Alternative Energy Promotion Center

Making Renewable Energy Mainstream Supply in Nepal

CARBON FINANCE: STRATEGIES FOR DEVELOPING AND MONETIZING CARBON CREDITS IN TIMES OF TRANSITION
Prof. Dr. Govind Raj Pokharel Executive Director, AEPC

Outline

Carbon Financing Initiatives in Nepal Lesson Learnt Opportunity & challanges A Way Forward

Alternative Energy Promotion Center

Making Renewable Energy Mainstream Supply in Nepal

19 June 2012

Carbon Financing Initiatives in AEPC

First CDM project (biogas) registered in Dec 2005 5 registered CDM projects 3 PoA CDM are in final stage of validation Established dedicated unit CCU in AEPC to develop & manage CDM projects High priority activity as carbon revenue will contribute to increase sustainability of the renewable energy sector

Alternative Energy Promotion Center

Making Renewable Energy Mainstream Supply in Nepal

19 June 2012

CDM Projects in Nepal

Name of Projects
4

No. of systems bundled

Expected ER/year

Project Participants

Status

Biogas Support Program 9,708 Nepal Activity-1

Biogas Support Program 9,688 Nepal Activity-2 Micro-hydro Promotion About 650

30,203tCO2e AEPC
31, 875tCO2e AEPC

Registered & CER issued

Registered & CER issued Registered Registered Registered

40,535tCO2e AEPC 56,919 CO2e AEPC 56,487tCO2e AEPC

Biogas Support Program 20,254 - Nepal Activity-3 Biogas Support Program 20,348 - Nepal Activity-4

Nepal Biogas Support Program-PoA

Annual 20,000

AEPC
2.5tCO2e/pl ant
19 June 2012

Final stage of validation

Alternative Energy Promotion Center

Making Renewable Energy Mainstream Supply in Nepal

CDM Projects in Nepal

Name of Projects
5

No. of systems bundled Annual 38,000 8,000

Expected ER/year 113,128 tCO2e 38,699 tCO2e 19,899 tCO2e

Project Participant AEPC

Status

Promotion of the Improved Cooking Stove (ICS) - Nepal Promotion of the Improved Water Mills (IWM) - Nepal Improved Cooking Stove project Biogas Gold Standard Project Efficient Cooking stove Projects

Under Validation

AEPC

Under Validation

26,000 7,500 3*22000= 66000

CRT/N WWF-Nepal SDC

Registered Registered under VCS Under validation

Alternative Energy Promotion Center

Making Renewable Energy Mainstream Supply in Nepal

19 June 2012

Opportunities of Carbon Financing in Nepal

Growing awareness and knowledge of market based mechanism Experiences from previous projects Some technical manpower for project development Good potential of carbon projects in some sectors

Renewable energy (biogas, Improved Cooking Stoves, other biomass Micro-hydro Projects, Improved Water Mills, Bio-fuel, solar projects, wind projects, etc.) Improvement of energy efficiency in industrial/transport sector

Alternative Energy Promotion Center

Making Renewable Energy Mainstream Supply in Nepal

19 June 2012

Opportunities Contd.
Fuel

switch (to cleaner energy) in industrial sector. Replace thermal plants with Solar, Hydro, Biomass gasification etc. Municipal waste management. Composting, gas flaring, biogas generation, biomass gasification etc. Fuel switch in transport sector. Petrol/diesel to electricity, biogas, CNG etc. Hydro-power, if exported to neighboring countries (???)
Alternative Energy Promotion Center
Making Renewable Energy Mainstream Supply in Nepal

19 June 2012

Challenges of CDM in LDCs

Uncertainty of Kyoto Protocol Fluctuation (crash?) of Carbon Market Price Lack of Documentation skills and local manpower(as CDM is document based mechanism) Lack of sector specific GHG mitigation feasibility studies High transaction cost Too long and time consuming process What now ? Kyoto dying and price

Alternative Energy Promotion Center

Making Renewable Energy Mainstream Supply in Nepal

19 June 2012

Lesson Learnt

Project Proponent should have at least minimum knowledge of CDM complications Dont rely too much only on third partys expertise Proper documentation is must Follow both PDD & validation report while implementing and monitoring the project Be updated and follow up Executive Boards decisions Bundled CDM projects like household biogas is costlier for monitoring and challenges to ensure regular operation

Alternative Energy Promotion Center

Making Renewable Energy Mainstream Supply in Nepal

19 June 2012

A Way Forward

Develop national carbon mitigation strategy (as a part of Low Carbon Development Strategy) Prepare sector-oriented GHG mitigation potential to encourage private sector for investing the cleaner projects and improve the existing system of the industries Awareness raising among private sector and relevant GoN officials Give high priority to realize potential carbon projects as earliest possible Continuation of compliance carbon market mechanism
19 June 2012 10

Alternative Energy Promotion Center

Making Renewable Energy Mainstream Supply in Nepal

Thank You !!!

Alternative Energy Promotion Center

Making Renewable Energy Mainstream Supply in Nepal

19 June 2012

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