CDM in Africa: Status. September 2007

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1 CDM in Africa: Status September 2007 UNFCCC Kishor Rajhansa Programme Officer Methodologies UNFCCC

2 Potential of the carbon market The Kyoto mechanisms can generate investment: Assuming 60-80% emission reduction by industrialized countries If 50% of these reductions are met through investments in developing countries (e.g. via a mechanism like the CDM) If the price for a tonne of carbon is above $10 per tonne Potential to mobilize resources for developing countries of some US$ 100 billion annually

3 The three Kyoto mechanisms Clean Development Mechanism Projects in developing countries can earn saleable credits for reducing/avoiding emissions certified emission reductions (CERs) 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

4 What is the Clean Development Mechanism? COP/MOP (i.e. the Kyoto Protocol countries) CDM Executive Board (supported by technical panels and working groups and UNFCCC secretariat) Designated operational entities (DOE) Project participants Designated national authorities (DNA)

5 What is the CDM Incentives Industrialized countries (Annex I) To assist in meeting their emission limitation commitments Investors Project participants (private business, governments, NGOs) CDM project activity (private business, governments, NGOs) Developing countries (Non-Annex I) To assist in achieving sustainable development

6 Status of the CDM The Project Cycle Project Activity Design (PDD and project developers) Proposal of a New Baseline and/ or Monitoring Methodology Use of an Approved Methodology Validation of the CDM project activity (DOE) Registration of the CDM project activity (Executive Board) Certification/ Verification of the CDM project activity (DOE) Issuance of CERs (Executive Board) Status: 31 May 2007

7 Status of the CDM The Project Cycle

8 Status of the CDM Project Activities (Few Key Areas) Examples Energy Efficiency and fuel switch (industry, agriculture, transportation, residential, commercial sectors) Additives in cement Waste Heat Recovery Renewable Energy (Wind, solar, biomass) Methane avoidance, capture and energy generation Carbon Capture and Storage N2O reduction through primary, secondary of tertiary catalysts in Nitric Acid/ Caprolactum plants. PFC destruction in Aluminium industry HFC destruction projects

9 Status of the CDM Measuring success To date: 765 registered CDM projects 1.02 billion CERs expected to the end of 2012 In pipeline: > 2,100 projects > 2.2 billion CERs expected to the end of 2012 (assumption: no extension of crediting periods) Status: 27 August 2007 Map and statistics accessible from

10 Status of the CDM Measuring success An explosion of activities 2,500 2, No. of Projects / CERs before 2012 (millions) 2,000 1,500 1, ,900 1, May 2005 (SB22) December 2005 (COP/MOP1) May-06 May-07 Aug-07 Registered project activities Projects in the pipeline Projected CERs Status: 27 August 2007

11 Status of the CDM Measuring success Region KP parties Parties with DNA Parties with project experience Annex 1 parties (AI) n/a* 15 Parties with registered projects NAI-Africa (NAI-AFR) NAI-Asia and the Pacific (NAI-ASP) Status: 27 August 2007 NAI-Latin America and the Caribbean (NAI LAC) NAI-Other *number of parties with project experience can not be calculated due to lack of information

12 Status of the CDM Measuring success Region Africa Asia and the Pacific Other Latin America and the Caribbean Number of projects Status: 27 August 2007

13 Status of the CDM Measuring success Methodology development AMs ACMs A/R Tools 10 4 (plus 1 for AR SSC) 3 November 2006 (CMP.2 Nairobi) 38 (plus 20 for SSC) 49 (plus 24 for SSC) 11 August 2007 (As on date) 8 (plus 1 for SSC AR) 6 (plus 5 for AR)

14 Status of the CDM Measuring success Large Scale Methodologies (AM,AR-AM) Number Of Methodologies* ( Large-scale (AM, Scope AR-AM) ) Energy industries (renewable - / non-renewable sources) (1) 21 Energy distribution (2) 0 Energy demand (3) 4 Manufacturing industries (4) 10 Chemical industries (5) 9 Construction (6) 0 Transport (7) 1 Mining/mineral production (8) 0 Metal production (9) 2 Fugitive emissions from fuels (solid, oil and gas) (10) 4 Fugitive emissions from production and consumption of halocarbons and sulphur hexafluoride (11) 2 Solvent use (12) 0 Waste handling and disposal (13) 9 Afforestation and reforestation (14) 9 Agriculture (15) 0 * A methodology can be linked to more than one scope

15 Status of the CDM Measuring success Small Scale Methodologies (AMS,AR-AMS) Number Of Scope Methodologies* ( Small-scale (AMS, AR-AMS) ) Energy industries (renewable - / nonrenewable sources) (1) 6 Energy distribution (2) 1 Energy demand (3) 3 Manufacturing industries (4) 3 Chemical industries (5) 2 Construction (6) 0 Transport (7) 1 Mining/mineral production (8) 0 Metal production (9) 0 Fugitive emissions from fuels (solid, oil and gas) (10) 0 Fugitive emissions from production and consumption of halocarbons and sulphur hexafluoride (11) 0 Solvent use (12) 0 Waste handling and disposal (13) 6 Afforestation and reforestation (14) 1 Agriculture (15) 1 * A methodology can be linked to more than one scope

16 Status of the CDM Measuring success Consolidated Methodologies (ACMs) Number Of Scope Methodologies* ( Consolidated (ACM) ) Energy industries (renewable - / non-renewable sources) (1) 6 Energy distribution (2) 0 Energy demand (3) 0 Manufacturing industries (4) 4 Chemical industries (5) 0 Construction (6) 0 Transport (7) 0 Mining/mineral production (8) 1 Metal production (9) 0 Fugitive emissions from fuels (solid, oil and gas) (10) 1 Fugitive emissions from production and consumption of halocarbons and sulphur hexafluoride (11) 0 Solvent use (12) 0 Waste handling and disposal (13) 2 Afforestation and reforestation (14) 0 Agriculture (15) 1 * A methodology can be linked to more than one scope

17 Status of the CDM Africa projects Registered Projects Activities: 21 Of Which: - Energy industries: 10 - Energy Demand: 1 - Manufacturing industries: 3 - Chemical industries: 3 - Fugitive Emissions from fuel: 1 - Waste Handling and disposal: 6 Requesting registration: 0 Status: 27 August 2007

18 Status of the CDM CERs Issued CERs issued by Host Party: Egypt: 416,187 Morocco: 26,213 Status: 27 August 2007

19 Status of the CDM Measuring success Processes / Procedures defined / open to optimisation Methodology standard: Number increasing / consolidation / generic tools Process being optimised and shortened Registration: 765 registered projects 26 rejected ( around 3.3%) Central bank : 76 million CERs for 334 requests 2 rejected (less than 0.8%) Accreditation body: Opportunity for single accreditation recognized in all Parties to KP. Status: 27 August 2007

20 Status of the CDM Measuring success The only regulated mechanism that is up and running, that ensures real, measurable emission reductions that are additional to what would have occurred without the project. Transparency: - All information is public - Public comments are sought Close to the market stakeholders: bottom up approach Increasing interaction/constructive dialogue Evolving with experience Status: 27 August 2007

21 Status of the CDM Measuring success Stimulating investment flow (>22 billion by 2012 (10 USD/CER) in value of the CO2 eq. reduction only) to Non- Annex I countries Giving Annex I countries flexibility in how they meet their KP commitments (presently pipeline of the magnitude of the annual emissions of Russia). It is growing even in a context of perceived medium and long-term uncertainties Status: 27 August 2007

22 Status of CDM Key challenges CDM works, now let s focus on: Continuously increasing its efficiency: Further information access, e.g. CDM Bazaar Further access to decisions, e.g. catalogue of decisions Further interaction with players, e.g. fora (DOE, DNA), project participants Realizing its potential (scaling up) Programme of activities (POA) Sectors: energy efficiency / transport Methodologies: simplicity, applicability Regional opportunities Regulatory optimization : relatively slim / streamlining and optimization opportunities have and will be pursued EB to report to CMP3 its ability to deal with its success Status: 27 August 2007

23 Thank You! Catalogue test address: Information cdm.unfccc.int Status: 27 August 2007