Dr Ram Babu

1
Clean Development Mechanism Poverty Reduction

• Dr Ram Babu
• Associate Director
• PricewaterhouseCoopers Pvt Ltd

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Purpose of the Kyoto Protocol

• GHGs Reduction
• Sustainable Development

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Three Dimensions of SD
Economic
Sustainable Development
Environmental
Social
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Core of Sustainable Development
S
O
N
O
C
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Poverty Reduction
I
S
A
N
L
E
M
D
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The motto that was created during the Rio Earth
Summit in 1992 "think global, act local",

• By implementing projects at a low scale level,
  the quality of the global environment will be
  improved

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Core of Sustainable Development
Poverty Reduction
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SouthSouthNorth Matrix

• A tool to appraise sustainable development of CDM
  project activities under the Kyoto Protocol.

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SSN matrix tool

• Indicator

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Social Sustainability and development
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Poverty Alleviation
Excluding large Hydro
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Energy Ladder
Fuel switch, Cleaner Energy
Renewable Energy
Natural Gas
Afforestation, Biomass, Energy Efficient
Petroleum Fuels
Coal
Charcol
Wood
Crop Residues
Improved energy technology
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Top of the Pyramid

• Renewable Projects AM0019, AM0026 ,ACM0002
• Biomass Projects AM0007,ACM0002
• Methane extracts and capture through animal waste
  management system and solid waste management
  systemAM0006, AM0012,AM0016

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Projects types deemed to deliver
Sustainable Development

• Substituting more GHG intensity fuel
• Renewable energy, excluding large, gt15MW hydro
  projects
• Energy efficiency
• Methane capture with methane burning for
  electricity generation purposes

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Afforestation Project

• Approved large Scale methodologiesAR-AM0001-
  Reforestation of degraded land
• the most plausible scenario is that the project
  areas would remain abandoned and degrading in
  absence of the project activity,

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Proposed New Methodologies under consideration

• ARNM0007-rev Moldova Soil Conservation Project
• ARNM0012 Afforestation or reforestation project
  activity implemented on unmanaged grassland
• ARNM0013 The Mountain Pine Ridge Reforestation
  Project (MPR Project)
• ARNM0014 'Treinta y Tres' afforestation
  combined with livestock intensification
• ARNM0015 Reforestation as Renewable Source of
  Wood Supplies for Industrial Use in Brazil
• ARNM0016 Los Eucaliptus Afforestation Project
• ARNM0017 Mexico Seawater Forestry Project
• ARNM0018 Assisted Natural Regeneration of
  Degraded Lands in Albania
• ARNM0019 Reforestation around Pico Bonito
  National Park, Honduras
• ARNM0020 Afforestation for Combating
  Desertification in Aohan County, Northern China

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Results

• Direct link to poverty reduction as poorer
  segment of the population are also the managers
  of forests and areas where deforestation is
  taking place
• In tree planting projects for production of
  fruits , tea and other consumer goods contribute
  to carbon storage while bringing employment and
  valuable economic and social benefits to local
  community

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Middle of the Poverty Reduction Pyramid

• Energy efficient , fuel switch, recovery and
  utilisation of gas , waste gas based power
  generation, single cycle to combined cycle for
  power generation, coal bed methane capture and
  use for power, water pumping efficiency
  improvements, leak reduction from natural gas
  pipelines, steam optimisation

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Bottom of the Pyramid

• AM0001Incineration of HFC 23 Waste Streams
• AM0002Greenhouse gas emission reductions through
  landfill gas capture and flaring where the
  baseline is established by a public concession
  contract
• AM0003Simplified financial analysis for landfill
  gas capture projects
• AM0021Decomposition of N2O from existing adipic
  acid production
• AM0028 Catalytic N2O destruction in tail gas of
  Nitric Acid plants
• ACM0001 Landfill Gas project activities
• ACM0005 Increasing the blend in cement production

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Results

• HFC, N2O, Land filling project are very good for
  GHG reduction, do not contribute to
  sustainability.
• High tech end of the pipe application
• Limited employment and local environmental
  benefits

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CERs from CDM projects to be expected until 2012
by project type
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Expected average annual CERs from Registered
projects
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Registered Projects by Host Country
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Registered Projects by scope
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e7 Bhutan Micro Hydro Power CDM Project Case
Study

• 524 CERs per annum
• Benefits

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Findings

• Strong community organisation and involvement for
  the systems to work
• Poverty reductions
• The carbon revenue will not justify the high
  transaction cost requires to make these kind of
  projects as CDM projects

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Conclusion

• Many CDM project have potential to improve living
  conditions of poor
• However, poverty reduction through direct
  participation in economic benefits accrued by CDM
  project activity is difficult to achieve through
  actual CDM projects.

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Future Course of Actions

• Poverty reduction should be an integral component
  in the selection, implementation and transaction
  of CDM project

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Thank you