Bali Road Map, Climate Change and Official Statistics Maria Netto United Nations Development Programme 25 June 2008

1 1 What needs to be accounted for/reported? Convention All Parties: GHG inventories – sectors as defined in IPCC 1996 guidelines (information from 2006 guidelines is also recommended) – provide for a set of sectors Vulnerability assessments & Adaptation – no single methodology – a set of sectors in IPCC Developed countries (Annex I Parties): Annual GHG reports Regular reporting includes also information on policies and measures (PAMs) Developing countries (non Annex I Parties): Every 3,4 years. Depend on availability of data. No obligation to report on PAMs. LDCs: National Adaptation Plans of Action.

2 2 What needs to be accounted for/reported? Kyoto Protocol Annex I Parties: More detailed accounting of GHG emissions and PAMs – need to link them up to assigned amounts to account for QELROs (targets) and participate in emissions trading. National institutional framework in place: national systems Emissions trading accounting: national registries Non-Annex I Parties: No additional obligations Under Clean Development Mechanisms however: importance of information availability of data for setting baselines and monitoring emission reductions. Some tracking of national accounts in CDM registry also possible

3 3 Bali Road Map - What is new? Recognition that actions to address climate change are intimately linked to economic growth and sustainable development goals and needs. Breakthrough in international climate change policy, highlighting a shared understanding for the necessity of common efforts, both by developed and developing countries and setting a deadline by The road map for negotiations laid down four main building blocks: mitigation, adaptation, technology and financing, and established a timetable under the Kyoto Protocol for emission reduction targets for industrialized countries by 2009.

4 4 Bali Road Map - Challenges Increasing understand that to promote increased resilience to climate change impacts and a lower-GHG emission economy fall across a variety of sectors, such as energy, agriculture, health, water resources, infrastructure, etc In order to effectively participate and develop positions in such a challenging and complex negotiation process, developing countries -- in particular those with medium- and small-size economies -- will be required to involve and increasingly co- ordinate various government decision makers across key economic sectors at the national level as well as other relevant stakeholders. Bali Road Map Deadline of 2009 is challenging – options need to be laid down and understood.

5 5 Bali Road Map negotiations - Kyoto Protocol Discussions so far (2007) focused on identifying criteria for targets for Annex I Parties. Agreement that for concentration stabilization levels of 450 ppm CO2-eq, GHG emissions from developed countries would need to be reduced for about 25 to 40 percent by 2020 (IPCC). Discussions in 2008 will also focus on means to achieve targets: mechanisms, national policies, role of LULUCF, etc. Contentious issues include: Role of LULUCF (what activities should be accounted both for the base year as for the emission reductions) Whether to consider or not obligations relating to emissions by bunker fuels Timing for agreeing on final criteria and starting discussions on exact targets by developed countries Extent of use of sectoral targets Extent of use of mechanisms and their possible expansion

6 6 Bali Road Map negotiations - Convention Mitigation: Developed countries – comparability of commitments (with KP) Developing countries – Measurable, reportable and verifiable mitigation action and means to support action (finance and technology) Adaptation: Linkage to other areas: development, disaster risk prevention, risk management Finance: access, scale up to address gaps ensure predictability of funds

7 7 Bali Road Map negotiations - Convention Finance: Evolved to a much broader range of issues relating to relationship between the costs / needs to address climate change and economic growth an development. Allocation of ODA and Convention Funds under the financial mechanism Possible role of, and what are the possible incentives to, promote national and international policies and regulations Innovative mechanisms to leverage additional funding and their governance Investments and finance to address climate change as linked to overall investment and finance for development.

8 8 Bali Road Map negotiations - Convention Technology: Strong linkage between technology and mitigation actions – recognition of need adequate access to technology and capacity for technology development for achieving emission reductions Dimensions: technology cooperation ; transfer; support to endogenous development; R&D New Mechanisms: Regional, thematic, PPP approaches IPRs

9 9 Bali Road Map negotiations - Challenges on reporting Need for enhanced accounting for both developed and developing countries – issue of availability and compatibility of data is now new. Linkage between economic data and GHG inventories, mitigation actions, vulnerability assessments and adaptation data – need to develop options to cope with climate change, plan in longer term and assess costs and needs. Need to consider climate change across economic sectors – involve various decision makers. Need not to duplicate efforts at national level – between existing accounting for various sectors and new needs for climate change.

10 Activity Data - Number of possible barriers to data collection Lack of data for a certain year or complete lack of data for any years Inconsistencies time series, e.g. changes in definition, survey methods Data classification system incompatible with IPCC format (e.g. LUCF) Access to activity data may be restricted (e.g. confidentiality issues) or very expensive Difficulties in identifying institutions responsible for data collection More than one institution retaining data for a given source category Contradictory data from different sources of information Legal issues or fees associated with obtaining data Avoid double counting

11 Activity Data - Addressing issues Identify AD sources (national/international) Identify potential barriers for data compilation and potential solutions Identify potential gaps and approaches to fill them If data do not exist, assess feasibility to generate them Discuss with experts from other countries on alternative solutions Involve institutions responsible for data collection to identify options for data gaps filling As a last resource, it is possible to rely on international AD sources for some GHG categories of CO2, CH4, and N2O

12 Compiling a national GHG inventory requires a fairly lengthy and interconnected series of tasks. GHG inventory requires fundamental decisions about data and methods, network of contacts, institutional arrangements, and a system for data management, QA, QC, documentation and archiving. Inventory process should thus be planned, operated and managed to ensure quality, efficiency and sustainability This is especially important as countries produce their second and subsequent inventories and intend to provide inputs to relevant policy decisions. GHG data and planning mitigation – Addressing data issues

13 Mitigation/GHG sectors Sectors Sources of emissions, sub-sectors, means, Energy supply Natural gas; Renewables; Hydropower; Nuclear; Crude Oil, Coal IndustryPulp and paper; Cement; lime, and other non-metallic minerals; Nonferrous metal smelting and iron and steel smelting; Metal and non-metal mining; Chemical products; Other manufacturing TransportationPassenger and freight movements by road vehicles; railways; aircraft; and both inland and maritime vessels BuildingsResidential floor space and all commercial or service activities, fuel use and emissions for space and water heating WasteLandfills, wastewater AgricultureAgricultural lands, comprising arable land, permanent crops and pasture Forestry

14 Economic sectors and mitigation sectors Mitigation sectorsEconomic sectors Agriculture Forestry Energy supply Industry Transportation Buildings Waste? Agriculture, hunting, forestry and fishing Mining and quarrying Electricity, gas and water supply Manufacturing Transport, storage and communications Financial intermediation real estate, renting and business activities Construction Wholesale retail trade, repair of motor vehicles, motorcycles, etc., hotels and restaurants Public administration and defence, compulsory social security Education, health and social work, other community, social and personal services

15 Matching mitigation and economic sectors / data In order to assess investment and financial flows for energy supply one needs to link to economic sector information Components of energy supply are divided between two economic sectors. Specifically: Oil, gas and coal production and petroleum refining are part of the mining and quarrying sector, together with other mining activities; Electricity generation, T&D and gas distribution are part of electricity, gas distribution and water supply sector.

16 Adaptation sectors The same challenges apply to Adaptation sectors: Agriculture, Forestry Water supply Human health Natural ecosystems (terrestrial and marine) Coastal zones Infrastructure

17 Importance to identify key players SourcesEconomic sectors Households Government Financial corporations Non-financial corporations Agriculture, hunting, forestry and fishing Mining and quarrying Manufacturing Electricity, gas and water supply Transport, storage and communications Financial intermediation real estate, renting and business activities Construction Wholesale retail trade, repair of motor vehicles, motorcycles, etc., hotels and restaurants Public administration and defence, compulsory social security Education, health and social work, other community, social and personal services

18 SourceTotal/SectorNotes HouseholdsTotal investmentA: GFCF dataAssumed to be entirely domestic CorporationsTotal investmentB: GFCF data Domestic fundsC: Calculated (B – D – G) FDID: UNCTAD dataAssumed to be all non-financial corporations Adjusted domestic fundsE: Calculated (B – F – G) Adjusted FDIF: UNCTAD dataAdjusted for mergers and acquisitions; not available by sector Foreign debtG: BIS data GovernmentTotal investmentH: GFCF data Domestic fundsI: Calculated (H – J – K) Foreign debtJ: BIS data ODAK: OECD dataAssumed to be all government TotalTotal investmentA + B + H Domestic fundsA + C + I FDID Adjusted domesticA + E + I Adjusted FDIF Foreign debtF + J ODAK

19 Matching data to mitigation priorities / CDM potential About 100 methodologies available Each methodology provides for guidance on eligibility activities Baseline in particular needs many times data at regional/national level – in some cases there is strong reliance on historical data (e.g. forests) Screening methodologies against mitigation priorities allow to select key sectors where CDM could have potential in the country (e.g. carbon intense products) and for which data could be made available to facilitate project development Some types of projects/methodologies rely a lot on availability of national data – e.g. energy efficiency, electricity to the grid, etc.. Difficult access to data and non-availability of data are important barriers to implement CDM

20 CDM examples on data - Bus Rapid Transit Projects ElementMonitoring Methodology Core data for determining baseline emissions Alternative A: based on relative data (fuel consumption and distance driven per vehicle category and fuel type) Alternative B: sectoral fuel consumption Technology improvement factor Passengers per transport mode using new transport system after project start (relative distribution and absolute numbers) Alternative A: fuel consumption based on measurement of a representative sample, international literature, IPCC values related to local circumstances and distance driven based on official statistics Alternative B: Based on representative surveys Default value based on international literature Monitored annually by project based on surveys plus registration of total passengers transported by the system

21 CDM examples on data - Tool to calculate the emission factor for an electricity system ElementSource of data recommended Amount of fossil fuel type consumed by power plant / unit Utility or government records or official publications CO 2 emission factor of fossil fuel type i in year y Option 1: Values provided by the fuel supplier of the power plants in invoices (If data is collected from power plant operators (e.g. utilities) ) Option 2: Regional or national average default values (If values are reliable and documented in regional or national energy statistics / energy balances) Option 3: IPCC default values at the lower limit of the uncertainty at a 95% confidence interval as provided in table 1.4 of Chapter1 of Vol. 2 (Energy) of the 2006 IPCC Guidelines on National GHG Inventories

22 Measurable, reportable and verifiable Mitigation actions by developing countries – Some experience with national communications and CDM – Challenges of new proposed approaches – e.g. sectoral, SD PAMs Support to implementation actions: – Finance – Technology transfer and support Annex I Parties: – Experience with national communications, PAMs and emissions trading – Sectoral approaches are also a challenge

23 Conclusions – Existing Convention and KP requirements Data needs and barriers are not a new issue Need for national institutional framework Consider flexible ways to support capacity of countries (rather than create more reporting burdens) Experience with GHG inventories, national communication and CDM provide useful basis – methodologies and categories are available

24 Conclusions – New requirements Role of data for longer term planning (history data and continuous collection and monitoring) Possible new sectors or activities (LULUCF, Bunkers, etc.) Need for economic assessment of mitigation options Linkages amongst mitigation sectors and economic sectors Measurable, reportable and verifiable information – on mitigation action

25 Conclusions – Climate Change and official statistics Possible methodological linkages between IPCC, CDM, other carbon accounting standards (e.g. WRI/WBCSD) and official Statistics such as SEEA) Importance of SEEA in assisting improved monitoring and measuring at national level and in supporting modelling/long term planning Need to enhance capacity of developing countries to consider climate change across sectors and enhance ongoing capabilities to collect and maintain data Need to consider further how to formulate statistical information that provide for economic / finance accounting of mitigation / adaptation options