CDM and SSN: A winning combination

SSN and CDM Creating partnerships between South, South and North countries through the opportunity of the Clean Development Mechanism to combat adverse climate change, and to promote Sustainable Development, best practice, and capacity enhancement in the developing world.

The SouthSouthNorth project The SouthSouthNorth Project is a capacity building initiative helping four southern countries to learn from the experience of developing CDM projects The SouthSouthNorth Project is a capacity building initiative helping four southern countries to learn from the experience of developing CDM projects We operate in Brazil, South Africa, Indonesia, and Bangladesh We operate in Brazil, South Africa, Indonesia, and Bangladesh

An SSN introduction In this presentation we will highlight some fundamental points regarding, In this presentation we will highlight some fundamental points regarding, the Clean Development Mechanism the Clean Development Mechanism and illustrate what SSN seeks to achieve and illustrate what SSN seeks to achieve

TRADE with the SOUTH : THE CDM The CDM, or Clean Development Mechanism, is a unique trade instrument The CDM, or Clean Development Mechanism, is a unique trade instrument Through it, SOUTH countries (without targets) can elect to assist NORTH countries (with targets) to achieve their target at a lower cost Through it, SOUTH countries (without targets) can elect to assist NORTH countries (with targets) to achieve their target at a lower cost How is this done? How is this done?

A CDM project: Emitter in NORTHEmitter in SOUTH Target level of emissions Achieved level of emissions COST $ COST $ Investment funds Emission Reduction credits

Countries and emitters A CDM Project activity can either be a contract between countries or emitters themselves: A CDM Project activity can either be a contract between countries or emitters themselves: Holland Local Landfill Project Philips Costa Rica

In summary… The SOUTH project developer receives investment from the NORTH investor/purchaser The SOUTH project developer receives investment from the NORTH investor/purchaser And in return assists the NORTH investor/purchaser to reach its target at a lower cost And in return assists the NORTH investor/purchaser to reach its target at a lower cost This is TRADE: there must be a difference between the cost to the investor and the price to the developer This is TRADE: there must be a difference between the cost to the investor and the price to the developer

The project activity… Must reduce GHG’s against a validated baseline Must reduce GHG’s against a validated baseline This baseline represents what the emissions would have been without the CDM project taking place This baseline represents what the emissions would have been without the CDM project taking place Each ton CO2 equivalent reduced in this way becomes a CERTIFIED REDUCTION CERTIFICATE, which is tradable Each ton CO2 equivalent reduced in this way becomes a CERTIFIED REDUCTION CERTIFICATE, which is tradable

And… The NORTH emitter wins by achieving a portion (no more than 50%) of its target at a lower cost The NORTH emitter wins by achieving a portion (no more than 50%) of its target at a lower cost The SOUTH emitter wins by receiving investment funds to improve technology and performance The SOUTH emitter wins by receiving investment funds to improve technology and performance The world wins through a reduction of GHG’s The world wins through a reduction of GHG’s And… And…

The host country… It is a requirement of the Kyoto Protocol that the host country must first satisfy itself that any CDM project will contribute to its SUSTAINABLE DEVELOPMENT It is a requirement of the Kyoto Protocol that the host country must first satisfy itself that any CDM project will contribute to its SUSTAINABLE DEVELOPMENT So the host country wins in this way So the host country wins in this way Well, that, at least, is the idea… Well, that, at least, is the idea… But a lot has gone wrong But a lot has gone wrong

SD: the challenge Setting SD rules is complex Many developers want deal flow without restrictions: a race to the bottom? Some CDM projects will result in job losses Government may be stuck in the middle Should there be thresholds? And anyway, with the US out, is there a carbon market?

CDM projects: the cycle The CDM project is a component of a development project The CDM project is a component of a development project It is based on a PROJECT DESIGN DOCUMENT (PDD) It is based on a PROJECT DESIGN DOCUMENT (PDD) The PDD is a prediction of the “carbon offset” which the CDM component will achieve The PDD is a prediction of the “carbon offset” which the CDM component will achieve This prediction is then validated, approved, registered and transacted This prediction is then validated, approved, registered and transacted

The Project Cycle illustrated Owner and Stakeholder Groups Project Design Approval by DNA Validation by OE Registration by Exec Board Monitoring Verification and Issuance Implementation

CDM milestones Owner and Stakeholder Groups Project Design Approval by DNA Validation by OE Registration by Exec Board MonitoringVerification and Issuance DNA : approves project for Sustainable Development OE = Operational Entity eg: accredited auditor Validates project design Exec Board = of the CDM Registers Project By the OE Issues CER’s CDM Administrative Bodies

So what can the CDM achieve? The South can help the North meet its targets The South can help the North meet its targets In return the South can promote its path towards sustainable development In return the South can promote its path towards sustainable development The South can choose its projects, the timing, the investors, and so forth The South can choose its projects, the timing, the investors, and so forth So…the CDM could achieve a great deal So…the CDM could achieve a great deal

The SSN Project Our organisation, our work

We are about… Viable, commercial, and transactable CDM projects People focused sustainable development Capacity development and learning

We are first a SOUTH organisation… South Africa Office Central Office Brazil Office Indonesia Office Bangladesh Office We are monitored by HELIO INTERNATIONAL Our principal funder is the Government of the Netherlands

Our structure…

Object 1: assist project owners to develop CDM projects BRAZIL SOUTH AFRICA INDONESIABANGLADESH Thermo Power Plant Energy Production through the using of waste gas (bio- gas) and bio- diesel (methyl ester) Bundled housing project over 3000 low cost houses Geo-thermal power plant with Unocal Rural solar homes system with Grameen for houses Bio-diesel (methyl ester) Production from Residual Vegetable Oil Landfill project aimed at the recovery & collection of LFG for subsequent use as thermal or electrical energy Transport project in Yokjakarta Electric vehicle project in Dhaka Thermo Power Plant through a semi dry Anaerobic Bio-digestion technology

We assist project developers: By providing a technical team with expertise for each project activity By providing a technical team with expertise for each project activity By assisting with approval, validation, registration and transaction By assisting with approval, validation, registration and transaction By providing a portion of the transaction costs By providing a portion of the transaction costs By providing project facilitators By providing project facilitators By sourcing investors/purchasers By sourcing investors/purchasers In this way maximizing benefits to southern hosts In this way maximizing benefits to southern hosts

Object 2: work with governments We are in close co-operation with all four governments to assist them in developing criteria and indicators, and a procedure, for the approval of CDM projects We are in close co-operation with all four governments to assist them in developing criteria and indicators, and a procedure, for the approval of CDM projects We are also assisting all four governments to develop internal capacity for the Designated National Authority offices We are also assisting all four governments to develop internal capacity for the Designated National Authority offices We are facilitating consultative meetings between governments and stakeholders We are facilitating consultative meetings between governments and stakeholders

Object 3: develop a CDM guide Our CDM guide will be based on actual experiences gained from developing CDM projects Our CDM guide will be based on actual experiences gained from developing CDM projects The Guide has 64 modules and can be used in various formats and for various audiences The Guide has 64 modules and can be used in various formats and for various audiences It will contain template documents It will contain template documents It will be web, CDROM and trainer-event based It will be web, CDROM and trainer-event based It will be for all to use It will be for all to use

Helio helps us to monitor our projects, Helio helps us to monitor our projects, To develop Monitoring and Verification Protocols To develop Monitoring and Verification Protocols And to develop a number of trained CDM monitors And to develop a number of trained CDM monitors

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