Download Presentation title

KZN Pre-COP17 Summit
Inkosi Albert Luthuli ICC, Durban
26 September 2011
KZN Pre-COP17 Summit – Climate Change Finance
0
Financing Climate Change Mitigation and
Adaptation Measures
Alex McNamara
Principal Consultant
Camco South Africa
Climate Change Finance in Context
KZN Pre-COP17 Summit – Climate Change Finance
2
Climate Change Finance in Context
• Adequate finance is critical for any low carbon development path
• Funding is also key to supporting community livelihoods and
adaptation efforts
KZN Pre-COP17 Summit – Climate Change Finance
3
Climate Change Finance in Context
• To be effective, funding flows need to be:
1. Robust and transparent
2. Support local economic development
3. Ensure ownership by involved parties
4. Encourage additional finance and investment where possible
5. Be matched by an enabling regulatory framework
KZN Pre-COP17 Summit – Climate Change Finance
4
Current Types of Funding Available
KZN Pre-COP17 Summit – Climate Change Finance
5
Types of Funding Available (Global)
• The term ‘climate finance’ can be defined very broadly, and is a fluid
concept at present
• Globally, typical types of climate finance at present include:
• Carbon credits developed and sold under the CDM
• Carbon credits developed for sale under the voluntary carbon market
• Grants and soft loans provided by donors and multilateral institutions
(e.g. the World Bank)
• ‘Fast Start’ funding pledges that are slowly being implemented, as
agreed under the Cancun Agreements (COP16)
• Limited support to developing country adaptation plans, including
through the Adaptation Fund
KZN Pre-COP17 Summit – Climate Change Finance
6
Types of Funding Available (Local)
• In addition, South Africa specific funding sources are in place that are
‘climate finance’ related:
• National Treasury – Incentive for Investing in Energy Efficient Equipment
• National Treasury – Neighbourhood Development Partnership Grant
• SANERI and NRF research grants
• Eskom Standard Offer and Standard Product Offerings
• Eskom Solar Water Heating Programme
• Department of Energy: Renewable Energy Finance and Subsidy Office
(REFSO) – Subsidy for Renewable Energy Technology
Both global and local funding types are available to South Africa
KZN Pre-COP17 Summit – Climate Change Finance
7
Typical Funding Areas
KZN Pre-COP17 Summit – Climate Change Finance
8
Typical Funding Areas – Mitigation
Mitigation efforts related to:
Biomass
Forestry and REDD+
Biogas / waste to energy
Biofuels
Rural electrification
Distributed & off-grid power
generation
Solar
Energy storage &
conservation
Wind
Energy efficiency
Geothermal
Tidal / ocean
Hydropower
Cleaner transport
Other industrial emission
reductions
KZN Pre-COP17 Summit – Climate Change Finance
9
Typical Funding Areas – Adaptation
Adaptation efforts related to:
Water security /
integrated water resource
management
Agricultural development /
food security
Flood and drought protection
Coastal protection /
managing coastal areas
Resilient infrastructure
Early warning systems
Ecosystem based adaptation
Sustainable land
management
Disaster risk management
KZN Pre-COP17 Summit – Climate Change Finance
10
Examples of Projects Financed
in South Africa
KZN Pre-COP17 Summit – Climate Change Finance
11
CDM Example
• Tugela Mill Fuel Switching Project:
 Fuel switch from coal to biomass (bark) at boiler in
Tugela Paper Mill
 Location: Mandini, KZN
 Project developer: Sappi
 Forecast emission reductions: 51,962 tCO2e/year
Source:
http://cdm.unfccc.int/about/multimedia/stories/i
ndex.html
 Actual emission reduction over initial monitoring period:
22,661 tCO2e/year
• South Africa now has 19 registered CDM projects,
and Africa has 66 in total
KZN Pre-COP17 Summit – Climate Change Finance
12
International Donor Example
• University of KZN Biogas Pilot Plant:
 Project type: pilot project
 Biogas pilot plant using chicken litter or similar farm waste to produce
methane gas for heating, cooking and transportation
 Approx. 25 jobs to be created
 Supported under the: ‘Energy and Environment Partnership for Southern
and East Africa’ (http://www.eepafrica.org/)
 Programme funded by the Government of Finland and Austrian
Development Agency
KZN Pre-COP17 Summit – Climate Change Finance
13
Potential Future
Funding Sources
KZN Pre-COP17 Summit – Climate Change Finance
14
Potential Future Funding Sources
• Existing carbon markets
• Scaled up ‘Fast Start’ finance
• Green Climate Fund
• Nationally Appropriate Mitigation Actions (NAMAs) / Sectoral
Mechanisms / Bilateral Agreements
• Other international partnerships on priority regional projects
• Greater emphasis on the Adaptation Fund:
• SANBI recently accredited by Adaptation Fund Board (AFB), and will be able to put
forward project proposals
• Next AFB meeting to take place in Durban from 12-14 December 2011; civil society
dialogue also planned for 11 December 2011
KZN Pre-COP17 Summit – Climate Change Finance
15
Key Challenges
KZN Pre-COP17 Summit – Climate Change Finance
16
Key Challenges
• South Africa has taken only very limited advantage of the CDM, and
• The clock is ticking fast on registering conventional CDM projects in
South Africa
• SA has also yet to submit a project concept to the Adaptation Fund
• Much of the new climate finance architecture is still being set up (e.g.
for Fast Start and the Green Climate Fund) and will take time to
implement
• Therefore, considerable uncertainty regarding how much will be
leveraged, by when, and how funds will be disbursed
KZN Pre-COP17 Summit – Climate Change Finance
17
Alex McNamara
Camco South Africa
T: +27 (0)11 253 3400
M: +27 (0)79 699 3284
E: [email protected]
KZN Pre-COP17 Summit – Climate Change Finance
18