1. Joint implementation and eligibility requirements
UNFCCC JI Technical Workshop
Bonn
13-14 February 2007
Andrew Howard
Climate Change Secretariat

2. Overview Crediting JI projects
Implications of track 1 and 2 eligibility
Implementation of Kyoto institutions
Progress towards Parties’ eligibility
Annual reporting and review
Annual greenhouse gas inventory
Annual assigned amount information
Changes in the national registry
Changes in national system
Calculation of commitment period reserve

3. Crediting JI projects
Host Annex B Party converts (“issues”) existing units into emission reduction units (ERUs) based on JI projects
Registries transfer ERUs to investing project participants
ERUs may be used by Annex B Parties for compliance
ERUs differ from CDM credits, which are newly created units
AAU
RMU
ERU
for emission-reducing projects
for projects in LULUCF activities

4. Safeguards through eligibility
Kyoto’s institutions for compliance accounting
Measuring and verifying emissions
Tracking transactions in emission rights
Carbon market institutions
Ensuring integrity of emission rights
Providing a firm basis for market contracts and prices
Annual reporting and review
Annual greenhouse gas inventory
Annual assigned amount information
Changes in the national registry
Changes in national system
Calculation of commitment period reserve

5. Kyoto institutions and eligibility
National systems
Annex B Party systems
Emissions
inventories
Reporting
process
National registries
Kyoto Protocol units
Assigned amount
Eligibility requirements
Review and compliance processes
Emissions
Secretariat compilation and accounting
systems
Article 3.1 compliance
assessment
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6. JI eligibility requirements
Track 1 (full eligibility)
a. Party to the Kyoto Protocol
b. Assigned amount calculated
c. National system in place for estimating emissions/removals
d. National registry in place for tracking assigned amount
e. Submission of most recent required emissions inventory
f. Accurate accounting of assigned amount and submission of information
a. Party to the Kyoto Protocol
b. Assigned amount calculated
d. National registry in place for tracking assigned amount
Track 2 eligibility
National systems and reliable inventories are fundamental for determining compliance of Parties with their Kyoto targets
calculation of assigned amount under Articles 3.7/8
maintaining mechanisms eligibility
end of commitment period compliance test
Initial inventory with full time-series is important for calculation of assigned amount under both track 1 and 2
Difference between track 1 and 2 hinges on ongoing provision of annual inventory that meets requirements

7. JI issuance, transfer and acquisition
No eligibility
Cannot issue or transfer ERUs
Track 2
Can issue and transfer ERUs
 only after JISC verification of the project and reductions
Can issue, transfer and acquire ERUs
 Party may verify projects and reductions by its own procedures
Track 1 (full eligibility)
No eligibility needed to participate in JI projects
 eligibility only relates to ERU issuance, transfer and acquisition

8. Eligibility process Initial review process Compliance Committee
Annex B Party Initial Report
Review report (may include questions of implementation)
Compliance Committee
(Enforcement Branch)
Decides that requirements are not met
Or decides that it is not proceeding with any questions of implementation
Compliance Committee determination is decisive
Initial report and review is “to facilitate calculation of assigned amount and demonstrate capacity to account for emissions and assigned amount”
GHG inventory (focus on base year)
National system
National registry
Calculation of initial assigned amount under Articles 3.7/8
Calculation of commitment period reserve
Selection of sinks activities under Article 3.3/4
Facilitative Branch
Considers questions on reporting and accounting prior to CP
Provides advice, and facilitate financial and technical assistance
Enforcement Branch
Can apply adjustments to inventories
Make corrections to Party’s accounting
Suspend and reinstate eligibility to participate in mechanisms

9. Eligibility status Most Initial Reports submitted on time
- 32 submissions received
- Outstanding: Bulgaria, Canada, Romania, Russia
Country visits by Review Teams are underway
- Japan last week, Austria this week
- All reviews to be completed by December 2007
Compliance Committee has up to 16 months of Initial Report
- otherwise full eligibility is automatic for the Party
- may declare earlier that it is not proceeding with any questions
Party must continue to meet requirements to maintain eligibility
Annual reporting and review
Annual greenhouse gas inventory
Annual assigned amount information
Changes in the national registry
Changes in national system
Calculation of commitment period reserve

10. Emissions trading
Subsequent ERU trading subject to trading eligibility
- transferring and acquiring Parties
- only full eligibility is possible (no track 1 equivalent)
Entity-level EU trading fits under the Kyoto trading umbrella
- phase 1 ( ) has separate EU allowances
- phase 2 ( ) links EU allowances to Kyoto AAUs
- linking directive allows trading of CERs/ERUs in both phases
International ETS trades automatically accounted under Kyoto

11. International transaction log
Essential market infrastructure
Links registries of all Parties
Real-time monitoring of transactions prior to completion
Power to stop transactions where Kyoto rules are broken
Regular reconciliation of ITL and registry records
ITL implementation on track for April 2007
Early registry connections: CDM, Japan, NZ
EU registries planning to link to ITL from May 2007

12. Closing words Kyoto institutions almost complete
Review and compliance processes are at work
Eligibility expected for late 2007 or early 2008
Annual reporting and review
Annual greenhouse gas inventory
Annual assigned amount information
Changes in the national registry
Changes in national system
Calculation of commitment period reserve