Capacity Development Work plan for the Clean Development Mechanism in Uganda

ROLES AND COMPOSITION OF THE DESIGNATED NATIONAL AUTHORITY

(DNA)

Presented by:

Enock Mugyenyi- Uganda Management Institute

Role

Activity Skills required

1. A

pp

roval R

eg

istra

tion

Check on : Sustainable

development Validity of baseline i.e

will project meet the reduction indicated

Credibility of project developers

Financial reliability of the Projected CER Value

Advantages to government vis-à-vis project developer (CER Shares)

Monitoring proposal Reporting proposal Overall credibility of

the underlying assumptions

Evaluation of baselines or at least basic understanding of how this is done

Basic Financial analysis skills

Negotiation Skills with Project financiers

Project Monitoring and reporting tools and dynamics

ROLES, ACTIVITIES & SKILLS REQUIRED OF THE (DNA)

2. Reporting to EB on CDM Activities

Validity of project (Based on approach)

Evaluation of baselines or at least basic understanding of how this is doneProject Monitoring and reporting tools and dynamics

3. Promoting CDM

Understanding potential in CountryNegotiating with potential developers (mainly government)Keeping in- Country Stakeholders interestedLinking CDM to developmentUpdating itself on international developments relating to CDM or affecting CDM

NegotiationMarketingAwareness raising

RATIONALE FOR INSTITUTIONAL ANALYSIS

CDM is about investments with different Institutions having a role to play according to their expertise. However, in an environment of scarce resources there is need to situate CDM in the existing Institutional framework rather than creating a completely new Institutional framework. The intention is to have a cost-effective Institutional framework which is sustainable.

GENERIC MODELS FOR DNA

Theoretically, there are five models for DNA. They include: A single government department model A two-unit model Inter-departmental government model Foreign Direct Investment - Piggyback and Outsourcing model

CHARACTERISTICS AND FUNCTIONS OF A SINGLE GOVERNMENT DEPARTMENT MODEL

One department or Ministry undertakes all the activities of the DNA - most likely the environment department/climate change unit.The department or Ministry acts as a secretariat and would invite technical experts from other government agencies/ministries upon demand to evaluate/analyse and validate CDM projects/investments.

The secretariat would then prepare a project design document (PDD) and report to the EB (refer to CDM cycle).The secretariat (the environment agency) would ultimately be responsible for approval of the CDM projects.The secretariat would be responsible for marketing and promoting CDM by designing CDM promotion material and furnish the FDI office and other relevant stakeholders.

StructureExecutive Board

Environment Ministry/Agency

DNA Secretariat

TECH experts(Energy)

TECH experts(Agriculture)

TECH expert(forestry)

CHARACTERISTICS AND FUNCTIONS OF A TWO-UNIT MODEL

Activities of the DNA are split into two.

Part 2Capacity Building

Out reach promotion

Technical and economic

assessments

Part 1Evaluation ApprovalRegistration

Development of Projects

Policy development

The first part could be located in department responsible for climate change and second part in many places as an independent unit.The separation into two parts helps to avoid possible conflicts of interest in the process of project formulation and approval.

CHARACTERISTICS AND FUNCTIONS OF INTER-DEPARTMENTAL MODEL

Entails establishing a structure which allows all the relevant government departments to be integrated into DNA as permanent members.The ministry of Environment would act as co-ordinator but approval of projects would be undertaken by all departments. A committee to operationalise the approval of projects would be set up.

The co-ordinating Institution would act as the registration office and would receive proposals on behalf of DNA.The co-ordinating Institution would communicate with other DNA members and also with the EB but upon agreement within DNA

Structure

Energy Ministry

Environment Agency/ Ministry

Agriculture Forestry

EB

DNA

FOREIGN DIRECT INVESTMENT (FDI) PIGGYBACK MODEL

Most countries have a FDI Institutional framework which promotes foreign investment and typically comprises of a promotion office and an approval or implementation office.This Institution receives projects from foreign investors and using a pre-structured criteria evaluates and approves projects.

The criteria for approving projects largely reflects the national development priorities.The FDI framework could be adapted for CDM and used as the DNA.The investment office would thus receive and approve projects from various areas using its established system.Given the special aspect of CDM, concerning GHG emission reduction, the relevant technical experts would be sourced by the investment office when a CDM project is submitted to assist in validating the GHG reductions.

The FDI office would then prepare the project design document (PDD) and communicate with the EB.Naturally, the FDI office would promote CDM along with its other investment promotion activities.

Structure

FDI Office

GHG techexperts

DNA

EB

CHARACTERISTICS AND FUNCTIONS OF OUTSOURCING MODEL

Host countries may choose to outsource the bulk of DNA services to a private agency.The agency would evaluate the projects and validate them.The agency would report to a government environment agency which would then communicate approval to the EB.

THE ROLES AND COMPOSITION OF DNA

Institution Role Activity Skills required

• NEMA• Ministry of

Water, Lands & Environment

• Ministry of Trade, Tourism & Industry

• U I A

1. Approval

Registration

Check on : Sustainable

development Validity of

baseline i.e will project meet the reduction indicated

Credibility of project developers

Evaluation of baselines or at least basic understanding of how this is done

Basic Financial analysis skills

Negotiation Skills with Project financiers

Project Monitoring and reporting tools and dynamics

Institution Role Activity Skills required

• Uganda National Bureau of Standards

• Uganda Cleaner Production Centre

• Ministry of Finance, Planning & Economic Dev't

• Ministry of Energy & Mineral Dev't

• Forest Department• Department of

Meteorology

Financial reliability of the Projected CER Value

Advantages to government vis-à-vis project developer (CER Shares)

Monitoring proposal Reporting proposal Overall credibility

of the underlying assumptions

DNA coordinating Institution

2. Reporting to EB on CDM Activities

Validity of project (Based on approach)

Evaluation of baselines or at least basic understanding of how this is doneProject Monitoring and reporting tools and dynamics

•NEMA •Ministry of Water, Lands & Environment•Ministry of Trade, Tourism & Industry •U I A•URA•PSF•Uganda National Chambers of Commerce•Ministry of Finance, Planning & Economic Dev't•Ministry of Energy & Mineral Dev't•Forest Department

3. Promoting CDM

Understanding potential in CountryNegotiating with potential developers (mainly government)Keeping in- Country Stakeholders interestedLinking CDM to developmentUpdating itself on international developments relating to CDM or affecting CDM

NegotiationMarketingAwareness raising

ACTIVITIES FOR ESTABLISHING A DNA

Hold a consultative workshop to identify DNA coordinating Institution and compositionIdentify legal and regulatory implications of the DNA Develop operational guidelines for functioning of the DNAIn depth review of DNA members to identify capacity gaps and develop specific implementation plan to capacitate themOrganise targeted series of sensitisation and training workshops for DNA members

Develop CDM promotion manuals and other aidsConduct periodic reviews of DNA to strengthen capacityDevelop guidelines for approval/registration of CDM projectsEstablish a list serve for the DNA members