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UNFCCC Recent Challenges in Implementing PoAs from a Commercial Perspective. 8 th May 2011 Mischa Classen Senior Project Manager Regulatory Affairs and Consulting, First Climate Group. Recent Challenges in Implementing PoA. Promise: PoAs aim at scaling up CDM The Commercial Perspective - PowerPoint PPT Presentation
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UNFCCCRecent Challenges in Implementing PoAsfrom a Commercial Perspective8th May 2011
Mischa ClassenSenior Project ManagerRegulatory Affairs and Consulting, First Climate Group
9th May 2011 | 2Project Developer Forum | UNFCCC PoA Workshop, Bonn
Recent Challenges in Implementing PoA
Promise: PoAs aim at scaling up CDM
– The Commercial Perspective
– Key Obstacles for Credit Buyer …
– … become Challenges for Project Developer
– Building Blocks for a scale up post 2012
9th May 2011 | 3
Promise: PoAs aim at scaling up CDM
– The Commercial Perspective
– Key Obstacles for Credit Buyer …
– … become Challenges for Project Developer
– Building Blocks for a scale up post 2012
Project Developer Forum | UNFCCC PoA Workshop, Bonn
Recent Challenges in Implementing PoA
9th May 2011 | 4Project Developer Forum | UNFCCC PoA Workshop, Bonn
The Commercial Perspective
Key features of private carbon investment
– Upfront Investment– Forward Carbon Premium
this one moves ... ... this one does not
9th May 2011 | 5Project Developer Forum | UNFCCC PoA Workshop, Bonn
Recent Challenges in Implementing PoA
Promise: PoAs aim at scaling up CDM
– The Commercial Perspective
– Key Obstacles for Credit Buyer …
– … become Challenges for Project Developer
– Building Blocks for a scale up post 2012
9th May 2011 | 6Project Developer Forum | UNFCCC PoA Workshop, Bonn
Key Obstacles for Credit Buyer
What is the Value of a CPA-CER?
– EU Eligibility Criteria
– Contractual Issues
– Counterparty Risks
9th May 2011 | 7
Key Obstacles for Credit Buyer
EU Eligibility Criteria non LDC– CERs from registered pre-2013 eligible in the EU post-2012 ?
• Serious challenge to lock in buyer for post-2012
?
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PoA #2registered2014
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EU ETS DirectiveArticle 11.a.3)
9th May 2011 | 8
Key Obstacles for Credit Buyer
EU Eligibility Criteria
– Uncertainty freightens investors• Ban on Host Countries?• Ban on Scale / Technology?
– EC considers to release ruling• Some restrictions expected to remain
9th May 2011 | 9Project Developer Forum | UNFCCC PoA Workshop, Bonn
Recent Challenges in Implementing PoA
Promise: PoAs aim at scaling up CDM
– The Commercial Perspective
– Key Obstacles for Credit Buyer …
– … become Challenges for Project Developer
– Building Blocks for a scale up post 2012
9th May 2011 | 10Project Developer Forum | UNFCCC PoA Workshop, Bonn
Challenges for Project Developer
What is the cost of a CPA-CER?
– No standard product for DOE
– Counterparty Risks
9th May 2011 | 11Project Developer Forum | UNFCCC PoA Workshop, Bonn
Challenges for Project Developer
No standard product for DOE
– Quotations for Validation:
“Proposed Activity not possible”
– Cost for Verification?– Liability shift to PD?
9th May 2011 | 12Project Developer Forum | UNFCCC PoA Workshop, Bonn
Challenges for Project Developer
Counterparty Risks
– Project management costs– Role & Experience of CME– EB 48 Annex 66/67 ?
Traditional CDM PoA
9th May 2011 | 13
Building Blocks for a scale up post 2012
– Firm status of EU eligibility
– Scope beyond LDC?
– Standardised Products from DOEsincl. managing liability
– First delivered issuance
– Tested business models
– Adopted guidelines Validation / Verification procedures
9th May 2011 | 14
Thank you
