Demand side perspective on JI

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Demand side perspective on JI

UNFCCC Side event on Joint Implementation

Gertraud Wollansky

Federal Ministry for Agriculture, Forestry, Environment and WaterManagement

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Importance of Joint Implementation

Many Annex II countries have established or are planning to establish acquisition programmes for ERUs and CERs (NL, Canada, Austria, Denmark, …)

EU ETS and Linking directive give a new impulse to the market, demand will increase from private sector

Estimates exist for overall demand for project based credits, but difficult to split into JI and CDM demand

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Comparative advantages of JI versus CDM

JI host countries established markets for many European companies

Daughter companies in JI countries provide opportunity for emission reductions

Perceived by some companies as less risky than CDM Track 1 less complicated than CDM, if requirements are

met

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Comparative disadvantages of JI versus CDM

Double counting provision in Linking directive limits use of JI by EU countries in new EU members

Some – not all – new MS have held up approval of JI projects

Risk of eliminating JI in EU MS by establishing very restrictive double counting rules?

Market prices for ERUs have tended to be higher than for CERs in the past

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How to compensate disadvantages

Simplify JI by using Track 1 – still uncertain course for some host countries

Give certainty about Track 2 – not restrict investments to Track 1 countries!

Establishment of Green Investment Schemes Procedures probably very like Track 1 Avoids obstacles to JI posed by Linking directive Allows a coordinated approach and more control for

host party over project portfolio

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Expectations (1)

What Parties and PPs expect from COP/moP1:

Confirmation of the assumptions used for projects already started (baseline and monitoring methodologies, DOEs-IEs, ….)

Security for the investments by providing the legal framework – this means adoption of JI decision

Guidance how to use the framework developed under CDM

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Expectations (2)

Experiences from CDM that can and should be used for JI, i.a.:

Approved methodologies for baselines and monitoring Provisions for small scale Accredited DOEs as IEs Accreditation procedures for IEs Rules of procedure for SC as applicable Use of Panels, Working groups

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Expectations (3)

Open questions: Further linkeages between JI and CDM concerning

methodologies, accreditation, …. SC and EB are independent bodies, can make their own

decisions Independent development of JI, even if using

experiences from CDM

But: SC and EB should keep close contact and take account of developments in the other bodies

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Expectations (4)

Funding issue has to be solved, not concentrate only on CDM and ITL funding

Adequate resources for Secretariat important JI SC can build on work already done, but has to adapt it

to its own needs SC should develop a work plan for the first year based

on guidance by COP/moP to set up modalities for JI implementation

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Thank you for your attention!

Contact information: [email protected]