CAPACITY DEVELOPMENT WORKPLAN FOR THE CLEAN DEVELOPMENT MECHANISM IN UGANDA Prepared by: Uganda Management Institute ( UMI) Supported by: UNEP Collaborating Centre on Energy and Environment (UCCEE) Coordinated by: Department of Meteorology Ministry of Water, Lands and Environment May 2003 i ITEM TABLE OF CONTENTS PAGE 1.0 1.1 1.2 1.3 Introduction and Background ……………………………………… Introduction …………………………………………………………………………….. Background …………………………………………………………………………….. Structure of the plan…………………………………………………………………… 1 1 1 2 2.0 2.1 3 2.2 2.3 2.4 2.5 2.6 The National Context ……………………………………………………………… Economic performance & Policies of enhancing environmental Management …………………………………………………………………… Population …………………………………………………………………………….. Uganda’s key development objectives…………………………………………… Key areas of economic importance ……………………………………………… Energy sector …………………………………………………………………… Transportation sector…………………………………………………………………. 3.0 3.1 3.2 3.3. On-going and Up-coming projects related to CDM …………… On-going projects …………………………………………………………………. Up-coming projects …………………………………………………………………. Other possible CDM projects ……………………………………………… 7 7 7 10 4.0 4.1 4.2 4.3 Stakeholder analysis …………………………………………………………… Potential stakeholders of CDM and their mandates ………………………… Other potential stakeholders of CDM …………………………………….. Consolidated CDM stakeholder analysis matrix ………………………………. 11 11 18 19 5.0 5.1 5.2 Public and private sector institutions evaluating & certifying projects ……………………………………………………………… Public sector institutions evaluating and certifying projects …………… Private sector institutions evaluating and certifying projects ………… 24 24 26 6.0 6.1 6.2 6.3 6.4 Project development ……………………………………………………………… Public sector Agencies ………………………………………………………………. Donors …………………………………………………………………. ……….. Private sector agencies ………………………………………………………… Non governmental organisations ………………………………………………… 26 26 28 28 28 7.0 The roles and composition of Designated National Authority (DNA) ………………………………………………… The Roles of DNA ……………………………………………………………… Generic models of DNA ………………………………………………………… Selection of DNA Coordinating Institution ……………………………… Institutional Interpretation of DNA in Uganda ……………………….. Institutional size of DNA ………………………………………………………… Ownership of CDM concept …………………………………………………… 29 29 31 32 33 34 34 7.1 7.2 7.3 7.4 7.5 7.6 3 3 3 4 5 6 i 8.0 Workplan ……………………………………………………………… 8.1 8.2 8.3 Component 1: Establish and capacitate …………………………… Component 2: Imparting project development skills ……… Implementation ………………………………………………………… 34 35 38 39 Appendix 1: List of potential CDM Stakeholders ……………. 48 Appendix 2: List of stakeholders consulted ………………… 49 ii CAPACITY DEVELOPMENT WORKPLAN FOR THE CLEAN DEVELOPMENT MECHANISM IN UGANDA 1.0 Introduction and Background 1.1. Introduction This document presents a multi-year work plan for capacity building of Uganda to enable the country access the Clean Development Mechanism (CDM). This plan is developed and will be implemented within the framework of a project 'capacity development for the clean development mechanism' being implemented by the UNEP Collaborating Centre on Energy and Environment (UCCEE). The project is being implemented with financial support from the Dutch government. Twelve developing countries - five in Africa, three of which are in Sub-Saharan Africa will benefit from the project. The project began in May 2002 and is ending in 2005. The project has two main objectives namely to develop skills in project development and to establish the Designated National Authority (DNA) both of, which are pre-requisites for accessing CDM. In Uganda the project is hosted by the Department of Meteorology, Ministry of Water, Lands and Environment as it is the focal point for UNFCC. Due to the differences across the different couuntries in the project, a need for a work plan that reflects the specific needs of each country was recognised. Hence the 1st phase of the project (May - December 2002) was dedicated to development of such a work plan. In acknowledgement of the importance of local circumstances, the plans are being developed by national institutions with technical support from regional institutions and the UCCEE. The Energy Research and Development Centre (EDRC) of the University of Cape Town in South Africa is the regional centre supporting the Uganda Management Institute (UMI) to develop the work plan for Uganda. The plan has been developed using a consultative approach to assess capacity building needs of stakeholders. This was done through interviews. The draft was then distributed to these stakeholders for comments prior to holding a workshop where the stakeholders would provide feedback on the draft. The plan elaborates on the process needed to establish a DNA based on a thorough institutional analysis and guided by the principle of institutional sustainability in an environment of scarce resources. The plan also provides activities needed to build capacity on CDM project development of targeted stakeholders based on current engagements and available resources. 1 1.2 Background The UNFCCC, which was opened for signature after adoption in 1992 came into force in 1994 aims at stabilizing concentration of greenhouses gases in the atmosphere and commits parties to implement it. The Government of Uganda (GoU) signed and ratified the convention on 13th June 2002 and 8th September 1993 respectively. The convention makes it possible to adopt additional commitments in response to changes in scientific understanding and political will. Subsequently in December 1997, at a conference held in Kyoto, Japan, a decision was made to adopt the Kyoto protocol under which industrialized countries would reduce their combined greenhouses emissions by at least 5% compared to 1990 levels in the period 2008-2012. The Kyoto protocol, which was opened for signature in 1998, has three markets based mechanisms aimed at achieving cost-effective emission reductions. They include: International Emission Trading (IET), Joint Implementation (JI) and Clean Development Mechanism (CDM). The CDM as stated in article 12 of the Kyoto Protocol allows governments or private entities in industrialised and developing countries to implement emission, reduction projects in developing countries and receive credit in the form of “Certified Emissions, Reductions” or CERs, which may count against Annex 1 Parties reduction targets. The CDM should promote sustainable development in developing countries, while allowing developed countries to contribute to the goal of reducing atmospheric concentrations of green-house gases. The CDM therefore offers an opportunity to make progress simultaneously in climate change, development and local environmental issues. The Marrakech accords have provided a regime to make CDM operational and parties can get certified emission reduction units retroactively for projects starting from the year 2000. In order to participate in the CDM, countries must meet three eligibility criteria – namely voluntary participation in CDM, the establishment of a Designated National Authority (DNA) and ratification of the Kyoto protocol. The GoU acceded to the Kyoto Protocol on 25th March 2002. Uganda is yet to establish the DNA that will promote implementation of CDM projects. 1.3 Structure of the plan This plan is organised in eight Sections. Section two deals with the national context focussing on Uganda’s economic performance and policies for enhancing environmental management, its population, key development objectives, key areas of economic importance as well as the energy and transportation sectors. 2 Section three focuses on on- going and up-coming potential CDM projects. Section four is an analysis of the mandates of potential key stakeholders of CDM and their existing capacities and competencies. Section five is a continuation of the institutional analysis which looks at public and private sector institutions evaluating and certifying projects/ programmes in Uganda. Section six analyses agencies involved in project development from the public sector, private sector, donors and the NGOs. Section seven covers roles and composition of DNA. Section eight shows the manner in which the project will be implemented, specifically pointing the activities to be undertaken to establish the DNA and develop capacity for project development in Uganda. 2.0 The National Context 2.1 Economic Performance and Policies for enhancing Environmental Management Since the late 1980’s there has been great progress in economic growth and development of Uganda. On average the economy has grown at a rate of 6.5% per annum over the last 10 years. Programmes such as Poverty Eradication Action Plan, Universal Primary Education, Plan for Modernization of Agriculture and the Basic Health Package, plus reforms such as decentralization and liberalization have been instrumental in bringing about positive socio-economic change which is inextricably linked to the environment. Newly developed policies such as Population Policy, Health Policy, Gender Policy and Youth Policy, Disaster Management and Preparedness Policy, Forestry Policy, Environment Policy, national Water Policy, Energy Policy, National Wetlands Policy and the Policy Goal on climate monitoring are guiding the direction of environmental management and climate change in Uganda. 2.2 Population Uganda’s population size according to the 2002 population and Housing Census stands at 24.6 million with an annual growth rate of about 3.3 % which is higher than 2.6% and 1.7% for sub-Sahara Africa and Low-Income countries respectively. Low level of income is reflected in per capita income (about US$ 300) and revenue/GDP ratio of about 11.3%. 2.3 Uganda’s Key Development Objectives The constitution of Uganda is the overall legal basis for government to plan and implement development initiatives aimed at improving the conditions of the people in Uganda. This is explicitly defined in the National Development Objectives and Directive Principles of State Policy. The Constitution obligates the state among other things to take measures aimed at protecting and preserving 3 environment from abuse, pollution and degradation; and management of the environment for sustainable development and promotion of environment awareness in Uganda. The people of Uganda defined their development aspirations in the Uganda Vision 2025 report. The key concern of the report is elimination of mass poverty. Consequently, the government developed a Poverty Eradication Action Plan (PEAP) which is the Government’s consolidated response to the question of poverty in Uganda. It provides the overall framework within which the government’s planning and programming of development interventions take place. It guides the identification of priorities, allocation of resources as well as the assessment of progress and impacts of government development programmes, among others. As a mechanism that aims at meeting sustainable development goals, CDM is expected to fit within the PEAP framework. The capacity building effort should hence be structured so as to contribute towards PEAP goals. The PEAP is constructed on four pillars – namely; Sustainable economic growth and structural transformation; good governance and security; increased ability of the poor to raise their incomes and improved quality of life of the poor. While CDM must directly relate to pillar four which in particular has among other things the components of conservation of natural resources and the environmental and disaster management all the four pillars of necessity have environmental applications in particular green-house gases emissions. 2.4 Key areas of economic importance Agriculture is the backbone of Uganda’s economy. It constitutes about 81% of the labour force. Agricultural performance fluctuates with climate variability, an aspect that is not well reflected in the PEAP. The contribution of agriculture to total GDP decreased from 45.7 percent in 1995/96 to 41.5 percent in 1999/00. Productivity is also adversely affected by rudimentary means of production and poor market and storage infrastructure. Government is committed to modernisation of agriculture and has designed an implementation plan which should be operationalised soon. The government’s initiative to modernise the Agricultural sector through the plan for modernisation of Agriculture (PMA) within the decentralised framework has called for the establishment of the National Agricultural Advisory Services (NAADS) which aims at enhancing sustainable rural livelihoods by increasing agricultural productivity and profitability. Another growing area of economic interest is the tourism industry which is however also vulnerable to climate change because climate change impacts on the game and their movement as well as other bio-diversity species. Moreover a good climate attracts the inflow of tourists. 4 Table 1: GDP at Factor cost at constant 1991 prices and percentage contributions Sector 1995/96 1996/1997 1997/98 1998/99 1999/000 Total GDP 2,852,756 2,982,180 3,143,090 3,375,940 3,546,662 Agriculture 45.7% 44.2% 42.7% 42.5% 41.5% Mining and Quarrying 0.4% 0.6% 0.7% 0.7% 0.7% Manufacturing 7.9% 8.6% 9.3% 9.7% 10.0% Electricity and Water 0.9% 1.0% 1.0% 1.0% 1.1% Construction 7.5% Wholesale, retail, Hotels & Restaurants 14.8% Transport and Communication 4.7% 7.7% 7.9% 7.9% 8.1% 14.6% 14.7% 14.9% 14.9% 5.0% 5.2% 5.2% 5.4% Community services 11.8% Rent and owneroccupied 6.2% Dwellings 11.9% 12.0% 11.7% 11.6% 6.4% 6.5% 6.5% 6.6% Total GDP% 100% 100% 100% 100% Source: 2.5 100% Uganda Bureau of Statistics Energy sector Energy is a crucial ingredients in national development. One of the main indicators of economic progress and the results of development of a country is the per capita energy consumption. The total energy consumption of Uganda in 2001 is estimated to be 294.2 Peta Joules. Per capita energy consumption is 12.91 Giga Joules. In a similar way the stage of development of a country can often be gauged by its level of consumption of commercial energy. Uganda’s energy mix comprises of biomass, petroleum and electricity. Biomass is the main source of primary energy contributing about 92.8 %, petroleum 6.1 % and electricity 1.1 %. Biomass is mostly used in the rural households. Uganda faces significant constraints to continued rapid economic development due to lack of sufficient electric power both in urban and rural areas. 5 The government has realized the importance of energy in national development. With assistance from various sources, the energy supply in Uganda will be increased especially in the rural areas where most of the population lives. However, there is increasing recognition of the need to eliminate residual/ fuel oil in order to reduce the amount of GHG emissions. To this end, the following mitigation options and measures are being considered. Fuel oil has been used mostly in agro-based industries such as tea and sugar processing plants. Fuel wood, which is cheaper and considered as a renewable energy resource is now, preferred to fuel oil and residual oil in process that requires heat. Uganda still has undeveloped hydroelectric resources mostly, along the Nile River. Studies have proposed the development and implementation of an enhanced rural electrification programme to improve the electrification coverage from the currrent 1% to 10% by the year 2012. This strategy is to be combined with grid extension, and development of small-scale hydropower in areas remote from the nation grid as well as the use of solar photovoltaic systems. 2.6 For reduction of GHG in the rest of East African a hydro-power export strategy under East African power study identifies potential sites. This include 450mw Kalagala, 180MW Karuma, 250MW Bujagali, 642 MW Murchison Falls. The Rural Electrification strategy and plan covering the period between 2001 and 2010 incorporates the use of solar and wind energy. It is estimated that over 25,000 solar units have been installed in homes over the last decades. Government commissioned the Uganda alternative Energy Resource Assessment and Utilisation study. This will assist Government to formulate a flexible least Cost Alternative Energy Resources Development Programme (AERDP) that can be swiftly adapted to changing conditions including adaptation to climate change. The AERDP covers a 15 year period (20052020). Transportation sector Considering that traffic congestion in the capital city of Kampala leads to an incremental fuel consumption of approximately 10 to 15% (Rendal Palmer and Tritton1994) it was proposed that ethanol from sugar processing may be blended at a level of 15% for all petrol by the year 2020( ethanol blended with petrol to 20% does not require petrol engine modification. Currently, however, the estimated cost of ethanol production in Uganda is still far beyond equivalent amounts of petrol. 6 3.0 On-going and Up-Coming Projects related to the CDM Most of the projects that consider environmental effect of energy were funded under the Global Environment Facility (GEF) and of recent the Carbon Prototype Fund. under these funds, projects are supported on the base of GHG emission abatement. The main types of greenhouse gas under consideration in Uganda are carbon dioxide and methane. Carbon dioxide sequestration projects in the forest sector have also been implemented. The areas of GEF support fall under the following. 3.1 hydro power generation under Independent Power Producers and for the main grid. stand alone solar home systems power generation from sugar mills (accounting from 20% of GEF funding) On-going projects Uganda Photovoltaic Project for Rural Electrification (UNDP/GEF) US$ 1.8m 3.2 (on going and will be linked to ERT programme) Bushenyi and Rukungiri Rural Electrification Project. The capacity about 5MW. The project cost $6.5 to $7.25m. To be implemented by the Uganda Rural Electrification Company Limited. Kakira Biomass Cogeneration Capital cost estimate 14 MW, US$14m in the first phase. The phase will generate 20-25 MW. Nyakak Hydropower Scheme and 1.5 Hydropower plant at Olewa, in addition 2.5 MW diesel generation. Kasiizi Micro-hydro Electrification Project. Will be developed by the Kisiizi Hospital. Additional 150 KW to the existing 60 KW micro hydro plant. Global Life Stock Group- Improved animal feed Uganda Wild Life Authority, Forest Department and FACE Up-coming projects PV solar systems under ERT, US$10.80 million. Mount Elgon Power Company, power supply in Mbale. Hydro power supply to the following areas Buseruka, Masindi, and Hoima. The UPPPRE is a pilot project whose goal is to establish the foundation for the sustainable use of solar photovoltaic (PV) technology for rural electrification in Uganda. 7 It is designed to demonstrate the financial and institutional mechanism that will provide PV-based electrical services on a commercial basis to households, businesses and communities in rural and peri-urban areas, which are not projected to have access to grid-based electricity in the foreseeable future. The targets end users which have the ability and willingness to pay the unsubsidised cost of the PV systems. In support of the UPPPRE, the Global Environment Facility (GEF) has provided US$1.8m for the provision of technical assistance, training, information collection and dissemination. The Government of Uganda is providing US$200,000 to cover local costs. In addition, a $500,000 PV credit fund has been provided by the UNDP Kampala office, form its TRAC resources to promote the provision of loans through local financial institutions to communities, business and households for the purchase of solar PV systems. The development objective is to provide basic electrical services to those rural areas of the country, which are not projected to have access to grid-based electricity in the foreseeable future through the use of affordable, environmentally benign solar PV technology, which will reduce greenhouse gas emissions significantly. The project will serve as a demonstration of an innovative, sustainable alternative to grid-based electrification, which will have applications elsewhere in Africa and in other developing countries. Africa Rural and Renewable Energy Initiative (AFRREI) AFRREI is a World Bank project whose aim is to: Improve rural quality of life and facilitate significant rural non-farm income by accelerating rural electrification, including from photovoltaic systems, with a tentative target of increasing rural electrification access from about 10% by 2010. Develop Uganda’s indigenous, renewable energy resources on a cost-effective basis, with a tentative target of about 70MW of power generation from small renewable energy resources by 2010. The project will help in reducing carbon emissions in the domestic sector. The lighting appliance is the most common emitter of GHS from the household due to the burning of the kerosene. Estimated PV Installation AFRREI Programme The installation of the PV system stated under the UPPPRE Programme. It expected to end in the year 2001. Thereafter AFRREI is assumed to have taken off. In the lifetime of the UPPPRE 2000 households are expected to have 8 installed the PV system, while AFRREI is to benefit 70,000 households with-in ten years from its inception. The project component is about US $10.80m. The two projects UPPPRE and AFRREI will benefit about 72,000 households. The PV can replace the traditional energy sources of energy for lighting in the household. At the end of the project in the year 2011, traditional sources of energy used for lighting primarily kerosene lamps and candles, will be displaced by PV systems, resulting in reduction of CO2. West Nile Hydro Power Project Power supplies to the West Nile is planned along developing a run-off hydro power station with capacity of 5.1 MW on River Nyagak in Nebbi District, and a 1.5 MW mini-hydro plant at Olewa in Arua District. The power will be developed by an Independent Power Producer (IPP) concessionaire who will benefit from the smart subsidies to be extended to the rural electrification fund, under the Energy for Rural Transformation (ERT) Programme. The Prototype Carbon Fund (PCF) has reached an agreement with the Government on an emission reductions purchase from this project. Kakira Co-Generation Kakira Sugar Works intents to increase sugar production to satisfy local demand of sugar and to reduce imports and possibly export sugar in the future. This will be through more intensive agriculture with irrigation and increase in the sugarcane acreage. There are two main by products from the sugarcane. The molasses which is a source of ethanol and bagasse which is used for thermal generation of steam. The steam is used for processing sugar and power generation. Excess bagasse, which is disposed off, can be used for electricity generation. The co-generation capacity is about 14 MW. The estimated cost of the project is US$ 14 m. In future power generation can be increased to 35-40 MW. Kisiizi Project This is a small project in which Kisiizi hospital intents to increase hydropower generation from the present 60KW to about 200 KW and sale excess electricity to the neighbouring communities and commercial enterprises that are located within the vicinity. The cost of the project (US$300,000?). Bushenyi/Rukungiri Electricity Project This is one of the projects to be developed by the Uganda Rural Electrification Company Limited with support from ERT. It is based on building a 5.5 MW run off-river hydro power plant on Ishasha River in Nanungu District. The power will 9 be distributed to Kanungu, Rukungiri and Bushenyi Districts. The surplus will be fed to the national grid. The estimated cost of the project US$14.5m. The ICF will support a commercial viable-with some capital cost subsidies and power distribution. HydroPower Generation and Supply Project at Buseruka, Hoima District The Hydromax Limited is planning to develop a hydropower plant with installed capacity of 15.3 MW at estimated cost of US$22.9 . The estimated energy production is 81.2 GWh/y. This project was among the three projects selected for pre-feasibility studies in the SWECO International study of Potential Hydro Power Sites. Mount Elgon Hydro Power Development The project is to be developed by entrepreneurs and Government officials of the Mbale District. The power produced will be supplied in the Mbale and Kapchorwa districts with an estimated demand of about 10 MW in the year 2005. The following plants will be developed: Kapchorwa plant with capacity 3.3 MW. 3.3 Other possible potential CDM projects There are also other possible CDM projects that came through the Uganda Investment Authority. They include: Busoga Forest Company Limited is being promoted by a Norwegian investor. It will be dealing in commercial forests and will be implemented by Bukaleba Forest Reserve in Mayuge District. Institute Fur Umwelt Und Entwicklung (IUE) is being promoted by a German investor. They are targeting commercial forest and are planning to implement a project at Kikondwa Forest Reserve in Mubende District. Global Livestock Group is being promoted by a Canadian firm. Their main area of interest is production of improved animal feed. It is expected that the animals feeding on such feeds will produce less methane than conventional feeds. They are working closely with individuals based in the Faculty of Veterinary Medicine Makerere University and other professional from National Agricultural Research Organisation (NARO). Kampala Jellitone Supliers Limited are interested in production of Biomass Fuel Briquettes from agricultural waste. It is a local firm based at Natete Kampala. 10 Bakojja Wood Country Ltd is a locally funded firm interested in commercial forestry. It activities will be allocated in Mubende District. KAMOBUSE Investments Ltd is a locally funded firm interested in mass transport. The use of public means of transport will reduce the use of smaller capacity vehicles. But implementation of such a project may not be easy due to a growing number of private minibuses 4.0 Stakeholder Analysis for CDM Institutional set-up 4.1. Potential Stakeholders of CDM and their mandates Promotion of the implementation of CDM projects in Uganda for enhancing environmental quality and sustainable development is dependant on a multidisciplinary and holistic approach to development which requires institutional collaboration and coordination of different stakeholders. In Uganda, there are different institutions/organisations responsible for environmental management and contributing to sustainable development. Their mandates are different on different aspects of environmental management in general and it is from this perspective that these are evaluated as potential stakeholders in operationalisation of CDM. National Environment Management Authority (NEMA) One of the important outputs of the National Environment Action plan (NEAP) process was the establishment of NEMA by the National Environment statute 1995. NEMA’s mandate is to coordinate, monitor and supervise environmental management in the country. The essence in establishing NEMA was to build capacity for co-ordinated planning and management of environmental resources at all levels of government. By implication, NEMA is not an implementation agency and is therefore expected to work in liaison with lead agencies, local authorities, NGOs and private sector. NEMA ensures that EIA is undertaken and it is the responsibility of the developer (from the private and public sectors) to do an EIA. NEMA then reviews the reports and undertakes field inspections to verify the claims made. After that, the Executive Director makes one of the following decisions: outright approval, approval with conditions, refer back the project for additional information/ verification of facts, approve part of the project or rejection of the project. Nema could therefore play an important role of ensuring that CDM investments are environmentally sound and compliant. However, it was acknowledged that staff responsible for EIA are weak in internalising and applying concepts relating 11 to GHGs and baseline evaluation. The staff has the willingness to learn new knowledge and skills in these areas. Ministry of Water, Lands and Environment The Ministry is mandated to promote and ensure the rational sustainable utilisation and development; and the effective management and safeguard of land and water resources and the environment for social and economic welfare and development as well as regional and international peace. Including the utilisation of weather and climate information for sustainable development. The mandate of the ministry shows a lot of scope for participation in the approval /registration of CDM investment and promoting policies, standards, plans and guidelines that enhance CDM investments in the country. CDM being a new concept, the Ministry staff needs to be sensitised on the concept and practice of CDM for their effective participation in the DNA. The Forest Department The forest Department (FD) is currently under the Ministry of Lands, Water and Environment and it is being restructured to create a National Forest Authority. According to the Forestry Department’s Standing orders (DSOs) 1997, the Forest Department is broadly mandated to: - Protect and manage forest reserves, control of harvesting of trees on public land and advise on sound management of private forests. - Carry extension services and collaborate with the local communities. In line with the objectives of CDM, the Forest Department has of late been encouraging collaborative forest management (CFMA). It has for example signed formal community Forestry Management Agreements using the permit system under the Forest Act, and the forest rules. Examples include: - CFMA between FD and Nyangole B village regarding the management of Tororo central Forest Reserve. - CFMA between FD and Bamusili village regarding the Management of Namatale Forest Reserve. - Permit to farmers to reforest peri-urban reserves. 12 Although the impact of most of these approaches are yet to be seen on the ground, it is nonetheless a positive step in the right direction. However, in the case of peri-urban undertakings, there is evidence that private sector is now superceding FD in plantation. In the interest of CDM in Uganda, the Forest Department or the impending National Forest Authority (NFA) could be part of the DNA in the Approval/registration and promotion of CDM investments. However, it needs knowledge and skills in baseline evaluation, project development, monitoring and evaluation as well as marketing. The Department of meteorology The Department of Meteorology exists “to maintain a well developed weather and climate monitoring system that provides necessary information and advisories in a cost effective manner in support of Government policies for sustainable socio-economic development such as agriculture, water resource, transport (air, land and sea) communication and tourism, health among others” The Department is slated for divesture under the on-going Civil Service Reform Programme. Government has agreed in principle to make the Department an agency under the fast track modality. This agency status is not likely to happen until two or so more years in view of the detailed pre-liminaries to be done. The Department as a focal point on climate and climate change has so far initiated a number of consultative meetings to explore mechanisms for implementing the UNFCCC and the Kyoto protocal. CDM being one of the three instruments of the Kyoto protocal, the Department has been keen to promote the implementation of CDM projects in Uganda. Although the CDM projects are aimed at reducing emissions and promoting sustainable development, it would be unfair to overstretch the mandate of the Department by directly involving it in investment promotion. The mandate of the Department is not directly related to promoting investments. However, together with other players under the DNA, the Department will play a key role in approving / registering CDM projects, and promoting the CDM concept in its regular activities of raising awareness on climate change issues. Ministry of Agriculture, Animal Industry and Fisheries (MAAIF) The mandate of the MAAIF is “to support, promote and guide the production of crops, livestock and fisheries so as to ensure improved quality and increased quantity of agricultural produce and products for domestic consumption, food security and export”. 13 Its role in the DNA would be to initiate appropriate policies for the production of feeds aimed at reducing methane emissions. The Ministry therefore needs to be sensitized about the CDM concept. Ministry of Trade, Tourism and Industry The ministry is mandated to promote, expand and diversify trade, ecologically sustainable industrialisation, appropriate technology; and to facilitate the development of the tourism sector in order to generate wealth for the country. The above mandate positions the Ministry to work with the DNA in registering/ approving and promoting CDM investments in the country. It is particularly relevant in developing appropriate policies, standards and guidelines relating to sustainable industrialization and appropriate technology. Like most Ministries and other agencies, it needs to be sensitized and trained in CDM concept and practice. Uganda Investment Authority The Uganda Investment Authority (UIA) was established in 1991 under the investment code 1991. The code provides a law relating to local and foreign investment in Uganda by providing more favourable conditions for investment. UIA is an environmental liaison unit in relation to NEMA is aware of the national legal framework for environmental management and has been active in ensuring that projects they approve are ecologically acceptable. Accordingly UIA has been particular in contacting NEMA over its position with respect to environmental concerns. In this process the final decision rests with NEMA. The structure and mandate of UIA focuses on investment promotion and facilitation – which it has done well with respect to industrial development. Its mandate was defined as such by government after due regard of existing institutions in the country. However, it has not focused on other investment opportunities beyond mainstream industrial establishments such as in the forestry sector. However, its structural arrangement and mandate clearly fits in the roles of the DNA of registering / approving CDM projects and promoting CDM investments in the country. Nevertheless, the authority needs capacity development in CDM concept and practice, baseline evaluation skills and project development and marketing skills. 14 Uganda Manufacturers Association (UMA) UMA brings together individuals and organisations involved in manufacturing and together productive activities into an association that is used to disseminate information to its members and to lobby for appropriate policies. It has a subcommittee on environment and standards. For the last 10 years, it has been very active and has so far registered a membership of 750 small, medium and large-scale enterprises drawn from both the private and public sector. In view of its mandate, it is an appropriate institution to participate in the DNA since it has a proven track record in policy advocacy, running training programmes for its members and holding trade fairs and exhibitions. In this regard, UMA could be used as an effective vehicle for promoting CDM investments amongst its members in the country. However, it needs knowledge and skills relating to the CDM concept such as project development baseline evaluation and marketing. The Uganda national Bureau of Standards The Uganda National Bureau of Standards (UNBS) was established by the Uganda National Bureau of Standards Act 1983. Its mandate is to formulate standards and codes of practices relating to the achievement and maintenance of standards. The Bureau responsibility for environmental management with respect to formulation of standards and codes of practices geared towards the protection of the environment. It could act as an advisor to the DNA on how to enforce CDM rules. It therefore needs knowledge and skills in monitoring and evaluating CDM projects in the country. Uganda Revenue Authority Uganda Revenue Authority’s mandate is to collect revenue on behalf of the government and to advise it in that regard. Accordingly, it works very closely with the Ministry of Finance and Economic Planning. It has an environmental liaison unit coordinator. The Authority’s responsibility for environmental management is both direct and indirect. The direct responsibility arises over issues concerning the following. - Certification of the quality of goods imported into the country. 15 - Certification of exports so that marked items under conventions like CITES are not exported. Destruction of expired goods or consumables which would endanger human health. Indirect responsibility include: - Levying taxes or charges to discourage importation and production of environmentally degrading substances. - Giving tax rebates, holidays and other incentives to encourage the importation or manufacture of environmentally friendly products. For example, the government imposes no tax on solar equipment to encourage mass adoption. Being mandated to ensure that imported and exported taxable goods and services are complaint with national and international standards. The authority could be part of the DNA. They could be part of the group targeted for project development where their awareness would be raised enabling them to provide incentives for CDM investors. The Private Sector Foundation The PSF was formed in 1995 to promote the growth and development of private sector initiatives and strong private sector institutions. It supports the emergence and development of organisational capacity in all members – directed organisations including trade and industry associations. It is heavily involved in developing and carrying out effective policy and advocacy activities on behalf of private sector positions on issues related to business and economic development. PSF also facilitates initiatives aimed at increasing and strengthening Uganda’s capacity to effectively participate in the global trading environment. Membership comprises close to 50 business associations professional bodies and corporate partners from the private sector as well as support institutions from the public sector. It runs capacity building training programmes in response to the requests from member associations. In view of its wide membership and experience in capacity building training programmes, the PSF would help in sensitizing the members about CDM-including project development skills. The training sessions on CDM could be organized by or with PSF assistance. It therefore needs skills in baseline evaluation, project development and marketing. Uganda National Chamber of Commerce and Industry The Uganda National Chamber of Commerce and Industry (UNCCI) is the umbrella organization for the private sector in Uganda. It was incorporated in 1978 under the company’s Act-ACP 85 as Company Limited by guarantee without share capital. It operates branch offices in all districts of Uganda for effective 16 delivery of services to the entire business community in Uganda. It exists to: Promote, co-ordinate and protect trade investment and industrial interests of Uganda and of members in particular. Like other membership organizations, the UNCCI would help in reaching a wide audience about the CDM concept and practice. In particular, it has an added advantage of being district wide. It would therefore need skills in baseline evaluation, project development and marketing. Uganda Cleaner Production Centre Uganda Cleaner Production Centre was established in October 2001 as a result of the joint effort between the Government of Uganda and the United Nations Industrial Development Organization (UNIDO). This funded by the Austrian Government. It is one of the 30 already established National Cleaner Production Centres (NCPCs) worldwide. The NCPCs programme is jointly co-ordinated by UNIDO and UNEP since 1994. It makes consultations with NEMA in view of its responsibility for co-ordinating monitoring and supervising environmental management in the country. The main objective of the Uganda Cleaner Production Centre is to introduce cleaner production practices to enterprises in Uganda. It helps companies to reduce operating costs through increased overall efficiency, especially in the use of materials and energy. Consequently, cleaner environmental impacts and enables companies to achieve environmental compliance. Uganda cleaner production centre provides advice, technical assistance and training in cleaner production and environmental management. Ministry of Finance, Planning and Economic Development The Ministry’s mandate is “to manage and control public finances in a prudent and sustainable manner and to oversee the planning of national strategic development initiatives in order to facilitate economic growth, efficiency, stability and the eradication of poverty” As a macro-economic ministry responsible for approving all government projects, it will play a key role in promoting CDM investments in the country. They could act as monitors and should be in the DNA since they are actually undertaking EIA. It therefore, needs skills in baseline evaluation, project development and monitoring and marketing. 17 Ministry of Energy and Mineral Development The mandate of the Ministry of Energy and Mineral Development is to establish, promote the development, strategically manage and safeguard the rational and sustainable exploitation and utilization of energy and mineral resources for social and economic development. Given its mandate, the Ministry is well positioned to promote the investment of CDM projects in the country through appropriate incentive and disincentive policies. However, it needs knowledge and skills on the concept and practice of CDM, baseline evaluation, project development and monitoring and marketing. The Ministry of Local Government (MOLG) The Ministry of Local Government is responsible for the co-ordination of and advocacy for Local Governments and for ensuring that national policies and performance standards are adhered to. The district councils at LC5 and LC3 levels are responsible for conducting local government under the provisions of the Local Governments Act (1997), including technical planning, the enactment of district bye-laws and the delivery of specified services. Sector ministries can inspect, monitor and offer technical advice, support and training in their respective sectors. Under the DNA institutional framework, the Ministry could play an important role in influencing District Local Governments and Urban Councils to promote CDM in their environmental management activities. Therefore it needs basic knowledge and information about the CDM concept. 4.2 Other Potential Stakeholders of CDM There are other potential stakeholders of CDM which may or may not play a key role in the DNA. They are: Research Institutes Ministry of Foreign Affairs Ministry of Justice Universities (Public and Private) National NGO Forum Ministry of Local Government Uganda Renewable Energy Association Uganda Wildlife Authority (it has 18 experience in FACE Project) 4.3 Consolidated CDM Stakeholder Analysis Matrix Mandate Sector of operation Organisatio nal Identity Scope of activities Current Capacity Competency Coordinate, Monitor and Supervise environmental management in the country Environment Semigovernment - EIA - Advisory - Ministry of Water, Lands and Environment Promote rational utilisation of water resources, lands and safeguard the environment Land, Water and Environment Government - Policy formulation & guidelines - Issuing of water permits CDM concept new Forest Department Protect and Manage forest resources Forestry Government - Limited knowledge on CDM concept Issue/Aspect Institution National Environment Management Authority - 24 promote tree planting licensing capacity building conservatio n monitoring action research baseline monitoring Limited knowledge on CDM concept. Gaps -Baseline evaluation -Project developme nt Negotiation Skills -Awareness creation -Monitoring project Developme nt negotiation skills -Baseline evaluation -Monitoring -Project developme nt Negotiation skills Mandate Sector of operation Organisatio nal Identity Scope of activities Current Capacity Competency Gaps Maintain a well developed weather and climate monitoring system Environment Government - - -Baseline evaluation -Monitoring and reporting -Basic financial analysis -Baseline evaluation -Project developme nt -Monitoring -Marketing -Awareness raising Issue/Aspect Institution Department of Meteorology (MWLE) - Action Research Emission evaluation Advisory services Monitoring - Some knowledge on CDM concept Focal point for UNCCC Ministry of Trade, Tourism and Industry Promote trade ecologically sustainable industrializatio n and facilitate development of tourism Trade industry and tourism Government Policy formulation & guidelines Limited knowledge on CDM Uganda Investment Authority Promote & Facilitate investment Investment Semigovernment - Promote investments, licensing - Policy advocacy - Monitoring Experience in investment promotion and facilitation The Uganda National Bureau of Standards Formulate standards and codes of practices relating to the achievement and maintenance of Standards Public health Semigovernment - Set standards CDM concept new Uganda Revenue Collect Finance - Monitor compliance Semi25 Taxation CDM concept -Evaluation of baseline Negotiation skills - Project monitor ing and reportin g - Basic financia l analysis marketi ng skills -Monitoring and reporting -Awareness creation Negotiation skills Environmen tal audit and inspection - Awaren Authority revenue on behalf of government and adverse it in that regard The Private Sector Foundation Promote growth and development of private sector initiatives and strong private sector institutions Productive Introduce cleaner production practices among enterprises in Uganda Disseminate information to members and Lobby for appropriate policies Industrial Uganda Cleaner Production Centre Uganda Manufacturers Association government Membership organization new - Industrial Semigovernment (Liability Company) - Membership organisation - - - 26 Promotion Project developme nt Capacity building Advocacy Negotiation s Limited knowledge on CDM concept Compliance promotion Capacity building -Have knowledge and skills of CDM with respect to production processes - Good at information dissemination promotion advocacy capacity building monitoring ess raising - Negotia tion Skills - Basic understandi ng of baseline -Monitoring Negotiation skills -Awareness creation -Awareness raising -Evaluation of baseline - Marketi ng Awaren ess raising Mandate Sector of operation Organisation al Identity Scope of activities Current Capacity Competency Gaps Manage and control public funds and oversee planning of national strategic development initiatives Promote rational and Sustainable exploitation and Utilisation of energy and mineral resources Combat environment destruction and conserve natural resources Finance Government - Policy formulation - Sanction projects - Monitor projects -Have knowledge and skills in financial analysis and project monitoring and reporting -Evaluation of baseline -Negotiation skills -Energy - Mineral development Government - -Expertise in energy -Evaluation of baseline -Basic financial analysis -Negotiation skills -Project monitoring -Baseline evaluation -Monitoring and evaluation -Project development Uganda Renewable Energy Association (UREA) Promote use of renewable energy Energy MAAF Support, promote & guide production of crops, livestock and fisheries Developing appropriate technologies Agriculture, Animal Industry and Fisheries Government Productive SemiGovernment Foreign Affairs Promoting national image abroad Foreign Affairs Justice Promoting the rule of law Issue/Aspect Institution Ministry of Finance, Planning and Economic Development Ministry of Energy and Mineral Development JEEP to represent all other NGOs Research Institutes Universities - Energy and Environment Nongovernmental - Membership organisation - - Research and - Policy formulation Monitoring Capacity building Promote projects Advocacy Capacity building Promote tree planting Promote energy saving devices Monitor compliance -Limited knowledge on CDM concept -Have knowledge and skills in awareness raising -Awareness raising high Policy formulation Guidelines & regulations -Limited knowledge and skills in CDM concept - research advisory services -Have competency in dissemination Government - Legal advisory services Government - protocol promotion/ mobilization of resources legal framework regulations Education Government - research -Have diplomatic and negotiation skills -Interpretation of the law relating to investment and trade -Have research - 27 -Evaluation of baseline -Basic financial analysis -Project monitoring -Negotiation -Baseline Evaluation -Negotiation skills -Project Monitoring -Baseline evaluation -Project monitoring -Marketing -Awareness raising -Negotiation skills -Evaluation of training National NGO Forum Ministry of Local Government Co-ordination of NGO activities in Uganda NGO Ensuring that national policies and standards are adhered to at the local level Local Government and Private - Non Government - Government 28 and training skills -Have knowledge and skills in awareness raising baseline - capacity building awareness raising education advocacy - waste dust -Limited knowledge on CDM concept -Marketing -Awareness raising Marketing 4.4 Public Sector Institutions Evaluating and Certifying Projects Deliberations and decisions for public sector investment projects is the responsibility of the Ministry of Finance, Planning and Economic Development. The principal institutions which have a direct concern regarding the deliberations and decisions are the Ministry of Finance, Planning and Economic Development, Individual “Line” Ministries and the “Donor” Community. The framework within which deliberations and decisions regarding project and programme proposals is the Development Committee (DC) which decides whether they should be included in the 3 year Public Investment Plan (PIP). In order to be included in the PIP they need to satisfy the DC in three areas namely: The project or programme should be internally consistent, well prepared and demonstrate that it has the capacity to achieve its objectives effectively. The project or programme should be consistent with the policies and priorities of the Government of Uganda (GOU). The development expenditure, recurrent expenditure and counterpart funding expenditure should be consistent with the GOU budgetary resource constraints. In principle, when the DC is presented with proposals it may make one of the following three decisions. To approve the inclusion of the project in the PIP. To refer the project proposal back to the Line Ministry concerned with a request for further information or for further work on specific aspects of the proposals. To reject the proposal. 29 The membership of the committee include Directors and Commissioners of the two Directorate of Economic Affairs and Budget as well as representatives from the office of the President, office of the Prime Minister, the National Environmental Management Authority (NEMA) the Ministry of Local Government and Economic Advisors unclear terms the following is the leadership structure and composition of the DC. Chair – Deputy Secretary to the Treasury Deputy Chairs - Director, Budget Director, Economic Affairs Members are: Commissioner, Macro-economic Policy Department Commissioner Economic Development Policy and Research Department Commissioner – Budget Policy and Evaluation Department Commissioner – Aid Liaison Department Commissioner – Public Administration Department Commissioner – Infrastructure and Social Services Department Representative from office the President Representative from office the Prime Minister Representative from the National Environmental Management Authority (NEMA) Representative from the Ministry of Local Government (to represent the interests of local Governments) Economic Advisors (not part of the quorum.) The secretariat of the DC is within the Budget Policy and Evaluation Department. Project and programme proposals come from different Line Ministries, agencies and authorities and the DC is supposed to meet on a monthly basis or as and when business is available. Once projects are approved, they become part of the 3 year rolling Public Investment Programme (PIP) In view of the mandate of the DC within the Ministry of Finance, Planning and Economic Development, it is apparent that the DC is an ideal entry point for promoting CDM investments in Uganda – and therefore is appropriate to be part and percel of the DNA in the approval/registration and promotion of CDM investments. Guidelines used by the DC could be used as a basis for developing CDM guidelines. The DC will play a key role in influencing the Line Ministries and donor agencies to consider and develop project/programme proposals in line with CDM. It is hence proposed that a detailed evaluation on how DC is sustained be undertaken within the work programme as a potential role model for DNA. 4.5 Private Sector Institutions Evaluating and Certifying Projects The framework for evaluating and certifying projects in the private sector is not as predictable in terms of bringing together all the key players such as the Uganda Investment Authority, the Private Sector Foundation, the National Chamber of Commerce and Industry, and the Financial Institutions. This contradicts greatly with the public sector agencies which operate within a defined institutional framework. The private sector institutions tend to approve projects where they perceive profit will be made immediately or see there is interest and capacity of the investor. The Uganda Investment Authority is aware of the national legal framework for environmental management and sustainable development and has been active in ensuring that projects they help approve are environmentally acceptable. Accordingly, the UIA has been particular in contacting NEMA to ensure that an EIA for the projects they approve and license is undertaken. Conversely the PSF and UNCCI have got the advantage of a wide membership which they could cost-effectively sensitize on CDM concept, philosophy and approach in their training activities. 5.0 Stakeholders analysis on Project Development Project development, monitoring and reporting in Uganda is performed by various institutions categorized as public sector agencies, private sector agencies, NGOs and Donors. Below are highlights of these different agencies relating to their capacities, competencies and their relevance for CDM. 5.1 Public Sector Agencies As far as the sectoral aspects of Government of Uganda economic planning and management is concerned, Line Ministries, agencies, and authorities are responsible for the development, monitoring and reporting of projects and programmes which are normally included in the PIP. These projects/programmes are normally funded by donors although on a limited scale, funding also comes from the Government of Uganda. Most Line Ministries have planning and policy analysis units which coordinate the development of projects from the different departments. The most relevant Line Ministries for CDM because of their responsibility for energy projects, reforestation and afforestation projects, transportation and industrial projects are the Ministry of Energy and Mineral Development, Ministry of Lands, Water and Environment, Ministry of Works, Housing and Communications and Ministry of Tourism, Trade and Industry. The functions undertaken by Line Ministries through professional officers including planners/economists as well as professional staff from other disciplines relevant to the sector in the development of projects include: Advising and assisting the Permanent Secretary (PS) in matters relating to the development and co-ordination of sector policy and the preparation and implementation of the PIP for the Ministry. Undertaking economic and policy studies on aspects of the Ministry’s responsibilities. Collecting and analyzing statistical and survey data relating to the sector in cooperation with the Government of Uganda Statistics Department. Preparing the sectoral and PIP sections of the National Plan relating to the Line Ministry. Identifying and preparing development projects. Overseeing the implementation of development projects and programmes together with their monitoring and evaluation. Advising the Ministry of Finance, Planning and Economic Development, Heads of Department on economic issues relating to the work of their specific Line Ministry. Advising on the allocation of recurrent budget resources and the preparation of the Development Budget for the Ministry. Acting as the main line of communication between the Line Ministry and Ministry of Finance, Planning and Economic Development. In a nutshell, each operating Line Ministry, Department or agency has a prime responsibility in its sector or sub-sector for analyzing investment proposals, for formulating investment projects and programmes, for supervising their implementation, and for providing, monitoring and evaluation reports. Investment projects and programmes require funds for implementation, and the budgeting of this financing process is the responsibility of the Ministry of Finance, Planning and Economic Development in collaboration with the Line Ministries. In some cases the financing of projects and programmes will be provided entirely by regular Government of Uganda domestic revenue sources. However, in many cases funding is provided, through the Ministry of Finance, Planning and Economic Development, by the Donor Community. 5.2 Donors The Donor Community represents one of the most significant sets of CDM stakeholders in the context of deliberations about development projects and programmes in Uganda. As already mentioned, most development projects in Uganda are donor funded. Given their heavy involvement in facilitating the development of projects and financing them, it is important that donors are also familiar with the concept of CDM and the benefits it delivers in pursuing sustainable development goals. Key donors in the field of environment and energy include: Sweden, African Development Bank, Netherlands Government, European Union, World Bank, other funding opportunities include UNDP, the Global Environment Facility (GEF) of which Uganda has been a beneficiary under the international grant funding mechanism that has targeted the focal areas of biodiversity, international waters, Ozone layer and climate change. There is also a rural electrification at the instance of the World Bank. The Government of Uganda in association with World Bank’s African Rural Renewable Energy Initiative is preparing the Energy for Rural Transformation Programme. The programme will assist in operationalising the Rural Electrification Fund, which, will provide economic incentives like subsidies for new connections (including grid extensions, isolated systems and photo-voltaic systems). 5.3 Private Sector Agencies In most cases, project developers of private sector projects do not have the time, requisite skills and inclination to write project proposals or feasibility studies. And as such, they normally seek the services of private sector consulting firms on the advice of project promoters like the UIA, UNCCI, the PSF and UMA. These firms are registered with the Uganda Investment Authority, NEMA and Support for Private Enterprises Expansion and Development (SPEED) Project funded by USAID. Most firms are formed to respond to emerging business opportunities without either the requisite qualifications and experience or interest. They need skills for data collection, analysis and report writing. 5.4 Non-Governmental Organizations In view of Government’s Limited financial and human resources among other things, it has become increasingly difficult for the government to undertake all necessary environment management related activities alone. Consequently, a number of NGOs have come up in order to complement and supplement government efforts to promote sustainable development. Generally speaking, NGOs perform the following functions in the field of environmental management and sustainable development: Organizing and mobilizing members of the community to agree on common goals, objectives and targets for solving their own environmental problems. Conducting training for the community and giving them skills to solve the existing environmental problems. Liaising with extension officers and other change agents and inviting them to assist in training the community. Setting up demonstration centres where they can teach the community practically. These can include agro-forestry plots, and sample energy saving stores and hearths. Organising and holding competitions among households desirable environmental practices. Monitoring the effectiveness of the programmes and the positive impact, they a they are having on the community. Championing advocacy of sound environmental practices and management. Although they operate on a small scale and deal mainly with small-scale project sponsors, their impact is likely to be great given that they reach all corners of the country. For example, JEEP’s efforts if complemented and supplemented by other NGOs of a similar mandate for energy saving would have a significant impact. Since 2001, JEEP has been the focal point for the Coalition of NGOs (Local and international) on environment and sustainable development in Uganda. 6.0 The Roles and Composition of DNA 6.1 The roles of the Designated National Authority (DNA) The DNA shall be a permanent forum for co-ordination of the entire key Stakeholders in the CDM network. In order to execute its roles efficiently and effectively, it is suggested that the composition of the DNA be small but embracing the interests of the other stakeholders who may be excluded. The table below shows the potential institutions for comprising the DNA from which the actual DNA members could be selected. Their roles, activities and skills required are also indicated. Institution Role Activity - 1. Approval Registration Check on : Sustainable development Validity of baseline i.e will project meet the reduction indicated Credibility of project developers Financial reliability of the Projected CER Value Advantages to government vis-à-vis project developer(CER Shares) Monitoring proposal Reporting proposal Overall credibility of the underlying assumptions - NEMA Ministry of Water, Lands & Environment Department of Meteorology Forest Department Ministry of Trade, Tourism & Industry UIA Ministry of Finance, Planning & Economic Devt Ministry of Energy & Mineral Devt - DNA Co-ordinating Institution 2. Reporting to EB on CDM Activities Validity of project ( Based on approach) Skills required - - NEMA Ministry of Water, Lands & Environment Ministry of Trade, Tourism & Industry UIA URA Uganda National Chambers of Commerce Ministry of Finance, Planning & Economic Development Ministry of Energy & Mineral Devt Forest Department 3. Promoting CDM Understanding potential in Country Negotiating with potential developers ( mainly government) Keeping in- Country Stakeholders interested Linking CDM to development Updating itself on international developments relating to CDM or affecting CDM Evaluation of baselines or at least basic understanding of how this is done Basic Financial analysis skills Negotiation Skills with Project financiers Project Monitoring and reporting tools and dynamics Evaluation of baselines or at least basic understanding of how this is done Project Monitoring and reporting tools and dynamics Negotiation Marketing Awareness raising 6.2 Generic Models of DNA Theoretically there are various models for the DNA- namely; A single government department model, a two –unit model, inter-departmental government model, Foreign Direct Investment (FDI)- Piggyback model and outsourcing model. The choice of anyone of these models depends on the country specific circumstances and the need to have a sustainable DNA. Below is a brief on how each model functions. Single government department model This model presupposes that one department or ministry undertakes all the activities of the DNA. This would most likely be the environment department. The DNA is hence located within the climate change unit or directorate. Since CDM projects may focus on different topic and hence validation requires specific technical experts, the department would invite technical experts from other government agencies/ Ministries upon demand. This effectively means that the DNA acts as secretariat. The experts would collaboratively work with the DNA secretariat or focal point to evaluate/analyse and validate the project. The secretariat or rather the environment agency would thus be ultimately responsible for approval of the CDM projects. The DNA Secretariat would be responsible for the marketing and promotion of CDM. Hence DNA secretariat would design CDM Promotion Material and furnish the FDI office and other relevant stakeholders. A two – Unit model The activities of the DNA would be split into two parts, where part 1 concerns evaluation, approval and registration of Development projects and policy development and part 2 concerns capacity building, outreach promotion and technical and economic assessments. The first part could be located in a department responsible for climate change and the second part could be located in many places as an independent unit. This separation would help in avoiding possible conflicts of interests in the process of project formulation and approval. Inter- departmental government model This model entails establishing a structure, which allows all the relevant government departments to be integrated into the DNA as permanent members. The Ministry of environment would hence act as the co-ordinator but all the departments would undertake approval of projects. A Committee to operationalise this approval could be set up. The Co-ordinator would act as the registration office and would thus receive project proposals on behalf of DNA. The Co-ordinator then communicates with all other DNA members and with the EB but upon agreement with DNA. Foreign Direct Investment ( FDI) Piggback model Most countries have a Foreign Direct Investment (FDI) institutional framework which, promotes foreign investment. Typically this comprises of a promotion office and an approval or implementation office. These institutions receive projects from foreign investors and using a pre- structured criteria evaluate and approve projects. The criteria largely reflect the national development priorities and interests. The FDI framework could be used as the DNA. The investment office would thus receive and approve projects. Typically, the investment office receives projects from various areas and hence has an established system of handling these. However, given the special aspect of CDM, the GHG emission reduction, relevant technical experts would be sourced by the investment office when a CDM project is submitted to assist in validating the GHFG reductions. The FDI would then prepare the PDD and communicate to the EB. Naturally, the FDI would promote CDM along with its other investment promotion activities. Outsourcing model Host countries may choose to outsource the bulk of DNA services to a private agency. This agency would evaluate the projects and validate them. The agency would report to a government environment agency, which would then communicate approval to the EB. 6.3. Selection of the DNA Co-ordinating Institution The above alternative models were considered and evaluated as CDM institutional framework for Uganda. 6.3.1 Single –government department model. This does not seem appropriate because most government departments in Uganda lack the necessary autonomy to marshal the requisite resources within the mainstream government’s bureaucratic complications and redtape. In addition, they lack the means and inclination to undertake marketing and promotion for CDM investments. 6.3.2 A two – Unit model This model may not be feasible because splitting the activities of the DNA and locating them in different departments would make co-ordination difficult and DNA activities unsustainable. Furthermore, it would not only take a long time to integrate CDM concerns in the different departments, but also the activities of those departments may take precedence over those of CDM. 6.3.3 Inter-departmental government model This model could be used for DNA on two grounds. Firstly, allowing the government Ministry responsible for environment to coordinate the activities of the DNA would render the system inefficient given the bureaucratic complications and redtape. Secondly, allowing different departments to approve projects would undermine the quality of projects in the long run and would render coordination ineffective. 6.3.4 FDI –Piggyback model This model could be used for the DNA on grounds that the existing FDI would take on CDM as part of what it is already doing- which is basically promoting, facilitating and approving investment projects. Furthermore, the FDI, which has a high degree of autonomy, is insulated from bureaucratic complications and interference. Hence ideal for quick decision making and reporting. 6.3.5 Out-sourcing Model Although this is in line with the GoU privatisation and liberation policies, allowing the private sector agency to evaluate and validate projects may not work given that private sector agencies are driven by immediate benefits; and yet CDM in terms of CERS is of a long term nature. In addition, the private sector in Uganda is still organisationally weak and therefore lacks the necessary technical and financial capacity to engage in projects of a long term nature such as CDM. 6.4 Institutional interpretation of DNA in Uganda Institutionally, the DNA is meant to be a “Loose” establishment or Unit consisting of key stakeholders in the field of promoting investments and approving investment proposals/projects. For purposes of co-ordination and taking quick decisions and actions it should therefore be coordinated within one of the agencies for either promoting investments or approving investment proposals/ projects. It is for this reason that the DNA is tied to the overall mandates of the different key stakeholders. Consultations with the key stakeholders have also indicated their willingness and support to participate in the DNA roles for CDM investments under the multi-sectoral and collaboration arrangement. While that may be the case, a number of concerns have been raised as to the placement of coordination of DNA within one of the key stakeholders of CDM. These issues are discussed below. 6.5 Institutional Size of DNA Although the potential key Stakeholders for promoting, approving and reporting CDM Projects are many and varied in their mandates, it has emerged that some have got mandates, which are more close to the promotion of CDM investments in Uganda than others. It would thus appear desirable in the face of limited resources instead of creating a new institution to have one of the key stakeholders with the closest mandate for promoting, approving and reporting CDM projects be the host institution or organisation. The host institution should act as the secretariat and will bring together all relevant institutions/ organisations to approve and validate/register CDM investments. 6.6 Ownership of CDM Concept All the key Stakeholders have their own specific mandates relating to CDM. They will continue to play those roles but should be more conscious of promoting CDM projects in their various sectors. They should look at CDM as part and parcel of their respective mandates. In this respect, they are expected: Not to look for additional financial and material support for promoting CDM investments from the DNA host institution/ organisation To initiate on their own CDM activities To initiate cohesive programmes of action on how to integrate CDM concerns in their activities To report their activities to the DNA host institution as required from time to time. 7.0 Workplan The project comprises of two components namely: the establishment of the DNA and capacity building for project development skills. 7.1 Component 1: Establish and Capacitate DNA It is to be realised that CDM investments cut across many sectors especially energy, natural resources and transport. Accordingly, its successful implementation can only be multi-sectoral. While that may be the case, there must be a national coordination mechanism to approve/register CDM investments, promote CDM investments, promote CDM concept and investments and report to the executive Board at the international level on CDM activities in the country on behalf of its development partners. This part therefore looks at the activities to be undertaken in order to determine where the coordination of DNA should be set up and its composition and functions. Activity 1.1: Develop operational guidelines for functioning of the DNA The structure, roles and responsibilities of each of the DNA members will be elaborated. The guidelines will clarify how members relate to each other and how they function together to meet the DNA requirements. These guidelines will draw on experience from existing similar local structures such as the DC as well as foreign DNAs. Output 1.1: A document on operational guidelines elaborating the structure, roles and responsibilities of the DNA members. Timing 1.1: June 2003- August 2003 Responsibility 1.1: Local consultants and EDRC Activity 1.2: Hold a consultative workshop to identify DNA Coordinating Institution A workshop of the CDM stakeholders will be held to agree on the composition of the DNA and who will be the host institution/organisation to coordinate its activities. The composition of the DNA and choice of the host institution/organisation for DNA will be guided by the current – mandates of the institutions and their experience in CDM related investments. The Regional Centre in collaboration with independent consultants will facilitate the workshop. Background information/material will be presented on the concept and benefits of CDM. The stakeholders analysis undertaken and reported in this document will be used extensively as a basis for deliberations. Outputs 1.2: a consultative workshop DNA coordinating institution and composition identified Timing 1.2: August 2003 Responsibility 1.2: Local consultant, UCCEE and EDRC Activity 1.3: Identify legal and regulatory implications of the DNA Given the significant role of the DNA particularly as a body that makes decisions that has legal implications for the country, it is important that the DNA has a legal status. Thus an analysis of how to legalise DNA will be undertaken. This will entail a review of legal institutional framework used for similar bodies. Based on the findings, recommendations for establishing a legally recognized DNA will be made to the relevant entity. Output 1.3: Report on recommendations for legal framework. Timing 1.3: September 2003 Responsibility 1.3: Local consultant Activity 1.4: Organise a workshop to discuss the recommendations relating to the legal and regulatory framework for DNA. A workshop for key stakeholders of DNA will be organised to seek their input and improve on the recommendations relating to the legal and regulatory framework for DNA. Output 1.4: Recommendations relating to the legal and regulatory implications of DNA improved. Timing 1.4: November 2003 Responsibility 1.4: Local Consultant Activity 1.5: Draft legislation for the functioning of the DNA Legislation will be drafted in order to institute DNA, create an enabling environment for its functioning and inspire the confidence of CDM investors. Output 1.5: Draft legislation Timing 1.5: December 2003 Responsibility 1.5: Local Consultant and Ministry of Justice and Constitutional Affairs Activity 1.6: Carry out in depth review of DNA members to identify capacity gaps and develop specific implementation plan to capacitate them. While in general capacity gaps of the stakeholders have been identified during preliminary consultations, it is important to prepare and perform activities that address these gaps in accordance with availability of specific stakeholders. In addition it is relevant to identify the persons from the stakeholder institutions who will be directly engaged in the process. Since the aim of the project is also to built institutional rather than just individual capacity, it is imperative that the capacity development plan incorporate measures to reach beyond the individual. Output 1.6: Report on capacity gaps of DNA members and capacity building plan for DNA members developed. Timing 1.6: December 2003 Responsibility 1.6: EDRC and local consultants Activity 1.7: Organise a national workshop to discuss draft legislation A national workshops targeting DNA stakeholders will be organised to elicit their input and improve the content of the draft legislation. Output 1.7: Draft legislation improved Timing 1.7: January – February 2004 Responsibility 1.7: DNA Coordinating Institution and EDRC Activity 1.8: Conduct training workshop for relevant policy makers Training workshops will be conducted targeting government policy makers, in particular parliamentarians to facilitate legalization of DNA. A draft legislation will be submitted to parliament for approval by the Minister responsible for the DNA coordinating institution that will have been identified under activity 1.1. Output 1.8: Policy makers trained on the regulatory and legal requirements and foundations that are necessary to operationalise the CDM at the national level. DNA legalized. Timing 1.8: March – April 2004 Responsibility 1.8: EDRC and DNA Coordinating Institution Activity 1.9: Organise targeted series of sensitisation and training workshops for DNA members: Imparting relevant skills including evaluation of baseline, basic financial analysis skills, negotiation skills, project monitoring and reporting, marketing and awareness raising. As part of the implementation plan to capacitate DNA members, workshops will to be organized to facilitate sharing of knowledge and experiences and enrich DNA performance. This will also offer a forum for updating DNA members on international developments on CDM which would impact on approval/registration. Output 1.9: Report on a series of sensitisation and training workshops for DNA members Timing 1.9: February – August 2004 Responsibility 1.9: DNA coordinating institution, EDRC and Local Consultants. Activity 1.10: Develop guidelines approval of CDM projects The DNA will need a clear procedure, a coherent framework for approving CDM projects. In addition guidelines on what elements to take into account in approving projects will be necessary. These guidelines will provide clear instructions on how to ensure that baselines and assumptions thereof are reliable as well as how to spot inconsistencies. Review of existing approval procedures such as those used by the DC and UIA etc will be done to facilitate transfer of lessons and avoid repeating mistakes. Also DNA will need reporting guidelines to EB on CDM activities in the country. Output 1.10: A document on guidelines for approval of CDM projects Timing 1.10: September 2003-June 2004 Responsibility 1.10: DNA coordinating institution, EDRC Activity 1.11: Establish a list serve for the DNA members To facilitate communication among the DNA members as well as between the DNA and EB a simple list serve will be established. Output 1.11: Review report on the performance of DNA. Timing 1.11: March 2004 Responsibility 1.11: Local Consultant Activity 1.12: Develop CDM promotion manuals and other aids The DNA will be promoting CDM projects. Thus a simple manual highlighting the attractiveness of Uganda as a CDM project host . The manual would also provide information on ongoing projects and potential projects. Possibilities for incorporating CDM into exiting promotion tools will be evaluated and used whenever possible. Promotion aids used by UIA and ministry of foreign affairs, among other will be used as basis for designing CDM promotion tools. Output 1.12: Promotion manuals and other aids developed and disseminated. Timing 1.12: June – July 2004 Responsibility 1.12: Local Consultant and EDRC Activity 1.13: Conduct a review of DNA to strengthen capacity Given the evolving nature of CDM internationally as well as local institutional changes over time, it is important to review the DNA and ensure that it is able to meet its obligations. Capacity gaps identified through this reviews will be addressed based on available resources. 7.2 Output 1.13: A database of DNA members established Timing 1.13: August 2004 Responsibility 1.13: DNA coordinating institution Component 2: Imparting Project Development Skills A comprehensive training programme for project developers will be designed and delivered. This entails the following activities and responsibilities.. Activity 2.1: Identify local trainers who will deliver a suite of CDM relevant courses Some institutions such as the university, UMI, and UIA, PSF have been involved in training on various issues, some of which are related to CDM. Such institutions would be evaluated to determine their ability to offer relevant CDM training. Since CDM is a relatively new concept most of the institutions might not have all the expertise needed. Output 2.1: Report on recommendations for local trainers who will deliver a suite of CDM relevant courses. Timing 2.1: July-august 2003 Responsibility 2.1: EDRC Activity 2.2: Design training programme The specific characteristics of the CDM warrant a targeted training programme, which however takes into account the knowledge on other project development skills. This include baseline development, and monitoring. The design of implementation such a programme will be done to accommodate availability of the targeted stakeholders. Hence a consultative approach will be used in finalizing the plan. It is expected that short-term courses and training workshops will be the main delivery modes. The regional centers will develop the training programme which will indicate the durations and delivery models, while the local institutions will consult on availability of stakeholders and hence finalise the implementation dates. Output 2.2: A Report showing a comprehensive training programme for project developers. Timing 2.2: July-Oct 2003 Responsibility 2.2: EDRC and Local Institutions Activity 2.3: Train Local Institutions in project development skills In recognition of the limited skills available in CDM in local institutions, a targeted training programme will be developed and delivered. This will entail training on baselines, monitoring, reporting as well as ways of accessing relevant information. The training would be conducted by regional centers. It is expected that the trained trainers would, with assistance, then implement local training programmes. Output 2.3: A report showing local institutions trained in project development skills. Timing 2.3: Oct 2003-November 2004 Responsibility 2.3: EDRC Activity 2.4: Modify training kits to meet local needs Recognizing that various models are used for baselines and monitoring, a simple and relevant model will be designed for use by project developers. Relevant simple manuals will be developed. Output 2.4: A simple and relevant model will be designed including relevant simple training manuals. Timing 2.4: Oct-DEC 2003 Responsibility 2.4: Local institutions Activity 2.5: Update information on potential project developers While initial stakeholders analysis has identified some project developers, it is believed that the analysis may not have been exhaustive. In addition it is imperative to identify specific individuals within the stakeholder institutions who will be undertaking the training. Output 2.5: A report showing updated information on potential project developers. Timing 2.5: Oct 2003 Responsibility 2.5: DNA coordinating institution and Local Consultant Activity 2.6: Establish a database on project development issues Project developers can share lessons through having access to a common database. The database will also provide information on relevant developments in CDM. Since maintaining such a database is rather expensive, it is expected that the function will piggy-back on existing systems. Evaluation will thus be done to identify relevant hosts. The ministry of finance, DC, UMI, PSF are potential hosts. The database would be updated on a regular basis. Output 2.6: A database on relevant developments in CDM established. Timing 2.6: Oct 2003-June 2004 Responsibility 2.6: Local Consultant Activity 2.7: Capacitate civil society to raise awareness and monitor CDM projects Civil society is increasingly acting a society watch-dogs for a better environment. As such it is important they are capacitated on CDM to ensure constructive participation. Targeted training on the CDM issues including baselines, and responsibilities of various participants will be conducted. Output 2.7 A report showing targeted training delivered for civil society on CDM issues. Timing 2.7: January 2004-August 2004 Responsibility 2.7: Local Institutions Activity 2.8: Undertake an external evaluation of the Project Towards the end of the project, the project will be evaluated to assess the extent to which the set objectives have been achieved. The evaluation will be administered by UCCEE. In order to ensure that the resulting assessment is sufficiently independent and objective, an international consultant in collaboration with a local consultant will undertake the evaluation exercise. Output 2.8 A report on the external evaluation of project Timing 2.8: October 2005 Responsibility 2.8: International Consultants and Local Consultants 7.3 Summary of Implementation Schedule Activity 1.1 Develop operational guidelines for the functioning of the DNA 1.2 Hold a consultative workshop to identify DNA coordinating institution and composition 1.3 Identify legal and regulatory implications of the DNA. 1.4 Organise a work shop to discuss the recommendations relating to the legal and regulatory framework for DNA. 1.5 Draft legislation for functioning of DNA 1.6 Carry out an indepth review of members to identify capacity gaps and develop specific implementation plan to capacitate them 1.7 Organise regional and national workshops to discuss draft legislation 1.8 Conduct training workshops for policy makers. 1.9 Organise targeted series of sensitisation and training workshops for DNA members 1.10 Develop guidelines for approval /registration of CDM projects J a n F e b M A a p r r 2003 (Months) M J J A a u u u y n l g S e p O N D J c o e a t v c n F e b M A a p r r 2004 (Months M J J A a u u u y n l g S e p 2005 Month O N D Oct c o e t v c Responsibility Local Consultant EDRC Local Consultant UCCEE, EDRC Local Consultant Local Consultant Local Consultant Ministry of Justice & Constitutional Affairs EDRC, Local Consultant DNA coordinating Institution EDRC DNA coordinating Institution EDRC DNA coordinating Institution EDRC Local Consultant DNA coordinating Institution EDRC Activity 1.11 Establish a list serve for the DNA members 1.12 Develop CDM promotion manuals and other aids 1.13 Conduct a review of DNA to strengthen capacity 2.1 Identify local trainers who will deliver a suite of CDM relevant course 2.2 Design training programme for project developers 2.3 Train local institutions in project development skills 2.4 Modify training kits to meet local needs 2.5 Update information on potential project developers 2.6 Establish a data base on project development issues. 2.7 Capacitate Civil society to raise awareness and monitor CDM projects 2.8 Undertake external evaluation of the project J a n F e b M A a p r r 2003 (Months) M J J A a u u u y n l g S e p O N D J c o e a t v c n F e b M A a p r r 2004 (Months M J J A a u u u y n l g S e p 2005 Month O N D Oct c o e t v c Responsibility Local Consultant Local Consultant EDRC DNA Coordinating institution EDRC EDRC Local Institutions Local Institutions DNA coordinating institution and Local Consultant Local Consultant Local Institutions International Consultants and Local Consultants APPENDIX 1 LIST OF POTENTIAL CDM STAKEHOLDERS 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. Ministry of Water, Lands and Environment Forestry Department – The National Forest Authority Department of Meteorology National Environment – Management Authority (NEMA) Ministry of Trade, Tourism and Industry Uganda Investment Authority Uganda Manufacturers Association (UMA) Uganda National Bureau of Standards Uganda Revenue Authority (URA) The Private Sector Foundation Uganda National Chamber of Commerce and Industry Uganda Cleaner Production Centre Ministry of Finance, Planning and Economic Development Ministry of Energy and Mineral Development and its allied parastatals Ministry of Agriculture, Animal Industry and Fisheries (MAAIF) Joint Energy Environment Project (JEEP) to represent NGOs Uganda Renewable Energy Association (UREA) Research Institute e.g Forestry Resources Research Institute (FORRI) Ministry of Foreign Affairs Ministry of Justice and Constitutional Affairs Universities and Training Institutes (e.g. Institute of Agriculture and Forestry, Nyabyeya Forest College, UMI, Environment Alert) National NGO Forum Ministry of Local Government Ministry of Works Housing and Communications. Uganda Tree Planting Association Uganda National Farmers Association Kampala City Council Uganda Wild Life Authority. Because of its experience in managing forest absorption carbondioxide emitted (FACE) project in Mt Elegon and Kibale National Parks. The Association of Environmental Journalists Uganda National Farmers Association Appendix 2 List of stakeholders consulted Name 1. Richard Kanyike 2. Sarah Nalumansi Title General Manager Human Resource Development Environment Desk Officer Assistant Director Organisation Solar Energy, Uganda Ltd Uganda Manufacturers Association 3. Alexandria Sgobbi Ministry of Finance, Planning and Economic Development 4. Isa Mukasa Investment Promotion Division, UIA 5. Paul Isabirye Senior Meteorology Department of Meteorology, MWLE 6. Godfrey Investment Executive Investment facilitation and Ssemakula aftercare Division, UIA 7. S.K Magezi Asst. Commissioner Department of Meteorology, MWLE 8. Dr. Patrick Executive Director Uganda Cleaner Production Mwesigye Centre 9. Telly Eugene Director Policy National Environment Muramira Planning and Management Authority Information 10. Dr. Francis Ejobi Environmental Department of Veterinary, Toxocologist Public Health and Preventive Medicine, Faculty of Medicine, Makerere University 11. Robert Wabunoha Senior Environmental National Environment Lawyer Management Authority 12. Gideon N. Senior Policy Analyst Private Sector Foundation Badagawa 13. Victor Paul Kobel 14. Cypriono Ebong 15. Dr. Ben Manyindo 16. Alexandra Karekaho 17. James Kibahiganira 18. Drazu Charles 19. Edward Onen-Cam 20. Paul Drichi 21. Ruth N. Kiwanuka 22. Siimon Sentamu 23. Thomiko Rwothumio 24. Anne Labeja 25. Engineer Mubiru Secretary General Uganda National Chamber of Commerce and Industry Namalere, NARO Head of Technical Uganda National Bureau of Operations Standards Programme Officer UNDP Senior Economist MFPED Programme Officer The Netherlands Embassy Forestry Department Forestry Department Joint Energy and Environment projects (JEEP) JEEP NEMA Co-ordinator Information Officer EIA Officer Secretary Development Committee Paul Assistant Commissioner, Energy Efficiency Ministry of Finance, Planning and Economic Development Ministry of Energy and Mineral Development