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First National Workshop On Capacity Building On CDM Under CD4CDM Project Enhancing Developing Countries Participation On The Carbon Market Overview of URC’s CDM Capacity Development Activities Moinul I Sharif Senior Scientist UNEP RISOE Centre April 2008.
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First National Workshop On Capacity Building On CDM Under CD4CDM Project Enhancing Developing Countries Participation On The Carbon Market Overview of URC’s CDM Capacity Development Activities Moinul I Sharif Senior Scientist UNEP RISOE Centre April 2008
International and Danish, interdisciplinary staff. • Based on agreement between Risø, UNEP and Danida. Located at Risø since 1990. • Mandate: support UNEP in its activities to incorporate climate and environmental aspects into development and energy planning and policy worldwide, with a special emphasis to assist developing countries.
Activity Areas • Energy & Poverty • Energy Efficiency & Renewable Energy • Energy Sector Reform • CDM & Carbon markets Development & Climate • National and International Policy Instruments • Transport • Capacity Development Three Thematic Areas • Energy and Development • Energy and Carbon Finance • Sustainable Development and Climate Change
Carbon Finance & CDM Major Activity Areas • Individual and Institutional Capacity Development (CD) • One of largest and most known CD programs in field • Global reach, but core focus on least developed countries • Generally investor-neutral, i.e., not connected to actual credit purchases • Development/Piloting of Demonstration CDM Projects • Methodologies, Guidebooks, and Policy Analyses • Series of ‘how-to’ manuals for CDM project development • Discussion papers, analytical contribution to UNFCCC process • Market Surveillance & Information Dissemination • CDM Pipeline tool has become one the key ‘open source’ information tools for monitoring developments and evolution of the market
Carbon Finance & CDM CDM Challenges • Complex CDM Modalities & Procedures • Transaction cost to hire service providers. • Heavy institutional requirements for project cycle (DNA, DOE Validation, DOE Verification, etc.). • Knowledge gap between CER buyers & sellers. • Limited access to finance by potential developers: • Financial intermediaries lack of knowledge about CDM. • Lack of trained national CDM experts. • Investment climate in host countries (e.g. SS Africa). • Limited budgets for operations of DNAs. • Need for national entities capable of bundling projects.
Carbon Finance & CDM Strategy for Capacity Development • Design of interventions based on: • Continuous barriers analysis process. • Monitoring global market. • Consultations with in-country stakeholders. • Core objectives: • Minimize transaction cost. • Remove CDM-related barriers. • Facilitate efficient & effective completion of CDM project cycle. • Key issues to achieve objectives: • A combination of targeted, hands-on sectoral workshops, guidebook materials, market analysis & research, host country participation in global carbon events, & web-based tools.
Guidebooks on specific issues of the CDM (CDM procedures; baselines; Institutional; legal; financing; PDD guidebook; CDM SD impacts; • Working Paper Series (CDM forestry and biomass; SD&CDM; EE & pCDM; bio-energy & CDM) • Perspective Series (determining a fair Price for carbon) • Overview of JI & CDM Pipeline • support design of new methodologies (e.g. in LULUCF in Sub-Saharan Africa) • Sector specific workshops (e.g RE; landfill; EE, etc) for sector experts; practitioners; project developers • Executive briefings for ministries and key officials • Support national experts to produce portfolio PINs & PDDs including programmatic activities
On going CDM Capacity Development Activities • Capacity Development for CDM (CD4CDM): $12.5 million budget, 12 countries Phase I + 7 countries Phase II. Completion 2009. • Using Carbon Finance for Sustainable Energy in Africa (CF-SEA) Project: five countries, jointly with World Bank’s CDCF, $1 million. • GTZ Energy-Sector CDM CD for francophone SS Africa, $500,000. • European Commission CD for MEA, APC countries, $4 million. • French-funded francophone CASCADe Project (Carbon Finance for Agriculture, Sylviculture, Conservation and Action against Deforestation), $3 million. • Danida CDM Green Facility in Africa (6 countries), $3 million. • UNDP-UNEP East Africa CDM Capacity Building, $1.7 million. • Programmatic CDM in China + Bioenergy CDM CB in China. • UNFCCC CDM Bazaar hosting & management. • UNEP SBCI CDM and the building sector • Production of a series of CDM manuals, guidebooks, working papers, etc.
CD for CDM - Results Achieved • Core business & regulatory frameworks for CDM investment • Operationalization of DNAs in a number of countries: • DNA infrastructure support; DNA CDM web site. • Modalities & Procedures for CDM projects approval are in place • National CDM Investors’ Guide. • Participation of DNAs in Carbon Expo. • Preparation of pipeline of PINs/PDDs by national consultants. • Organized capacity building workshops • Skills and Knowledge provided to local experts to prepare good quality PINs/PDD. • Local experts able to deal with the complete cycle of CDM projects • Local relevant institutions have good understanding of CDM and Climate Change • Inter-institutional networks and coordination have been generated and enhanced through country team activities and the DNAs.
CD Success Indicators • Key contribution is reduction in projects’ transaction costs • Number of days DNA review/approve a CDM project. • Local experts capable of preparing good qualityPIN/PDD. • Local financial institutions have good understanding of CDM, possibly willing provide underlying project financing. • Validation/Verification processes conducted in a timely manner. • Number of signed Emission Reduction Purchase Agreements (ERPAs).
URC CD Value to Carbon Market • Not a buyer. Not a seller: • Unbiased advisory services & research products • Trusted by both buyers & sellers. • In-country CDM CD activities in more than 30 developing countries: • Cross-fertilization of experiences from different regions and sectors. • Intimate knowledge of host countries’ situation • Access to valuable field information • Institutional, financial & market barriers facing them. • Ability to invest time & effort in activities unattractive to private sector: • Research products (CDM Pipeline database). • Operate & pave way in high sovereignty risk countries (e.g. Sub-Saharan Africa). • Diversified experiences (geographic & sectoral) among carbon finance team in UNEP.
Thank You !! For more information visit: www.cd4cdm.org www.uneprisoe.org