Solid-Waste Management and Financing: With Special Focus on CDM

1. Solid-Waste Management and Financing:With Special Focus on CDM Agus P. SariManaging Director Pelangi – EcosecuritiesAlliance on Climate and Energy

2. Methane-capture to energy Incineration Electricity Wet Dry Electricity Recyclables Recycling Anaerobic bio-digestion Separator Sanitary Landfilling Landfilling Choices of waste-management

3. Choices for solid-waste management

4. Characteristics of (typical small) municipal waste in Indonesia (500 tpd)

5. Financing arrangements (typical, 500 tpd)

6. Emissions reduction with CDM Industrial countries Developing countries CertifiedEmissions Reduction (CERs) How does CDM work?

7. Baseline: Emissions that occur with the absence of the CDM project. Methane that will be released by the landfills. Carbon-dioxide that will be released from fossil-based electricity generation. CERs: Certified (and Verified) emissions reduction due to the CDM project implementation. Emisi tanpa CDM (Baseline) CER Emisi dengan CDM Concepts and terms

8. Institutional setting of CDM Conference of the Parties serving as Meeting of the Parties (COP/MOP) Countries / Parties Secretariat CDM Executive Board (Accredited) Operational Entities:Verification (Accredited) Operational Entities:Validation Designated National Authority (Komnas MPB) Project Proponents

9. CDM in waste-management • Methane avoidance: 21 times carbon-dioxide • Out of 500 tpd typical landfills: • Emissions of CH4: 10 kt/year • Carbon equivalent: 200 kt/year • CER revenue, @ $5/t: $1 M/year • In 2006 – 2012 (7 years): $7 M • Electricity generation out of 3 MW • 24 kt/year • CER revenue, @ $5/t: $120 K/year • In 2006 – 2012 (7 years): $840 K

10. Registration by Executive Board Methodological approval Feasibility and Due Diligence Documentation Transaction of CERs Implementation Public consultation Issuance of CERs by EB Validation by Operational Entity Approval by National Authority Verification by OE 1 2 7 3 4 2 5 10 11 9 6 Steps to develop a CDM project

11. Financial needs of the CDM

12. Markets of CDM in the world • Demand: 3.2 billion tons of CO2-equivalent. • 1.2 billion tons from Canada. • 1.1 billion tons from European Union. • 0.8 billion tons from Japan, and others. • “Cash” demand: $2.5 billions. • $880 million from the Netherlands, $800 juta from Canada, $160 juta from Denmark, and $140 million from Japan. • World Bank provides about $250 million. • Private sector provides about $200 million. • “Price” was originally set by the buyers (buyers’ market): • Commencement of the EU Emissions Trading Scheme moves the CER price up (even though not the same market, not the same commodity): • Entry into force of the Kyoto Protocol increases the certainty of the market. • Supply is not as much as we originally thought.

13. Thank you — Terima kasih Agus P. SariPelangi – EcosecuritiesAlliance for Climate and EnergyGraha Niaga Lantai 17Jalan Jenderal Sudirman Kav. 58Jakarta 12190Tel: (62-21) 250-5707Fax: (62-21) 250-5708Email: apsari@pelangi.or.id, apsari@ecosecurities.com