Laguna De Bay Carbonshed Project Idea:

A Demand-Driven, Umbrella Approach to Community Carbon Finance

for Environmental Projects

Erosionand Siltation

Pollution(organic, nutrients,

solid waste)

PollutionReduction and

Treatment

Watershedrehabilitation

Key Issues inLaguna de Bay

Global Benefits

CO2

CH4 N2OCO2

sequestration

emissions reductions

Actions

Small scale watershedenvironmental projects.

Community participation inidentification of

environmental prioritiesand projects.

Reduced transaction costs through national intermediaries

LLDA: technical intermediary.MDFO: financial intermediary.

Should reduce transactioncosts by exploring the use of intermediaries

and streamlined procedures.

Projects must benefit communities

and theirlocal environment.

Focuses exclusively onsmall scale projects.

CDCF Carbonshed Project

LISCOP (component 1) Small scale watershed environmental projects

Financing Planning

LGU-NGCost sharing

MDFOFinancial

Intermediary

250 million PhP

Siniloan Tanay Pillila Binan……..

25-50 projects (5 million-10 million PhP each) in up to 24 microwatersheds

River CouncilsParticipatory

Multi-stakeholder

LLDATechnical

Intermediary

LEAPCharacterization Priority setting

Project Identification & Development

CDM eligible projects(Carbonshed projects) Other projects

24 microwatershedsCERs

Project TypesExample

subprojectMicrowatershed Potential GHG

emissions reduction for individual project

Waste treatment

Pig waste biogas Siniloan,

Pagsanjan-Lumban

2,000 ton CO2/yr

Erosion reduction

River bank vegetation

Pagsanjan-Lumban, Tanay

4,000 tons CO2/yr

The total amount for the bundled projects will depend on choice of and demand for subprojects:

Expected: 9,000 tons CO2/yr - 60,000 tons CO2/yrMaximum: 150,000 tons CO2/yr

Baseline Methodology and AdditionalityFor Small-scale Projects

Methodology: Streamlined CDM procedures for small-scale projects. Exist for some proposed subprojects (biogas), may have to develop for others. Would be incorporated as part of LEAP process and included in PDD.

Additionality: Follows small-scale additionality rules, including one of the following:

a. Investment barrier.b. Technological barrier.c. Barriers due to prevailing practice.d. Other: institutional, limited information, managerial or organizational

resources, financial resources, capacity to absorb new technologies.

Would be incorporated as part of LEAP process and included in PDD.

Indicative Project Preparation Schedule

2003 2004 2005 2006 Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul

LISCOPSubproject preparation

and implementation

CDCF project cycle

PIN= Project Idea Note

PDD= Project Design Document

ERPA= emissions reductions project agreement

CDCF due diligence

Validation Verification and Certification (continues until 2017)

Construction and implementation (continues until 2017)

4 microwatersheds plans

Subproject agreements signed

ERPA negotiation and signing

PDD preparationPIN

20 remaining microwatershed plans

Prepare baseline, monitoring and verification

Signed and future agreements will be covered by ERPA

Feasibility studies

agreed monitoring and verfication protocol

Representative Subprojects:Pig Waste Biogas Project

HOG FARM WASTE GENERATION IN LAGUNA DE BAY(kgs/year)

1,200 kg/yr

7 backyard piggeries2 commercial piggeries

coconut arearice area

19 households

8,100 kg/yr

23 backyard piggeries19 commercial piggeries

52 households

7,900 kg/yr

34 backyard piggeries14 commercial piggeries

coconut area

176 households

Lu

cb

an

ri

ve

r

Initian

Creek

Majayjay

River

Balanac River

Laguna de Bay Organic Waste LoadingFrom Majayjay

Communal Pig Waste Biogas DigestersProject basicsCost 9.8 million PhP20 LGU-run biogas reactors for backyard piggeries2 LGU-run biogas reactors for commercial piggeries

Baseline: Disposal of waste using current practices without collection of methane.

Emissions reduction: Reduction of methane and N2O emissions from waste and replacement of current cooking fuel use.

Small-scale additionality test:Prevailing practice is no treatment or treatment using lagoons. Biogas collection is very uncommon and not mandated by regulations.Other: Lack financial resources with complementary technical and information support.

Environmental Benefits  # of biogas

systems

Waste treatment

(% of pollution from piggery

type)

GHG

emissions reduction (Tons CO2 equiv/yr)

Annual revenues for LGUs and

communities

(PhP/yr)

Backyard piggeries

20

(90 pigs/system)

100%

of pollution from backyard piggeries

198 50,000

Commercial piggeries

2

(5800 pigs/system)

18%

of pollution from backyard piggeries

1,255 314,000

Total 22 17%

of pollution from piggeries in Majayjay

1,453 364,000

Community Benefits• Reduced odors, improved sanitation.• Cost savings from fuel use.• 364.000 PhP/yr of revenues from ERs can be reinvested by LGUs in environmental activities in community.

As the UMBRELLA CONCEPT is an INNOVATIONfor the CDCF, the decision on how this approach or alternativeapproaches would be undertaken will be discussed and agreedwith the CDCF and the Philippine counterparts as part of the

project preparation.

The project will act as a pilot for LdB watershed and a demonstration for other watersheds within the Philippines and therefore catalyze more emissions reductions in the country.

Project Idea Summary

• CDM-eligible investments in sustainable development at the community level.

• Reduces transaction costs through umbrella approach.

•Community ownership through demand driven, participatory approach.

• Brings benefits of CERs to communities.

THANK YOU!