1. GOVERNMENT REGULATION AND INCENTIVES AT NATIONAL AND LOCAL LEVELS IN MITIGATION ACTIVITIES Noviembre 2010 Gabriel Quadri de la Torre gabriel@sigea.com.mx

2. Contents Public goods, and CO2e mitigation policies Sectors and inventories of emissions Local competences and policy instruments National competences and policy instruments (NAMA´s) Mitigation and competitiveness

3.  Regulations (emissions, building codes, transport, portfolio standards, land use)  Property rights and markets (cap and trade, cap and dividend)  Taxes and subsidies (carbon tax, feed in tariffs, subsidy removals)  Contracts (Public-private partnerships, PES)  Autonomous actions (subject to free riding and problems of collective action, unless there is corporate value to be tapped) Public goods, and CO2e mitigation policies

4. Sectors and inventories of emissions  Transport (among most relevant in many LA countries, and first in cities)  Electricity generation (usually among the most relevant, ¿Brazil, Costa Rica?)  Deforestation (among the most relevant in many LA countries)  Waste management (CH4 in landfills, WWTP and agri-business, usually relevant)  Oil and gas (CH4 fugitive emissions and CO2, much relevant in Mexico, Venezuela)  Manufacturing energy use (usually not a top emitter)  Industrial process (CO2 in cement and steel, N2O in fertilizers, HFC in refrigerants, PFC and SF6 in aluminium, electronics and electricity) (CDM) (?)  Agriculture (N2O from fertilizers) (?)  Energy use in homes, buildings, services (relatively important in Panamá, others)

5. Local competences and instruments  Building codes for energy efficiency  Land use regulations to avoid urban sprawl, REDD  Property taxes to induce smart growth  Local (small) carbon tax, road pricing, parking fees, public transport  Public-private partnerships for infrastructure in public transport, waste management (concessions, contracts, privatizations)  Covenants for energy efficiency in manufacturing, services  REDD – PES and Natural Protected Areas

6. National competences and instruments (NAMA´s)  Feed in tariffs, tax credits, portfolio standards, interconnection contracts, low transmission fees in renewable energy  Sector cap and trade  Carbon tax in vehicle fuels (not in industry), subsidy removal in fuels and electricity.  Sustainable housing subsidies (photovoltaic energy, solar water heaters, insulation, efficient appliances, efficient lighting)  Emissions and/or energy efficiency standards or norms in appliances, motors, boilers, waste water discharges…)  Emissions or energy efficiency standards for vehicles  Public-private partnerships and development banks funding in waste management and transport (concessions, contracts, privatizations) (Debt, equity, subordinated debt…)  REDD – PES and Natural Protected Areas

7. Mitigation policies and competitiveness  Green tax reform (carbon tax in vehicle fuels + reductions in personal and corporate income taxes). Negative cost mitigation  Electricity and vehicle fuel subsidies removal, and their conversion to renewable energy and energy efficiency financial support mechanisms. Negative cost mitigation  Efficient and competitive cities through land use regulations, green property taxes (compact urban development, public transport, pedestrian mobility, cycling, energy efficiency in buildings). Negative cost mitigation  Emissions and/or energy efficiency standards or norms in appliances, motors, boilers, waste water discharges…). Negative cost mitigation.  Private investment, employment, new technologies  REDD: Land titling, rule of law, secure property rights, land restoration, forest management, watershed protection