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Deforestation accounts for roughly 17 per cent of global greenhouse gas emissions. So it is no surprise that in the runup to the December 2009 climate talks in Copenhagen, REDD – reduced emissions from deforestation and degradation – is emerging as a strategy with big potential for mitigating climate impacts. With REDD, local communities can be rewarded for conserving their forests, so the approach works for poverty alleviation as well as emissions reduction. Evidence is showing that REDD is simple and workable. Funding is an altogether more complex issue, however. Looking at the roles of market and government, is a combined approach to financing REDD feasible?