Introduction to registry systems under Article 7.4 of the Kyoto Protoco Pre-sessional consultations on registries Bonn, 2-3 June 2002 Andrew Howard UNFCCC secretariat [email protected]
Feb 12, 2016
Introduction to registry systems
under Article 7.4 of the Kyoto Protocol
Pre-sessional consultations on registries
Bonn, 2-3 June 2002
Andrew HowardUNFCCC [email protected]
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Scope of presentation
• Kyoto Protocol compliance
• Registry system requirements
- registry structures
- transactions
- features for integrity and transparency
Based on document FCCC/CP/2001/13/Add.2:
• Decision 19/CP.7 on Article 7.4 (pages 55-72)Para numbers in this presentation refer to this decision
• Decision 17/CP.7 on the CDM (see pages 41-43 on the CDM registry)
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Compliance with Kyoto Protocol targets
Emissions
Sin
k ad
ditio
ns
Target
Ann
ex B
targ
et
Party A is a net buyer …
Sin
k ad
ditio
nsEmissionsTarget
Ann
ex B
targ
et
Party B is a net seller …
Mec
hani
sms
subt
ract
ions
Mec
hani
sms
addi
tions
4
Accounting units (paras 1-4)
Assigned amount unit (AAU)• Based on the Annex B target (Articles 3.7/8)
AAU
CER Certified emission reduction (CER)• issued into the CDM registry as a result of CDM projects
ERU Emission reduction unit (ERU)• converted from AAUs or RMUs as a result of JI projects
Removal unit (RMU)• Based on carbon sequestration in sinks (Articles 3.3/4)
RMU
All units denominated as 1 tonne of CO2 equivalent:
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CDM registry(operated by
the executive board)
A registry is a standardized electronic database for recording and tracking of units (ERUs, CERs, AAUs and RMUs) (para 19)
National registries(operated by Annex I Parties)
Annex IBulgaria
Annex IRussia
Annex ICanada
Annex IGermany
Tracking the units through the registry system
CER
Transactions ERU
AAU
Transaction log(operated by the secretariat)
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National registry account types (para 21)
CanadaHeld by the government
Party accountHeld by companies, organizations or individuals (if authorized by the Party)
Legal entity a/c
Legal entity a/c
Units transferred here to count towards compliance
Retirement a/c
Units transferred here to compensate for net emissions from sinks or to strengthen targets
Cancellation a/c
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AAU and RMU issuance (paras 23 and 25)
Bulgaria
Party account
Legal entity A
Legal entity B
Retirement a/c
Cancellation a/c
Calculation of assignedamount (Articles 3.7/8)
AAUAAUAAUAAU
Calculation of net sequestration (subject to limits!)
(Articles 3.7/8)
RMURMURMURMU
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Transfers and acquisitions under emissions trading (para 30)
Canada
Party account
Legal entity A
Legal entity B
Germany
Party account
Legal entity A
Legal entity B
CER
RMU
ERUAAU
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Retirement and carry-overs (paras 34 and 36)
>=<
Emissions 2008 to 2012
Compliance assessment
Units in retirement account
Units in retirement accounts not transferable
Russia
Party account
Legal entity A
Legal entity B
Retirement a/c
Unused units carried-over in holding accounts to the next commitment period
(paras 36)
Retirement(para 34)
RMU
CERERU
AAU
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ERU issuance (para 29)
ERU
Germany
Party account
Legal entity A
Legal entity B
Retirement a/c
Cancellation a/c
Russia
Party account
Legal entity A
Legal entity B
Retirement a/c
Cancellation a/c
JI project(conversion
of AAUsto ERUs)
Verification by host Party (track 1) or
independent procedure (track 2)
AAUERU
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CER issuance (into the CDM registry)
CDM project
Certification of emission
reductions by an operational entity
CERCERCERCER
Participants’request
CERCERCERCER
Canada
Party account
Legal entity A
Legal entity B
Retirement a/c
Cancellation a/c
CDM registry
Pending account
Share of proceeds (for adaptation and
admin costs)
Bolivia account
India account
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Cancellation of units to strengthen targets (para 33)
What: Cancelled units are removed from the system and cannot be used for compliance
Who: schools, NGOs, individuals, etc
Units in cancellation accounts may not be transferred or retired
Party account
Legal entity A
Legal entity B
Retirement a/c
Cancellation a/c
Germany
RMU
CERERU
AAU
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Features for integrity and transparency
• serial numbers• account numbers• the transaction log• accessible information
--------------------------> to keep track of the units-------------------------> to identify the accounts-----> to ensure the integrity of transactions
-----------------> to maintain transparency
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Unique serial numbers for units (para 24, 27 and 29)
AAU
RMU 01 CA 2 3 003752 000
ERU 01 PL 3 0 078625 033
CER 01 BO 4 0 047691 046
Party of originLULUCFactivity
Uniquenumber
Projectnumber
Unit type
01 CH 1 0 314782 000
Commitment period
Number formats are not yet specified - these are examples only
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Account numbers (para 22)
Party account
Legal entity A
Legal entity B
Retirement a/c
Cancellation a/c
Canada
Unique numberParty
CA 001
CA 002
CA 003
CA 485
CA 486
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Message exchange: International transfer (para 38-43)
Account in national registry of Party A
Transaction log(automated checks)
Account in national registry of Party B
Confirmation
4
Confirmation
4Proposalresponse
2
Proposalresponse
2
Proposal1
Proposal
1
Transactionrecord containing:- trans. number- trans. type- serial numbers- account numbers
1
Instruction / transfer3
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Message exchange: Domestic issuance (para 38-43)
Account in national registry of Party A
Transaction log(automated checks)
Confirmation
4Proposalresponse
2
Proposal
1
Transactionrecord containing:- trans. number- trans. type- serial numbers- account numbers
1
Issuance
3
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Potential discrepancies (para 42)
The transaction log conducts automated checks for:• units improperly issued or duplicated units• units previously retired/cancelled• units not carried over from the previous commitment period• eligibility of Parties / legal entities• infringements on the commitment period reserve• infringements on the limits for carbon sequestration
The transaction log ensures the integrity of all transactions
Each unit is held in one account at a time
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Publicly accessible information (paras 44-48)
• Account information (account type, holder, representative, etc)
• JI and CDM project information (on national registries and the CDM registry respectively)
- name
- location
- reports / documentation
• Information on holdings and transactions, including on cancellations and retirements
• List of legal entities authorized by the Party (national registries)
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Registries development beyond COP7
Technical standards on the exchange of data between national registries, the CDM registry and the transaction log
… a decision at COP 8 (Nov 2002)
… completed by COP 10 (Nov 2004)
Establishment of the transaction log by the secretariat
… before 1 Jan 2007
Establishment of national registries by Annex I Parties
… interim registry by COP 8?
Establishment of the CDM registry by the CDM executive board
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www.unfccc.int
Andrew HowardUNFCCC [email protected]
Introduction to registry systems under Article 7.4 of the Kyoto Protocol