UNDP & CDM: Strategy for Efficient Implementation Forum MDP Maroc Project de Renforcement des Capacités sur le Mécanisme de Développement Propre Arun Kashyap Climate Change & CDM Adviser UNDP April 2004

Underlying Principle  Millennium Development Goal  Halve the proportion of people living in extreme poverty by 2015  Water, Energy, Health, Agriculture & Biodiversity (WEHAB) Climate Change - a cross cutting issue

Efficient CDM Process  Obtaining high value investments  New investments to catalyze reduced carbon development  Divert existing investments to areas that would reduce GHG emissions  Host country approval – Designated National Authority  Sustainable development criteria – host country responsibility  Lead to high quality CERs  Obtaining optimum price for CERs

Learning by Doing: UNDP’s Experience - Findings  Existence of win-win project opportunities  Large proportion of small size projects  Good rate of return on a project is a necessary but not a sufficient condition  Demand for transparent government infrastructure and clarity on institutional responsibilities  Critical need for human, institutional and systemic capacity and enabling environment

Designated National Authorities (DNAs): Learning  Project promotion and Project over- sight represent inherent conflict  Inputs from diverse stake holders can be beneficial  Efficient administrative structures reduce transaction costs  Clarity in implementation guidelines  Sustainable Development Criteria

Sustainable Development Criteria  Equity, Efficiency and Sustainability and Defined by national priorities  Microeconomic and Project based  Ability to Measure and Monitor  Operational  Transparent  Participatory  Minimal – Keep it Simple

Sustainable Development Vs. MDG Indicators Can MDG Indicators provide guidance for development of the Sustainable Development Indicators?

Other Lessons  Need to start now!  CER price is a concern  Need to understand the market  Reduce transaction costs  Long term and equity perspective ⇓ Capacity Development

Spectrum of Needs  Human, Institutional & System-wide Capacity  Geographical and Project Equity  Small size projects  Efficient and Participatory Policy Environment & Innovative Macroeconomic Instruments  Long term perspective  Obtaining optimum terms of trade

CDM Strategy Capacity Development to Implement CDM Human Institutional System-wide Learning by Doing Small Size Projects

UNF CDM Project: Phase 1 Project Entrepreneurs -Brazil: Bioenergia, BP -South Africa: PIKITUP, Mondi UNDP (coordinator) WBCSD, UNIDO, UNCTAD Host Government Bilateral support DANIDA Learning-by- Sharing for other Entrepreneurs PDDs Developed Civil Society (Universities, NGO) Potential Buyers: Danish Gov’t, PCF

UNF CDM Project: Phase II UNDP (coordinator) UNIDO, UNCTAD, WBCSD, Natsource Host Governments Secondar y Partners (donors, industry, civil society) Project Entrepreneurs Pipeline of Bankable CDM projects Sustainable Development Criteria Support to DNA Advisory Services for Projects and GHG Market Network of South- South Knowledge Sharing ENABLING ENVIRONMENT FOR EFFICIENT CDM

UNDP-CDCF Collaboration CDCF UNDP GEF SGP Projects Non-SGP GEF Projects UNDP Energy Projects (TTF) Develop Portfolio of Viable Projects UNDP - GEF SGP -Entrepreneurs - UNDP COs Small-Scale CDM Projects CDCF - CDCF Plus

UNDP-Canada CDM Efforts UNDP DFAIT CDM Institutional Capacity Development - Progress towards SD criteria - Progress towards effective DNA Host Government -South Africa -Brazil Private Sector -Civil Society -Other donors (DANIDA, WB)

UNDP CDM User’s Guide

Country Level Activities Ongoing q Bangladesh, Brazil, China, India, Malaysia, Morocco, Nicaragua, Peru, Philippines, Trinidad & Tobago, South Africa Planned q Cambodia, Indonesia, Thailand, Vietnam, African Region, SIDS In house capacity building Best practices