Utilizing CDM experiences to develop NAMAs – MRV

1. Utilizing CDM experiences to develop NAMAs – MRV Perumal Arumugam Regional Workshop on CDM and NAMAs for Latin America and the Caribbean ,Bogota, (31 – 02 Sep 2014) UNFCCC secretariat

2. Outline • Planning ,Design ,Implementation cycle of NAMA and where does MRV fits?? • NAMA types and MRV requirements and types of MRV • Domestic MRV as per WARSAW • Scope of evolving MRV requirements • Key considerations of NAMA – MRV • Baseline setting and various approaches to set Baselines • Use of SB, sampling standards, suppressed demand concept, voluntary SD tool • CDM Experience to NAMA / Leverage CDM MRV to FIT NAMA

3. Planning, design and implementation cycle of NAMAs: where does MRV fit?

4. Planning, design and implementation cycle of NAMAs: MRV fits here?

5. Broad types of MRV • MRV of Emissions - Estimation of emissions at national, regional, sectoral levels. • MRV of NAMAS – Estimation of the impacts of mitigation policies and actions. • MRV of Support - MRV of financial flows/technology transfer/capacity building and their impacts

6. Scope of Evolving MRV Source : GHG Mitigation Actions (MRV Issues and options); OECD

7. Key considerations of NAMA – MRV • NAMA proposal can be defined with a broad (national or sectoral) or narrow(specific activities) scope. • The scope depends on the capacity and ambition of a country in the targeted area of activities. The covered activities: processes, space, product, technology , inclusion of all GHG emissions etc. • Boundary A broad definition could be, for example, an emission baseline for an entire country or the whole of the sector linking to national plan and strategy and its mitigation potential. (temporal (short/medium/long-term), geographical, gases coverage) • A narrowly –but clearly –defined NAMA can be more towards activity –based actions ,such as implementation of set of technology interventions (e.g. Housing NAMA for energy efficient housing that includes solar hot water system, CFLs, efficient appliance, etc.) should be a part of a broader strategy (e.g. Urban NAMA) which provides a framework for the NAMA and ensures that actions are in line with national development strategies.

8. ESTABLISHMENT OF BASELINE (BAU) Emission until 2020. • A baseline scenario may be intended to be a “business as usual” projection, or can represent other scenarios referring to emission reduction targets and be based on different assumptions or conditions. It is important, however, that baselines take into account all UNFCCC gases (CO2, CH4, N2O, SF6, PFCs, HFCs, NF3) and use the GWP established by the IPCC. • It comprise present economical, technological, demographical and social trends without consideration of any climate change mitigation policy towards defined national emission reduction targets. • There are no international requirements nor internationally recognized guidelines for the construction of a baseline and methodology to be chosen based on the desired level of detail, availability of data and technical expertise. • Double counting and environmental integrity: Relation to carbon market(e.g. overlapping and double counting with CDM and other new market mechanisms. setting the boundary ensures that no activity is doubly counted in evaluations.

9. Approaches for determining baselines - ESTABLISHMENT OF BASELINE (BAU) Emission until 2020. • Status quo Simply drawing a flat line from existing historical emissions • Extrapolating current emission trends (what is level of extrapolation/supressed demand) ,impacts of existing policies, effect of planned or identified policy measures, a key issue when constructing baseline scenarios is whether or not to include the effects of pre-existing or planned emissions abatement policy in the baseline, their economic lifetime, macroeconomic and socio-demographic indicators , policy implications • Control group method – benchmark of use patterns and energy performance of technologies - is very country specific • Dynamic baselines • Futuristic emission assumed continuation of historical emissions (project); continued rate of growth of emissions / emissions intensity (sector); modeling based on policies included in the baseline. • Rebound effects. Rebounds occur when energy efficient improvements in technologies result in greater usage rate, effectively offsetting emission reductions. This is likely to accompany shifts to more consumer-oriented lifestyles.

10. Use of standardized baseline /Methodological tools in development of NAMAs (MRV). • Scalability; Setting of targets – (one or multiple measures) • Specificities of countries ; Baseline (Level of emissions) – BAU Baseline Scenario. • Sectoral emission estimation and ladder for supported and sectoral crediting (credited NAMA) • Establishment of adequate boundaries • Partially address the issue of double counting. • Implementation of NAMA requires reference level or pathway against performance. • Defined set of indicator to monitor the baseline (spatial ,time boundary, growth rate and trends as well as associated emissions). • Interaction between different measures and policies (entanglement of policies) ,technological and behavioural changes .

11. Use of suppressed demand concept of CDM in NAMA SCOPE AND APPLICABILITY • Applicable where the minimum service level is not met (Basic lighting demand, purified water, water treatment); • Provides methodological approaches for two issues: • The identification of the baseline measure under a suppressed demand situation; and • The identification of the baseline service level that should be used to calculate baseline emissions in a suppressed demand situation.

12. Sampling allowed for a group of homogeneous CPAs under a small scale PoA; populations of all CPAs in the group are combined for a single survey Group of Actions MEASURE 3 Measure –I CITY 2 Measure - I CITY 3 MEASURE 2 Measure - I CITY 1 Use of CDM sampling standard in NAMA NAMA - SECTOR

13. Use of the CDM - Voluntary sustainable development tool

14. CDM EXPERIENCE TO DEVELOP NAMA • Governance Structure • Accounting Structure (centralized system ,registry & ITL , DOE etc.) • Methodological standards – Comparable quality and fungible • Ensure Environmental Integrity • MRV provision (Program level assessment (poA) / bottom-up and top down approaches) • Consistency in MRV requirements in most of the programs except verification levels. • Transparency and Independence. • Participatory approach (local/global stake holder) • QA/QC procedures on data quality • Empowerment of DNA

15. Leverage CDM MRV to FIT NAMA • Flexibility in monitoring methods depending on Size and other socio ,techno ,economic parameters • Strengthening assessment of non-GHG estimation and MRV • Reduce complexity in MRV procedure. • Further work on the sector wide approaches. • Development of more ex-ante (up-stream) standardized approach and reduced ex-post MRV • Reduce transaction cost (provide further top-down work in assessment of uncertainty ,materiality , reduce monitoring procedures).

16. DOES A SIMPLIFIED CDM MRV SYSTEM ATTRACT MORE INVESTMENT INTO NAMA ??

17. THANK YOU!parumugam@unfccc.intTeam Lead ,Programme Officer,Standard Setting Unit of SDMUNFCCC