Overview of CDM Documentation and Procedures

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1 Overview of CDM Documentation and Procedures April 2006 London, England John Kessels

2 CDM Documentation Project Design Document CDM Institutions CDM New Methodology Baseline (CDM NMB) CDM New Monitoring Methodology (CDM NMM)

3 CDM Project Design Document 1) General description of project activity 2) Application of a baseline methodology 3) Duration of the project activity/crediting period 4) Application of a monitoring methodology and plan 5) Estimation of GHG emissions by source 6) Environmental impacts 7) Stakeholders comments 8) Host country approval 9) Submit the PDD to Designated Operational entity

4 CDM PDD Provide an acceptable description of the project, consisting of project objectives, technical description and boundaries Determine in a credible way what would have been done if the proposed CDM project was not implemented

5 CDM PDD Environmental Impact Assessment Additionality check following the format of the CDM EB Monitoring plan in which the emission reductions are monitored

6 CDM PDD Host country approval including sustainable development requirements Submit PDD to DOE for certification of the project and to open the documents for public comments

7 CDM PDD Two crediting periods: First one a fixed crediting period of 10 years. Second option a single crediting period of seven years with a maximum of two renewals up to 21 years as long as the OE determines the original baseline of the project is still valid

8 CDM Project Cycle Procedures Operational entities (OE) validate proposed CDM projects on the basis of project design documents. This includes a check to ensure the validity of the baseline, on which basis the emission reductions will be calculated, and the project s monitoring plan; The executive board then will formally register the project under the CDM

9 CDM Project Cycle Once the project is running, the participants monitor the project. A different OE will verify the monitored emission reductions. The different OE certify those emission reductions as legitimate CERs. Based on this, the executive board will issue the CERs and distribute them to project participants as requested.

10 CDM Project Cycle Timeline Project Idea Note (1 months) Baseline Study and Monitoring and Verification Plan (MVP) (3 months) Validation Process (2 months) Negotiation of Project Agreements (3 months) Construction and Start Up (1-3 years) Periodic Verification and Certification (Up to 21 years)

11 CDM Institutions CDM Executive Board (10 members) 4 industrial countries 5 developing countries 1 AOSIS country Methodology Panel key role is to prepare recommendations on new baselines and monitoring methodologies for the CDM EB (20) Accreditation Panel for Operational Entities Small-scale Panel to simply procedures for small-scale CDM projects

12 CDM Institutions Designated National Authorities (97) Operational Entities (12) Certifiers (3) Approved Methodologies (65) Registered CDM projects (161) In CDM Pipeline (670)

13 CDM New Methodology Baseline Identification of methodology Summary description Choice and justification of baseline approach Explanation and justification of the proposed new baseline methodology

14 CDM New Methodology Baseline Data sources and assumptions Assessment of uncertainties Explain baseline methodology and how it was developed

15 Three General Baselines 1. Existing actual or historical emissions 2. Emissions from a technology that represents an economically attractive course of action 3. The average emissions of similar project activities in the last 5 years under similar circumstances and whose performance is among the top 20 percent of their category

16 Baseline options Hybrid baseline methods Top-down sectoral baseline methods Top-down country/nationwide baseline methods Technology benchmark baseline methods Multi-project baseline methods Project-specific baseline methods

17 CDM New Monitoring Methodology Identification of new monitoring methodology Data to be collected and used to monitor project activity and how the data will be archived Description of formulae to estimate project emissions Treatment of leakage and how it will be estimated Assumptions used in the new methodology Indicate whether quality control or quality assurance procedures are being undertaken

18 Clean Development Mechanism Project Cycle Project Identification Project Discussion Project developer with investors, stakeholders, etc. Project Design Document Project Description Baseline Study Stakeholders Feedbacks Monitoring Plan Environmental Impact Assessment Comments by Parties, Stake- Holders, NGOS Letter of Approval by Designated National Authority Validation by Operational Entity Make PDD Public Publication Of Comments Advice to Executive Board Validation Executive Board Legend Resubmit Executive Board Project Approval? No Disapproved Project Shelved Projects Host Country Yes Project Developer Registration Operational Entity Only if necessary Start of CDM project Emissions Reductions from Projects Emissions Monitoring Emissions Verification Certificates from Executive Board Verification Report

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