Reducing Emissions from Deforestation and Forest Degradation (REDD) is an effort to create a financial value for the carbon stored in forests, offering incentives for developing countries to reduce emissions from forested lands and invest in low-carbon paths to sustainable development. "REDD+" goes beyond deforestation and forest degradation, and includes the role of conservation, sustainable management of forests and enhancement of forest carbon stocks. An effective global REDD+ policy depends not only on policies that create the demand necessary to produce forest emissions reductions but also on a reliable source of finance to pay for those reductions.
Through partnership with Ohio State University and the Environmental Defense Fund, the Nicholas Institute for Environmental Policy Solutions established that international forest carbon reductions through voluntary markets or emissions compliance markets could be established if policies created demand for a sufficient supply of reasonably priced carbon credits. Nicholas Institute researchers and other policy analysts also determined that a combination of approaches is necessary to finance various REDD+ activities under the United Nations Framework Convention on Climate Change (UNFCCC) and in voluntary markets—at least for the present.
The Nicholas Institute continues to provide guidance to parties developing REDD+ protocols in tropical developing countries.