial or budgetary information, etc; • Documents prepared by the project developer, contractors or project partners in the context of the proposed project activity or similar previous project implementations; • Written documentation of independent expert judgements from agriculture, forestry and other landuse related Government / Non-Government bodies or individual experts, educational institutions (e.g. universities, technical schools, training centres), professional associations and others18. Apply the …decision tree to the outcome of sub-step 2b. [The baseline scenario]

The PD identifies only one scenario as facing no barriers. This is land remaining as cropland or grassland. This was confirmed via stakeholder interviews.


4.3. Monitoring PlanThe conclusions regarding (as required by VCS 2007 Validation Template, Section 3.3): Approval of the monitoring methodology, Correct application and justification of selected monitoring methodology, and Whether the monitoring plan provides detailed information related to the collection and archiving of all relevant data

needed to: Estimate or measure emissions occurring from GHG sources, sinks and reservoirs Determine the baseline emissions Estimate changes in emissions from the site should be summarised in this section.

The conclusions regarding conformance with VCS specific criterion relating to monitoring (VCS 2007.1 section 5.11 and Tool for AFOLU Methodological Issues).

4.3.1. Approval of the monitoring methodology

Findings from Review on 23 March 2011Section B.1. of the PD states that the project uses, “Simplified baseline and monitoring methodologies for small-scale afforestation and reforestation project activities under the Clean Development Mechanism implemented on grasslands or croplands AR-AMS0001 Version 04.1”.

This is not a VCS approved methodology due to the validity dates.Conformance Yes No N/A CAR/OBS CAR 06/11


4.3.2. Correct application and justification of selected monitoring methodologyFindings from Review on 23 March 2011The monitoring plan in the PD was assessed to determine if it followed the requirements of the methodology for the gathering of ex-post data.

Section B.8 of the PD describes the monitoring activities that will be undertaken. Overall, the monitoring plan was found to be adequate. However, the section does not make clear links back to the methodology’s steps or equations. This could cause difficulties when it comes to verification and the Proponents are required to show how their monitoring results and execution of ex-post calculations have complied with the methodology. (OBS 05/11)

Step in Monitoring Methodology Findings

A. Ex post estimation of the baseline net greenhouse gas removals by sinks

The methodology does not require the baseline is monitored.

8. Stratification of the project area should be carried out to improve the accuracy and precision of biomass estimates.

PDD on section B.5. states “A single stratum with the average expected growth based on measured carbon stocks will be assumed of each planting year from 2002 to 2013.” As a result, there will be a total of 12 ex -ante project strata.

9. For ex post estimation of project GHG removals by sinks, strata shall be defined by:

(i) Relevant guidance on stratification for A/R project activities under the clean development mechanism as approved by the CDM Executive Board (if available); or

(ii) Stratification approach that can be shown in the PDD to estimate biomass stocks according to good forest inventory practice in the Host country in accordance with DNA indications; or

(iii) Other stratification approach that can be shown in the PDD to estimate the project biomass stocks to targeted precision level of ±10% of the mean at a 95% confidence level.

Carbon stocks (expressed in t CO2-e) shall be estimated through the following equations:

IP(t) =∑(PA(t) i + PB(t) i) * Ai*(44/12)

The Project Proponent has defined a total of 12 ex-ante project strata to determine the biomass estimates with at least 10% of standard error at a 95% of confidence. A revision of the calculations demonstrates the project aims this. However, the monitoring plan in section B.8. does not mention this or another approach. It is only mentioned the following “A preliminary inventory and previous monitoring results will be used to stratify the project area and create sample designs to estimate the project biomass stocks to a precision level that complies with AR-AMS001”.

This is acceptable for a plan, but will require elaboration in the monitoring report.

Carbon stocks (expressed in t CO2-e) shall be estimated through the following equations:

P(t) =∑(PA(t) i + PB(t) i) * Ai*(44/12)

The Project Proponent has done a preliminary exercise of calculations to determine the total carbon stock in the reforestations, based on technical knowledge and some assumptions but in general, the idea is to use equation 24 of the methodology.

The approaches used to date are in line with the methodologies ex-post requirements.

40. The calculations shown in paragraphs 41–47 shall be performed for each stratum.

In the PDD, the equation 24 is transcript from the methodology, including acronyms. This is the only part of the PDD where the Project Proponent plans to estimate the carbon stocks for each stratum: “Where: …Ai = project activity area of stratum i (ha)


i = stratum i (I = total number of strata)”Above-ground biomassFor above-ground biomass PA(t) i is calculated per stratum i as follows:PA(t) i =E(t) i* 0. 5

The PDD does not explain which carbon fraction factor will be used. Although they must use 0.5 as per the methodology.

Estimate of above-ground biomass at time t achieved by the project activity E(t) shall be estimatedthrough the following steps:Step 1: Establish permanent plots and document their location in the first monitoring report;

Page 35 of the PD explains the approach to sampling, but there is not yet a decided upon design. The PD does state that “the monitoring will follow the processes outlined in Márquez, 2009 or Pearson et al, 2005”.

Not defining the sampling strategy in detail now does not allow the auditors to assess whether or not it is adequate, which will increase the risk of issues at project verification. The methodology does not have detailed requirements, so therefore the outline that the PD provides at this stage is sufficient.

(OBS 06/11)Step 2: Measure the diameter at breast height (DBH) or DBH and tree height, as appropriate this measure and document it in the monitoring reports;

This step will need verifying after monitoring has been done.

Step 3: Estimate the above-ground biomass using allometric equations developed locally or nationally.If these allometric equations are not available:Option 1: Use allometric equations included in Appendix C to this report or in annex 4A.2 ofthe IPCC good practice guidance for LULUCF;Option 2: Use biomass expansion factors and stem volume as follows:E(t) i = SV(t) i * BEF * WDStem volume SV(t)i shall be estimated from on-site measurements. Consistent application of BEFshould be secured on the definition of stem volume (e.g. total stem volume or thick wood stem volumerequires different BEFs). National default values for wood density should be used. If national values arealso not available, the values should be obtained from table 3A.1.9 of the IPCC good practice guidancefor LULUCF.

The PDD only states “The choice of allometric equations will be documented along with their sources”. The audit team determined that Brown 1997 will be used to estimate the above-ground biomass, but it is not specified in the monitoring plan. Care will need to be taken that an acceptable equation is chosen and used correctly during monitoring.

The same values for BEF and WD should be used in the ex post and in the ex ante calculations.

No BEF or WD values were used in the baseline.

Below-ground biomassCarbon stocks in below-ground biomass at time t achieved by the project activity during themonitoring interval PB(t) shall be estimated for each stratum i as follows:PB(t) i=E(t) i * R * 0. 5Documented national values for R should be used. If national values are not available, the valuesshould be obtained from table 3A.1.8 of the IPCC good practice guidance for LULUCF.If root to shoot ratios for the species concerned are not available, project proponents shall use theallometric equation developed by Cairns et al. (1997)

The PD includes equation 5, which is to determine the root biomass. The equation is not referenced, but the auditors found that it is in the methodology and is thus appropriate.

(OBS 07/11)


PB(t) i =exp(.1.085 + 0.9256 * ln E(t) i) * 0.5Project emissions are considered insignificant and therefore:PROJ t GHG , = 0

There is no need to validate this step.

Table 1. Data to be collected or used in order to monitor the verifiable changes in carbon stock in the carbon pools within the project boundary from the proposed afforestation and reforestation project activity under the clean development mechanism, and how these data will be archived

Table 1 in the methodology contains a list of things that must be monitored.

The PD does not include plans to gather the following data from the table:

- Ai - Size of the areas where the project activity has been implemented for each type of strata.

- Location of the permanent sample plots.

(CAR 09/11)Conformance Yes No N/A CAR/OBS OBS 05/11: Bosque Sustentable should clearly document a monitoring plan that aligns with the steps in

the methodology.

OBS 06/11: Bosque Sustentable should define a more detailed sampling and monitoring plan.

OBS 07/11: Bosque Sustentable should label all sources of data and equations.

CAR 09/11: Bosque Sustentable shall document a monitoring plan that contains all the elements contained within the methodology.

4.3.3. Conformance with VCS specific criterion relating to monitoring (VCS 2007.1 section 5.11 and Tool for AFOLU Methodological Issues Step 6)

Findings from Review on 23 March 2011Please see boxes below for findings.From VCS 2007.1 Section 5.11: The project proponent shall establish and maintain criteria and procedures for obtaining, recording, compiling and analysing data and information important for quantifying and reporting GHG emissions and/or removals relevant for the project and baseline scenario (i.e. GHG information system). Monitoring procedures should include the following:

VCS Required Monitoring Procedures FindingsPurpose of monitoring The purpose of the monitoring is not explicitly stated; however, from the

headings in section B.8 of the PD, the purpose is clear: to quantify the above-ground & below-ground biomass and monitor leakage.

Types of data and information to be reported - including units of measurement

A table in section B8.1.1.1 of the PD shows the data to be measured and the units of measurement.

Monitoring methodologies, including estimation, modelling, measurement or calculation approaches

In section B.8.3 the PD states,

“Forestry promoters are responsible for the field work, including the implementation of the monitoring plan. The assistant director of Bosque Sustentable is responsible for field supervision of the forestry organizers, while the director of Bosque Sustentable, a forestry engineer, is responsible for training, the review and processing of the data, the carbon calculations, the preparation of monitoring reports and the overall supervision of the monitoring program.” P41

Interviews with staff confirmed this.Monitoring times and periods, considering the Every year 20% of the project area will be monitored, such that the whole

area is covered every five years.


needs of intended usersMonitoring roles and responsibilities The responsibilities for the monitoring are explained in section B.8.3 of the

PD.GHG information management systems, including the location and retention of stored data

See section B.8.2 of the methodology


4.3.4. Whether the monitoring plan provides detailed information related to the collection and archiving of all relevant data

Findings from Review on 23 March 2011The monitoring plan contained in the PD does not contain detailed information related to the collection and archiving of all relevant data. During interviews the use of a server was mentioned, but there were no official procedures in place.

VCS 2007.1, 5.13 states,

“The project proponent shall keep all documents and records in a secure and retrievable manner for at least two years after the end of the project crediting period.” (p18)

No plan to do this was seen. (CAR 10/11)Conformance Yes No N/A CAR/OBS CAR 10/11: Bosque Sustentable shall provide detailed information related to the collection and archiving

of all relevant data, in compliance with the VCS specific rules on data storage.

4.4. Calculation of GHG EmissionsThe conclusions regarding (as required by VCS 2007 Validation Template, Section 3.4): The appropriateness of the source, sink and reservoir (pools), The correctness and transparency of formulas and factors used, The assumptions made for estimating GHG emission reductions, and Uncertainties should be summarised in this section.

4.4.1. The appropriateness of the source, sink and reservoir (pools)Findings from Review on 23 March 2011In the PD the project states that it has selected ‘above ground’ and ‘below ground’ carbon pools. The wording used does not align with that in the methodology, “2. Carbon pools to be considered by these methodologies are above- and below-ground tree and woody perennials biomass and below-ground biomass of grasslands (i.e. living biomass).” (p1) or the VCS 24th May program update that distinguishes from above-ground tree and non-tree. However, the meaning becomes clear because only trees are discussed later in the methodology, as the carbon pool on which calculations of net emissions reductions are executed. (OBS 08/11)Conformance Yes No N/A CAR/OBS OBS 08/11: Bosque Sustentable should use the appropriate and official language according to VCS, to

describe the carbon pools. 4.4.2. The correctness and transparency of formulas and factors usedFindings from Review on 23 March 2011In general the PD was relatively transparent in the formulas and factors used. There are isolated examples of unreferenced equations and incorrect referencing (p27); however, these are explained elsewhere in the report, and do not affect the results.Conformance Yes No N/A CAR/OBS No CARS and OBS raised.


4.4.3. Calculation of emissions/sequestration in the baseline scenario (ex-ante estimate)Findings from Review on 23 March 2011In section B.6. of the PD it is stated that all selected sites will have less than 10 trees per ha. It is stated that increases in biomass of these trees would be insignificant.

An option for accounting for the biomass when >10 trees are present per ha is provided. The methodology described references some equations from part 9-14 of the baseline methodology. However, growth does not appear to be considered.

After discussions with the Project Proponent, it was explained that pre-existing trees will be ignored (their original biomass and growth during the crediting period will not be measured). It was explained that a guidance document, “Annex 16 Guidance On Conditions Under Which The Change in Carbon Stocks in Existing Live Woody Vegetation Are Insignificant (Version 01)” was used to determine insignificant pre-project biomass. They explained that within this guidance document they were using condition (ii) (2% of 465 tree per ha at the end of the crediting period = 9.3 so this is why the <ten trees per ha, or < 10% cover). Whilst at the present time it was easy to distinguish planted trees from pre-existing trees, over time this may become more difficult. The project had no method for identifying pre-existing trees. This could lead to future inaccuracies in carbon stock estimates. (CAR 08/11) (OBS 09/11)Methodology Step Findings

Above-ground biomass

9. For above-ground biomass BA(t) is calculated per stratum i as follows:

M(t) shall be estimated using average biomass stock and growth rates specific to the region. In the absence of such values, national default values should be used. If national values are also not available, the values should be obtained from table 3.3.2 of the IPCC good practice guidance for LULUCF.

Since the PD ignores the pre-existing biomass, these methodology steps are not necessary. See discussion above about the presentation of this in the PD.

10. If living biomass carbon pools are expected to increase according to paragraph 6 (c), the average biomass stock is estimated as the above-ground biomass stock in age-dependent above-ground biomass stock in woody perennials:

M(t=0) = Mwoody (t=0)(1)

if: Mwoody (t=n-1) + g * t < Mwoody_max then:

M(t=n) = Mwoody ( t=n-1) + g * t(2)

if: Mwoody (t=n-1) + g * t ≥ Mwoody_max then:

M(t=n) = Mwoody_max (3)

N/A See above.

11. Documented local values for g and Mwoody_max should be used. In the absence of such values, national default values should be used. If national values are also not available, the values should be obtained from the IPCC good practice guidance for LULUCF: from table 3.3.2 for g and for Mwoody_max.

N/A See above.


Below-ground biomass

12. For below-ground biomass BB(t) is calculated per stratum i as follows:

If living biomass carbon pools are expected to be constant according to paragraph 6 (a) and 6 (c), the average below-ground carbon stock is estimated as the below-ground carbon stock in grass and in biomass of woody perennials:

BB(t=0) = BB(t) = 0.5 * (Mgrass * Rgrass+ Mwoody (t=0) * Rwoody)(4)

N/A See above.

13. Documented local values for Rgrass and Rwoody should be used. In the absence of such values, national default values should be used. If national values are also not available, the values should be obtained from table 3 A.1.8 of the IPCC good practice guidance for LULUCF.

N/A See above.

14. The baseline net GHG removals by sinks can be calculated by:

CBSL,t = (B(t) - B(t-1))*(44/12)(5)

N/A See above.

Conformance Yes No N/A CAR/OBS CAR 08/11

OBS 09/11: Bosque Sustentable should devise a method in the monitoring plan to identify and track pre-existing trees.

4.4.4. Calculation of emissions from project activities (ex-ante estimate)Findings from Review on 23 March 2011The methodology does not require the calculation of emissions from project activities.Conformance Yes No N/A CAR/OBS N/A

4.4.5. Calculation of emissions reductions or avoided emissions due to the project (ex-ante estimate)Findings from Review on 23 March 2011Section III of the methodology contains the steps for the ex-ante estimate of project removals by sinks. The findings are presented in the boxes below. Section C of the PD contains the ex-ante estimates. The spreadsheet, “Carbon calculations for VCS PDD March 4 2011 FINAL” documents the ex-ante calculations. The results are presented in table 4 and 5 of the PD.

In general the PD’s approach does not link clearly back to the methodology steps for how to make an ex-ante estimate of the project scenario. (OBS 10/11)

The ex-ante projections do not include thinning, although thinning is expected to occur in most cases.Methodology Step Findings

15. Stratification of the project area should be carried out to improve the accuracy and precision of biomass estimates.

The spreadsheet, “Carbon calculations for VCS PDD March 4 2011 FINAL” shows that 12 strata based on planting date were used in ex-ante predictions. This includes an assumption that 40 ha will be planted each year in 2010, 2011, 2012 and 2013.

16. For the ex ante calculation of the project biomass, the The project area is stratified based on planting date as a first criterion, since the growth of the species is expected


project area should be stratified according to the project planting plan that is, at least by tree species (or groups of them if several tree species have similar growth habits), and age classes.

to be similar.

17 .The carbon stocks for the project scenario at the starting date of the project activity4 (t=0) shall be the same as the baseline stocks of carbon at the starting date of the project (t=0). Therefore:

N(t=0) = B(t=0) (6)

For all other years, the carbon stocks within the project boundary (N(t)) at time t shall be calculated as follows: I

N(t) = ∑(NA(t) i + NB(t) i) * Ai (7)

The baseline stocks are considered zero (with pre-existing trees being ignored).

4 The starting date of the project activity should be the time when the land is prepared for the initiation of the afforestation or reforestation project activity under the CDM. In accordance with paragraph 23 of the modalities and procedures for afforestation and reforestation project activities under the CDM, the crediting period shall begin at the start of the afforestation and reforestation project activity under the CDM (see UNFCCC website at <http://unfccc.int/resource/docs/cop9/06a02.pdf#page=21>).


Above-ground biomass

18. For above-ground biomass NA(t) i is calculated per stratum i as follows:

NA(t) i =T(t)i * 0.5 (8)

Cell C58 of the ‘yield tables’ tab in the spreadsheet, “Carbon calculations for VCS PDD March 4 2011 FINAL” uses 0.5 as the CF value.

19. If biomass tables or equations are available then these shall be used to estimate T(t)i per stratum i. If volume table or equations are used then:

T(t)i=SV(t)i * BEF * WD (9)

An allometric equation (Brown, 1997) was used to determine the above-ground biomass at time t under the project scenario.

20. Values for SV(t)i shall be obtained from national sources (such as standard yield tables). Documented local values for BEF should be used. In the absence of such values, national default values should be used. If national values are also not available, the values should be obtained from table 3A.1.10 of the IPCC good practice guidance for LULUCF. If national default values for wood density are not available, the values should be obtained from Table 3A.1.9 of the IPCC good practice guidance for LULUCF.

The allometric equation uses only the diameter of the trees as independent variable, to estimate the above-ground biomass at time t. Hence, it was not necessary to use a value for SV(t)i .

Below-ground biomass

21. For below-ground biomass, NB(t) is calculated per stratum i as follows:

NB(t) i=T(t) * R * 0.5 (10)

22. Documented national values for R should be used. If national values are not available, appropriate values should be obtained from Table 3A.1.8 of the IPCC good practice guidance for LULUCF.

23. If root to shoot ratios for the species concerned are not available, project proponents shall use the allometric equation developed by Cairns et al. (1997).

NB(t) = exp(–1.085 + 0.9256 * ln T(t)) * 0.5 (11)

In accordance with point 23 the Cairns equation is used in column E of the tab ‘Yield Table’ in the spreadsheet, ““Carbon calculations for VCS PDD March 1 2011 FINAL”.

24. The removal component of actual net GHG removals by sinks can be calculated by:

CPROJ,t = (Nt - Nt-1)*(44/12)/t (12)

The estimate is calculated correctly in units of CO2.

25. Project emissions are considered insignificant and therefore:

= 0

Project emissions are not considered. This is acceptable.

26. The ex ante actual net greenhouse gas removals by sinks in year t are equal to:

Since project emissions are not considered, the emissions reductions are equal to the sequestration from the project.


CACTUAL,t = (13)Conformance Yes No N/A CAR/OBS OBS 10/11: Bosque Sustentable should link the steps in the PD where the ex-ante estimates are made, to

the appropriate steps in the methodology.

4.4.6. Calculation of emissions from leakage (ex-ante estimate)Findings from Review on 23 March 2011The Project used two CDM tools and two guideline documents in place of the ex-ante leakage section of the methodology.

“Estimation of the increase in GHG emissions attributable to displacement of pre-project agricultural activities in A/R CDM project activity” (Valid)

It was not clear to the auditors that the tools were appropriate for use on small scale projects because they allow the dismissal of leakage as insignificant if displacement is < 50 ha. For small projects this could still be a significant area. However, using the tools/guidance, the project is able to show that leakage is insignificant by:- “Guidelines on Conditions Under Which Increase in GHG Emissions Related to Displacement of Pre-Project Grazing

[Cultivation] Activities in A/R CDM Project Activity Is Insignificant”: III.4.A: The leakage survey shows the area displaced is expected to be less than 50ha.

- “Guidelines on Conditions Under Which Increase in GHG Emissions Related to Displacement of Pre-Project Grazing [Cultivation] Activities in A/R CDM Project Activity Is Insignificant”: III.4.B: Activities are being displaced to land already classed as degraded for grazing, and that croplands were already under crop usage.

- In addition point 28 of the methodology allows a zero ex-ante estimate of leakage when there is no expected deforestation (as evidenced by the leakage survey).

In conclusion, the zero ex-ante estimate of leakage is justified; however, the PD could be clearer in explaining which steps of which tools were used to arrive at this conclusion. (OBS 11/11)Conformance Yes No N/A CAR/OBS OBS 11/11: Bosque Sustentable should transparently and completely document how they derive the zero

leakage estimate using CDM tools.

4.4.7. Calculation of net VCUs to be issued (ex-ante estimate)Findings from Review on 23 March 2011The VCS guidelines do not state specifically that the number of VCUs to be issued must be estimated. However, it does state,

“The (ex-ante) determination and quantification of the baseline and project scenario, including the leakage assessment shall follow either relevant IPCC 2006 Guidelines (GL) for AFOLU, or approved CDM or VCS methodologies. An ex-ante calculation of the net carbon benefits of the project is only required to determine whether decreases in carbon pools or increases in GHG emissions are insignificant and need not be measured and monitored.”

The PD does not contain an estimate of the VCUs that will be issued.

Since the CDM calculates credits in a different way to VCS (CDM issues temporary credits and has no buffer), it would benefit the project to calculate VCUs now in order to demonstrate the VCS system for credit calculation. (OBS 12/11)Conformance Yes No N/A CAR/OBS OBS 12/11: Bosque Sustentable should produce an ex-ante estimate in the PD for the number of VCUs

they will receive at each monitoring period.


4.4.8. The assumptions made for estimating GHG emission reductionsFindings from Review on 23 March 2011The most important assumptions made for estimating removals are:

a) The plantations density is the same, 1100 trees per hectare. However, this is not the case in the fields, the density varies significantly in some farms.

b) A general allometric equation is used for all the species.c) Plantation densities will not vary during the Project. There is a growth model based on this assumption.

It was concluded that the assumptions were not transparently documented in the PD (although it was possible to determine the assumptions by looking through the excel sheets). Whilst the assumptions were not accurate in all cases, any errors would likely cancel out. (OBS 13/11)Conformance Yes No N/A CAR/OBS OBS 13/11: Bosque Sustentable should document transparently all the steps that led to the ex-ante

prediction and any assumptions involved.

4.4.9. UncertaintiesFindings from Review on 23 March 2011The selected methodology does not require an estimation of the uncertainties. Conformance Yes No N/A CAR/OBS No CARS and OBS raised.

4.5. Environmental ImpactThe conclusions regarding (as required by VCS 2007 Validation Template, Section 3.5): Requirements for and approval of an Environmental Impact Assessment (if applicable) The sufficient documentation of environmental impact should be summarised in this section.

4.5.1. Requirements for and approval of an Environmental Impact Assessment (if applicable)Findings from Review on 23 March 2011During the field visit, the audit team interviewed various representatives of local institutions (SEMARNAT, Forestry Department, Profepa, and CONAFOR). The general agreement was that both the Forestry Law (Ley de Desarrollo Forestal Sustentable) and the “LGEEPA” Law (Ley General del Equilibro Ecológico y Protección al Ambiente), do not require an Environmental Impact Assessment (for major reforestation projects) nor a Manifiesto de Impacto Ambiental (or MIA, for small reforestation projects). The representative of SEMARNAT even mentioned there is a legal loophole concerning the EIA for reforestations, even if it is established in a protected area. Some of the people interviewed agreed also in saying that due to the kind of project, and based on the predominant actual use of the land, it is preferable to establish a reforestation in full compliance with the Management Program of the Sierra Gorda Biosphere Reserve, until the Law clarifies the point.

The audit team reviewed both laws and did other consultants to interpret the content and finally agreed that an environmental assessment is not legally enforced.Conformance Yes No N/A CAR/OBS No CARs or OBS raised.

4.5.2. Comments by stakeholders

The conclusions regarding (as required by VCS 2007 Validation Template, Section 3.6):Findings from Review on 23 March 2011As part of the planning process for the project, Bosque Sustentable hosted various stakeholder consultations during 2009 and 2010, with small landowners, agencies and neighbours of communities adjacent to the project areas. Moreover, as it is stated in the PDD, numerous meetings of consensus were held with communities prior to the establishment of the Biosphere Reserve itself. It was mentioned that there were done various presentations to the SG advisory council conformed by


representatives from communities as well as local, state and national governments and agencies.

In general, the idea of these meetings included the sharing of information about the projects, as well as offered stakeholders the opportunity to provide feedback on the project activities.

During the field audit, a list of participants was provided to the auditors by the Project Proponent. Additional interviews with Bosque Sustentable staff during the field audit confirmed the stakeholder consultation process described in the PDD.

Also during the audit, the Project Proponent and the current and potential project participants (small reforesters) held a meeting where the donation was given to those projects already verified by Bosque Sustentable as it is considered in the contract. At the end of the group meeting, there was an opportunity for the reforesters to ask questions and critic the project, but all the interventions were related to receive again further clarifications of the project: objectives, conditions and requirements, amount of donations.

As part of the CCB consultation period, the project also received comments (support) primarily from institutions that have worked together with Bosque Sustentable, such as Fundación Gonzalo Rio Arronte, and the World Land Trust. In summary, comments were like the project represents a direct support to communities and its projects; the project represents a permanent source of employment; the project implementation contributes to the governability of the area due to the lack of economic resources of national institutions.

Finally, the audit team had the opportunity to receive positive comments and support from three local authorities.Conformance Yes No N/A CAR/OBS No CARs or OBS raised.

4.5.3. Negative environmental and socio-economic impacts of the project.

The conclusions regarding (as required by VCS 2007.1 section 3.4): AFOLU projects potential negative environmental and socio-economic impacts and mitigation steps prior to generating

Voluntary Carbon Units (VCUs).

Findings from Review on 23 March 2011The project is also seeking validation to the Climate Community and Biodiversity Standards (CCB).

The PD for CCB makes a comparison between the impacts in both scenarios “with project” and “without project”, and also has a brief analysis of the community benefits under the following general categories: water capture, soil conservation, temperature regulation, poverty reduction, training of local people, community participation, and improvement in quality of life.

The negative socioeconomic impacts of the project are explained in the “without project” scenario. There is also a brief analysis of the potential impacts outside the project (offsite stakeholder impacts).

As a result of the identification of potential negative impacts, Bosque Sustentable designed a preliminary plan to monitor the impacts consisted of the methods, indicators, frecuency, stakeholders to monitor.

A similar exercise was performed by Bosque Sustentable in regards to the environmental impacts of the project to establish the negative impacts. The “with and without project” scenarios were used also for two ecology factors “habitat for wildlife” and “pressure on forest as domestic fuel”. The High Conservation Values were analysed separately according to the specific requirements of the CCB standard.

Finally, in the Annex 9 the Project Proponent intends to define a biodiversity monitoring plan applicable to the project area (and also to the whole Biosphere Reserve).Conformance Yes No N/A


CAR/OBS No CARs or OBS issued.

5 VCS Risk Assessment

4.6. Risk factors applicable to all project types

Risk Factor Self

Ass

essm

ent

Ris

k R

atin

g

Findings OBS/CAR

Risk of unclear land tenure and potential for disputes

See 4.7 Due to repetition between the VCS tables, findings are presented in section 4.7 below.

No CAR/OBS raised.

Risk of financial failure See 4.7 Due to repetition between the VCS tables, findings are presented in section 4.7 below.

No CAR/OBS raised.

Risk of technical failure See 4.7 Due to repetition between the VCS tables, findings are presented in section 4.7 below.

No CAR/OBS raised.

Risk of management failure See 4.7 Due to repetition between the VCS tables, findings are presented in section 4.7 below.

No CAR/OBS raised.

Risk of rising land opp. costs causing reversal of sequestration/protection

See 4.7 Due to repetition between the VCS tables, findings are presented in section 4.7 below.

No CAR/OBS raised.

Risk of political instability Low According to interviews, the audit team determined that the political relationship between local institutions and the Project do not represent a risk of instability for the Project itself. The auditors agree that a low rating is acceptable.

No CAR/OBS raised.

Risk of social instability Low In both zones the audit team determined that there is similar poor level of the small landowners, but this does not represent a risk; project participants use marginal areas to implement the project. The auditors agree that a low rating is acceptable.

No CAR/OBS raised.

Risk of devastating fire Low In general terms, there is a very low risk of devastating fire in both zones. This was confirmed by landowners and by field observations. The dispersed nature of the reforestations means that any one fire is only likely to affect a few parcels. The auditors agree that a low rating is

No CAR/OBS raised.


Note: Risk factors are determined through a qualitative analysis conducted, following the guidance of the VCS Tool for Non-Permanence Risk Analysis and Buffer Determination, combined with the 13 April 2010 VCS Program Update. Evidence supporting the qualitative assessment must be provided by the project proponent.

acceptable.Risk of pest and disease attacks

Low Three main pests were identified during the field visit: squirrel, a parasite plant called muerdago, and a butterfly. All of them are considered low risk. The auditors agree that a low rating is acceptable.

No CAR/OBS raised.

Risk of extreme weather events (e.g. floods, drought, winds)

Low The Project area is not considered a zone with high vulnerability to extreme weather events. The auditors agree that a low rating is acceptable.

No CAR/OBS raised.

Geological risk (e.g. volcanoes, earthquakes, landslides)

Low There is no evidence of recent earthquakes or other geological events. The auditors agree that a low rating is acceptable.

No CAR/OBS raised.

Summary of findings and assessment of risk ratingThe auditors agreed with the rating and defence provided by the Project Proponent.CAR/OBS: No CAR/OBS raised.

4.7. Risk factors applicable to ARR projects

Risk Factor Self

Ass

essm

ent

Ris

k R

atin

g

Findings OBS/CAR

Project longevity/ Commitment period

Low The areas are planted as reforestation areas for nature, not for harvesting. This is clear in the contracts signed by landowners. The auditors observed that a risk was present that there may be commercial value in the timber after a number of years and some landowners may be tempted to harvest, even against the advice of the Project Proponent.Bosque Sustentable explained that to prevent the harvest at the end of the contract, multiple meetings had been held with the project participants. However, during the interviews, people do not seem to manage a clear objective of the plantations.

OBS 14/11: Bosque Sustentable should increase efforts to explain the long term management plans of the reforested areas to all those involved.

Ownership type and user rights

Low The following aspects are considered as potential risks of land tenure and potential for disputes:

a) In Zone 2 of the project the community possession of the land prevails.

b) In the case of new areas, the land tenure is subject to the lack of the money necessary to do the paper work. Moreover, the fees of notary is considered to be exorbitant, that can prevent people to submit or update the

No CAR/OBS raised.


information.c) Grievances over the land can

appear after the project start date. d) The right of use.

However, the Project Proponent has analyzed these aspects in advance and considered a low risk. During the field visit all of them were discussed with key personnel, then the audit team considered the risk as low.

Technical capability Low Bosque Sustentable demonstrated that they had sufficient technical capacity to manage the project and have been doing so with success for a number of years. The auditors agree that a low rating is acceptable.

No CAR/OBS raised.

Financial capacity Low The project has received start up donor funding and will subsist on sales from carbon credits. Financial projections for the crediting period were seen that indicated the project is not at financial risk, providing sales of credits are made. The fact that many credits have already been sold ex-ante, without VCU certification is evidence that the project has the ability to market and sell credits. The auditors agree that a low rating is acceptable.

No CAR/OBS raised.

Management capacity of project developer

Low Bosque Sustentable has many years experience in forest management, and in particular in management of this carbon project. The risk of insufficient management capacity leading to reversals in the project was judged by the auditors to be low. The project has an onsite management team who make visits to the dispersed sites. The auditors agree that a low rating is acceptable.

No CAR/OBS raised.

Future income Low A comprehensive budget was shown to the auditors that indicated the project was sufficiently well financed to sustain itself during the crediting period. The auditors agree that a low rating is acceptable.

No CAR/OBS raised.

Future/current opportunity costs

Low Consultation with landowners and stakeholders gave no indication that the land value was likely to rise. The planted areas are often not easily accessible and degraded. The auditors agree that a low rating is acceptable.

No CAR/OBS raised.

Endorsement of project

Low The Project Proponent has demonstrated its endorsement; moreover, the project is involved in a regional strategy to develop the whole Sierra Gorda Reserve Biosphere, so indirectly other institutions have also shown its endorsement to the project.

No CAR/OBS raised.


Summary of findings and assessment of risk ratingSee findings specific to risk ratings above.CAR/OBS: OBS 14/11

11.1.1 Default buffer withholding percentages for ARR projectsRating/Amount Findings

Self Assessment Risk Class Low Low was found to be an appropriate risk rating.Self Assessment Buffer Withholding Percentage

20% 20% is the highest percentage available within the low class. This is an acceptable deduction.

CAR/OBS: No CAR/OBS raised.


6 Validation ConclusionBosque Sustentable’s, ‘Carbon Sequestration in Communities of Extreme Poverty in the Sierra Gorda of Mexico’ consists of a number of small scale plantings (0.5-4.32 ha) in parcels dispersed throughout the Sierra Gorda Biosphere reserve and its area of influence. The land which is planted belongs to farmers who plant under contract, and receive carbon payments for maintaining the plantation through the crediting period. The planted areas will not be subject to rotational harvesting. This is a grouped project which expects to add 40 more hectares per year in the same region. Criteria for site selection were provided. The previous landuse and baseline was shown to be cropland or pasture. The Project Proponent addressed the 10 Corrective Actions that were issued in the draft report via the submission of additional evidence and revised documentation. The Project was found to be in conformance with the VCS standard 2007.1. The project’s risk assessment determined that it was a low risk project, with a buffer corresponding to 20%.


Appendix A: Company Details

11.2 Contacts

Primary Contact for Coordination with SmartWood

Primary Contact, Position: David RossAddress: Ave. La Presa S/N, Col. Barrio El Panteón,

Jalpan de Serra, Querétaro 76340Mexico

Tel/Fax/Email: [email protected]

Billing Contact

Contact, Position: As aboveAddress: As aboveTel/Fax/Email: As above

11.3 On-line Certification Contact

Note: upon Validation, the SmartWood web site posts and maintains Customer Fact Sheets for companies with the information in the table below at http://www.rainforest-alliance.org/climate.cfm?id=international_standards

Field Text for Customer Fact Sheet Has this Info Changed?Contact, Title: Laura Pérez-Arce, Fundraising and

Public Relations Coordinator Yes No

Address: Ave. La Presa S/N, Col. Barrio El Panteón,Jalpan de Serra, Querétaro 76340Mexico

Yes No

Tel/Fax/Email/Website: Tel: +52-441-296-0242e-mail: [email protected]: www.sierragorda.net

Yes No

Products/Descriptions: N/A Yes No


mailto:[email protected]