Visit of the S. Korean delegation UNEP Risø Centre, 1 September 2005 Jørgen Fenhann Analysis of the CDM project pipeline Content of the presentation: What does a PDD contain? Baseline & monitoring methodologies Crediting period & Additionality Small-scale CDM In which sectors and are CDM projects developed? In which countries are CDM projects developed? Examples of the 202 CDM projects in the pipeline Some LULUCF issues

What does a PDD contain?

Baselines A baseline is a scenario that represents the GHG emissions in the absence of the CDM project Baseline Conservative Baseline With CDM project Time Emissions GHG reductions A baseline should be conservative and transparent

132 new proposed methodologies have been sent to the EB

Approved Methodologies (1) A baseline and a monitoring methodology is always paired

Approved methodologies (2)

Project duration For normal CDM projects the duration can be 3*7 years or 1*10 years For forest projects the project duration can be 3*20 years or 1*30 years. It looks nicer to choose 21 years than 10 years, but the danger in choosing 21 years is that the basline may not be validated again after the first 7 years. A project can have a starting date before the date of registration (& after 1/1 2000), if evidence can be provided, that the incentive from the CDM was considered seriously in the decision to proceed with the project activity.

Additionality issues A CDM project must be additional to any that would occur in the absence of the CDM project (Art in the Kyoto Protocol) At the last Executive Board meeting (EB16) a tool for demonstration of additionality was finalised. At EB16 it was agreed that it can be assumed in baselines that E-policies (promoting RETs & EE) implemented after the Marrakesh Accord were not in place. This helps solving the ”perverse incentive problem”.

The tool for demonstration of additionality

Why is small-scale easier? Standardized simplified baselines are provided so no new methodologies needs to be approved by the EB. Monitoring methodologies are simplified with a less frequent and reduced monitoring plan. The additionality assessment requires only a barrier assessment. Calculation of leakage is only required for biomass projects and where new equipment and existing equipment at to places are exchanged. The same DOE may undertake validation and verification Bundling is allowed

Eligible small-scale CDM project categories Small-scale Afforestation/Reforestation (A/R) projects must reduce emissions < 8 ktCO2. A/R Working Group formed, are preparing A/R categories. A Small-scale Working Group are preparing more small-scale categories.

Small-scale projects are not always small An efficient refrigerator saves 200 kWh/year. To be below 15 GWh of savings there is room for refrigerators. A Solar home system often use a 50W solar PV. To be below the 15 MW there is room for solar PVs A private car running km/year emitting 200 gCO 2 /km emits 4tCO 2 /year. To be below 15ktCO 2 there is room for about hydrogen cars.

Bundling is allowed for small- scale CDM projects The size of a bundle should not exceed the limits for small scale projects (<15). Bundled projects activities have the following benefits: Can be covered by one PDD Only one overall monitoring plan One combined emission reduction calculation Combined environmental impact Combined stakeholder comments One validation One registration One certification

Debundling is not allowed A small-scale project activity that is part of a larger project activity is not eligible. A small-scale project activity is debundled if there is a registered (or application to be registered) small-scale CDM project activity: With the same project participants In the same project category and technology/measure Registered within the previous 2 years; and Whose project boundary is within 1 km of the project boundary of the proposed small-scale activity at the closest point.

Additionality for Small-Scale projects Show that the project would not have occured without CDM due to: Investment barrier Technological barriers Barrier due to prevailing practice Other barriers: Institutional, information, managerial, organizational capacity, financial, or capacity to absorb new technologies

Which sectors are prevailing (1)?

Which sectors are prevailing(2)?

Which sectors are prevailing(3)?

Which countries are prevailing ?

Examples of the 202 CDM projects in the pipeline