Module 4 Introduction to barriers to Mitigation

1. Module 4Introduction to barriers to Mitigation • Concepts and scope • (Some) Sectoral Barriers • Overcoming Barriers

2. Module 4a Concepts

3. Introduction • Numerous technologies and practices exist to reduce GHG emissions. • Significant technical progress has been made in many areas such as wind turbines, hybrid engine cars, underground CO2 storage, etc. • Opportunities to increase efficiency are overall. • But significant barriers exist. • Barriers add to the cost of implementation, and reduce the feasible potential • Barriers can be technical, economic, political, cultural, social, behavioral and institutional.

4. Mitigation Potential Proposed conceptual framework

5. The Concept of Barriers • “The transfer of technologies and practices that have the potential • to reduce greenhouse gas (GHG) emissions is often hampered by • barriers that slow their penetration” • [IPCC, 2001 Mitigation: Working Group III to the Third Assessment Report] • A barrier is any obstacle to reaching a potential reduction of GHG that can be overcome by a policy, programme or measure. • Opportunities for any given country might be found in the removal of any combination of barriers. An opportunity is a situation or circumstance to decrease the gap between the market potential of a technology or practice and the economic, socioeconomic, or technological potential. • Barriers and opportunities tend to be context-specific, can change over time and vary across countries. • Barriers identification is a key issue to select feasible mitigation options.

6. Sources of Barriers • prices • financing • International trade • market structure • institutional and regulatory frameworks • Information provision • social, cultural and behavioral norms and aspirations Barriers categories or areas… • Within each of these areas, barriers and opportunities represent: • failures or imperfections in markets, policies or other institutions that lie between the market potential and the possible achievement of the economic potential • Other barriers are aspects of institutions or social and cultural systems that separate the economic and socioeconomic potentials.

7. Some Key Issues • Definition • Categories (efficiency gap) • Barriers mean additional costs • They are context-specific, can change over time and vary across countries. • They could be a key element to select feasible mitigation options

8. Module 4b Sectoral Barriers

9. Sectors Considered • Buildings • Transport • Industry • Energy Supply • Forestry • Solid Waste • Agriculture

10. (Some) Barriers in the Buildings Sector • Traditional customs • Lack of skills • Behavior and style • Social barriers • Misplaced incentives • Lack of financing • Market structure • Absence of regulation • Administratively set prices • Imperfect information

11. (Some) Barriers in the Transport Sector • Infrastructure • Lifestyles and Culture • Economic Development • Patterns of industrial production • Consumer behavior (status or cost minimization) • Lock-in technology (mobility, freedom, flexibility, fun, status, safety, a personal territory, a means of self expression) • Subsidies - No full costs estimation • Inadequate alternative options

12. (Some) Barriers in the Industry Sector • Lack of information • Limited Capital Availability • Lack of skilled personnel • Decision making process • Distorted perception

13. (Some) Barriers in the Energy Supply Sector • Energy Prices • Inconsistency in evaluation of energy costs • Lack of adequate financial support • Institutional transformation and reforms • Legal and regulatory frameworks • Lack of information • Decision making process and behavior • Social and cultural constraints • Capital availability

14. (Some) Barriers in the Forestry Sector • Lack of technical capability • Lack of capacity for monitoring carbon stocks • Opportunity cost of the land use

15. (Some) Barriers in the Solid Waste Sector • Lack of enabling policies initiatives, institutional mechanism, information and opportunities • Organizational problems in collection and transport • Lack of coordination among different groups • Scale

16. (Some) Barriers in the Agriculture Sector • Farm-level adoption constraints • Government subsidies • Lack of capacity and skills • Lack of information • Lack of intellectual property rights

17. Some remarks • Not necessary the best sectors and options (for GHG mitigation) are the most feasible ones. • Overcoming barriers is part of the decision on options • A ranking of options could consider barriers as an indicator

18. Module 4c Overcoming Barriers

19. Overcoming Barriers Diagnosis  Barrier  Problem Policy (Intervention)  Prioritize problems  Objectives  Strategies  Actions  Measures  Results • Depends on sector and technology pathway • Identification, analysis and prioritization of barriers are time and country specific • Barrier removal requires consideration of different interests and influences of stakeholders • Driven by needs: increase the flow of technology to the needs • Improve the quality: transfer only the right technology (ESTs) Policy itself has barriers: a key challenge is the identification of feasible policies and to translate in adequate strategies.

20. Overcoming Barriers • Removal of barriers during capital stock turnover and periods of rapid social change can minimize disruption and mitigation costs. • National responses to climate change can be more effective if deployed as a portfolio of policy instruments to limit or reduce greenhouse gas emissions. (Climate change as part of sector policies) • Effectiveness can be enhanced when climate policies are integrated with the non-climate objectives of national and sectoral policy development (e.g., sustainable development). • Coordinated actions among countries and sectors may help to reduce mitigation cost, address competitiveness concerns, potential conflicts with international trade rules, and carbon leakage. (JI/CDM) • Nevertheless, earlier actions, including a portfolio of emissions mitigation, technology development and reduction of scientific uncertainty, increase flexibility in moving towards stabilization of atmospheric concentrations of greenhouse gases.

21. Overcoming Barriers: Sectoral Level • Market based instruments (taxes, tradable permits, subsidies, deposit/refund systems) • Standards, product bans, energy mix requirements • Voluntary agreements • Information, and labeling programs • Government investment/ R&D spending • Regulation Sectoral options only as effective as allowed by macro conditions

22. Overcoming Barriers: Macro Levels • Macro policies: Some examples: • Reform of the legal system • Creation of adequate markets conditions • Enhancing physical and communications infrastructure • Improve land tenure • Improve macro-economic stability • International co-ordination can address competitiveness, international trade rules, and “leakage” • Setting appropriate macro-conditions can contribute more to mitigation than improving sectoral policies, measures, and instruments. • IPCC shows a major gap in research: few studies identify barriers and ways to overcome them, or estimate the cost of their removal.

23. Opportunities For Overcoming Barriers • Seeking synergies between competitiveness and GHG mitigation (e.g., when GHG mitigation could reduce costs) • Communication among firms, between firms and users, or universities or government labs. • Good communication strategies (marketing) may encourage consumer acceptance of new technologies. • Economic, regulatory, and social incentives for reducing GHG emissions will also act as incentives for innovation to find new means of mitigation. • Introduce low-emission technology, when previously locked-in technology begins to change. • Changes in the market and regulatory context can also provide opportunities for innovation.

24. Overcoming Sectoral Barriers:Buildings • Voluntary programs • Building efficiency standards • Equipment efficiency standards • Demand-side management (DSM) programs • Financing programs • Government procurement • Tax credits • Accelerated R&D • Carbon cap and trade schemes

25. Overcoming Sectoral Barriers: Transport • Fuel taxes • Charges on road users, including parking fees, road taxes, license fees, and insurance premiums • Shifting local government spending towards public transport and away from private transport. • Fiscal and regulatory measures and public purchasing aimed at developing larger markets for low- GHG-emission vehicles plus international co-operation • Implementing planning measures that encourage more sustainable transport patterns, avoiding the pollution, congestion, higher accident rates, and GHG emissions associated with cars. Introduce toll rings around big or medium sized cities, • Moving away from zoning and car-based transport, and towards multi-function, high-density pedestrian zones • Effective mitigation strategies would entail combinations of measures for overcoming the many forms of inertia and lock-in.

26. Overcoming Sectoral Barriers: Industry • Technology diffusion policies: there is no single instrument to reduce barriers; instead, an integrated policy accounting for the characteristics of technologies, stakeholders, and countries addressed would be helpful. • Information programmes designed to assist industry in understanding that employing technologies and practices will improve their competitiveness and reduce costs at the same time that use energy more efficiently. • Best Practice’ programmes aimed to improve information on energy efficient technologies, demonstration projects and information dissemination, Energy audit programmes, among others. • Environmental legislation can be a driving force in the adoption of new technologies. • Direct subsidies and tax credits or other favorable tax treatments. • Financial incentive programmes leading to large impacts on energy efficiency

27. Overcoming Sectoral Barriers:Energy Supply • Multilateral cooperation is especially important for the development of hydropower programmes, regional interconnections, and developing small renewable technologies (e.g., mini hydro, solar, and wind). • A reduction in nuclear or hydro unit size and/or improved safety might could help to overcome the capital availability barrier. • Greater regional co-operation among developing countries in both research and development, and the development of an international commercial contracting network, to improve technology transfer. • Accounting for the needs of potential users, and harmonizing diffusion strategies with local physical, human, and institutional resources, while building local technical and institutional capabilities. • Expansion of electricity supply systems, while improving the efficiency of new capacity. • Promoting commercialization of excess electricity production (e.g. from Industrial CHP) through better regulated access to existing grid systems.

28. Overcoming Sectoral Barriers:Forestry • Forestry sector options are relatively low cost compared to those in the energy sector, which helps to reduce barriers. • Promotion of mitigation projects also automatically promotes the flow of technology • Independent verification of C abatement would help to increase the credibility and funding of forestry-sector mitigation projects.

29. As a conclusion • Need of policies (Intervention) • Instruments and measures depend on national circumstances • Policy itself has barriers: a key challenge is the identification of feasible policies and to translate in adequate strategies

30. Module 4c Examining Barriers During a Mitigation Assessment

31. Examining Barriers During a Mitigation Assessment • Mitigation assessment should include information on the barriers and opportunities for implementation. • Useful to identify main implementation requirements including: • Financial support • Assessment of technology options for the different mitigation options in various sectors • Institutional capacity-building to sustain mitigation work • Regulation policies • Further improvements of the national decision framework • Costs associated to the implementation of mitigation options

32. Possible Topics for Discussion • How can the concepts of mitigation potential (market, economic, social, technological) and barriers best be incorporated into a mitigation assessment? • What approaches could be used for barrier identification and assessment?