Rutu Dave

28 September, 2009
Quezon City, Philippines
 The Clean Development
Mechanism - CDM

Developing Country
Industrializ
Funding
ed
Country
Technolog
y Projects to reduce GHG
emissions

Emission reduction
compared to an existing
baseline
Certified Emission
Reduction (CER)
 Pre-project (one Post-project (Repeated):
1 time) 5 FY1…

PD, Consultant PD, DOE

2 6

3 DNA DOE
7

DOE
4 EB, ITL, NTL

CDM/EB – Meth, SSC, LULUCF

 Unequal Distribution of CDM
Projects
•4 countries (China, India, Brazil and South Korea) account for 70% of CDM
projects and 80% of CERs through to 2012

• Sub-Saharan Africa accounts for 2% of registered projects and 5% of

CERs through to 2012

• 88 non-Annex 1 countries have yet to benefit from any registered CDM

project activity Location of approved CDM
projects

● CDM project, Large scale, one location

● CDM project, Large scale, several locations
● CDM project, Small scale, one location
4
● CDM project, Small scale, several locations
 Under PoA, GHG emission reductions
are achieved by multiple actions or
projects, referred to as CPA (CDM
Programme Activity) executed over
time as a result of a government policy
measure or a private sector initiative
One Program of Activities & Many CDM Project Activities (CPAs):
One Methodology, One or more project participants, One or
more locations,
● Implement
● Institutional, financial
Program and methodological
policy/program or goal
of framework
Activities
(PoAs)

● Project Activities Unique and identifiable

generate CERs
with a defined boundary
 Enhances CDM potential
in sector important for
cities, e.g. lighting,
buildings
 Reduces transactions
costs because of
economies of scale
(many small CDM projects
under one Program)
 Potential catalyst
(incentive) to transform
entire sectors towards low
carbon development
 The CPA definition is critical in the
design of POA
 CPA characteristics include:
 Typification (similarity across CPAs)
 Different proponents possible for CPAs in
different locations
 Starting date and crediting period can be
different for different CPAs
 Single approved methodology for all CPAs
 Single Project Bundle of Projects Program
Single location Many locations Many locations,
across countries
Single project owner Many project owners Many project owners
(e.g., 1 (e.g., 10
landfill/dumping landfills/dumping sites)
site)

1 project only A number of activities A number of activities

submitted as 1 project submitted over the
(e.g., 10 duration of a program
landfills/dumping sites)

A single crediting Single crediting period Each project has own

period (e.g., for all activities (7/10 crediting period
7/10years) years)
 Project by Project approach – high transaction costs
 Few approved methodologies in high priority urban
sectors – e.g. transport
 Regulations limiting cities’ ability to enter into long-term
CDM project contracts
 Weak institutional capacity at city level to:
 undertake CDM projects
 Integrate CDM into priority city development programs
 design policies and measures to encourage CDM activities

 New Opportunity: CDM Program of Activities

 Need to understand systems to design an urban PoA
 Street lighting for example in cities is the responsibility of
municipalities who in turn award concessions
 PoA can be structured either at municipal level or by
aggregating cities and municipalities at the country level
 CME (Coordinating Monitoring Entity) is often likely to
evolve into a PPP institutional framework
 Goal: replace 30 million incandescent light bulbs with
CFL to start transform EE Sector in Residential Building
 Features: 4 bulbs/HH, distributed for free through retail
shops
 Model CPA: City of Puebla 1 million CFL
 Est. GHG Reduction (avg yr): 27,700 t CO2
 Energy Savings per HH: (avg yr) 200 kwh
 Status: submitted to UNFCCC CDM EB by private
Developer - Cool nrg www.coolnrg.com
 Monitoring arrangements – intensive!
 At exchange: registration each light bulb
 Independent Verification (DOE), plus
 Sample of 60 HH (hr, energy) – too small?

 Financial Viability - full cost recovery?

 Est.Revenues: 6.5 Mill Euro @ 15/t CO2 – high?
 Total costs $3.5 Mill. – mostly upfront
 May require subsidies from local governments

 Definitely: CDM - Significant contribution

to cover program cost
 10–150 Wp size solar PV home systems, to be
installed across Bangladesh, for users not
connected to the electricity grid
 Nearly 10,000 liters of fossil fuel replaced
annually
 Annual emission reductions: 35,000 Tonnes of
CO2e
 US$ 350,000 per annum carbon revenue
 Financial Barriers

Technology
Barriers

Institutional & Regulartory

Barriers
 Improved biomass cooking stoves
 Biogas digesters using animal waste

 Off-grid applications using renewable

energy
 Utilization of climate friendly construction
material, and
 Various measures in the transport sector
such as road maintenance, fleet
replacement
Municipal Areas

Pumping energy efficiency

Raw Water & leakage reduction
Raw & Waste
Water Treatment
Waste
Water technologies
Solid Waste Recycling (paper, plastic,
Solid Waste metals)
Treatment options
Public
services Landfill gas to electricity

transport Public Energy efficiency

services Renewable Energy options
Buildings

Other
Municipal Areas

Incentives for reduced vehicle

Raw Water Urban & Public
transport use
Fuel switch, non-motor
Waste options
Water Energy efficiency
Solid Waste Public & other
buildings Whole Building
Public design
services
Energy efficiency
transport Other
Renewable Energy
Buildings options
Urban forestry &
agriculture
Other
Thank you for time and attention