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Sethi 28 August 2009

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Clean Development Mechanism …

Clean Development Mechanism
Ministry of Environment & Forests
Government of India

Published in: Technology, News & Politics

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  • 1. Clean Development Mechanism Ministry of Environment & Forests Government of India
  • 2.  
  • 3. What is anthropogenic climate change?
    • Suite of gases (CO2, CH4, N2O, etc,) emitted from various economic activities: Fossil fuel use, wet paddy cultivation, cattle raising, fertilizer use, etc.
    • Growing (but not mature) forests absorb (“sequester”) CO2, the major GHG
    • Increasing concentrations of these gases in the atmosphere have same effect as a greenhouse, hence “Greenhouse gases” (GHGs). The resulting increase in temperature may impact many climate parameters
  • 4. Global Warming Potential (GWP) Above 10,000 (SF 6 ) Sulphur hexa fluoride 140 to 11700 (HFCs) Hydro fluoro carbons 560 ~ 9200 (PFCs) Per fluoro carbons (PFCs) 310 N 2 O Nitrous oxide 21 CH 4 Methane 1 CO 2 Carbon-di-oxide GWP Chemical Formula Green house gas (GHG)
  • 5. Kyoto Protocol
    • Parties adopted in COP-3 in 1997
    • Commits developed countries to reduce GHG emissions by 5.2% below 1990 levels during the first commitment period 2008-12
    • KP came into force on February 16, 2005. Required ratification by at least 55 Parties and amounting to 55 % emissions
    • USA major country who has not ratified yet
  • 6. Kyoto Reduction Commitments – 6.5 % - Italy – 6 % Canada – 6 % Japan – 12.5 % - United Kingdom – 21 % - Germany – 8 % (EU Burden Sharing Agreement) EU Reduction commitment for 2008-2012 [% of base year] Country
  • 7. Contd..
    • Three Mechanisms
      • Clean Development Mechanism
      • Joint Implementation
      • Emissions Trading
  • 8. CDM Project Cycle - Basics Project Performance Monitoring by Project Proponent ONE TIME ACTIVITY RECURRING ACTIVITY Preparation of PIN - DNA Preparation of PDD - UNFCCC Host Country Approval To the Candidate Project Project Validation By UNFCCC Accredited DOE Submission for Registration (UNFCCC – CDM Executive Board) Certification & Issuance of CERs (DOE & UNFCCC)
  • 9. Additionality tool
    • Screening for early start projects
    • Identification of alternatives to the project activity;
    • Investment analysis to determine that the proposed project activity is not the most economically or financially attractive;
    • Barriers analysis;
    • Common practice analysis; and
    • Impact of registration of the proposed project activity as a CDM project activity
  • 10.
    • Existing actual or historic emissions
    • Emissions from Technology___ attractive investment
    • Average emissions of similar ___ previous 5 years___ performance top 20%
    • Calculation of GHG emission by sources
    • Precise transparent, comparable , avoid over estimation
    • Applicability
    • System boundaries
    • Leakages
    Baseline
  • 11. Small Scale CDM Projects
    • Power projects upto 15 MWe
    • Energy saving of 60 GWhe
    • Reduction of 60 kt CO2 eq.
    • A & R Sequestration of 8 kt CO2
    • Approved Simplified Methodologies by CDM EB
    • Same DOE can undertake validation, verification and certification
    • Bundling of projects feasible
  • 12. Small Scale CDM Projects (Contd..)
    • Additionality
      • Investment barrier
      • Technological barrier
      • Barrier due to prevailing practice
      • Other barriers
    • Simplified methodologies developed by EB
    • Same DOE can undertake validation, verification and certification
    • Bundling of projects feasible
  • 13. Sectoral Scope Agriculture 15 Afforestation and reforestation 14 Waste handling and disposal 13 Solvent use 12 Fugitive emissions from production and consumption of halocarbons and sulphur hexafluoride 11 Fugitive emissions from fuels (solid, oil and gas) 10 Metal production 9 Mining/mineral production 8 Transport 7 Construction 6 Chemical industries 5 Manufacturing industries 4 Energy demand 3 Energy distribution 2 Energy industries (Renewable / Non-renewable sources) 1 Sectoral Scope No.
  • 14. Methodologies
    • 127 Meths available for use
      • 67 approved large scale
      • 14 consolidated large scale
      • 46 small scale for small scale projects
      • 10 A/R
      • 5 SSC A/R
    • 20 Meth tools (Including A&R)
      • CH4 emissions avoided from dumping wastes
      • Combined baseline selection & additionality
  • 15. Approved methodologies - - 7 Metal production 1 - - Mining/mineral production - 5 1 Transport - - - Construction - 4 13 Chemical industry 5 10 11 Manufacturing industries - 7 6 Energy demand - 1 1 Energy distribution 7 Small Scale 7 30 Energy industries (renewable/non-renewable sources) Consolidated Methodologies Large Scale Sectoral Scope
  • 16. Approved methodologies Contd/- 1 3 1 Agriculture 2 6 9 Aforestation and reforestation 3 7 6 Waste handling and disposal. - - - Solvents use - 2 6 Fugitive emissions from production and consumption of halocarbons and sulphur Hexafluoride 1 1 6 Fugitive emissions from fuels (solid, oil and gas)
  • 17.
      • First Order decay method for estimating methane emissions from waste disposed in landfill sites
      • Estimation of combined margin factor for an electricity grid
      • Estimation of methane flare efficiency
    Methodological Tools
  • 18. National CDM Authority
    • Secretary (E&F) - Chairman
    • Foreign Secretary
    • Finance Secretary
    • Secretary, DST
    • Secretary, DIPP
    • Secretary, MNRE
    • Secretary, MOP
    • Secretary, Planning Commission
    • Joint Secretary (CC), MoEF
    • Director (CC), MoEF - Member Secretary
  • 19. Single Window Clearance
    • PCN as per MoEF format
    • PDD as per UNFCCC format
    • Project promoter to give a presentation in the DNA meeting
    • Host Country Approval
  • 20. Host Country Approval
    • Emissions Additionality
    • Sustainable Development
    • Parties should have ratified Kyoto Protocol
    • Voluntary participation
  • 21. Sustainable Development Criteria
    • Prerogative of the Host Party
    • Economic well being
    • Social well being
    • Environmental well being
  • 22. Type of projects
    • Renewable energy (Wind, Biomass, Solar,Hydro)
    • Switching to Alternate Fuels
    • Energy Efficiency
    • Waste Management
    • Oil & Gas
    • Agriculture
    • Carbon Sequestration in Forests
  • 23. CDM Regulatory Bodies| the basics COP/MOP EB UNFCCC secretariat SSCWG A/RWG MP AP RIT DOE supervises elects accredits supports recommends supports approves supports recommends
  • 24. Portfolio of Host Country Approved CDM Projects
  • 25. Portfolio of Host Country Projects approved . Sectors No. of Projects Energy Efficiency 431 Fuel Switching 76 Industrial Process 65 MSW 33 Renewable 474 Renewable (Biomass) 337 Forestry 9 Total 1,425
  • 26. Sector-wise break-up : CERs expected till 2012 from Host Country Approved projects as of 21 August 2009. Sectors CERs (upto 2012) Energy Efficiency 216,369,909 Fuel Switching 60,314,965 Industrial Process 104,956,443 MSW 11,258,855 Renewable 121,047,877 Renewable (Biomass) 88,731,489 Forestry 8,039,713 Total 610, 719, 251
  • 27. Investment in CDM Projects
  • 28. Indian Projects Registered by CDM-EB . 2 Forestry Sectors No. of Projects Energy Efficiency 129 Fuel Switching 16 Industrial Process 22 MSW 9 Renewable 143 Renewable (Biomass) 129 Total 450
  • 29. Portfolio of Host Country PSU Projects approved 2 Forestry Sectors No. of Projects Energy Efficiency 57 Fuel Switching 8 Industrial Process 20 MSW 2 Renewable 33 Renewable (Biomass) 2 Total 124
  • 30. International Statistics
  • 31. Expected Average Annual CERS from Registered Projects till 2012
  • 32. CERS Issued by Host Party. 69,073,247 India
  • 33. NATCOM ANALYSIS # Not counted in the national totals (All figures in Million Tonnes) 6 5 4 3 2 1 1228.54 0.178 18.083 817.023 Total (Net) National Emission 3.373 - - 3.373 Emissions from Bunker fuels# 23.233 0.007 1.003 - Waste 14.292 0.00004 0.0065 37.675 Removals-23.533 Land use, Land-use change and Forestry 344.485 0.151 14.175 - Agriculture 102.710 0.009 0.002 99.878 Industrial Processes 743.82 0.0114 2.896 679.47 Energy Including industry, transport residential and mining etc CO 2 eq. emissions N 2 0 CH 4 CO 2 emissions GHG source categories
  • 34. How far we’ve come | Growing demand Number of projects / Millions of CERs (to 2012)
  • 35.
    • Typical revenue flow for a 5MW grid connected hydropower project in India
    • With 0.6 PLF, = 26280 MWh electricity generation
    • With 0.75 grid emission factor = 19710 t CO2 reduction /year
    • = 19710 CER/year
    • With 10 Euro CER price = 197100 Euro/year revenue
    • (conservative approach considering various transaction costs)
    • At Rs 53/Euro rate = Rs 10446300/year
    • = Rs 1.04 Crore /year
    • For 10 year crediting period = Rs 10.4 Crore CDM revenue
    Sample Calculation for CER Revenue
  • 36. Challenges
    • CMM, CBM, MSW, SME & CPSUs potential un-tapped
    • Afforestation and Reforestation offer opportunities for CDM Projects
    • Active Financial institutions participation in CDM market with innovative financing models
    • Large CDM projects should be conceived
  • 37. Programmatic CDM
    • Developing projects under the programmatic mode of CDM
    • Guidelines issued by CDM EB
    • Range of projects possible such as CFLs, MSW, R&M of TPS etc.
  • 38. CDM Post 2012
    • Strong signal from Annex-I Parties for continuation of CDM beyond 2012
    • Deeper emission reduction targets and longer commitment period
    • Allow non state Parties, MNCs into Kyoto Mechanisms
    • One Universally acknowledged Carbon Unit i.e. CER
  • 39. Thank You [email_address]

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