RBEC UNDP-GEF Climate Change Mitigation Portfolio: Lessons Learnt John O’Brien Regional Technical Advisor, Climate Change Mitigation UNDP – Bratislava Regional Centre Sub-Regional Workshop for GEF Focal Points & Constituency Meeting April 2010

1 RBEC Energy and Environment CoP Meeting 1 Presentation Overview  Overview of UNDP GEF CC Portfolio  Lessons Learned during GEF - 4  Looking towards GEF - 5

2 RBEC Energy and Environment CoP Meeting 2 UNDP GEF Climate Change Activities Globally Renewable Energy Portfolio: US$ 865 m Energy Efficiency Portfolio: US$ 1 billion Transport Portfolio: US$ 890 m Objective: Assist developing countries to develop and adopt low carbon and climate resilient strategies/development through promotion of market transformation for EE, RE and Sustainable Transport technologies  UNDP has 132 Country Offices in 6 Regions  We are Country Driven

3 RBEC Energy and Environment CoP Meeting 3 UNDP GEF Portfolio Overview - Energy-Efficiency is Number One Priority

4 RBEC Energy and Environment CoP Meeting 4 UNDP interventions in Europe and CIS region are focused on Removing Barriers to EE Low energy efficiency (even new EU members), little use of renewable energy (except hydro) → most energy- and carbon-intensive economies globally Source: World Resources Institute 2008 World average

5 RBEC Energy and Environment CoP Meeting 5 UNDP key priority: Energy efficiency in Buildings Source: UNDP/GEF Project Document, Kyrgyzstan 40% of energy used in buildings Building stock 2-3 times less efficient than in EU Utilities account for 20% in poor households income 30% reduction in costs can make a substantial difference

6 RBEC Energy and Environment CoP Meeting 6 Barriers to remove: UNDP key priority: Energy Efficiency in buildings How do you think about work the heating supply system in your apartment? Bad 30, 1% Don’t work at all 20,5% No answer 1,8% Good 47, 7% Turkmenistan: 50% of customers are not satisfied with heat systems Source: UNDP/GEF Project Report - Poorly designed and insufficiently enforced legal and regulatory framework - Weak capacities to identify and implement energy efficiency measures among municipalities, tenants and district heating companies - Financing Barrier – access to credit is very difficult – Scaling Up

7 RBEC Energy and Environment CoP Meeting 7 Lessons Learned: Municipal EE in Croatia Source: UNDP-GEF Project in Croatia - Policy-level support: National EE Master-plan with the Programme of Implementation Energy Charter: signed by ALL towns and counties in the Republic of Croatia - Over 40 million USD investments leveraged in energy EE across Croatia - 91,5% of households are aware of availability and the benefits of EE products related to home appliances - Project budget: 13 M US$ (on-going) with UNDP/GEF contribution 3.5 M$ BEFORE Advocacy kit under UNDP “House in Order” project Energy Charter

8 RBEC Energy and Environment CoP Meeting 8 Lessons Learned: EE Renovation in Bulgaria Source: UNDP/GEF Project Booklet, Bulagria - 28 voluntary associations of condominium owners for the purposes of renovation and future maintenance created; - 7 multifamily buildings fully renovated and 21 buildings undergoing renovation - Annual energy saving: 50-75% due to EE renovation BEFORE AFTER

9 RBEC Energy and Environment CoP Meeting Upscaling EE Activities : Options for Consideration OPTIONS TO CONSIDEROPTION EXPLAINED and WHAT IS NEEDED Loan Guarantees for BanksBanks are reluctant to provide loans to home owners, due to inability to provide security; If banks provide loans, the interest rates are too high Guarantee by a “third party” could help More analysis needed on how this might work and collaboration with the various IFIs. Free energy audits and/or interest free loans (provided by Government) Average size of a loan for household EE is low:less than US$ 10,000. A government programme for interest free loans for this purpose and free energy audits could work (Action Energy Programme in UK) Analysis of lessons learnt from similar programs Carbon financeNo impact to date on the EE field – transaction costs are high; number of emission reductions small/project basis. New Programme of Activities (PoA) under CDM – will combine activities at national/sub-national/regional level in one project Analysis needed on the use of the PoA approach in EE in buildings

10 RBEC Energy and Environment CoP Meeting 10 UNDP key priorities: Renewable energy Wind power: Kazakhstan Biomass: Slovakia, Belarus, Poland, BiH, Slovenia, Latvia Solar Water Heating: Albania Small hydro power: Georgia, Kyrgyzstan and Tajikistan  Security of Supply is critical (for biomass projects)  Long-term PPA is critical for electricity generation projects  Demonstration projects can play a ‘catalytic effect’

11 RBEC Energy and Environment CoP Meeting 11 Lessons learnt: Working Well and Areas for Improvement  Coordination with other Agencies  Finding Investors/Engaging Private Sector  Upscaling Activities & Replication We are working well when it comes to  working at a local level (municipalities, local governments)  changes in policies, legislation, regulation  awareness raising activities  guidebooks, training materials  demonstration activities Where we can and need to improve

12 RBEC Energy and Environment CoP Meeting 12 Lessons Learned: Engaging the Private Sector How do we engage the private sector more effectively  staff/consultants with experience working in the private sector at a senior level – managing risk  understand concepts of risks and returns and how we can assist with reducing risks/enhancing returns  choose ‘world class companies’ to work with  specific role within our projects of leveraging private sector investment In our projects : reward results, reward sucess

13 RBEC Energy and Environment CoP Meeting 13 Primary Focus  Energy-Efficiency in Buildings - In particular EE in residential buildings & public buildings  Removing Barriers to Renewable Energy - esp. biomass Secondary Focus  Sustainable Transport  Carbon Forestry (incl. cross cutting projects) Integrate focus on linkages with carbon markets (CDM, JI) into our projects under GEF – 5 (Carbon Finance is the future) Looking to GEF 5 – Areas for Focus for UNDP

Thank you!