Durban Decisions on the Clean Development Mechanism DUAN Maosheng Chair of the CDM Executive Board First SDM Joint Coordination Workshop Bonn, Germany March 2012

Durban Decisions Related to the CDM 1. 1/CMP.7: Outcome of the work of the AWG KP at its 16th Session 2. 2/CMP.7: Land use, land-use change and Forestry 3. 3/CMP.7: Emissions trading and the project-based mechanisms 4. 8/CMP.7: Further guidance relating to the CDM 5. 9/CMP.7: Materiality standard under the CDM 6. 10/CMP.7: M&P for CCS in geological formations as CDM project activities 2

Outcome of the AWG-KP reconfirms the qualitative supplementarity requirement on the use of the mechanisms 2. requests SBSTA to initiate a work programme to consider and, as appropriate, develop and recommend M&P for possible additional LULUCF activities under the CDM with a view to forwarding a draft decision for adoption by CMP9 3. requests the SBSTA to initiate a work programme to consider and, as appropriate, develop and recommend M&P for alternative approaches to addressing the risk of nonpermanence under the CDM with a view to forwarding a draft decision for adoption by CMP9 3

Further Guidance Relating to the CDM 1. Requests the EB to develop appropriate voluntary measures to highlight the co-benefits brought about by CDM PAs and PoAs, while maintaining the prerogative of Parties to define their SD criteria 2. Requests the EB to continue to further improve the consistency, efficiency and transparency of its decision-making 4

Further Guidance Relating to the CDM 3. Welcomes the work undertaken by the EB to address liability in the context of the draft procedure on significant deficiencies in validation, verification and certification reports 4. Requests the sec. and the EB to further investigate the impact of potential approaches to address significant deficiencies in validation, verification and certification reports and to prepare a report 5. Requests the EB, in consultation with stakeholders, to revise the draft procedure, taking into account conclusions, if any, on the appeals process under consideration of the SBI, for adoption by CMP8 5

Further Guidance Relating to the CDM 6. Encourages the EB to extend the simplified modalities for the demonstration of additionality to a wider scope of PAs 7. Requests the EB to continue ensuring environmental integrity when developing and revising methodologies and tools, in particular by considering possible ways of improving the current approach to the assessment of additionality 6

Further Guidance Relating to the CDM 8. Requests the EB to further improve the guidelines on the use of first-of-its-kind and the assessment of common practice, on the basis of application 9. Requests the EB to accelerate the implementation of guidelines on suppressed demand in baselines and monitoring methodologies 7

Further Guidance Relating to the CDM 10. Requests the EB to further develop simplified top- down methodologies, tools and standardized baselines for use in underrepresented countries and for project types, and to expand the scopes covered by the guidelines for the establishment of sector-specific standardized baselines 11. Requests the EB to ensure its readiness to process submissions of standardized baselines 8

Further Guidance Relating to the CDM 12. Urges the EB and the secretariat to ensure that the average waiting time between the receipt of submissions for registration and issuance and the commencement of completeness checks is less than 15 calendar days 13. Requests the EB to assess the implications of the withdrawal or suspension of LoAs and make recommendations to CMP8 9

Further Guidance Relating to the CDM 14. Requests the EB to continue promoting the equitable distribution of project activities 15. Requests the secretariat to enhance its support for underrepresented countries 16. Requests the EB to allocate funds for this purpose 17. Requests the secretariat to accelerate the operationalization of the loan scheme 10

Materiality Standard under the CDM 1. Defines the concept of material information 2. Decides that the scope of materiality initially covers: a. The stage of verification by designated operational entities; b. The assessment of requests for issuance by the Executive Board of the CDM and its support structure; c. Non-prescriptive and prescriptive requirements; d. Quantitative information 3. Decides on the materiality thresholds 4. Decides that the scope of materiality and the thresholds shall be reviewed by the EB no later than one year after their implementation 11

Materiality Standard under the CDM 5. Requests the EB: e) To implement the concept of materiality and to report to CMP8 f) To develop guidance on how to calculate the thresholds and on what should be done if the thresholds are surpassed g) To address the issue of uncertainties of measurements in methodologies, so that these types of uncertainties do not need to be considered in addressing materiality 12

Responses from the EB 1. Swift and robust responses to the needs of Parties and the guidance given by the CMP 2. CDM management plan 2012 a. Greater integrity, efficiency and enhanced predictability in the operation of the CDM through simplification, improved objectivity and compliance with sustainable timelines b. Expansion of the reach and reputation of the CDM through outreach, further development of requirements, increased distribution of projects, and focused skills development 13

Responses from the EB 1. A(1): Ensure operational capacity and improve efficiency in the operation of the CDM a. Risk-based approach for assessing project submissions b. Management of operational capacity to deal with expected increase in submissions c. Implementation of the PoA standards and procedures d. Improvement to the guidelines on suppressed demand 14

Responses from the EB 2. A(2): Improved objectivity, clarity and integrity in the CDM a. Top-down small-scale methodologies using standardized approaches b. Guidelines on standardized approaches for determining baselines c. Revised micro-scale additionality guidelines and extension of simplified modalities for additionality demonstration d. Top-down development and revisions of small scale methodologies e. Implementation of the CDM PS, VVS, and PCP 15

Responses from the EB 2. A(2): Improved objectivity, clarity and integrity in the CDM f. Top-down large-scale methodologies using standardized approaches g. Guidance on the application of materiality h. Improve guidelines on first-of-its-kind and the assessment of common practice i. Revised draft procedures to address significant deficiencies and CMP recommendations j. New or revised standards and/or guidelines for additionality 16

Responses from the EB 3. EB66 a. agreed on the steps for the implementation of the concept of materiality and requested the secretariat to increase its interaction with DOEs in developing guidelines b. Agreed to establish a working group on CCS with flexibility on the number and scheduling of meetings requested the secretariat to secure the required expertise for the assessment of CCS methodologies c. Allocation of necessary financial resources to the Policy Dialogue 17

Key Messages 1. Vision for the CDM : “Credible offset mechanism for a low greenhouse gas future promoting sustainable development 2. Endeavored to ensure the environmental integrity 3. Committed to continuing with this crucial focus 4. Improving the efficiency and effectiveness of the mechanism 5. Ensuring that the CDM is “fit for the future 18

THANKS 19