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PAVING THE ROAD FOR THE IMPLEMENTATION OF A NATIONAL GREENHOUSE REGISTRY IN ROMANIA

PAVING THE ROAD FOR THE IMPLEMENTATION OF A NATIONAL GREENHOUSE REGISTRY IN ROMANIA. Mihaela DUPLEAC - TERRA Millennium III, ROMANIA Development of Registries, REC&CANCEE Side Event, SBSTA, June 7, 2003. 1. INTRODUCTION.

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PAVING THE ROAD FOR THE IMPLEMENTATION OF A NATIONAL GREENHOUSE REGISTRY IN ROMANIA

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  1. PAVING THE ROAD FOR THE IMPLEMENTATION OF A NATIONAL GREENHOUSE REGISTRY IN ROMANIA Mihaela DUPLEAC - TERRA Millennium III, ROMANIA Development of Registries, REC&CANCEE Side Event, SBSTA, June 7, 2003

  2. 1. INTRODUCTION • Project in the frame of REC’s “Support for the Implementation of the Kyoto Protocol” • October 2002 - March 2003 • TERRA Millennium III - apolitical, non-governmental and not for profit organization for environment protection; regional center of CAN CEE, legitimated by the UN to follow the UNFCCC negotiations

  3. Objectives: • overview of the intl. requirements (UNFCCC, EU) for national registries (NR) • overview of the national circumstances that support/hinder the implementation of a NR in Romania • establishment of the specific needs related to the NR implementation • establishment of a scheme for the NR under the most probable option for Romania’s participation in flexible mechanisms • contribution to capacity building in Romania - recommendations on the next steps.

  4. Methods: • desk research • international requirements • trading schemes • existing climate policy, legal framework, institutions, capacity, needs, financial support • existing monitoring and registration systems • interviews • specialists - env. & energy research, statistics, companies, financing institutions; operators of existing registries • decision makers (MWEP, MIR) • brainstorming • comments on the draft paper.

  5. 2. INTERNATIONAL REQUIREMENTS ON THE IMPLEMENTATION OF A GHG REGISTRY • UNFCCC Guidelines • EU Proposed Scheme for GHG Emissions Allowance Trading

  6. UNFCCC Guidelines • Kyoto Protocol: each Annex I Party shall establish and maintain a NR • COP 7, Marrakesh Accords: decisions on NR, CDM registry and independent transaction log • COP 8, New Delhi: technical standards for the structure and data formats of registry systems.

  7. EU Proposed Scheme for GHG Emissions Allowance Trading • MS/authorities will grant GHG permits that set obligations to hold transferable allowances equal to the actual emissions • Yearly, companies must submit for cancellation a number of allowances corresponding to their actual emissions • Holding and tracking of allowances will be done through an electronic register • Preliminary phase 2005-2007 • Second phase - five years periods, starting 2008 • Linked national registries - crucial component • Synergies with existing legislation (IPPC Directive) - EPER • Accession countries may link to the EU scheme by entering into agreements with EU Parties to mutually recognize each other’s allowances • Proposal does not foresee inclusion of credits from JI and CDM.

  8. 3. NATIONAL CIRCUMSTANCES FOR THE IMPLEMENTATION OF A GHG REGISTRY IN ROMANIA GENERAL • Romania - Annex I country • Ratified the Kyoto Protocol in 2001 • MoUs with: The Netherlands, Switzerland, Austria, Norway, Denmark • AIJ already, JI under development; ET envisaged.

  9. INSTITUTIONAL FRAMEWORK • MWEP; national climate change focal point • Future National Environmental Agency • Environment Protection Inspectorates • National Commission on Climate Change • Institutes of research (ICIM, INMH, ISPE, ICEMENERG) • National Institute of Statistics • NGO - TERRA Mileniul III.

  10. CLIMATE CHANGE STRATEGY AND ACTION PLAN • No specific CC strategy • Guidelines for NAPCC initiated by REC Romania (March 2003) • Strategies for the environment protection (1996; 2001-2004) • National strategy for economic development of Romania • National strategy for sustainable development • Sectoral strategies • NEAP (1995); new one scheduled for 2003.

  11. LEGISLATION • Ratification of UNFCCC in 1994 (Law) Ratification of Kyoto Protocol in 2001 (Law) • Law on environmental protection • Law and ministerial orders on the protection of atmosphere • Set of laws regarding the Environment Fund • Law regarding integrated pollutants prevention and control (IPPC Directive) • Ministerial order for the set up of the PER.

  12. NATIONAL COMMUNICATIONS AND INVENTORIES • NC 1 (1995) - used CORINAIR • NC 2 (1998) - used the 1995 IPCC Guidelines, includes Inventory for 1989-1991 and estimates for 1992-1994 • NC 3 (2003) - draft; revised UNFCCC Guidelines • Inventory for 1992-2000 and National Inventory Report for 2000 were submitted in Dec. 2002, based on revised UNFCCC Guidelines and Common Reporting Format.

  13. Circumstances that SUPPORT the Implementation of a NR in Romania • Political Commitment • First Annex I country that ratified the Kyoto Protocol • commitment to participate in flexible mechanisms (ranked as the most interested AC) • commitment to keep the pace with EU initiatives • Legislation • primary legislation in place • precedent created: setting up of the PER • existing primary and secondary legislation on electronic commerce • Experience with other registries • most existing registries in the country are operated by governmental institutions, under specific regulation • existing capacity for developing, operating and maintaining registries is satisfactory • many Romanian companies dealing with software development and computerized services emerged on the internal and international market • March 2003: National Guide of Pollutant Emissions issued; implementation of PER - public register to provide environmental information on industrial activities covered by IPPC Directive (including GHGs); useful for air emissions trading between facilities  PER and NR efforts can be joint.

  14. Circumstances that HINDER the Implementation of a NR in Romania • Strategy- no clear strategy on GHG mitigation • Compliance with the UNFCCC reporting requirements- until present the country has not provided the GHG Inventories annually; only 3rd Inventory (for 1992-2000) complies with the requirements • Institutional • reduced climate related capacity in the MWEP • National Commission on Climate Change met only once a year (1997-2002), no working group, no activities between meetings; starting 2003, the frequency of the meetings has raised • Monitoring systems for air quality • lack of funds  very few stationary sources are equipped with continuous measurement instruments to monitor air emissions • a reliable inventory can not be achieved at a regional/local level  data uncertainties in collecting emissions info from sources, low capacity on verification of data at the local inspectorates for environment protection • Financing - financial assets at MWEP are unsatisfactory; new Environmental Protection Fund • Status of international negotiations on registry systems - not finalized yet, ongoing discussions in the EU, Romania follows the discussions.

  15. National Registry Built in Romania or Acquired from Abroad? 1) ACHIEVEMENT OF THE REGISTRY IN ROMANIA • Romania has the background, necessary expertise and means • less costly, while respecting international requirements • best adaptation to the local situation • built on existing databases in the country • implemented using existing infrastructure • limited external support: technical and financial assistance (MoUs) • establishment of national framework of recording relevant information, as a preliminary step to the NR, while intl. negotiations settle an agreed and detailed set of requirements for the NR

  16. 2) ACQUIRING THE REGISTRY FROM ABROAD • readily made Registry, once such systems emerge internationally • eliminate concerns regarding credibility and compatibility with other international registry systems • low existing legislative, financial and even technical capacity in the country • international negotiations have not been finalized yet  stand-by approach • international technical and financial assistance for the implementation (MoUs) 3) WHILE STANDARDS ARE STILL BEING NEGOTIATED INTERNATIONALLY, ROMANIA NEEDS TO START THE INSTITUTIONAL FRAMEWORK FOR THE REGISTRY • designation of the NR Administrator (governmental/private body) • selection and training of personnel • definition of the NR requirements etc.

  17. 4. DESIGN OF A NATIONAL GHG REGISTRY FOR ROMANIA ROMANIA’S POLICY OPTION REGARDING PARTICIPATION IN FLEXIBLE MECHANISMS • Romania is willing to participate in JI and ET (seller) • currently it is envisaged that only the government will be entitled to trade; further on, probably legal entities will also be allowed to trade • a domestic trading system is not likely to evolve at present in Romania.

  18. GENERAL REQUIREMENTS FOR THE DEVELOPMENT OF A NATIONAL REGISTRY • NR to ensure accurate accounting of the issuance, holding, transfer, acquisition, cancellation and retirement of AAUs, ERUs, RMUs and the carry-over of the AAUs and ERUs • concordance with technical standards (mandatory and indicative) - issuance and transactions occur in an accurate, transparent and efficient manner • Romania will have to provide a description of its NR to the UNFCCC (Marrakesh Accords) • NR will be reviewed at UNFCCC • Romania may link its NR to the EU’s trading scheme by entering into agreements with EU Parties so as to mutually recognize each other’s allowances • Romania’s NR will be integrated in the EU network of NR and linked to the Central Emissions Register.

  19. FUNCTIONS OF THE REGISTRY (1) • Recording of units • holding account - containing initial AAUs & RMUs and ERUs initiated in JI projects • cancellation account - corresponding to each commitment period • retirement account - for each commitment period, to demonstrate compliance • each legal entity authorized to trade will have at least one holding account • available list of legal entities (to UNFCCC Secretariat and public) • serial numbers - assigned to AAUs, RMUs, ERUs • account numbers - assigned to every account in the NR.

  20. FUNCTIONS OF THE REGISTRY (2) • Processing transactions • issuance • no. of AAUs to be issued is equal to no. of tones of CO2e corresponding to Romania’s assigned amount (92 % of emissions in 1989) • issuance of RMUs, equivalent to net GHG removals • issuance of ERUs, as result of JI projects • cancellation (AAUs, RMUs, ERUs), in case: • the LULUCF activities result in a net source of GHG emissions; • of non-compliance; • retirement - valid AAUs, ERUs and RMUs shall be retired for the commitment period, to be used for demonstrating compliance • carry-over - neither retired nor cancelled AAUs can be carried over(if retirement account shows compliance).

  21. FUNCTIONS OF THE REGISTRY (3) • Substantiation of compliance/ Reporting • Informationfrom and about NR will be incorporated in the annual Inventory reports and the National Communications • The National Inventory Report shall contain information on any changes that have occurred in the NR, compared to last submission • Access to information • NR records non-confidential information • Publicly accessible user interface through the Internet • Data transparency  improved credibility regarding: • implementation of measures for compliance achievement • reliable systemof GHG emissions monitoring, verifying, registration and reporting Romania would be a trustworthy counterpart for transactions (including JI projects).

  22. 5. RECOMMENDATIONS FOR THE ESTABLISHMENT OF A NATIONAL REGISTRY IN ROMANIA POLICY • Urgent development of CC strategy, stating also the modalities Romania will participate at flexible mechanisms • A more enhanced MWEP coordination of the CC related activities; strategy before action plan LEGISLATION • Creation of a specific legal framework to set up the registry (i.e. Ministerial Order, as for PER) • definition of the NR’s functions; • data collection, validation and registration in the NR; • assigning an institution responsible with the NR. • Emission trading needs to be regulated • Transposition of the Council Decision 93/389/EEC as amended by Decision 99/296/EC for a Monitoring Mechanism of Community GHG Emissions - inclusion in the MWEP’s Program of Priority Measures (2002-2004).

  23. COMPLIANCE WITH UNFCCC REPORTING REQUIREMENTS • Prior to January 1, 2007, Romania will have to submit to the UNFCCC Secretariat the report on calculation of its assigned amount for the first commitment period, plus a complete inventory • Romania will have to issue a quantity of AAUs equivalent to its assigned amount in its NR • Romania will have to authorize: • legal entities to participate in projects; • legal entities to make transactions. • Immediate implementation of measures should commence, as the country lacks infrastructure and capacity.

  24. INSTITUTIONAL BUILDING • Assign of an institution as Central Administrator of the NR, governmental (MWEP’s option)/ private body • Romania - separate registry, not a consolidated one • Later, brokerage companies will evolve. CAPACITY BUILDING • Development of a national institutional infrastructure: MWEP, inspectorates for environment protection, Central Administrator, MIR (and agencies) • Coordination between: • responsibles in the MWEP; • MWEP and other governmental institutions; • targeted trainings addressed to personnel, including in inspectorates for environment protection; international assistance needed.

  25. MONITORING • Monitoring systems needs a dramatic improvement: • increase of number of monitored sources and • endowment with high quality monitoring equipment. • Enforcement of the existing legislation in the environment protection • Close follow-up of the fulfillment of the so-called ‘programs for compliance’ of facilities by inspectorates. FINANCING • MWEP does not dispose of sufficient financial assets • New Environment Protection Fund, low resources • Further need for international financing assistance (agreements under MoUs, GEF capacity building).

  26. Dr. Mihaela DUPLEAC Executive Director TERRA Mileniul III 1-3 Walter Maracineanu Sq., Room 171, sector 1, Bucharest, ROMANIA Tel/fax: +4021- 312 68 70 Email: terra@fx.ro; terramileniul@xnet.ro Http://terraIII.ngo.ro

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