Capacity Development for CDM The UNEP CDM Sustainable Development Impacts Guidebook Tunis, 27-29...

Capacity Development for CDM - RW4 / 27-29 August 2004 1

Capacity Development for CDM

The UNEP CDM Sustainable Development Impacts

Guidebook

Tunis, 27-29 August 2004

Samir Amous, APEX, TunisiaSamir Amous, APEX, TunisiaRegional Centre for North Africa and Middle-EastRegional Centre for North Africa and Middle-East


Published by URC in June 2004 Authors: 4 experts from URCAlmost 90 pages


8 Chapters

1.Introduction and outline

2.Article 12 KP addressing SD

3.Steps for SD assessments in CDM projects

4.SD in relation to CDM

5.Selecting SD Criteria for CDM projects

6.Selecting SD indicators for CDM projects


8 Chapters

7.Decision-making tools for SD evaluation

8.CDM and SD: case studies

Annex: the South-South-North criteria and indicators Appraisal matrices


1. Introduction and outline

SD: a main driver for Non-Annex I partie participation to the CDM

Stress on the difficulties to assess SD contribution of CDM projects

The guidebook is meant to give a general introduction to policy makers and project developers how CDM projects can be developed in a way where they assist in achievement SD goals


2. Article 12 of KP and the link to SD

Explicit purpose of the CDM contribute to SD of host countries

The SD perspectives of the CDM – examples of areas where CDM can contribute to SD:

• Increased Energy Efficiency

• Sustainable energy production

• Transfer of Technologies and Financial Resources

• Local env. benefits

• Poverty alleviation

• Private and public sectgor capacity development


3. Six major steps of a SD assessment

1. Overview of Policy priorities reflecting the development context

2. Selecting SD Criteria based on national SD priorities

3. Initial screening of potential CDM projects

4. Outline of procedures for assessing SD impacts

5. General decision-making procedures

6. Evaluation performance of implemented CDM projects


3. Six major steps of a SD assessment

4. Outline of procedures for assessing SD impacts:

Identification and selection of SD indicators

Designate an approach for assessing the indicators

Format of Reporting: measurment standards and aggregation rules

5. General decision-making procedures: stakeholder dialogue, detailed SD assessment

6. Evaluation performance of implemented CDM projects


4. SD in relation to CDM

CDM and the SD perspective: Environment is the core issue, but also Development priorities of host countries

Some examples of SD criteria Social (improve quality of life, alleviate poverty, improve equity

Economic: financial returns to local entities, positive impacts on balance of payments, transfer of nezw technologies

Environment: reduce GHG, conserve local resources, reduce pressure on local env., etc.



SD criteria for CDM are largely overlapping with national Dev. CriteriaLarge potential synergies

Operationalizing SD at the project level: if a project contribute to SD at its level, it will have a positive impact on SD at national level (although marginal):

SD criteria should be meaningful from a project level perspectiveappropriate indicators

The overall SD impacts should be positive

The negative/irreversible side-effects should be taken into account



Aggregate SD impacts: how to interpret the resultsnegative VS positive impacts

How to address the trade-offs

Compensation of the negative impacts

In absence of reliable calculationonly limited impacts are acceptable (above safe minimum level)


5. Select SD criteria

Link CDM projects to national SD criteria:Screening the Millenium Development Goals: formalized targets:

E.g. Halve the proportion of people whose income is less than US$ 1 between 1990-2015goals and indicators

E.g. achieve significant improvement in the lives of at least 100 millions slum dwellers in Indiacommission 14 GW hydro

In general: linkage between MDG and Energymeet national power demandhow can CDM support rural electrification


Desirable properties of SD indicators

Complete: all dimensions are reflected through the set of indicators

Operational

Decomposable

Non redundant

Minimal


Some examples of SD indicators

Employment: nbr man-years generated

Growth : Net Surplus achieved

Exhaustible resources: physical units


Some examples of applying SD

Hypothetical illustration (e.g. biogas in rural area)

Only qualitative assessment


Conclusion regarding indicators

Indicators are necessary for any assessment procedure

There are many qualitative and quantitative indicators available in the litterature that we need to define for assessing CDM projects


7. Decision making tools for SD evaluation

A number of Tools are available: Cost-benefit analysis, Multicriteria analysis, Ranking methodologies

Can be carried out in a simple or more complex way

Key advantage and disadvantages of each approach



Cost-effectiveness analysis: cost of the mitigation against potential reductions

• Simple, but

• Difficulties in predicting the future

• Care is needed when defining the relevant cost: financial VS economic costs, etc.

Cost-benefit analysis: all costs of the project (either negative or positive):

• Time cost, lack of transparencymore relevant for CDM programmes

• Readily appliable for larger CDM projects



Multicriteria analysis: weighting the different criteria, combine scores and obtain an overall value, examine the result, conduct sensitivity analysis:

• Widely used• Attractive approach

Ranking methodologies: simple checklist approach (identification of indicators, notations: negative, neutral, positive, weights), best practice (project against the baseline, -1 to +1), Analytical Hierarchy Processclose to multicriteria Analysisscoring and weighting tool for non quantifiable attributes


8. Case studies

South-South-North initiative: the Checklist approach (details in annex A). Indicators:

-2 to +2: -2: Major negative impacts (ecological, social,

economic, etc. -1: very minor negative impacts

Applications:South Africa (biomass)Brazil (Biodiesel)

Too many criteria, high level of subjectivity associated with using scores to qualitatives cirteria


8. Case studies

Multicriteria analysis:Egypt (better guidance to apply indicators, but varying number of indicators in each type of criteria, a sensitivity analysis is required)

Cost-effectiveness Approach Applications (dependent of the discount rate, carbon benefits are rarely crucial to justify the project, etc.) :

Egypt PhilippinesUganda


END OF THE PRESENTATION

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