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The CDM and Local Sustainable Development

The CDM and Local Sustainable Development. The CDM Point of Departure.

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The CDM and Local Sustainable Development

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  1. The CDM and LocalSustainable Development

  2. The CDM Point of Departure • CDM is the first multi-lateral trade mechanism insisting on Sustainable Development in article 12 of KP “…assist Parties not included in Annex 1 in achieving Sustainable Development and contributing to the ultimate objective of the Convention….” • CDM assists Annex 1 countries in meeting their emissions reduction targets in return for income for credits derived from projects that contribute to sustainable development

  3. Assessment of CDM objectives • An accredited DOE verifies the reduction in emissions resulting from a CDM project activity • The determination of the SD contribution is left to the host country government.

  4. Is the CDM delivering on SD? • Slack SD rules to attract CDM related FDI • Current CDM pipeline dominated by high yield (HFC, CH4,N2O) low abatement cost projects, with low SD contribution. • Renewable energy, energy efficiency, etc. are marginalised as uncompetitive in CDM market.

  5. Current overview

  6. Kuyasa Thermal Efficiency in Low-income Housing:Project Scope Retrofit 2309 low-cost houses in Kuyasa, Khayelitsha with: • Insulated ceilings, • solar water heaters and • CFL’s (energy efficient lighting)

  7. Thermal Efficiency Upgrade • The Kuyasa project pre-empts a rise in domestic electricity use in low income urban areas in South Africa through the installation of renewable energy and energy efficiency interventions • This required the establishing of a baseline that takes into account the suppressed demand for energy services as a result of energy poverty and lack of energy infrastructure • The registerstration of the project as a CDM project will enable it to access carbon revenues to subsidise the capital expenditure. Its Gold Standard rating ensures a premium ito the price it is able to command. • The project has numerous benefits including reduced expenditure on space heating, water heating and lighting, a reduction in respiratory health impacts, and the creation of employment opportunities

  8. Project Benefits BENEFITS • Alleviates energy poverty through access to affordable, renewable energy and energy efficiency measures • Saves R600/hh/annum in energy costs: reduced expenditure on space heating, water heating and lighting, • Creates over 100 person years employment • Improves health conditions • Improves local air quality • Reduces peak energy demand • reduction in respiratory health impacts • Benchmark for replication internationally South Africa Western Cape City of CT Kuyasa

  9. The Public Sector and CDM • Financial barriers: the need for bridging finance and working with public mony in a speculative environment • Legal & institutional: legislation, bureaucracy, inflexibility, lack of capacity to manage risk • Dedicated Resources: climate change action vs. development objectives • Policy vacuum: NCCRS not translated to the local level.

  10. Ensuring SD in CDM • Project Developers: Maximise southern benefits through selection of projects, choice of investors (CER buyers), and timing transactions. • DNA: Establish robust SD criteria, in line with country dev. priorities for project appraisal. Provide effective and enabling framework for project approval. • Public Sector and Public Sector Partnership: How do we incentivise the private sector to undertake emissions reductions in renewable energy and energy efficiency in sectors crucial to SD • Civil Society: Vigilance in appraisal of DNA decisions

  11. Thank you, shirene@southsouthnorth.org Website: www.southsouthnorth.org www.cdmguide.com

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