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NAMAs and the Building Sector. UNFCCC Workshop Buildings under UNFCCC Flexible Mechanisms Chia-Chin Cheng UNEP-SBCI Beihang University International Green Energy Center Bonn, Germany March 24, 2011. Outline. NAMAs context

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namas and the building sector

NAMAs and the Building Sector

UNFCCC Workshop

Buildings under UNFCCC Flexible Mechanisms

Chia-Chin Cheng

UNEP-SBCI

Beihang University

International Green Energy Center

Bonn, Germany

March 24, 2011

slide2

Outline

  • NAMAs context
  • CDM and NAMAs working together– a two-track developing country mitigation support mechanism
  • Benefits of the new NAMAs mechanism

Three Papers/Reports from SBCI and Risoe:

  • The Kyoto Protocol, the CDM & The Buildings & Construction Industry- 2008
  • NAMAs for Dispersed Energy End-Use Sectors: Using the Building Sector as an Example- 2009 Perspective Series
  • CDM, NAMAs and the Building Sector: a Two-Track Financing Mechanism for Post-2012 – 2011 working paper

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new development under unfccc
New Development under UNFCCC
  • Developing Countries will share mitigation responsibilities
  • Bali Action Plan
  • Nationally appropriate mitigation actions by developing country Parties in the context of sustainable development, supported and enabled by technology, financing and capacity-building, in a measurable, reportable and verifiable manner.
  • Copenhagen Accord started signing up for NAMA
  • Cancun Agreement confirmed setting up NAMA registry for support
underlying causes for low eeb uptake
Underlying causes for low EEB uptake
  • Long-tail characteristics of the sector- small saving, big effort
  • Fragmentation of sector / uncoordinated stakeholders
  • Insufficient R&D and information for new EEB technologies
  • Insufficient EEB tech and management expertise and tools
  • High upfront and transaction costs for tech adoption in DC
  • Lack financing mechanism and interests for EE investments
  • Lack of awareness and general inertia restrict uptake

Source: Cheng, et al., 2008

slide5

To Overcome Generic Barriers in Building Sector

  • These barriers are essentially market failure
  • CDM as an market-based mechanism cannot correct market failure
    • key long-tail sectors – market failures are prominent
    • rural sectors and LCD – no sufficient market activities
  • Public policies are required to correct market and overcome barriers
  • To fundamentally transform the building sector in developing countries:
    • Developing countries requires public sector support to enforce public policies -- NAMAs
    • Developing countries requires private sector support for compliance of public policies -- CDM

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slide6

Possible Post-2012 Mechanisms -- Dual Track Financing

  • Policy based financing mechanism (NAMAs)
    • create enabling conditions for a systematic uptake for climate change mitigation activities from the private sector in developing countries
    • provide necessary funding, technology and capacity assistance for policy implementation, particularly to difficult sectors and in least developed countries
  • Project/program based carbon financing
    • The boost of enabling conditions foster large-scale private sector investment and make use of CDM as an additional mechanism
    • provide necessary means and financial resources to help regulated entities comply with government policies
    • increase speed, quality and depth of policy implementation

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slide7

Important Issues to be Address before inserting NAMAs

  • All BAP elements need to be addressed in the new mechanism
    • Technology transfer and development
    • Capacity building
    • Sustainable development
  • Avoid double counting with CDM
    • Use non-carbon based MRV

- some effective policy measures do not necessarily result in carbon emission reduction

- many quantitative indicators available to measure success

  • Source of funding
    • Initially public funding
    • Later private sector funding

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slide8

Need Based NAMAs Registry for the Building Sector

  • Mandatory building inventory and baseline performance
  • Mandatory minimum performance based standards
  • Mandatory/voluntary building rating and certification program
  • Loan, subsidies, incentives and tax breaks
  • Building auditing programs for compliance and certification
  • Building survey and monitoring programs for MRV purposes
  • Minimum performance standards for appliances and equipment
  • Building professional certification and education programs
  • Technology need assessment, demonstration and model house programs
  • Public sector building improvement and high performance building deployment programs
  • R&D programs for new building materials, technology, and practices
  • Awareness raising and informational campaign programs

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namas to create enabling environment for project based mechanism
NAMAs to Create Enabling Environment for Project Based Mechanism

BAU BASELINES*

Energy

Performance

KWh/m2

(by topology,

climate zones)

Time**

namas to create enabling environment for project based mechanism10
NAMAs to Create Enabling Environment for Project Based Mechanism

BAU BASELINES*

Improved Future Baseline

Energy

Performance

KWh/m2

(by topology,

climate zones)

NAMA Support (non-carbon credit based financing)

NAMAs

Mandatory Minimum Performance Standards

Time**

namas to create enabling environment for project based mechanism11
NAMAs to Create Enabling Environment for Project Based Mechanism

BAU BASELINES*

Improved Future Baseline

Energy

Performance

KWh/m2

(by topology,

climate zones)

NAMA Support (non-carbon credit based financing)

NAMAs

Mandatory Minimum Performance Standards

Carbon

Credits

CDM or Project & Program

Based Mechanism (carbon credit

based financing)

Voluntary technology upgrade

Building rating & certification

Time**

namas to create enabling environment for project based mechanism12
NAMAs to Create Enabling Environment for Project Based Mechanism

BAU BASELINES*

Improved Future Baseline

Energy

Performance

KWh/m2

(by topology,

climate zones)

NAMA Support (non-carbon credit based financing)

NAMAs

Mandatory Minimum Performance Standards

Carbon

Credits

CDM or Project & Program

Based Mechanism (carbon credit

based financing)

Premium Carbon

Credits

Voluntary technology upgrade

Building rating & certification

CDM or Project & Program

Based Mechanism (premium credits)

State of the Art Technology,

Best Practices

Time**

slide13

Benefits of the new NAMA mechanism

  • Because carbon credits are not the measurement of success , it avoids the double counting problem with the existing mechanisms.
  • Utilize public policy and funding to foster and mobilize private sector investment through the CDM.
  • For developed countries, the NAMA framework goes beyond offsetting mechanisms and focuses on supporting enabling environment for mitigation actions in developing countries.
  • Address all essential elements in the BAP 1b(ii) and include mechanisms to support activities for capacity building, technology, financing and MRV.

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slide14

Benefits of the new NAMA mechanism

  • Integrate funding from developed countries for development aids for capacity building and technology transfer in the climate change sector and implement in a more systematic manner.
  • Correct market barriers for key end-use long-tail sectors and boost CDM activities in these underdeveloped sectors.
  • Change the regional distribution of the CDM by an enabling policy framework based on country needs.

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