CDM What and How? /

Transcription

1 CDM What and How? /

2 Contents 1. Introduction of Det Norske Veritas AS 2. What is CDM? 3. DNV s approach 4. How? - Key steps in validation process (CDM ) 5. Mistakes to avoid and lessons to be learned 6. Experiences in SEA 7. Conclusion Slide 2

3 Introduction of Det Norske Veritas AS

4 More than 140 years of managing risk Det Norske Veritas (DNV) was established in 1864 in Norway Independent foundation with purpose of Safeguarding Life, Property and Environment The main scope of work was to identify, assess and manage risk initially for maritime insurance companies Slide 4

5 DNV Services Leading CDM validation body with 38% market share Validated 48% of all registered CDM projects Over 100 trained GHG auditors 300 offices worldwide, with 7500 employees worldwide and still growing Slide 5

6 Accredited For All Major Scopes DNV is accredited for 14/15 of the Scopes! Slide 6

7 DNV along your value chain DNV validates corporate emissions for large European clients under the EU emissions trading scheme DNV was instrumental in developing monitoring and reporting principles for the UNFCCC, the World Bank PCF and the Dutch programmes DNV is the first Designated Operational Entity to be accredited for all major sectors under the Clean Development Mechanism. DNV staff are acquainted with the latest developments in the your sector, state-of-the-art Technologies and (inter-)national climate change and sectorspecific policies DNV is perceived by brokers, project developers, governments and other potential buyers as guaranteeing high integrity of verified emission reductions Assessment of GHG reductions Identification and evaluation of reduction opportunities Project design Validation & Registration Implementation and operation Verification CERs for sale or compliance DNV s technology and R&D centre have long experience with risk-based monitoring systems DNV has validated over 150 projects in 15 industry sectors and over 35 nations during the last years DNV was instrumental in the development of PCF s and IETA s Validation and Verification Manual Slide 7

8 Reference List Slide 8

9 What is Clean Development Mechanism (CDM)?

10 Kyoto Protocol (KP) and CDM The Kyoto Protocol is a legally binding agreement that arose out of the UNFCCC to tackle climate change through a reduction of green house gas emissions. Countries (those listed in Annex I) are legally bound to reduce man-made green house gases emissions by approximately 5.2%. Individual countries have their own reduction targets outlined in Annex B of the Kyoto Protocol. The text of the protocol was adopted at the third conference of the parties to the UNFCCC in Kyoto, Japan, on 11 December Slide 10

11 Kyoto Protocol and CDM It came into force on February 2005 when Russia ratified the treaty There are three flexibility mechanisms, mainly Clean Development Mechanism (CDM), Joint Implementation (JI) and European Union Emissions Trading Schemes (EU-ETS) * DNV hub in South East Asia only involves in CDM projects (not JI or EU-ETS) CDM allows Annex I (industrialized) countries to meet their emission reduction targets by paying for green house gas emission reduction in non-annex I (developing) countries. Slide 11

12 Annex 1 and Non-annex 1 Countries Annex 1 Countries Parties include the industrialized countries that were members of the OECD (Organisation for Economic Co-operation and Development) in 1992, plus countries with economies in transition (the EIT Parties), including the Russian Federation, the Baltic States, and several Central and Eastern European States. Non-Annex I Countries Parties are mostly developing countries. A list of countries and their respective ratificationdates in region South East Asia are as bellow:- Cambodia, 22 August 2005 Indonesia, 3 December 2004 Lao People s Democratic Republic, 6 February 2005 Malaysia, 4 September 2002 Myanmar, 13 August 2003 Philippines, 20 November 2003 Singapore, 12 April 2006 Thailand, 28 August 2002 Vietnam, 25 September 2002 Note: *full list of the Annex I and Non-Annex I countries is available on Slide 12

13 Clean Development Mechanism (CDM) Sponsor Annex I Host Slide 13

14 CDM Project Activity Cycle Project Activity Design including the Project Design Document (PDD) - This can be done through proposal of a new baseline, or - Use of an Approved Methodology Validation of the CDM project activity Registration of the CDM project activity Certification/ Verification of the CDM project activity Slide 14

15 Number of CERs requested and issued Issuance Title Number of CERs Issued CERs 188,108,892 Total CERs Requested 206,506,020 Slide 15

16 Risk-Based Validation Approach Validation scope Project Design Document (PDD): Project design Baseline Comments by Monitoring Plan Parties, Emission reduction estimates stakeholders Environmental impacts and NGOs Comments by local stakeholders Identify risks associated with assumptions made and data sources used Review risk areas for completeness, conservativeness and accuracy Detailed investigation of remaining areas of material uncertainty Validation Report & Opinion Slide 16

17 Key steps in validation process (CDM)

18 The Validation Process (CDM project) Phase 1 Desk review Phase 2 Interviews Phase 3 Draft report Phase 4 Final report Project Developer Submit Documentation Initial clarifications Assistance with logistics Clarifications Corrective Actions DNV Preliminary check Identify risks associated with assumptions made and data sources used List of issues to be discussed during followup interviews and site visit schedule Interviews with relevant stakeholders Customized draft determination report Final determination report and opinion Publication of determination report Stakeholders Stakeholder comment period of 30 days Approval from host country Host country and donor country can request review for 45 days Slide 18

19 Validation process An Efficient Validation Process - Adding Value - Access to sufficiently accurate data and sources - Check additionality - Capacity to measure and document - Good project management - Communicate, communicate, communicate Slide 19

20 Main differences between CDM and non-cdm project CDM project will have to go through the followings: - web-hosting of PDD at DOE s website for stakeholders to comment; - Letter of Approval from Host country s DNA - Letter of Approval from Annex 1 country (for bilateral projects, i.e. Malaysia) - Modalities of communication (MOC) - Registration with UNFCCC A non CDM (i.e. VCS) project will not need to do all the above Slide 20

21 Mistakes to avoid and Lessons to be learned

22 Mistakes to avoid Ensure that project uses published default values (IPCC values) If possible, use approved methodologies (i.e. CDM) References should be made in PDD and monitoring report to substantiate statement or argumentation Ensure internal check is done effectively to prevent losing CERs Slide 22

23 Lessons to be learned Ensure that the project baseline, additionality is sound Most project chose to use higher values to have higher CERs conservativeness is the key Respond promptly to outstanding issues (CARs and CLs) Internal checking to prevent data transfer or calculation errors Communicate frequently with your DOE Slide 23

24 Projects and Application of Methodologies Sectoral Scopes that are under CDM are the following:- (1) Energy Industries (renewable/non-renewable sources) (around 1000 projects registered) (2) Energy Distribution (none registered) (3) Energy Demand (around 18 projects registered) (4) Manufacturing industries (around 100) (5) Chemical industries (around 40) (6) Construction (none) (7) Transport (only 2) (8) Mining/Mineral production (around 9 projects) (9) Metal production ( only 2) (10) Fugitive emissions from fuels (solid, oil and gas) (around 120) (11) Fugitive emissions from production and consumption of halocarbons and sulphur hexafluoride (around15) (12) Solvent use (none) (13) Waste handling and disposal (around 300) (14) Afforestation and reforestation*** (only 1) (15) Agriculture (around 90) *** DNV is not accredited on (14) Slide 24

25 Experiences in SEA. Biomass projects (cogeneration, electricity / steam generation) palm oil wastes (EFB), wood waste, rice husk, coconut shells Wastewater (anaerobic biogas) - tapioca/cassava mills, swine manures, domestic wastewater, poultry Hydropower/wind farm projects Landfill gases Cook stoves Fuel switch cement industry, glass manufacturing / high energy consumption plant Cement industry clinker reduction Slide 25

26 More. To learn more, please visit our website, / or contact us at SEA.Climate.Change@dnv.com Find out more about our CCS DNV Training Academy Relevant websites for our brochures:- - Slide 26

27 THANK YOU! Slide 27