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Barriers to Energy Efficiency under CDM

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Barriers to Energy Efficiency under CDM,
22 November 2007, Vienna, Binu K Parthan and Udo Bachhiesl, REEEP and IEE, TU Graz

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Barriers to Energy Efficiency under CDM

  1. 1. Barriers to Energy Efficiency under CDM 22 November 2007, Vienna Binu K Parthan and Udo Bachhiesl REEEP and IEE, TU Graz GFSE 2007, 22.11.2007, Vienna
  2. 2. REEEP • Multi-stakeholder partnership launched at WSSD by UK; • 245 partners with 38+24 governments; • 84 projects covering 50 countries with € 6.3 mio with over € 23 million leverage; • In Vienna with eight regional secretariats GFSE 2007, 22.11.2007, Vienna
  3. 3. IEE, TU Graz • Institute for Electricity Economics and Energy Innovation, Established in 2000, Faculty of Electrical Engineering and Information Technology, TU Graz; • Prof. Stigler, dean and head; • numerous academic activities and research projects in RE, EE, energy innovation and economics GFSE 2007, 22.11.2007, Vienna
  4. 4. Climate Change and Energy Efficiency • IPCC Fourth Assessment Report – “warming of climate system is unequivocal” • McKinsey – Environmental issues including climate change – #1 issue; • IPCC – Role of Energy Efficiency – supply, buildings, agriculture, transport. GFSE 2007, 22.11.2007, Vienna
  5. 5. CDM Projects • 844 projects registered Energy over 91 mio CERs Fuel Efficiency Switch 8% issued – over 1 billion 1% CERs expected; Renewables 15% • Only 97 energy Methane and efficiency projects Cement 6% registered – 5% CERs Industrial Gas till 2012. 70% (Source: UNFCCC, UNEP) GFSE 2007, 22.11.2007, Vienna
  6. 6. CDM Market • 2006 market volume - Other & LAC Unspecifie $5.25 billion; 10% d 7% • 2007 October CER prices: Africa 3% – Registered projects 13-15 €/tCO2e – Unregistered projects 8- Asia 11.5€/tCO2e 80% – Secondary 17€/tCO2e • Post 2012 credits – 2$ (Source: World Bank) to 7$; GFSE 2007, 22.11.2007, Vienna
  7. 7. Methodologies • 115 methodologies AR approved by EB – 12% RE Several withdrawn/ 16% Fuel consolidated; Switch 7% • 21 Energy Efficiency Ind gas EE 12% Methodologies 24% available; CH4+Cem • 11 methodologies never 29% used! (Source: UNFCCC, UNEP) GFSE 2007, 22.11.2007, Vienna
  8. 8. Barriers to Energy Efficiency • Households and Buildings – Behavioral issues, information and regulation; • Industry and Agriculture – information, management priority, competition; GFSE 2007, 22.11.2007, Vienna
  9. 9. Barriers to EE under CDM • Demonstration of additionality –Investment Barrier (86%) – payback- period and classical investment analysis – Constraints energy efficiency; • CDM M&P –single site, large scale and co-terminus emission reductions – Energy Efficiency (other than Industry) Smaller scale, dispersed and longer/different time periods GFSE 2007, 22.11.2007, Vienna
  10. 10. Barriers • Methodological issues – 10% of methodologies useful for EE – 30% success rate for EE methodologies compared to 50% average; – Monitoring methodologies for EE; – Equipment lifetime issues for retrofit or replacement; – Consideration of upstream emissions. • Need for methodological framework vs project specific methodologies GFSE 2007, 22.11.2007, Vienna
  11. 11. Barrier Removal Initiatives • CDM Executive Board – Measures to improve the share of EE in CDM; – PoA which will allow EE CPAs; • Expert Group on EE and Carbon Finance – WB, IEA, GEF, UN – methodologies, technical guidance and capacity building; • EEC – policy makers, industry and development agencies – advocacy, global assessments and best practice – Global Status Report on EE. GFSE 2007, 22.11.2007, Vienna
  12. 12. Barrier Removal Initiatives • CDM Gold Standard, sponsored by REEEP – 5- 25% premium prices- Financial attractiveness of EE; • LOGOC – Beijing London Olympic Games CDM Project; • Econoler International – Indian street lighting scale- up project – CGI; • IMT-Efficiency Power Plant - DSM, Jiangsu 2 mio tCO2e/y GFSE 2007, 22.11.2007, Vienna
  13. 13. Summary • Energy Efficiency offers one of the most cost effective options to mitigate Climate Change; • Energy Efficiency - several major barriers in general and specific to CDM; • Initiatives by CDM-EB and Networks and initiatives address some of the key barriers for Energy efficiency under CDM; • REEEP role is a facilitator – Industry, NGOs, FIs, Governments to use the partnership and its resources to support EE under CDM. GFSE 2007, 22.11.2007, Vienna
  14. 14. Thank You www.reeep.org - NewsREEEP www.reegle.info info@reeep.org or bachhiesl@TUGraz.at All pictures from REEEP supported projects GFSE 2007, 22.11.2007, Vienna

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