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. . . . . 1) CDM project planning (PIN, etc.). 3) Approval from Designated National Authority . 2) Project design document (PDD) preparation. 4) Validation. 5) Registration. CDM Project Cycle. Baseline Definition Demonstration of additionality Crediting period Project boundaries Monitoring .
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1. Methodological Issues in CDM Lighting Africa Carbon Finance Training Workshop
Dar es Salaam, Tanzania
Carbon Finance Assist, The World Bank
March 26-27, 2008
4. Clean Development Mechanism CDM, Art. 12 KP:
Certified Emission Reductions (CERs) must:
Create real, measurable, and long-term benefits related to the mitigation of climate change
Be additional to any that would occur in the absence of the certified project activity
5. Definition of Baseline
The baseline is the scenario that:
“reasonably represents GHG emissions that would occur in the absence of the proposed project activity”
Baseline = what would happen in the absence of the project
Not necessarily the continuation of the current practicesBaseline = what would happen in the absence of the project
Not necessarily the continuation of the current practices
6. Baseline Scenario Example Baseline:
Wastewater treatment lagoons without methane recovery
7. Baseline Scenario Example CDM project activity:
Lagoons cover, methane recovery and flaring
8. The Basic Picture …
9. … represents the course of action and development in the absence of the CDM project
… can be a future development that provides the same services as the proposed project
… is a reference to calculate emission reductions
Baseline is not necessarily a continuation of the status quo In summary, Baseline Scenario…
10. Baseline Methodology Should comply with requirements pertaining:
Methodology previously approved by the Executive Board; or
Modalities and procedures for establishing a new methodology.
Basline selected mehod scenario: justify the choice.
a) Project without effect on capacity.
b) Tendency for new investments or capacity addition
Basline selected mehod scenario: justify the choice.
a) Project without effect on capacity.
b) Tendency for new investments or capacity addition
11. Baseline Methodology Small-scale methodologies:
Type i.
Renewable energy project with maximum output capacity of 15 MW
Type ii.
Energy efficiency project that reduces energy consumption up to 60 GWh per year
Type iii.
Other type of projects that results in GHG reduction below 60 kt CO2e annually Baseline simplified, requirement for additionality demonstration and monitoring plan.Baseline simplified, requirement for additionality demonstration and monitoring plan.
13. Demonstration of Additionality can be demonstrated by:
Economic or financial analysis: the project is not the least cost or most attractive option;
Barrier analysis: without CDM, the project could not be realized due to lack of finance, non-availability of technologies, lack of skilled and/or properly trained labor, lack of infrastructure for implementation of the technology, etc.
14. Common practices must be analyzed to provide evidence that the project is not a common practice in the host country.
Additionality needs to take into account relevant national and/or sector policies or circumstances. Demonstration of Additionality
16. Project Boundaries
Project Boundaries shall encompass all emissions that are :
under the control of the project participants
significant, and
reasonably attributable to the CDM project activity.
17. Project Boundaries
Project boundaries are the limits and borders defining the GHG emission reductions project.
Refer to specific components and facilities used to mitigated GHGs
e.g. Number of households replacing bulbs
18. Leakage Leakage:
is defined as the net change of emissions which
occurs outside the project system boundaries,
measurable and
attributable to the CDM project activity
ERs must be adjusted for leakages
20. Crediting Period a) Maximum of 7 years which may be renewed 2 times (total of 21 years);
or
b) Maximum of 10 years fixed.
need to select the crediting period in the project design document;
In case a), need to assess if baseline scenario is still valid.
22. Monitoring The monitoring plan must provide for the collection of all data necessary for
Measurement or estimation of project emissions
Determination of the baseline of emissions
Monitoring plan
is required as part of the Project Design Document
previously approved by the Executive Board
? serves as the basis for verification of emission reductions
23. A Good Monitoring Plan … ... ensures the credibility and verifiability of emission reductions (ERs)
... defines quality assurance obligations of the project operator
... provides a recording system
…must be incorporated into the project operational and management procedures
24. Useful References Carbon Finance at the World Bank: Methodology (www.carbonfinance.org)
CDM-Home (http://cdm.unfccc.int)
UNEP, Risø Centre: CDM overview (http://www.cd4cdm.org)
National Communications (for Annex I and non-Annex I Countries) and National Emissions Inventories (Annex I countries): http://unfccc.int/national_reports/items/1408.php
IPCC Methodology reports (e.g. National Guidelines for National GHG Inventories) : http://www.ipcc.ch/pub/guide.htm
Energy Statistics: http://www.iea.org/Textbase/stats/index.asp
Climate Analysis Indicators Tool (World Resources Institute): http://cait.wri.org/
