European Capacity Building Initiative for Sustainable Development and Emissions Trading
The European Capacity Building Initiative (ECBI) focuses on reinforcing capacities for international climate change negotiations. It highlights mechanisms for emission trading and sustainable development, emphasizing environmental integrity and transparency. Article 6 outlines the legally binding promotion of sustainable development and robust accounting to avoid double counting. Safeguards ensure full comparability and prevent trading the same outcome twice. Options for operationalizing Article 6.2 include linking non-multilateral emissions trading schemes and establishing an accounting framework.
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initiative europenne de renforcement des capacits european capacity building initiative ecbi ecbi european capacity building initiative Article 6 Mechanisms EMISSIONSTRADING & SUSTAINABLE DEVELOPT MEC. T lio Andrade Ministry of Foreign Affairs of Brazil for sustained capacity building in support of international climate change negotiations pour un renforcement durable des capacit s en appui aux n gociations internationales sur les changements climatiques
Article 6.2 - Where engaging in use of internationally transferred mitigation outcomes towards NDCs; ecbi european capacity building initiative - Shall (legally binding): Promote sustainable development; Ensure environmental integrity & transparency: Including in governance Apply: Robust accounting; Among other things, avoid double counting (1/CP.21 on the basis of corresponding adjustments ); - Consistent with CMA guidance
Article 6.3 ecbi european capacity building initiative - Engagement in 6.2 voluntary and conditioned upon authorization of participating Parties.
- Necessary safeguards: ecbi european capacity building initiative fungibility requires full comparability; same outcome not to be traded twice; - Must work in the long term: context not the current; new policies from many more countries - Reputation of the regime.
Options for operationalizing Article 6.2 OPTION 1: framework for various approaches ecbi european capacity building initiative Linking various non-multilateral emissions trading scheme; Safeguards (comparability & non double counting) would require: impose multilaterally-agreed rules and governance on each existing and new scheme; policy space restrictions; existing ETS to undergo significant adjustments; Impractical. Procedurally, discussions on FVA suspended.
Options for operationalizing Article 6.2 OPTION 2: 6.2 as an accounting framework ecbi european capacity building initiative Analogy to emissions trading (KP, Article 17); voluntary; additional layer to 4.13 & 13; more rigid; top-down reminiscent dimension.
Analogy to Emissions Trading - Multilateral registry with national accounts; ecbi european capacity building initiative - International Transaction Log - Issuance of units quantification of NDCs; - Technical Expert Review of calculation; - Limitation of tradable units (Doha amendments); - additions to, and subtractions from, NDCs permitted emissions; - additions of CERs from CDM & SDM.
Sustainable Development Mechanism Article 6.4 - Legal language of the Paris Agreement and decision reflect KP Article 12 language on the CDM: ecbi european capacity building initiative Under CMA authority & guidance; Supervision by designated body; Voluntary; Real, measurable & long-term mitigation benefits; Additionality; Verification & certification by DOEs; 6.4(c) - Host Party to benefit from emission reductions that can also be used by another Party to fulfill its NDC; Share of proceeds.
Whats new? ecbi european capacity building initiative - Specific scopes of activities (reference to PoAs); - Incentivize & facilitate participation of public & private non-State actors (similar to CERs voluntary cancelation) Results-based finance; Corporate socioenvironmental responsibility strategies; Carbon footprint offset (including individuals). - 6.5: CERs used towards host country s NDC cannot be used again.
Issue of Highest priority: smooth transition from CDM to SDM ecbi european capacity building initiative - Key to legal certainty & reputation of the regime; - Foster early-action while SDM not fully operational; - Encompasses four dimensions: (i) CDM CERs converted to SDM CERs; (ii) continued validity of CDM methodologies; (iii)issuance of SDM CERs for CDM registered project activities; (iv) transposition of CDM accreditation system. - Decision in Bonn could immediately give price signal and revive CDM.
Additionality - To award activities that would not otherwise occur - Not in relation to NDCs, but in relation to SDM itself; ecbi european capacity building initiative - Continued application of CDM requirements: first-of-its-kind; Investment analysis; Barriers analysis; Common practice analysis. - With progressive implementation of NDCs, activities once approved will no longer be proven additional. - Additionality & conservative baselines to deliver overall mitigation.
SDM registry - Registry administered by Secretariat with Board supervision; ecbi european capacity building initiative - To gather every SDM CERs issued by the Board; - To allow non-Party stakeholders unprecedented access to UN credits; - CERs purchased from the SDM registry: By a Party: transfer to 6.2 national account; By non-Party actor: transfer to cancellation account.
No application of corresponding adjustments for 6.4 - Legally: under the Paris Agreement & decision, corresponding adjustments restricted to 6.2; ecbi european capacity building initiative - Technically: Illogical subtraction from host country national account if it has not taken part in transaction; illogical double subtraction (from host country national account and SDM registry).
No application of corresponding adjustments for 6.4 - Environmentally: ecbi european capacity building initiative Corresponding adjustments: perverse incentives To limit SDM potential for additional mitigation; host Parties not to move to absolute economy- wide targets; Risk of double claiming : 6.5;
No application of corresponding adjustments for 6.4 Accounting x Inventories ecbi european capacity building initiative - National inventories: bona fide calculation; - SDM mitigation activities will not necessarily affect the calculation of emission levels in national inventories; - CDM/SDM Executive Board baseline and monitoring methodology x IPCC Guidelines for National Inventories; - Counterfactual (hypothetical net emissions) x factual (actual emissions); - Emission factor: combined margin x average.
initiative europenne de renforcement des capacits european capacity building initiative ecbi ecbi european capacity building initiative THANK YOU! T lio Andrade Ministry of Foreign Affairs of Brazil tulio.andrade@itamaraty.gov.br for sustained capacity building in support of international climate change negotiations pour un renforcement durable des capacit s en appui aux n gociations internationales sur les changements climatiques
