Net Avoided Emissions

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The Yasuni ITT Initiative and
Net Avoided Emissions
CBD DIALOGUE SEMINAR ON SCALING UP FINANCE FOR
BIODIVERSITY
QUITO, MARCH 8
2012
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Lessons Learned: Environmental Policy and
Mechanisms
Ecuador’s Constitution (2008):
•Rights of nature. (Art. 71)
•Environmental services will not be subject to appropriation. (Art. 74)
National Plan for “Good Living” (Buen Vivir) (2009-2013):
•Sustainable management of natural heritage. (Policy 4.1. )
•Diversification of the national energy matrix. (Policy 4.3.)
International Mechanisms: Yasuni- ITT, Net Avoided
Emissions
Fiscal Mechanisms: Green Taxes
Domestic Incentives: Program for Environmental and
Social Remediation (PRAS), Sociobosque (Conservation)
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Yasuni National Park
Biodiversity
Non-contacted
Indigenous
Communities
Reserves of
crude oil
3
The Yasuni – ITT Initiative
Net Avoided
Emissions:
407 million
tons CO2eq
• Biodiversity protection
• Respect of the Rights of
Indigenous Peoples
• Transition to «goodliving» (buen vivir) and
Rights of Nature
Barrels of oil
underground:
840 million
• Support Yasuni (UNDP Fund):
mdtf.undp.org/yasuni
International
Compensation:
$3,600 million
dollars in 13 years
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What is Net Avoided Emissions (NAE)?
Mechanism of
Synergies for
the Fulfillment
of Multiple
Objectives in
the context of
sustainable
development
Net Avoided Emissions are those Green House Gas (GHG) emissions
which could occur within each country’s economy but are avoided.
New climate change mitigation market and non-market (bilateral),
sectorial crediting mechanism (compliance with ex ante baseline
setting) , supplementary to developed country actions for
accomplishment of mitigation commitments.
Its application in CBD allows for biodiversity protection in areas where
green house gas emissions are avoided (for example by leaving fossil
fuels underground)
Economic value associated to the service of avoiding emissions,
equivalent to the market price of total tons of CO2eq avoided, plus the
additional component of biodiversity protection.
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Net Avoided Emissions (NAE) Objectives:
Establishment of Synergies
Synergies for the fulfillment of
Multiple Objectives in the
framework of Sustainable
Development
•
•
•
•
Climate Change
Biodiversity
Desertification
Indigenous peoples
Climate Change Mitigation
• Incentives and fulfillment of
mitigation commitments
• Real net reduction of total
global net GHG emissions
Biodiversity Protection
• Incentives for the protection
of sensitive areas.
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Net Avoided Emissions (NAE) Design:
Governance
Decision-making:
Independent Mechanisms
(Bilateral, Regional)
1. NAE Executive Board:
-Under orientation and
authority of the Conference
of the Parties.
-Methodologies,
accreditation, registry.
«NAE» Hybrid Mechanism
Centralized Mechanisms
(Under supervision of the
United Nations
Framework Convention on
Climate Change;
Convention on Biological
Diversity)
2. NAE Steering Committee:
-A1 and non-A1 country
representatives, private
sector, local communities.
-Transparency,
representativity, local
communities interests and
funds use supervision.
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Net Avoided Emissions (NAE) Design:
Cost-effectiveness (opportunity cost)
MULTICRITERIA EVALUATION OF THE YASUNI ITT INITIATIVE
Ranking of Alternatives:
Opportunity Cost:
A= Yasuni ITT
BTT= Exploitation Scenario 1
BITT= Exploitation Scenario 2
Análisis Multicriterio de la Iniciativa Yasuní ITT. María Cristina Vallejo et Al. (Programa Yasuní)
http://www.ambiente.gob.ec/sites/default/files/users/dvelalcazar/ANALISIS_MULTICRITERIO_YITT.pdf
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Net Avoided Emissions (NAE) Design:
Cost-effectiveness
1,4% cost/CDM ton CO2eq
Mitigation actions in
Ecuador
(Land-use sector)
Region/
Country
Cost
(USD/CO2eq
ton)
Source
Submissions Form Parties (07/April/11)
Yasuni ITT Cost-Effectiveness (Ecuador),
UNFCCC
Yasuni-ITT
Ecuador
$0,015 – $0,02
Socio Bosque (sim. REDD)
Ecuador
$0,24
Ortega-Pacheco et al. (2010)
PROFAFOR (sim. MDL)
Ecuador
$1,42
Wunder and Alban (2008)
Offsets Forests
Ecuador
$1,22
Antinori and Sathaye (2007)
Offsets Forests
Global
$0,38
Antinori and Sathaye (2007)
The Yasuni-ITT Initiative: enhancing cost-effectiveness of, and promoting, mitigation actions, Document for UNFCCC: -Views on the
evaluation of various approaches in enhancing the cost-effectiveness of, and promoting, mitigation actions Submissions from Parties (7
April 2011) - Submission from Ecuador
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Net Avoided Emissions (NAE) Design:
Safeguards
Implementation
in developing
countries
Use of funds for
Mitigation and
Adaptation
Activities
Compensation for the
environmental service
provided (not for the
opportunity cost)
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Net Avoided Emissions (NAE) Design:
Advantages with regards to existing mechanisms
Net
Avoided
Emissions
• Real reduction of the global level of emissions in the
long term
• Protection of Biodiversity as a supplemental objective
• Use of existing institutions
• Development of methodologies for baselines per
sector, etc. based on existing experiences
• Bilateral or Market compensation
• Respeto a los marcos legales domésticos
• Equity and sovereignty in benefit distribution:
• Benefits for local communities
• Access to funds generated by the mechanism
• Sovereignty in project presentation and benefit
distribution
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Net Avoided Emissions (NAE) Design:
Equity and Benefit Distribution
Benefits for local communities:
Respect of the rights of indigenous peoples
Protection of ecosystems and livelihoods
Access to funds generated by the mechanism:
Climate change mitigation and adaptation activities
in the context of sustainable development, potential
for biodiversity protection
Sovereignty for the presentation of projects and
distribution of benefits:
Participation of the implementing party government
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Net Avoided Emissions (NAE) Design:
Environmental Integrity (efficacy)
Permanence
and
Leakage
-Baselines per sector
-Clear definition of scope
-Host country participation
Additionality
Verification
-Reflected in the long
term (Guarantee
certificates, limited
resource stock)
-Leakages control
-Climate Change
Co-Biodiversity
benefits
-Indigenous Peoples
-Desertification
-Heritage
-International
standards
-Institutional
arrangements (UN
board, national
committee)
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Next Steps
CoP Biodiversity
(CBD)
-Discussion of the Mechanism for Synergies and
implementation of biodiversity component:
-Instruments for biodiversity valuation
-Institutional arrangements
CoP Climate
Change (UNFCCC)
-Discussion of Modalities and Procedures
-Pilot schemes and Mechanism operationalization
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THANK YOU
Daniel V. Ortega
Director of Environment and Climate Change
Ministry of Foreign Affairs, Trade and Integration
Quito, Ecuador
dortega@mmrree.gob.ec
medioambiente@mmrree.gob.ec
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Annex 1: The Yasuni ITT Initiative - Deforestation
Component
The Yasuni-ITT Initiative: enhancing cost-effectiveness of, and promoting, mitigation actions, Document for UNFCCC: -Views on the
evaluation of various approaches in enhancing the cost-effectiveness of, and promoting, mitigation actions Submissions from Parties (7 April
2011) - Submission from Ecuador
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Annex 2: Cost-effectiveness of mitigation actions in Ecuador
(Land-use sector)
NPV
(desc. Rate 6%)
Type
Activity
Oil extraction
Programmatic/
Yasuni-ITT
Deforestation
avoidance
(max.)
Projects/
Socio-Bosque
Deforestation
sequestration
PROFAFOR
CDM-like
Reforestation
NPV
(desc. Rate 12%)
Emissions
Cost
Cost
Cost
Cost
(million ton
(million USD) (USD/ton CO2eq) (million USD) (USD/ton CO2eq)
CO2eq)
407
20,78
0,017
18,38
0,015
820
24,53
0,02
21,85
0,018
26,9
7,9
0,24
7,9
0,24
2,23
6,54
0,58
6,54
0,58
The Yasuni-ITT Initiative: enhancing cost-effectiveness of, and promoting, mitigation actions, Document for UNFCCC: -Views on the
evaluation of various approaches in enhancing the cost-effectiveness of, and promoting, mitigation actions Submissions from Parties (7 April
2011) - Submission from Ecuador
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Annex 3: Net Avoided Emissions (NAE) at the United Nations
Framework Convention on Climate Change (UNFCCC)
80. Decides to consider the establishment, at the seventeenth session of the
Conference of the Parties, of one or more market-based mechanisms to enhance
the cost-effectiveness of, and to promote, mitigation actions, taking into
account the following:
(e) Ensuring a net decrease and/or avoidance of global greenhouse gas
emissions» (1/CP.16)
• UNFCCC Conference of the Parties N° 16 (Cancun, 2010)
«79. Emphasizes that various approaches, including opportunities for using
markets, to enhance the cost-effectiveness of, and to promote, mitigation
actions, bearing in mind different circumstances of developed and developing
countries, must meet standards that deliver real, permanent, additional and
verified mitigation outcomes, avoid double counting of effort, and achieve a net
decrease and/or avoidance of greenhouse gas emissions” (Draft decision [/CP.17] AWG-LCA)
• UNFCCC Conference of the Parties N° 17 (Durban, 2011)
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