Transcript CF Assist - Carbon finance

Carbon Finance Assist
Update of Activities
Host Country Committee
Steering Committee meeting
4-5 October 2005
Strategic Objectives
 Mission: Enable full engagement of participating countries in
the carbon market/ building liquidity in the market
 Key for CFB delivery on Carbon Funds: CF-Assist should
feature as a key tool to enable CFB to implement programmatic
approach > deliver on commitment to purchase >$900 million
 High demand from client countries: client countries expect
Bank to go beyond bringing a few deals to closure > expect
Bank to build capacity at national / local levels
 Status: Operational as of April 2005
 Currently working on disbursement procedures
Program Description
CF-Assist: A single-purpose multi-donor trust fund for all
WB carbon finance capacity building and technical assistance
Features:
• Modular: program design based on needs assessment of
national conditions;
• Key Players: targeted at government institutions, private sector
entities, and the financial sector;
• Phased Approach: Divided in three phases to be completed in
3-5 years, with measurable performance indicators;
• Learning-by-doing: one to three projects per participating
country will be brought to market; where the Bank is the buyer
of last resort;
• Timing: March 2005 – 2012
Sources of Funding
CF Assist Umbrella
Experience
Exchange
(Coordination of all Technical Assistance and Capacity Building)
Direct Donor
Contributions
“Plus TA
Funds
PCF
$8.5M
(in-hand as of 2/05)
+
BioC +
CDCF +
Carbon
Finance
Business
(Carbon Asset
Purchases)
PHRD
(Implemented By Countries
& Regions w/CF-A Assistance)
•CFB buyer of last
resort for PDDs
developed under CFAssist
•CFB potential buyer
of other projects in
portfolio
$ Interest Earnings on
CFB Funds
Phase I: Bank execution
Indicators for Phase I Completion:
• CDM Governance: DNA has been established with criteria
and procedures / timelines for project approval
• Private Sector Engagement: Key experts in financial sector /
industry have been trained on design of carbon finance projects
• Deal Flow: Key sectors identified and potential volumes of
ERs quantified; information widely disseminated
• At least one PDD has been completed
• Knowledge Management: Private sector and public sector
agencies are fully aware of the CDM/JI potential and have put
systems in place to assess projects at their institutions
Phase II: Recipient and/or Bank Executed
Indicators Phase II Completion:
• CDM Governance: supportive regulatory and policy
frameworks for carbon finance projects developed
• Private Sector Engagement: Financial industry trained on in
synergies of carbon finance with lending/ grant instruments
• Deal Flow: At least one project validated [and registered] and
marketed to carbon buyers (three for middle income countries)
• One industry association or intermediary fully engaged in
carbon finance (intermediary has signed an agreement)
• Existence of a healthy and dynamic deal flow
• Participation at Carbon Expo
• Knowledge Management: knowledge sustained through
distance learning/ web-based instruments
• National and regional networks of experts cultivated
Phase III: Recipient Executed
Indicators for Phase III completion
• CDM Governance: Procedures refined/ validated by objective,
external evaluation
• Private Sector Engagement: Carbon Finance is fully integrated in
investment promotion strategies / concessional lending decisions
• Deal Flow:
• Intermediaries/ project developers access the carbon market
• JI countries: First Track/Art 17 participation. Establishment of green
investment scheme, traded volume
• Ongoing participation at Carbon Expo
• Knowledge Management: South / south knowledge transfer
• nationa/ regional community of practitioners
Measurable Indicators during
First Year
• Goal was to initiate CF-Assist programs in fourteen to
sixteen countries; complete phase two in eight to ten
• Status: initiated programs in sixteen countries
• Argentina, Bolivia, Brazil, Cambodia, Cameroon, Central
America, Ghana, Kenya, Mali, Mexico, Mozambique, Senegal,
Sri Lanka, South Africa, Uganda , Zambia
• Challenge: monitor results, disseminate lessons learned
• Carbon Market Study: issued at Carbon Expo in May 2005;
translated to Spanish
Example of Program: Mexico
Mexican CF-Assist Program: enabling energy sector to
bring projects to market for the first commitment period before
closing window of opportunity
Period: three years
Sector-focused program, first year on energy sector;
Executed by local implementing agency, in close collaboration
with Energy Ministry (SENER), and Environment and Natural
Resources (SEMARNAT), PEMEX, CFE, and the World Bank.
Launch date: end of November 2005
Argentina
Argentine Carbon Facility: first of kind facility
managed by host country to overcome significant
financial barriers
Objectives: to promote new investments in climate
friendly technologies, enhance Argentina’s potential in
the carbon market, promote partnership between public
and private sector.
Status:
design: evaluating proposals, discussion paper
should be done by end of 2005
•
•
identification of portfolio of projects
Focus on Africa
Without special focus, possibility that Africa is being
by-passed by the carbon market
•
PHRD grants in: Kenya, Senegal, South Africa,
Uganda
•
CDCF/ UNEP Partnership in Zambia, Mozambique,
Mali, Ghana, and Cameroon
•
Activities:
• PIN/ CFD development
• Training on project formulation and baseline
methodologies
• DNA/ institutional capacity building
•Status: on track; seeking additional funding
•
Green Investment Schemes
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Key to bridging OECD compliance gap in Kyoto
Protocols
Greening necessary to increase comfort level of
many buyers to ensure that proceeds from sale of
AAU s > result in real and measurable emission
reductions
Need more funding
Demand from Bulgaria, Russian Federation,
Latvia, Czech Republic, Slovak Republic
Other likely countries: Romania, Ukraine, Poland
Carbon Expo: May 10-12, 2006
Preparations Under Way
• Building on Last Year’s Success
1.385 participants from 85 countries in 2005 (50 % increase from
previous year)
134 exhibitors (168 % increase from previous year)
• First Platinum Sponsor: TFS Brokers
• Gold Sponsors: Government of Canada, DNV
Bank support for Host Countries: priority to CF-Assist countries;
those with large portfolios, well prepared
Training/Market Development Activities
• Integral part of CF-Assist country programs:
• Project identification and design
• Baseline Methodologies
• Contracting and Risk Management
• Exploratory Workshops in countries with high potential:
Georgia, India, Pakistan, Russian Federation
• GHG Forum: in India
• Carbon Expo Asia
• Fellows: from China and Morocco
Challenges/ Opportunities
Demand far exceeds our capacity to deliver
 Some unfunded activities in work program:
transportation sector, more countries, small
grants
 Early success needed to build confidence
 First Commitment Period

Issues for Discussion
•
Is program meeting needs of Host Countries?
•
How to make CF-Assist more effective?
HCC members to take lead in some activities:
newsletter; pricing sub-committee;
•
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Comments on report