1. UNFCCC COP 13 Bali, 10 December 2007

2. The Business Day in Perspective Bali Global Business Day, 10 December 2007 2 Moderator Claude Fussler former Program Director WBCSD Special Advisor to the UN Global Compact

3. Once upon a time… Voluntary initiatives Type II partnerships Walking the talk…

4. Now… state of happiness, the Creator, people and nature live in harmony with each other. state of happiness, the Creator, people and nature live in harmony with each other.

5. It is about… Business solutions Policy framework Inclusive, ambitious

6. Organizers Organizers International Chamber of Commerce World Business Council for Sustainable Development

7. Partners Partners BUSINESSEUROPE the Confederation of European Business International Emissions Trading Association Federation of German Industries (BDI)

8. Partners KADIN Indonesian Chamber of Commerce and Industry Nippon Keidanren International Council of Forest and Paper Associations

9. Partners World LP Gas Association International Council for Sustainable Energy Our media partner

10. an extraordinary support from an extraordinary support from and its great team!

11. No breaks But refreshments available all the time in lobby

12. As of tomorrow: www.youtube.com/balibusinessday

13. What do you mean by an inclusive policy framework? Would you agree with me that there are 5 key conditions. First of all as I wrote in my paper published for the Nairoby confrence I cannot agree with statements like the one made in your opening sesssion. How can you possibly claim that the current energy generation structure is obsolete and Question cards in your folder Q & A WHAT DO YOU MEAN BY AN INCLUSIVE POLICY FRAMEWORK ? WHAT DO YOU MEAN BY AN INCLUSIVE POLICY FRAMEWORK ?

14. Thank You!

15. Sorry!...

16. Bali Global Business Day, 10 December 2007 16 Biography In your conference pack

17. Solutions and enabling policies mitigation mitigation session Efficiency and demand management Carbo-neutral energy Forests and technical capture and storage

18. Solutions and enabling policies mitigation session Development and cooperation adaptation

19. The Bali Stakes Keynote Speakers Yvo de Boer Secretary General, UNFCCC Björn Stigson President, WBCSD Nobuo Tanaka Executive Director, IEA Bali Global Business Day, 10 December 2007 19

20. What can COP 13 deliver? Keynote Speaker Yvo de Boer Secretary General, UNFCCC Bali Global Business Day, 10 December 2007 20

21. Enhance business solutions Keynote Speaker Björn Stigson President, WBCSD Bali Global Business Day, 10 December 2007 21

22. Success factors for mitigation Keynote Speaker Nobuo Tanaka Executive Director, IEA Bali Global Business Day, 10 December 2007 22

23. INTERNATIONAL ENERGY AGENCY AGENCE INTERNATIONALE DE LENERGIE © OECD/IEA - 2007 Nobuo Tanaka Executive Director International Energy Agency Bali Global Business Day 10 December 2007 Success Factors for Mitigation Stimulating markets to outpace climate risks © OECD/IEA - 2007

24. The WEO Reference Scenario Our current trajectory: under-invested, dirty and vulnerable Leads to a future even worse than projected just one year ago Consistent with an increase in average global temperature of up to 6°C The 450 Stabilisation Case Coincides with the most ambitious of the IPCCs scenarios Would limit the increase in average global temperatures to 2.4°C Unprecedented strong and immediate policy action would be essential, associated costs very high Achievable or Science Fiction ? Two Possible Energy Futures

25. © OECD/IEA - 2007 Reference Scenario: World Primary Energy Demand Global demand grows by more than half over the next quarter of a century, with coal use rising most in absolute terms 0 2 4 6 8 10 12 14 16 18 198019902000201020202030 billion tonnes of oil equivalent 0 2 4 6 8 10 12 14 16 18 198019902000201020202030 billion tonnes of oil equivalent Other renewables Biomass Hydro Nuclear Gas Oil Coal

26. © OECD/IEA - 2007 Global CO 2 Emissions: Historical and Future Although China and India produced just 10% of total global emissions since 1900 they will represent 56% of the increase to 2030. By that time per capita emissions in China will approach those of OECD Europe. Cumulative Energy-Related CO 2 Emissions 0100200300400500 United States European Union Japan China India billion tonnes 1900-2005 2005-2030

27. © OECD/IEA - 2007 CO 2 Emissions - 450 Stabilisation Case Achievable or Science Fiction ? By 2030, emissions are reduced to some 23 Gt, a reduction of 19 Gt compared with the Reference Scenario 10 15 20 25 30 35 40 45 200520102015202020252030 Gt of CO 2 CCS in industry – 3% CCS in power generation - 9% Nuclear – 13% Renewables – 20% Switching from coal to gas - 8% End Use electricity efficiency -17% End Use fuel efficiency – 30% Reference Scenario 450 Stabilisation Case 27 Gt 42 Gt 23 Gt Energy-Related CO 2 Emissions

28. © OECD/IEA - 2007 Average Annual Power Generation Capacity Additions in the 450 Stabilisation Case, 2013-2030 A large amount of capacity would need to be retired early, entailing substantial costs 22 CCS coal-fired plants (800 MW) 20 CCS gas-fired plants (500 MW) 30 nuclear reactors (1000 MW) 2 Three Gorges Dams 400 CHP plants (40 MW) 17 000 turbines (3 MW) 0 10 20 30 40 50 60 Other Renewables Wind Biomass and waste Hydropower Nuclear Gas CCS Coal CCS GW

29. INTERNATIONAL ENERGY AGENCY AGENCE INTERNATIONALE DE LENERGIE © OECD/IEA - 2007 We will act with resolve and urgency to meet our shared multiple objectives of reducing greenhouse gas emissions, improving the global environment, enhancing energy security and cutting air pollution in conjunction with our vigorous efforts to reduce poverty -- from G8 Gleneagles Communiqué We will move forward with timely implementation of the Gleneagles Plan of Action. We have instructed our relevant ministers to continue the Dialogue on Climate Change, Clean Energy and Sustainable Development and report its outcomes to the G8 Summit in 2008 -- from G8 St. Petersburg Communiqué Technology, energy efficiency and market mechanisms, including emission trading systems or tax incentives, are key to mastering climate change as well as enhancing energy security. -- from G8 Heiligendamm Communiqué © OECD/IEA - 2007

30. In support of the G8 Plan of Action Energy Use in the New Millennium Trends in IEA Countries ENERGY INDICATORS © OECD/IEA 2007 Energy Efficiency: Support the IEAs I 3 Initiative Implement ! Implement! Implement ! Actual energy use Energy efficiency improvements Actual energy use Energy efficiency improvements Hypothetical energy use without energy efficiency improvements Source: Energy Use in the New Millennium (IEA, 2007) Energy Use in the New Millennium Trends in IEA Countries ENERGY INDICATORS © OECD/IEA 2007 Since 1990, the rate of energy efficiency improvement in IEA countries has been less than 1% per year – much lower than in previous decades. We must - and we can - do better!

31. © OECD/IEA - 2007 Energy Indicators: Factors Affecting Manufacturing Energy Use, IEA19 Energy Use in the New Millennium Trends in IEA Countries ENERGY INDICATORS © OECD/IEA 2007 There has been a strong decoupling of energy use from manufacturing output, particularly in metal products, chemicals, non- metallic minerals and paper and pulp.

32. In support of the G8 Plan of Action © OECD/IEA - 2007 Mind the Gap Mind the Gap Quantifying Principal-Agent Problems in Energy Efciency Why Doesnt Someone Pick up That 20 Euro Note On The Sidewalk? Energy efficiency potential is trapped beneath these barriers! It looks like its monopoly money market failures principal agent problem asymmetric information I have a sore back bounded rationality and limited energy costs Ill have to declare it on my income taxes inefficient government laws and regulation

33. INTERNATIONAL ENERGY AGENCY AGENCE INTERNATIONALE DE LENERGIE © OECD/IEA - 2007 Coal CO 2 Sequestration Nuclear Wind Solar PV Replace 300 conventional, 500-MW coal power plants with zero-emission power plants, or... Install 70 x current German wind generation in lieu of unsequestered coal Install 1090 x current US solar generation in lieu of unsequestered coal Install 1000 Sleipner CO 2 sequestration plants Build 140 1-GW power plants in lieu of unsequestered coal plants Efficient lighting Replace incandescent lamps by CFLs = 0.5 Gt Replace other lamps with efficient options = 0.5 Gt Replace incandescent lamps by CFLs = 0.5 Gt Replace other lamps with efficient options = 0.5 Gt Adapted from Pacala & Socolow, Science 2004 Mitigation Policy & Technology Avoiding 1 billion tonnes of CO 2 per Year Early market signals and technology R&D can work together to assist the market transition – Policies and R&D are inseparable!

34. INTERNATIONAL ENERGY AGENCY AGENCE INTERNATIONALE DE LENERGIE © OECD/IEA - 2007 Public Sector Energy R&D in IEA Countries R&D investment is not adequate given the magnitude of the climate challenge. Government spending on energy R&D has fallen, while the private-sector is focused on projects with short-term payoffs

35. INTERNATIONAL ENERGY AGENCY AGENCE INTERNATIONALE DE LENERGIE © OECD/IEA - 2007 The Institutional Challenge: What will be required? The support and cooperation of industry Good governance, as this will be critical to minimising risk and attracting investment A post-2012 Framework that: Involves participation of all major emitters Addresses cost uncertainty, promotes flexibility and accommodate differing national circumstances Considers sectoral approaches, as these could: broaden greenhouse gas reduction actions ease concerns for trade-exposed energy-intensive industries Appropriate bodies, such as the IEA, to provide advice and monitor and report against progress

36. In support of the G8 Plan of Action © OECD/IEA - 2007 ENERGY TECHNOLOGY PERSPECTIVE S Scenarios & Strategies to 2050 2 0 0 8 INTERNATIONAL ENERGY AGENCY Upcoming Publication: Energy Technology Perspectives 2008 How to get there: Research, Development and Demonstration policies Technology learning and deployment Technology transitions Investment needs and policy cost Energy and CO 2 emission indicators (efficiency) Consequences for consumers Scenario analysis Country level analysis for G8+5

37. The Bali Stakes Keynote Speakers Yvo de Boer Secretary General, UNFCCC Björn Stigson President, WBCSD Nobuo Tanaka Executive Director, IEA Bali Global Business Day, 10 December 2007 37

38. Opportunities in Energy Efficiency Moderator Teresa Presas, President, Confederation of European Paper Industries Expert view: Low-carbon scenarios for Germany Klaus Mittelbach, Head of Environment and technology, BDI Panel Paul Peeters, Senior Vice President, Philips Lighting Asia Pacific Region Doug Musyka, President, DuPont Greater China Gert-Jan Koopman, Director, DG Enterprise, European Commission Frances Beinecke, President, Natural Resources Defense Council Policy Review Nick Campbell, Chair, ICC Task Force on Climate Change Bali Global Business Day, 10 December 2007 38

39. Low Carbon scenarios for Germany Expert view: Klaus Mittelbach Head of Environment and Technology BDI Bali Global Business Day, 10 December 2007 39

40. Opportunities in Energy Efficiency Moderator Teresa Presas President, Confederation of European Paper Industries Bali Global Business Day, 10 December 2007 40

41. Opportunities in Energy Efficiency Panel Paul Peeters Senior Vice President, Philips Lighting Asia Pacific Region Bali Global Business Day, 10 December 2007 41

42. Opportunities in Energy Efficiency Panel Doug Musyka, President, DuPont Greater China Bali Global Business Day, 10 December 2007 42

43. What do you mean by an inclusive policy framework? Would you agree with me that there are 5 key conditions. First of all as I wrote in my paper published for the Nairoby confrence I cannot agree with statements like the one made in your opening sesssion. How can you possibly claim that the current energy generation structure is obsolete and Question cards in your folder Q & A WHAT DO YOU MEAN BY AN INCLUSIVE POLICY FRAMEWORK ? WHAT DO YOU MEAN BY AN INCLUSIVE POLICY FRAMEWORK ?

44. Opportunities in Energy Efficiency Panel Gert-Jan Koopman, Director, DG Enterprise, European Commission Bali Global Business Day, 10 December 2007 44

45. Opportunities in Energy Efficiency Panel Frances Beinecke President Natural Resources Defense Council Bali Global Business Day, 10 December 2007 45

46. Opportunities in Energy Efficiency Policy Review Nick Campbell Chair ICC Task Force on Climate Change Bali Global Business Day, 10 December 2007 46

47. Climate Policy and the Public Expert view Doug Miller President, GlobeScan Incorporated Bali Global Business Day, 10 December 2007 47

48. 48 Participating Countries (21*) 22,000 in-person / telephone interviews - June-July 2007 * Urban samples in 8 countries **Average of 21 countries. Asked in Egypt POLL

49. 49 Views of Action Needed to Reduce Human Impact on Climate Change Average of 21 Countries, 2007 Base: Representative samples of 22,000 adults in 21 countries M3. As you may know there is some discussion these days about whether it is necessary to take steps to reduce the impact of human activities that are thought to cause global warming or climate change. Which of the following...

50. 50 Position Held on Limiting Climate Change Gas Emissions in Less Wealthy Countries By Country, 2007 The white space in this chart represents DK/NA." Base: Representative sample of 22 000 adults in 21 countries

51. 51 Wealthy Countries Provide Less Wealthy Countries with Financial Assistance / Technology; Less Wealthy Countries Limit Emissions of Climate Changing Gases along with Wealthy Countries Average of 21 Countries, 2007 Base: Representative sample of 22 000 adults in 21 countries

52. 52 Support for Higher Taxes on the Most Harmful Types of Energy So That Individuals/Industry Use Less Strongly and Somewhat Favour, Average of 21 Countries, 2007 *Based on subsample results.

53. 53 Support for Higher Taxes on the Most Harmful Types of Energy So That Individuals/Industry Use Less 2007 *One-half of respondents who said they strongly or somewhat opposed energy tax or did not give an answer were then asked whether they would support an energy tax if the revenues of the tax were devoted only to increasing energy efficiency and developing energy sources that do not produce climate change. Base: Representative sample of 22 000 adults in 21 countries

54. 54 Ready to Make Significant Changes to Lifestyle to Help Prevent Climate Change Agree vs Disagree, by Country, 2007 The white space in this chart represents DK/NA.

55. Implications of Findings Unprecedented global constituency for immediate action on human causes of climate change Support for action by ALL countries in parallel Strong support for funding and technology transfer to support action in less-wealthy countries Pollsters view: a well-designed and communicated carbon tax is saleable in all countries surveyed Citizens and consumers see themselves as part of the solution A world-wide FOLLOWERSHIP exists; a time for LEADERS Details under News Centre on: www.GlobeScan.com

56. Towards Carbon Neutral Energy Moderator Laurent Corbier, Chair, ICC Commission on Environment & Energy Panel Teruaki Masumoto, President, Tokyo Electric Power Company (TEPCO) Andrew Richards, Executive Manager, Corporate Affairs & Government, Pacific Hydro Prashant Modi, FICCI Harlan Watson, Senior Climate Negotiator, US Department of State Jonathan Lash, President, World Resources Institute Policy Review David Hone, Climate Change Adviser, Royal Dutch Shell Bali Global Business Day, 10 December 2007 56

57. Towards Carbon Neutral Energy Moderator Laurent Corbier Chair, ICC Commission on Environment & Energy Bali Global Business Day, 10 December 2007 57

58. What do you mean by an inclusive policy framework? Would you agree with me that there are 5 key conditions. First of all as I wrote in my paper published for the Nairoby confrence I cannot agree with statements like the one made in your opening sesssion. How can you possibly claim that the current energy generation structure is obsolete and Question cards in your folder Q & A WHAT DO YOU MEAN BY AN INCLUSIVE POLICY FRAMEWORK ? WHAT DO YOU MEAN BY AN INCLUSIVE POLICY FRAMEWORK ?

59. Towards Carbon Neutral Energy Panel Teruaki Masumoto President, Tokyo Electric Power Company (TEPCO) Bali Global Business Day, 10 December 2007 59

60. Towards Carbon Neutral Energy Panel Andrew Richards Executive Manager, Corporate Affairs & Government, Pacific Hydro Bali Global Business Day, 10 December 2007 60

61. Towards Carbon Neutral Energy Panel Prashant Modi FICCI Bali Global Business Day, 10 December 2007 61

62. Towards Carbon Neutral Energy Panel Harlan Watson Senior Climate Negotiator US Department of State Bali Global Business Day, 10 December 2007 62

63. Towards Carbon Neutral Energy Panel Jonathan Lash President World Resources Institute Bali Global Business Day, 10 December 2007 63

64. Towards Carbon Neutral Energy Policy Review David Hone Climate Change Adviser Royal Dutch Shell Bali Global Business Day, 10 December 2007 64

65. Whats the same? Whats different?

66. The Technology Pathway Bali Global Business Day, 10 December 2007 66 Competing technology More cost competitive Number of installations / Products Technology cost Incentive Earlier deployment Discovery and Development Demonstration phase Deployment phase 0 20 40 60 80 100 1101001000

67. The iPhone Bali Global Business Day, 10 December 2007 67 Competing technology More cost competitive Number of installations / Products Technology cost New features Earlier deployment R&D is very well funded in the high technology sector; Extreme competition Spinoffs from other government initiatives. R&D is very well funded in the high technology sector; Extreme competition Spinoffs from other government initiatives. Early adopters pay for this Cool new features drive early deployment 0 20 40 60 80 100 1101001000

68. New Energy Technologies Bali Global Business Day, 10 December 2007 68 Competing technology More cost competitive Number of installations / Products Technology cost Not many early adopters so the demonstration phase will need help. Purchase incentives and/or CO 2 price Purchase incentives and/or the CO 2 market drive(s) early deployment Earlier deployment Probably need to refocus and expand R&D for energy. 0 20 40 60 80 100 1101001000

69. A focussed policy approach Power Generation / Industry & Manufacturing TransportCommercial & Domestic (Buildings) Discover & Develop Support for infrastructure (e.g. grids & pipelines) Support for advanced fuel development Urban planning decisions. Education and awareness. Demonstrate Fiscal support for large- scale CCS demonstrations Fiscal support for early 2 nd generation biofuel manufacture. Public transport Encouraging radical design Deploy Cap-and-Trade CCS rules and recognition Renewable Energy Certificates Fast-track planning Policies Focus on; Vehicle efficiency New fuels (e.g. biofuels) Consumer behaviour and vehicle use Efficiency standards (appliances, air-con) Use of project mechanisms linked to GHG market. Encouraging electrification. Broad energy production and use R&D support

70. Lunch Break Lunch Break Bali Global Business Day, 10 December 2007 70 Short ! 13:00 to 14:10 Buffet Dr. Mari Elka Pangestu Minister of Trade Indonesia

71. Session 3 Focus 14:20 – 15.30 hrs Large Scale Carbon Control Opportunities in conserving natural carbon sinks and in long- term capture and storage techniques Bali Global Business Day, 10 December 2007 71

72. Session 3 Participants Moderator: James Griffiths, WBCSD Panelists: Business Solutions & Policy Options: Ernesta Ballard, SVP Weyerhaeuser - capture via sustainable forest management & forest products Preston Chiaro, CEO Energy Products Group Rio Tinto – industrial CCS projects NGO perspective: Toby Janson-Smith, Senior Director Conservation International Government perspective: Prof Emil Salim, Advisor to President of Indonesia, Head of Delegation Policy Reviewer: Ian Emsley, Group Advisor Anglo American & Chair ICC UK Committee on Environment & Energy Bali Global Business Day, 10 December 2007 72

73. Context – Natural Carbon Sinks IPCC 4 th Assessment Report: 15-20 % of global CO2 emissions caused by land use change, primarily deforestation for agriculture Yet forestry can make very significant contribution to low cost mitigation that provide synergies with adaptation & sustainable development, and mitigation options such as storage in harvested wood products, product substitution & bioenergy Bali Global Business Day, 10 December 2007 73

74. Context – Biomass energy WBCSD – Sustainable Forest Products Industry, Carbon & Climate Change – key messages for policy-makers Biomass energy is fundamentally different from fossil fuel energy because biomass recycles carbon to the atmosphere, whereas fossil fuels introduce new carbon. This is why biomass from sustainably managed forests is called carbon neutral. Bali Global Business Day, 10 December 2007 74

75. Forest carbon sinks - policy options 1.Protect the economic value of trees 2.Mandate certification to sustainable forestry standards 3.Demand mutual recognition among different certification systems. 4.Reduce financial risk 5.Credit sustainable forestry and value chain products. 6.Let the marketplace work. Bali Global Business Day, 10 December 2007 75

76. Context – Long term Carbon Capture & Storage IPCC Special Report: By 2050, given technical limitations, around 20-40 % of global fuel CO2 emissions could be suitable for capture, including 30-60 % of electricity generation and 30- 40 % of industrial CO2 emissions IEA Technical Report: CCS in power generation sector has the potential to contribute to reductions of about 4.4 GT CO2 by 2050 Bali Global Business Day, 10 December 2007 76

77. 2. Preston Chiaro, Rio Tinto Business solutions Energy efficiency Low carbon energy (renewables, CCS) Adaptation Bali Global Business Day, 10 December 2007 77

78. Policy Options - CCS Comprehensive (all sectors, all solutions, global) Governments must set CO2 pricing framework(s) Set level playing field Bali Global Business Day, 10 December 2007 78

79. Non Governmental Perspective Toby Janson-Smith, Conservation International Bali Global Business Day, 10 December 2007 79

80. 18%-25% of global GHG emissions Forestry must supply ~35% of required offsets to keep <+2°C by 2030 at <40 per tCO 2 (McKinsey, 2007) Community ecosystem service + biodiversity benefits Developing-country emissions reduction commitments US Lieberman-Warner bill: 2.5% set aside for RED (~$1b/yr) Project-based RED must complement national-level schemes Opportunities for Reducing Emissions from Deforestation

81. Key issues: –Additionality –Leakage –Measurement & Monitoring –Permanence –Ancillary social & environmental impacts Climate, Community & Biodiversity Standards Voluntary Carbon Standard Importance of Forest Carbon Standards

82. The defining issue for AFOLU and CCS projects Temporary credits not well received/used Immature market for insurance products VCS pooled buffer approach could point the way –Credible (atmospheric integrity) –Workable (simple, inexpensive & easy to administer) –Project-friendly (only ~5-10% loss of discounted carbon revenues) –Investor-friendly (fungible credits + no performance risk/liability) Addressing the Permanence Challenge

83. Government perpective Professor Emil Salim, Head of Indonesian Delegation, Advisor to the President of Indonesia Bali Global Business Day, 10 December 2007 83

84. Discussion Bali Global Business Day, 10 December 2007 84 BUSINESS OPPORTUNITIES TO COMBAT CLIMATE CHANGE By Emil Salim Head of the Indonesian Delegation Nusa-Dua, Bali, 10 December 2007 esalim@rad.net.idesalim@rad.net.id, emilsalim2002@yahoo.com

85. PUBLIC & PRIVATE FUNDING 1. GEF has allocated US$7.4 billion with co-financing of US$ 29 billion for 1,980 projects in 160 developing countries; 2. Kyoto Protocols market-based mechanisms is the clean-development-mechanism (CDM) that enables green-house-gas reducing projects and contribute to sustainable development to earn certified emission reduction (cer) credits; There are 840 registered CDM projects in 49 countries with 1,800 projects in the pipe line Bali Global Business Day, 10 December 2007 85

86. TO MEET THE INCREASING NEEDS FOR FUNDS 1.To combat climate change, emission of annual CO2e must be stabilized at 450-550 ppm at an estimated cost of 1% global GDP; 2.Developed countries must make deeper cuts in CO2e emissions and developing countries must create co-benefits reducing CO2e emissions through sustainable development; 3.Technology transfer and innovative funding is required through public and private funds;

87. BUSINESS OPPORTUNITIES 1.Boost CDM in energy conservation/efficiency, promote adoption of renewable energy, reduce long term costs of low GHG emitting energy technology, promote sustainable transport; 2.Simplify Forestation CDM procedure for small scale projects; enhance reforestation projects; 3.Introduce reduction of emissions from deforestation, conservation and degradation; 4.Explore Carbon-Capture-Storage technology;

88. PROMOTE BUSINESS INVOLVEMENT 1. Developing countries can reduce emissions of CO2epath by following path of sustainable development through transfer of technology; 2. CDM is a tool of transfer accompanied by P-to-P cooperative arrangements to cut time horizon to re- invent the wheel; 3.Technology transfer with capacity building must be implemented simultaneously to create co-benefits reducing CO2e through sustainable development.

89. Discussion Q & A Panelist Q & A Participants Bali Global Business Day, 10 December 2007 89

90. Policy Review Ian Emsley, Anglo American & ICC UK Committee on Environment & Energy 1.Forest & Forest Product Carbon 2.Carbon Capture & Storage Bali Global Business Day, 10 December 2007 90

91. Policy Review Forests & Forest Products Carbon 1.Adequate supplies of wood and recovered fiber 2.Forest products value chain benefits 3.Bio mass-based technologies 4.Reduce cost of capital 5.Remove regulatory barriers to combined heat & power potential Bali Global Business Day, 10 December 2007 91

92. Policy Review Forests & Forest Products Carbon 6. Avoid unintended policy consequences 7. Recognized carbon stored in forest products 8. Minimize land competition 9. Encourage sustainable forest management 10. Market forces Bali Global Business Day, 10 December 2007 92

93. Policy Review Carbon Capture and Storage Many countries depend on coal and will continue to use it CCS is needed if coal is to be used in a climate-friendly manner Early action on CCS is needed to avoid carbon lock-in and will not happen without policy support Bali Global Business Day, 10 December 2007 93

94. Policy Review Requirements for CCS early action: 1.Regulatory Framework Incentives (carbon credits, price guarantees, feed-in tariffs, capital grants, etc) Legal Clarity Safety, health and environmental regulation in place Site selection and monitoring / reporting protocols Assumption of long term carbon liabilities Bali Global Business Day, 10 December 2007 94

95. Policy Review 2. Demonstration Projects Needed for: Technology reliability Cost reduction Infrastructure development Public acceptance Bali Global Business Day, 10 December 2007 95

96. Development and Cooperation Moderator Andrei Marcu, President, International Emissions Trading Association (IETA) Panel Rudi Fajar, President Director Riaupulp, APRIL Group Dr. Gail Kendall, Director, Group Environmental Affairs, CLP Holdings Limited Fernando Tudela, Under Secretary for Planning and Environmental Policy, Ministry for Environment and Natural Resources, Mexico Katherine Sierra, Vice President for Sustainable Development, World Bank Peter Goldmark, Program Director, Climate & Air, Environmental Defense Fund Policy Review Adam Kirkman, Program Manager, Energy and Climate Focus Area, WBCSD Bali Global Business Day, 10 December 2007 96

97. Development and Cooperation Moderator Andrei Marcu President International Emissions Trading Association (IETA) Bali Global Business Day, 10 December 2007 97

98. What do you mean by an inclusive policy framework? Would you agree with me that there are 5 key conditions. First of all as I wrote in my paper published for the Nairoby confrence I cannot agree with statements like the one made in your opening sesssion. How can you possibly claim that the current energy generation structure is obsolete and Question cards in your folder Q & A WHAT DO YOU MEAN BY AN INCLUSIVE POLICY FRAMEWORK ? WHAT DO YOU MEAN BY AN INCLUSIVE POLICY FRAMEWORK ?

99. Development and Cooperation Panel Rudi Fajar President director Riaupulp, APRIL Group Bali Global Business Day, 10 December 2007 99

100. Development and Cooperation Panel Dr. Gail Kendall Director, Group Environmental Affairs CLP Holdings Limited Bali Global Business Day, 10 December 2007 100

101. Development and Cooperation Panel Fernando Tudela Under Secretary for Planning and Environmental Policy, Ministry for Environment and Natural Resources, Mexico Bali Global Business Day, 10 December 2007 101

102. Development and Cooperation Panel Katherine Sierra Vice President for Sustainable Development World Bank Bali Global Business Day, 10 December 2007 102

103. Development and Cooperation Panel Peter Goldmark Program Director, Climate & Air Environmental Defense Fund Bali Global Business Day, 10 December 2007 103

104. Development and Cooperation Policy Review Adam Kirkman Program Manager, Energy and Climate Focus Area WBCSD Bali Global Business Day, 10 December 2007 104

105. UNFCCC COP 13 Bali, 10 December 2007 Policies to enhance business participation and investment

106. Evolution of the Debate - 2000 Bali Global Business Day, 10 December 2007 106 Mitigation Adaptation

107. Post-2012 debate in 2007 Bali Global Business Day, 10 December 2007 107

108. How do we attract private capital? Bali Global Business Day, 10 December 2007 108 1.Understand how and why business invests 2.Recognise that raising money is not the problem – directing the flow toward the development, demonstration and deployment of clean energy technologies is the key 3.Align policy, mechanisms, tools with commercial conditions in which business invests

109. Need to understand how and why a business chooses to invest Bali Global Business Day, 10 December 2007 109 Decision made in dynamic, highly differentiated, competitive market Every decision relies on commercial returns Money always flows to quickest returns Low carbon projects among more complex and risky forms of investment Different screening mechanisms, risk appetites, appraisal criteria Whole host of risks to be taken into account A great opportunity for one investor can be a step too far for another

110. Harness the power of the markets Bali Global Business Day, 10 December 2007 110 Political risks, legal frameworks, structures all influence pace of investment in the market In markets confidence is important Determines potential participants and scope of investment Policy uncertainty increases risks of achieving a commercial return While uncertainty prevails bulk of capital will flow to traditional energy sources, or remain uncommitted until definitive policies emerge

111. What policy is needed? Bali Global Business Day, 10 December 2007 111 International policy effort must align with the long range business investment horizon Supportive regulation and governance to encourage business to invest for the long term Dismantle trade barriers affecting the diffusion of technologies Manage IPR issues to balance the need to incentivise innovation and support investment Clear and strong expectation of CO2 price Create predictable future demand for key technologies to drive innovation and competition

112. What can governments in developing countries do? Bali Global Business Day, 10 December 2007 112 Build institutional capacity to translate energy and climate strategies into integrated development plans Stable and transparent regulatory regimes Expand and aggregate (project portfolios) to standardize and streamline Support investment in SMEs so they can own and operate projects and support deployment Technology cooperation through competitive business to business transactions to scale up

113. What can we do together - public and private Bali Global Business Day, 10 December 2007 113 Less developed countries need innovative Clean Energy Investment Frameworks Engagement in G8 Gleneagles Dialogue MDBs – High potential to leverage private sector investment in developing countries Public-private financing mechanism to develop pipeline of clean energy projects buy down incremental investment costs grants and concessional loans increase creditworthiness of the future carbon cash flows through partial guarantees

114. Have to get this right…. Bali Global Business Day, 10 December 2007 114 Must get technologies into developing world Rich countries need to help poor countries Business has capacity to help but needs policy certainty that brings stability, confidence in markets and facilitates long-term investment If we get it right it can be used to alleviate poverty, create jobs and build sustainable wealth Reduces emissions, protects and conserves energy resources, and crucially the ecosystems of the developing world

115. www.balibusinessday.org

116. Climate Policy, Business Engagement, Progress Moderator Claude Fussler, former Program Director, WBCSD Closing exchange Yvo de Boer, Secretary General, UNFCCC Steve Lennon, Delegation Chairman, ICC Mohamad S. Hidayat, President, Indonesian Chamber of Commerce and Industry (KADIN) Björn Stigson, President, WBCSD Bali Global Business Day, 10 December 2007 116

117. Climate Policy, Business Engagement, Progress Yvo de Boer Secretary General, UNFCCC Bali Global Business Day, 10 December 2007 117

118. Climate Policy, Business Engagement, Progress Steve Lennon Delegation Chairman ICC Bali Global Business Day, 10 December 2007 118

119. Climate Policy, Business Engagement, Progress Mohamad S. Hidayat President Indonesian Chamber of Commerce and Industry (KADIN) Bali Global Business Day, 10 December 2007 119

120. Climate Policy, Business Engagement, Progress Björn Stigson President WBCSD Bali Global Business Day, 10 December 2007 120

121. Up to the challenges? Or not yet? Dr. Gro Harlem Brundtland UN Special Envoy on Climate Change Bali Global Business Day, 10 December 2007 121

122. Closing Statement Rachmat Witoelar Minister Of Environment Republic of Indonesia Bali Global Business Day, 10 December 2007 122

123. Caring for Climate dinner 18:30Cocktails 19:30Dinner A few last minute registrations possible

124. www.balibusinessday.org UNFCCC COP 13 Bali, 10 December 2007

125. Thorsten Arndt Lucy Jasmin Mary Kelly Kija Kummer Marisa Low Christian Kornevall Carlos Busquet Stephanie Held Wendy Poulton Neil Franklin Tina Launois Jacqueline Cote Norine Kennedy Marcel Engel Jonathan Wootliff Michael Martin Anne Catherine Werner Music

126. state of happiness, the Creator, people and nature live in harmony with each other. state of happiness, the Creator, people and nature live in harmony with each other. May you all share it!