The UNFCCC, the Kyoto Protocol, and the CDM
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1 The UNFCCC, the Kyoto Protocol, and the CDM Chunyu Liang, Associate Programme Officer CDM Accreditation and Project Assessment Unit UNFCCC Secretariat IFAD CLIMTRAIN Workshop 03 July 2009 Rome, Italy
2 Outline The UNFCCC The Kyoto Protocol The Clean Development Mechanism The CDM Bazaar
3 The UNFCCC Framework convention lays out an objective, then allows for instruments to be developed over time, e.g. Kyoto Protocol (till 2012) Sets global to country commitments (mainly funding related and national commitments e.g. policies and measures to address climate change) Country-driven multilateral process to address climate change Conference of Parties (Ministerial Level once a year), and technical session twice a year (Subsidiary Bodies & Ad Hoc Working Groups) Five founds of AWG in 2009; COP 15 and COP/MOP (KP) 5 in Dec 2009
4 Objective: Article 2 The ultimate objective of this Convention and any related legal instruments that the Conference of the Parties may adopt is to achieve, in accordance with the relevant provisions of the Convention, stabilization of greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system. Such a level should be achieved within a time-frame sufficient - to allow ecosystems to adapt naturally to climate change - to ensure that food production is not threatened and - to enable economic development to proceed in a sustainable manner.
5 The Kyoto Protocol Entry into force on 16 February Parties (June 2009) Main features Legally binding targets for emissions of six major greenhouse gases in industrialized countries during first commitment period ( ) New international market-based mechanisms, creating a new commodity: carbon Facilitate sustainable development and additional support to developing countries on adaptation
6 The three Kyoto mechanisms Emission Trading (ET): exchanging emission allowances among Kyoto Protocol Parties Clean Development Mechanism (CDM): credits for emissions avoided through sustainable development projects in developing countries (non-annex I countries) Joint Implementation (JI): credits for emissions avoided through projects in Annex I countries
7 Clean Development Mechanism Defined in Article 12 of KP Projects in non-annex I countries developing countries. Projects must Contribute to sustainable development Result in real, measurable, verifiable, additional emission reductions Projects earn saleable/tradable certified emission reductions (CERs) Eligible projects in developing countries can earn tradable credits for reducing/avoiding emissions certified emission reductions The CERs can be used by countries with commitments under KP toward meeting a part of their targets Host countries benefit from sustainable development initiatives Bottom-up project-based approach Application-Approval approach
8 General overview of the CDM To date: 1,693 registered CDM projects In > 4,200 projects (including 1.6 billion CERs expected from pipeline: registered projects) existing registered projects to > 2.9 billion CERs expected the end of 2012 to the end of 2012 (Assumption: no extension of crediting periods) Map and statistics accessible at 8 Status: 21 July 2008
9 Eligible project types relevant to IFAD Afforestation/Reforestation: 10 approved methodologies, 2 consolidated methodologies, a number of projects (mainly reforestation) in the pipeline Bioenergy (biogas, biomass power generation) e.g.household biogas digesters, biomass replacing fossil fuel power generation Solar energy e.g.solar cooker, solar water heating, solar power generation
10 CDM Project Cycle simple version PDD: CDM Project Design Document Source: Michaelowa et al. (2007), Understanding CDM Methodologies A guidebook to CDM Rules and Procedures. Crown Copyright.
11 The CDM Bazaar
12 Development of the CDM Bazaar Was discussed at the 21st meeting for the Executive Board, as part of the CDM Management Plan, it was decided to; Make publicly available relevant information, submitted to it for this purpose, on proposed CDM project activities in need of funding and on investors seeking opportunities, in order to assist in arranging funding of CDM project activities, as necessary Part of the Nairobi Framework Launched in September 2007
13 Objective of the CDM Bazaar Facilitate the creation of an efficient and transparent global CDM market Reduce transaction costs in the CDM project cycle Cost free virtual platform for actors in the carbon market It is not possible to trade CER s
14
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