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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. Outline. NAMAs context

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NAMAs and the Building Sector

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  1. 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

  2. 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 Insert Footer: View menu, Header and Footer. Apply to All

  3. 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

  4. 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

  5. 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 Insert Footer: View menu, Header and Footer. Apply to All

  6. 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 Insert Footer: View menu, Header and Footer. Apply to All

  7. 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 Insert Footer: View menu, Header and Footer. Apply to All

  8. 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 Insert Footer: View menu, Header and Footer. Apply to All

  9. NAMAs to Create Enabling Environment for Project Based Mechanism BAU BASELINES* Energy Performance KWh/m2 (by topology, climate zones) Time**

  10. 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**

  11. 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**

  12. 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**

  13. 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. Insert Footer: View menu, Header and Footer. Apply to All

  14. 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. Insert Footer: View menu, Header and Footer. Apply to All

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