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clean development mechanism

Kenya’s first Carbon Credits from Geothermal Energy Pay for Schools

Patricia Marcos Huidobro's picture

Kids at the Oloirowua Primary School in Suswa, Kenya.

Last month, I drove through dust on bumpy dirt roads from Nairobi to visit the Oloirowua Primary School in Suswa, 140 kilometers northeast of the Kenya capital. The school sits on the vast savannah near Hell’s Gate National Park, an area with substantial geothermal potential.

Here, KenGen, Kenya’s electric generating company, has built the country’s largest geothermal plant with support from the World Bank. It’s part of the utility’s effort to “green the grid.”

At the school, classes are being taught outdoors and kids sit under a few trees with notebooks in their laps. Their old and crumbling school will soon be replaced by a new building that will accommodate 200 students. Their faces light up when they talk about the new school, and I feel thankful for being able to work with projects like this where I see the direct effects of our work on kids’ education.

Reducing Methane with Innovative Finance

Brice Jean Marie Quesnel's picture

 Curt Carnemark/World Bank

One key to addressing climate change is attracting private capital to finance low-carbon sustainable development.   For 2013, the World Bank estimates over US$1 trillion will flow to developing countries from private sources.  In order to increase capital flows to finance low-carbon investment, many forms of innovation are needed.  One source of innovation could come in the shape of results-based finance (RBF).   RBF, also known as pay-for-performance, was pioneered in the health sector and serves as the backbone of anticipated payments for protecting forests. It is increasingly being considered as a means for financing the adoption of low-carbon development pathways and greenhouse gas (GHG) emissions abatement. RBF provides payments for success, and only upon the delivery of pre-defined, verified results.

To see how such a results-based approach to mobilizing private sector funding could work in methane reduction, the World Bank convened - at the request of the G8 - a dedicated study group which looked at the role that pay-for-performance mechanisms could play. The resulting report from the methane finance study group found that, when implemented, pay-for-performance provided by a credit-worthy third party can be a powerful catalyst for private investment. There is potentially much wider scope for the use of pay-for-performance mechanism in climate finance for its deployment to target other GHGs in addition to methane.

Can Transport Continue to Drive Development in the Face of Carbon and Resource Constraints?

Andreas Kopp's picture

 Shutterstock

Transport drives development: It leads agricultural producers out of subsistence by linking them to markets, enables regions and nations to become more competitive, and makes cities more productive.  But transport is also a big polluter, contributing 20 percent of global energy-related CO2 emissions.  These emissions have grown by 1.7 percent annually since 2000, with 60 percent of the increase in non-OECD countries where economic growth has been accompanied by a surge in demand for individual motor vehicles.

Are attempts to change this trend bad for development? Recent historical experience tells us otherwise. Countries with the lowest emissions per passenger-km are the ‘development miracles’ of recent decades: Japan, Korea, Singapore, and Hong Kong are all champions in transport fuel-efficiency.

So what would a low-emission future look like? Some see rapid improvements in engine technology as the path to de-carbonization. (Source: IEA) The IPCC, however, finds that technical breakthroughs such as mass affordability of fuel cell cars are unlikely to arrive soon. If so, emission reductions will have to be achieved by a modal change, emphasizing mass transit, railways, and inland water transport rather than individual motorization and aviation.

China Gets Ready for a New Carbon Era

Wang Shu's picture

 Rush hour traffic on a road in Beijing, China. - Photo: Shutterstock

Also available in Chinese

The 5th Assembly of the World Bank’s Partnership for Market Readiness (PMR) is coming to an end after rich and rewarding meetings in Washington DC this week. I had the opportunity to present China’s final Market Readiness Proposal (MRP) (pdf), or in more simple language, China’s proposal to build a national emission trading system (ETS). Together with China, the PMR also received proposals from Chile, Costa Rica and Mexico on their initiatives. (Also read: Can Carbon Taxes Be Effective?)

From the Chinese perspective, our MRP serves as a summary of the Government’s initial thoughts on how a domestic ETS would be established to cover the whole country. For this to happen, a lot of work needs to be done, and this proposal provides a framework and roadmap to guide us on our journey. We are expecting domestic and international institutions, experts and stakeholders from different levels to be involved in this design process. Above all, we hope to draw on the experience of existing carbon markets around the world as well as from the seven pilot ETSs - comprising five cities and two provinces - set to start this year in China. Facilitating continuous technical dialogues, PMR serves as a knowledge exchange platform for our team from China and all the participant countries. This is a unique and valuable experience. 

City-wide Clean Development Mechanism: A Framework for Empowering Cities

Maggie Comstock's picture

Under the Kyoto Protocol’s Clean Development Mechanism, certain cities in developing countries have begun adopting an integrated systems approach to emissions reduction and resource conservation. Lauding their efforts, Maggie Comstock, Policy Associate, US Green Building Council asks when developed countries like the US will follow suit.

This blog originally appeared in the Official Blog of the US Green Building Council

As the dust settles after the COP17 Climate Talks in Durban, a sigh of relief is released. The mechanisms under the Kyoto Protocol have survived to see a second commitment period.

The mechanisms under the Kyoto Protocol—the Clean Development Mechanism (CDM), Joint Implementation (JI) and emissions trading—provide flexibility as participating countries attempt to comply with their emission reduction targets. Each of these mechanisms allows developed countries to fund emissions reduction projects outside of their borders in order to meet their domestic targets. The CDM has been universally embraced by the first and third world as a way to encourage sustainable development and green economic growth in developing countries.

Political Risk Insurance at the Forefront of Carbon Finance

Hoda Atia Moustafa's picture

Reduce. Reuse. Recycle. Green is the new black. With all of us more aware of global warming and the need to save our environment, the big question we at MIGA are asking is: what can we as an institution do to contribute?

Political Risk Insurance at the Forefront of Carbon Finance

One answer is that we can continue to do what MIGA has always done: supporting private investors. Specifically, however, MIGA can support those investors in the now well-established market of certified emission reductions (CERs) that are freely tradable on the European market, but depend heavily upon activities undertaken in developing countries. Investors relying on CERs as returns on their investments (in lieu of dividends) want assurance that governments that have signed up to the Kyoto Protocol will not renege on their commitments. This is very much a political risk, and with the right structuring is potentially a powerful political risk insurance product line.

Carbon Expo highlights China's experience in Clean Development Mechanism

Florian Kitt's picture

Ok. We are back again @ Carbon Expo. This year in Cologne. The German weather cannot really keep up with Barcelona (were Carbon Expo was held in 2009) but we are keeping the spirits up and the opening event proved to be very interesting with a speech by the German Environment Minister, Norbert Roettgen.

On his round across the fairground the Minister then visited the China booth and the East Asia Pavilion, where Thailand, Mongolia, Lao, and Indonesia and China are exhibiting. Jiao Xiaoping, Deputy Director General, CDM Fund, China, welcomed the Minister and presented him with the latest report on "Clean Development Mechanism in China". We'll soon have it up here.

Adding climate finance to our promises

Kseniya Lvovsky's picture
Photo © istockphoto.com

Here is the sad truth: Presently, the resources available for developing countries to address the impacts of climate change cover 5% of estimated needs by 2020.

One of the challenges is to mobilize the resources needed without dipping into the same basket of current official development assistance (ODA). Another challenge is to measure and monitor what is 'new and additional' from the complex web of sources and channels.

More than a technical exercise, it is a useful tool to build trust and accountability with developing countries to show that assistance is being delivered in line with promises made. 

Why so few carbon projects in Africa?

Isabel Hagbrink's picture
In Ethiopia, Humbo mountain is thriving after early regeneration efforts. Photo © World Vision

What are the obstacles to implementing carbon projects in Africa?

This was the question underlying many of the discussions at the Africa Carbon Forum, which took place in Nairobi, Kenya on March 3-5, 2010.

Over 1,000 participants attended the conference to discuss obstacles such as lack of financing, lack of experience and technical skill, land titling and monitoring challenges, and the complexity of Clean Development Mechanism (CDM) rules. These hurdles have to date resulted in low numbers of African carbon projects: only 2% of CDM projects registered by the UNFCCC are in Africa.