Carbon Markets - from CDM to
NAMAs
Dr. Silke Karcher
German Federal Ministry of Environment
Alexanderstraße 3 / 10178 Berlin
Fon: +49-30-18-305-3601
silke.karcher@bmu.bund.de
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CDM – a brief success story
The CDM was created by KP and MarrakeshAccords by
Until today the CDM market amounts to a total of
610 Mio. t CO2. In the EU ETS this corresponds
to 7,3 billion Euro.
With CERs the CDM provided the first global
Carbon Currency.
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CDM – learning by trial and error
The flexible Mechanisms of the KP, including the
CDM, presented completely new tools.
The development of the CDM gave opportunity to
learn about the design of such instruments.
Important topics include:
o
o
o
o
o
Practicability of procedures (validation, liability …)
Eligibility / Additionality
Transparency / Participation
Windfall profits
Inclusion of weaker market participants (LDC)
 CDM reform + lessons for new mechanisms
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New Mechanisms & NAMAS
Various approaches are discussed to supplement
and replace the CDM where appropriate:
o Market mechanisms on a sectoral scale (e.g. sectorial
crediting and sectoral trading)
o Emissions Trading Systems (national, regional)
o NAMAs („nationally appropriate mitigation actions“)
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What is a NAMA
NAMAs were intorduced in Bali 2007 (decision 1/CP.13).
 Neither a clear definition nor a concrete plan for
financing has emerged since.
Three ways of financing are discussed:
1) NAMAs financed by the developing countries themselves and
2) NAMAs financed with Annex I countries‘ support
3) NAMAs financed by carbon credits
Of course the possible sources could be combined.
Also Financial resources and existing mechanisms could
be combined
E.g. some notification to Appendix II of the Copenhagen
Accord declare that CDM should not be excluded from
use in NAMAs
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NAMA and MRV
NAMAs need to be monitored, reported and verified in an appropriate
manner
 For domestically financed NAMAs the government has strong
interests to assess how far national climate policies and measures
are in line with national GHG emission targets
 For supported and credited NAMAs the MRV framework is different.
The financing party has to be sure that the emission reductions are
additional to the “business as usual” scenario:
o Credited: when trading with emission certificates the MRV procedures
have to be as accurate as in CDM
o Supported: carbon financing as a support could focus on broader
climate issues such as technology transfer and capacity building, with
less detailed monitoring
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Concepts to be defined
NAMAs and new market mechanisms started to
exist as words and vague concepts.
The COP in Cancún decided:
o to create a registry for NAMAs
o to discuss new market mechanisms
For NAMAs the process of pinning down the
concept has started:
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First movers get to define!
Registry:
• Help with bringing together concepts and
financing
• Give transparent overview of NAMAs developed
• Good ideas can be copied and spread.
The definition of “NAMA” however rests with those
who create one. So the first movers will get to
influence what NAMAs are and can be.
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How to build a NAMA
There is no NAMA building manual yet.
But several approaches can be used:
o Top Down: Stocktaking of potentials and then defining
of measures to realize those potentials
o Bottom up: Scale up or adapt existing approaches,
e.g. scale up and broadening of existing PoAs or PoA
ideas ( Details presentation by KfW later in this
session)
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Prompt start
The CDM started before the rules were completely set:
The „prompt start“ in 2000 made it possible to start projects
that would later be recognized while the legal framework
was not yet set.
We will need a sort of prompt start and pilot projects for
NAMAs, too.
Financing can for example come from bilateral fast start
financing or possibly from the green Climate Fund.
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German Cooperation
The German Ministry of Environment is interested
in the NAMA process and new mechanisms.
Concrete projects include:
o MRV and NAMA partnership
o PoA support center – seeing PoAs as an improved
version of classical CDM and bridge to broader
mechanisms
o Bilateral cooperation with NAMA development, e.g.
with Mexico, Tunesia, …
o Participation in World Bank Partnership for Market
Readiness (PMR)
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Outlook
We are living in a quickly changing world.
Pioneers and experiments are needed.
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Thank you!
Contact details:
Dr. Silke Karcher
Head of Division KI I 4
EU Affairs and Bilateral Cooperation "Environment and Energy"
Federal Ministry for the Environment
Alexanderstr. 3/ 10178 Berlin
Telephone: +49-30 18 305-3601
silke.karcher@bmu.bund.de
Internet: http://www.bmu.de
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