Urban Carbon Mechanisms:
A Handbook for Local Policy Makers
Outline & Recommendations
Heather ROGERS
Stéphane Pouffary
Project Manager, Climate Change
& Energy Transition
Chief Executive Officer
& Founder Honorary President
ENERGIES 2050
ENERGIES 2050
heather.rogers@energies2050.org
stephane.pouffary@energies2050.org
Urban Methodologies for the built environment Workshop
27-28 March 2014
UNFCCC Headquarters, Bonn, Germany
Overview
1. Intro to the Handbook in preparation
2. Challenges for GHG mitigation in urban context
3. Metrics for measuring GHGs in built environment
4. The importance of MRV
5. Carbon & climate finance mechanisms - overview of
key mechanisms, relevance for built environment
6. Recommendations
And then over to you – discussion questions; feedback
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
1. Intro to the Handbook in preparation
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
Being prepared by ENERGIES 2050 for UNEP
To guide local policy makers through carbon & climate finance
mechanisms and their application in the built environment
Objectives:
1. Raise awareness of the potential for carbon &
climate finance to support GHG mitigation in the
built environment
2. Help local authorities to use carbon mechanisms as
part of wider climate strategies, to increase energy
performance of their district and generate revenue
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
1. Intro to the Handbook in preparation
Two documents being prepared: an in-depth research paper and
a simplified “Handbook for Local Policy Makers”
Version circulated = abridged version of research paper, for
discussion
Focus on urban context throughout
Structure:
Context of recent climate negotiations
Buildings & cities: commonalities, challenges, opportunities,
metrics & methodologies for measuring emissions
The importance of MRV
Carbon & climate finance mechanisms – existing and in
development
Looking ahead, recommendations
Your feedback
and best practice
examples please!
Best practice case studies are presented
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
2. Challenges for urban GHG mitigation – buildings
Buildings are one of the most cost effective and expedient
opportunities for GHG mitigation, often with co-benefits
But complex mix of buildings, stakeholders and technologies
Very local phenomenon (local needs, culture and policy)
Data availability is a key challenge
Specific obstacles include
Range and distribution of emissions potential among building types
“Landlord-tenant dilemma”,
“Lock-in effect” of choices made regarding building components
Transaction costs
Rebound effect
We need consistency, transparency and diffusion of GHG data –
hence SBCI work on the CCM
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
2. Challenges for urban GHG mitigation - cities
A key role to play in global climate action: generate 75% of CO2 emissions
Plus an additional 2 billion urban inhabitants expected by 2030
Decisions made now can have long-lasting impacts on GHG emissions
So cities hold significant emissions reduction potential…
…BUT need a prominent place in climate negotiations and access to finance
“Cities are where the Climate
Change battle will be won or lost
over the next decades”
Marco Scuriatti, Senior Operations Officer at
the World Bank, 2011
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
2. Challenges for urban GHG mitigation - cities
Every city is different – standardizing mitigation is therefore challenging
Complex mix of sectors, building types and stakeholders
It is crucial to engage city / municipal governments in national GHG
mitigation efforts…
…but there are many barriers to this, as shown in V-NAMA project:
Lack of financial or political incentives
Poor integration with national government
Lack of capacity (both in terms of resources and skills)
Given current budget constraints, carbon finance could provide a means to
supporting GHG mitigation efforts…
…but for this, we need the tools to measure set the emissions baseline
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
3. Measuring GHGs in the built environment
GHG emissions profile can vary widely by city, but the main sources remain
buildings, transport, waste, industry and electricity production
Each of these holds challenges & opportunities for GHG mitigation…but to
maximize potential, local actors must be engaged
UNEP & Gwangju City 2012: Cities and carbon finance: a feasibility study on an Urban CDM
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
3. Measuring GHGs in built environment
City GHG inventories are crucial first step towards accessing carbon &
climate finance at this scale…but methodologies vary
Study by Ibrahim et al 2012 compared four leading inventory approaches
found varying options but set of common recommendations
e.g. distinguish direct vs. upstream emissions; additional activity data improves
transparency and understanding; data quality should be assessed and reported
Efforts under way to standardize the approach e.g. GHG Protocol for
Community Scale GHG Emissions (GPC)
Carbon Cities Climate Registry (cCCR) – encourage regular reporting
At the building level…
Common Carbon Metric making good progress towards practical,
comparable tool and protocol for establishing the baseline…informing
upcoming International Standard
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
Many initiatives for measuring GHG emissions often tied to a specific city or
objectives…need a broader, systematic, adaptable, comparable approach
So how about a universal sustainable cities approach?
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
4. The importance of MRV
No MRV,
no entry!
Getty Images
Bottom line: MRV is a pre-requisite for
participation in carbon finance –
baseline and emissions reductions must
be measured, reported and verified…
What we cover in the research paper:
MRV basics (what is MRV, why is it important, what are the underlying principles)
MRV considerations for cities (apply to GHG inventory, available guidance, issues)
MRV considerations for buildings (approaches, challenges e.g. data availability)
General issues for MRV e.g. Types trade-off between accuracy vs complexity
We talk about MRV up-front before going into the carbon mechanisms to
emphasis it s importance throughout the process…not an afterthought
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
5. Carbon & climate finance mechanisms
Real heart of the Handbook is then an overview of existing and developing
carbon & climate finance mechanisms
We define and compare carbon finance and climate finance
And their potentially complementary role to support policy-based efforts
and technology-based activities - realize greater mitigation overall
Then we outline the mechanisms with an emphasis on their relevance for
the urban context, what they do to address challenges, and their
limitations
…complimented by best practice examples (but we would like more!)
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
5. Carbon & climate finance mechanisms
CDM
Outline of CDM, experience gained, tools and methods we can take from it,
reforms needed for urban context
Large scale
Some urban examples,
but not well adapted
built environment,
single technology, too
cumbersome for
individual buildings
Small scale
More
methodologies
being approved that
suit built
environment, still
restrained by
validation process,
potential for more
combinations
Bundled small scale
Starts to address some
limitations of CDM
single projects, reduces
transaction costs, but
very constrained
(identical
methodologies; identify
all component projects
at the start)
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
5. Carbon & climate finance mechanisms
CDM - Programme of Activities
(PoA)
Moves validation burden away from
project implementers (Component
Project Activities), increased
flexibility (can add more as it
grows), but still technology-bytechnology focus
NAMA
Climate finance approach – can
be policy based…very much
learning by doing. Linked closely
to development objectives…city
scale means sub-national
government involvement
City-wide PoA
Momentum has gathered for
multi-technology, multi-sector
city scale mechanism. This could
be rolled out within 1 city across
several sectors – or in 1 sector
across several cities
NMM
Early days. Definition work in
progress…market readiness
activities underway. Urban policy
makers to watch with interest…but
will they be given the chance to
influence its design?
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
6. Recommendations
Keep growing support at the international level for urban carbon mechanisms
Governments to put in place strict targets - and the instruments to support these –
in order to drive sub-national involvement
Continue capacity building to help sub-national governments access climate &
carbon finance
Develop an urban CDM methodology and reporting framework…
…with harmonised metrics and a common language - to aid consistency and
implementation of MRV
Continue to develop standardised baselines and default values
Develop innovative financial mechanisms adapted to the built environment
Create a satisfactory fees framework to reduce transaction costs
Work on an MRV framework for urban mitigation actions - focus on key issues:
systems boundaries; baseline setting; and data requirements
Develop a cities approach that is scalable & adaptable to all cities, regardless of size
and emissions profile
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
Urban Carbon Mechanisms:
A Handbook for Local Policy Makers
DISCUSSION QUESTIONS
Questions for discussion
1.
2.
3.
4.
5.
6.
7.
What progress has been made at international climate talks and what role
for cities?
CDM – what can we take from it and what reforms are needed for cities?
Programme of Activities- can it provide the flexibility needed for cities?
City-wide CDM - could PoAs provide a city scale solution?
NAMAs - an opportunity for bringing finance to concrete actions in cities?
New Market Mechanism (NMM) – will it provide new opportunities for
the built environment? How to ensure it does?
What are the next steps?
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
1. What progress has been made at international climate
talks and what role for the built environment?
Recap on recent climate negotiations:
COP18 Doha 2012
Official objective to limit global warming to 2°C reaffirmed
Second period of Kyoto Protocol (2013-2020) confirmed, but several key countries not participating
EU decided from 2012, credits will be imported only from projects in Least Developed Countries
Support shown for NAMAs, technology-transfer and to reinforce MRV schemes
Operationalization of Green Climate Fund not fully achieved, although some funds committed
COP19 Warsaw 2013
“Loss and damage” key topic of discussion resulting in “Warsaw International Mechanism for Loss
and Damage” to be developed in coming years
Agreement on emission targets postponed to 2015 (for implementation by 2020)
Change in wording from “commitments” to “contributions” signified a substantial change
First Cities Day held as official side event to COP 19 - considered a successful milestone
Bonn Climate Talks in March 2014…feedback?
Image: UN News Centre, 19 November 2013
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
2. CDM - what can we take from it for cities….?
There are many tools and techniques that have been developed for
CDM that can still be useful when developing new innovative
mechanisms
Infras 2012
E.g. Experience from ‘Additionality by benchmark’ can help with
developing standardised approaches going forward
E.g. Guidelines such as baseline data vintage (linked to speed of
technology development)
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
…and what reforms are needed for the urban context?
CDM requirements are not currently well suited to urban projects;
Missing methodologies!
Need for more approved methodology combinations  multi-technology
High transaction costs (fees, technical expertise)
Approach needs to be adapted to suit a large number of (often
small) dispersed emissions sources and multiple technologies
Baseline setting and proving additionality - need for standardized
approaches, given complex environment and varying capacity
Desperate need to build capacity – city policy makers need training
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
3. Programme of Activities- can it provide the flexibility
needed for buildings and cities?
PoA in the pipeline by project type.
UNEP & Gwangju City 2012
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
3. Programme of Activities- can it provide the flexibility
needed for cities?
Clear scope for the PoA in urban context - relatively small scale
projects with proven technology, that can be replicated across many
sites – whether retrofitting or specification of new buildings
Pros:
Reduced transactioncosts, investment risks and uncertainties for
CPAs
Approval process streamlined for CPAs
Flexibility to scale up the programme, adding CPAs as it grows
Cons:
Approval still not that speedy…
Coordinating or Managing Entity = crucial – may not be easy to find
High up-front costs for PoA set up
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
4. City-wide CDM - could PoAs provide a city scale solution?
City-wide PoA are starting to develop – we would like your examples
of work underway
Gives more scope to tailor a PoA to a city’s GHG profile
Can lead to rather complex baseline setting and MRV – this is where
we need a systematic city-scale methodology….what is the best
approach – estimation based on building type? Default values for
emissions reduction activities?
Combining small scale methodologies – important step towards
multi-technology, multi-sector programmes.
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
5. NAMAs - an opportunity for bringing finance to concrete
actions in cities and buildings?
Engagement of sub-national government is crucial for this
Which way forward for NAMA design?
unilateral (domestic resources and finance)
supported (requesting international support)
credited (credits can be traded on the global carbon market)
Must maximize opportunities for sustainable development co-benefits
Are the financial commitments forthcoming beyond the NAMA facility (UK /
Germany)? Green Climate Fund?
Early stages, particularly for MRV - emphasis on ‘learning by doing’
 Capacity building initiatives underway….but not reaching enough?
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
6. NMM – will it provide new opportunities for the
built environment? How to ensure that it does?
Aims to enhance the cost‐effectiveness of, and to promote,
mitigation actions…both of which are particularly important for
urban context – so far limited involvement in CDM
Signals a step away from the project-based conventional CDM to
more standardised approaches, with admin burden shifted to
DNAs…which should be good news for cities and buildings
Importance of consulting local policy makers in the design
process…so that NMM can address the downfalls / challenges of
CDM so far for urban context e.g. baseline setting and
demonstrating additionality
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
7. What are the next steps?
Transform knowledge into action…
…get more concrete projects in place – learning by doing, demonstrating
success, testing the tools and methodologies available
Transform constraints into opportunities…
…we know what the barriers are; newer more flexible mechanisms give us
the chance to turn these around, to experiment with a multi-technology,
multi-sector, city-scale approach – so long as the support is there to build
capacity and get things off the ground
Give cities a prominent place in the negotiation process…they are the
future, focus on those with rapid population growth rate
MRV MRV MRV MRV MRV!
“Urban Carbon Mechanisms: A Handbook for Local Policy Makers”
UNFCCC & UNEP Urban Methodologies for the built environment workshop, 27-28 March 2014, Bonn, Germany
stephane.pouffary@energies2050.org & heather.rogers@energies2050.org
www.energies2050.org
Urban Carbon Mechanisms:
A Handbook for Local Policy Makers
Thank you for your attention
and contributions
Heather Rogers
Project Manager, Climate Change
& Energy Transition
ENERGIES 2050
heather.rogers@energies2050.org
Stéphane Pouffary
Chief Executive Officer
& Founder Honorary President
ENERGIES 2050
stephane.pouffary@energies2050.org