Transcript COMO NEGOCIAR CON EXITO

KYOTO PROTOCOL
MECHANISMS
EURASIA 歐亞
Solicitors and Advocates
What is the Kyoto Protocol?
• The Kyoto Protocol is an agreement made
under the United Nations Framework
Convention on Climate Change
(UNFCCC). Countries that ratify this
protocol commit to reduce their emissions
of carbon dioxide and five other
greenhouse gases, or engage in
emissions trading if they maintain or
increase emissions of these gases to a
5.37% less than 1999.
KYOTO PROTOCOL PARTIES
• ANNEX 1 Countries:
– Developed countries
• Non- ANNEX 1
Countries:
– Non Developed
countries
Flexibility Mechanisms
• The Kyoto Protocol defines three innovative “flexibility
mechanisms” to lower the overall costs of achieving
its emissions targets.
• These mechanisms enable Parties to access costeffective opportunities to reduce emissions or to
remove carbon from the atmosphere in other
countries.
• While the cost of limiting emissions varies
considerably from region to region, the benefit for the
atmosphere is the same, wherever the action is
taken.
• Under this system, the amount to which an Annex I
Party must reduce its emissions over the five year
commitment period (“assigned amount”) is divided
into units each equal to one ton of carbon dioxide
equivalent.
Kyoto mechanisms are:
• CDM: Clean Development Mechanism.- provides
for Annex I Parties to implement projects that reduce
emissions in non-Annex I Parties, or absorb carbon
through afforestation or reforestation activities, in
return for certified emission reductions (CERs, tCERs
and lCERs) and assist the host Parties in achieving
sustainable development and contributing to the
ultimate objective of the Convention.
• JI: Joint Implementation.- an Annex I Party may
implement an emission-reducing project or a project
that enhances removals by sinks in the territory of
another Annex I Party (with a commitment inscribed
in Annex B of the Kyoto Protocol) and count the
resulting emission reduction units (ERUs) towards
meeting its own Kyoto target.
The clean development mechanism
(CDM)
• Provides for Annex I Parties to implement project
activities that reduce emissions in non-Annex I
Parties, in return for certified emission
reductions (CERs).
• The CERs generated by such project activities
can be used by Annex I Parties to help meet
their emissions targets under the Kyoto
Protocol.
• Such project activities are to assist the
developing country host Parties in achieving
sustainable development and in contributing to
the ultimate objective of the Convention.
Emissions trading (or cap and trade)
• Is an administrative approach used to control pollution by
providing economic incentives for achieving reductions in
the emissions of pollutants.
• A central authority (usually a government agency) sets a
limit or cap on the amount of a pollutant that can be
emitted. Companies or other groups that emit the pollutant
are given credits or allowances which represent the right to
emit a specific amount. The total amount of credits cannot
exceed the cap, limiting total emissions to that level.
• Companies that pollute beyond their allowances must buy
credits from those who pollute less than their allowances.
• This transfer is referred to as a trade. In effect, the buyer is
being fined for polluting, while the seller is being rewarded
for having reduced emissions. The more firms that need to
buy credits, the higher the price of credits becomes -which makes reducing emissions cost-effective in
comparison.
How de process works in South America
• In any Annex 1 Country
the cost of reducing one
ton a year of Co2 is USD
200-500.
• Specialized brokers seek
projects in Non Annex 1
countries to reduce
emissions. The whole
process takes 8 to 16
months.
1. Presentation of the
Project Idea Note or
PIN in the Ministry of the
Environment or the
related governmental
organism.
2. The organism will issue
the Project Design
Document or PDD.
3. Audit of the process to
certify the amount of
Co2 that will be reduced.
Continuation of the Process on the United
Nations Development Programme or UNDP
• After checking that the process will reduce
the projected Co2 over the next 6 years
the UNPD emits the certificates.
• The Certificates may be negotiated by the
owner.
• The ownership depends on the “sponsor”
of the program. There are 3 kinds of
ownership.
Ownership of Certificates
• The company assumes every costs and
risks and freely negotiates the Certificates
at USD 15-20 Ton/year, depending of the
market prices.
• The company pre sells the Certificates and
receives partial help from the buyer
(country or broker) at USD 7-9 /ton/year
• The company pre sells the whole package
and receives the agreed price: USD 4-5
/ton/year.
FINAL WORDS
• Because the market is constantly
changing it is similar to a stock market.
• In order to have an attractive project it's
required a minimum of 10.000 ton CO2
annually.
THANK YOU!
• Please feel free to contact for any
further details!