Philippine DNA for CDM Institutional Structure, Procedures and Sustainable Development Criteria Start of Project Addressing unsustainable growth and development at the expense of ENR sector; socio-economic development and poverty alleviation are top priorities Climate Change Initiatives: 08 May ‘91: Creation of the Philippine Inter-Agency Committee on Climate Change (IACCC) 15 Apr ‘98: Philippines signed the Kyoto Protocol Dec ‘99: Initial National Communication on CC CDM seen as an opportunity to achieve investment targets in priority sectors: the project explored ways to expedite designation of a CDM NA and country ratification of Kyoto Protocol 2002: Project on the Establishment of CDM NA Operational Framework and Support Systems was conceptualized; supported by the Dutch Government through UNDP Developments 20 Nov ’03: Philippines ratified the Kyoto Protocol 25 Jun ’04: DENR designated as the National Authority for CDM in the Philippines (Presidential Executive Order No. 320) 31 Aug ’05: DENR as the DNA issued Departmental Administrative Order (DAO) No. 2005-17 on the rules and regulations governing the implementation of EO 320 05&07 Sept ’05: publication of DAO 2005-17 16 Dec ’05: Issuance of First Letter of Approval by the Philippine DNA for CDM Present steps: DNA support mechanisms Manual of Procedures Supplementary guidelines/ issuances Philosophy of design Holistic approach through cooperative efforts Multi-sectoralism Regulatory stability Designation by executive issuance Participatory and transparent selection of sector representatives Balancing administrative feasibility and competitiveness in creating a system that is conducive to investment Continuing examination of links between the CDM system and other domestic processes relevant to CDM as guided by experience Philippine CDM approval process will: enrich practical & holistic development interventions enhance the policy environment Emplace transparent, credible and efficient procedures conducive to investments and consequently, socio-economic growth DNA Structure DENR Secretary TEC for Energy-Related Project Activities DOE CDM Steering Committee Chairperson – DENR USec and an alternate TEC for Afforestation & FMB- Members and alternates: Reforestation Project DENR DOE, DOST, Private Sector, Activities NGO TEC for Waste EMB- CDM EMB- Management Project DENR Secretariat DENR Activities CDM NATIONAL APPROVAL PROCESS BASIC STEPS Step 4 Step 1 Step 2 Step 3 Project Project Project Project Approval/ Application Evaluation Endorsement Non-Approval Project TEC CDM Steering DNA Proponent Committee (Secretary of DENR) Project Application Monitoring CDM Secretariat Sustainable Development Enhanced Philippine Agenda 21: harmonious integration of a sound and viable economy, responsible governance, social cohesion and ecological integrity Medium Term Philippine Development Plan (MTPDP) for 2004- 2010: Overcome poverty with promotion of livelihood, strengthening of education, attainment of fiscal stability, decentralized development and arriving at sustained national harmony ENR sector to pursue sustainable and more productive utilization of natural resources to promote investments and entrepreneurship Create a climate conducive to investments and production by • Liberalizing/streamlining and refocusing the EIS System • Linking community-based programs and small/medium scale projects to sources of finance and markets • Implementing at least 10 CDM project activities • Shifting from technology generation to technology transfer as well as providing technical assistance, best suitable practices and technologies Basic Policy of the DNA Facilitate and promote CDM project activities that: contribute to the UNFCCC objective of stabilization of GHG concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system lead to the transfer of environmentally safe and sound technology and know-how contribute to the conservation of biological diversity and sustainable use of natural resources comply with all other pertinent laws and regulations provide measures to alleviate poverty as part of their contribution to sustainable development Sustainable development criteria for CDM: Adhere to the antipoverty goals articulated in the PA21 and MTPDP by upholding project activities that: - provide livelihood and economic opportunities - provide new financial resources - promote use of cleaner, more efficient and environment-friendly technologies - provide proper safety nets and compensatory measures Recognize that ecological integrity is a key pillar of Philippine SD by pushing CDM project activities that: - promote sustainable use of natural resources - improve local environmental quality - comply with national environmental policies and standards Sustainable development criteria for CDM: Work toward instituting social order based on fairness and provision of support systems that look after the welfare of every Filipino by supporting CDM project activities that: - provide education & training to build capacities of local stakeholders - enhance access to local resources and services for vulnerable groups - promote local participation in the project Allowing only CDM project activities that have an overall positive impact on the national sustainable development ensures that the CDM process is aligned with Government’s priority development strategies, plans and programs Sustainable Development Benefits Description (SDBD) A document presenting the sustainable development impacts of the proposed CDM project activity Item IX of PAD; minimum content shall follow the outline below per Annexes III and IV of DAO 2005-17: Small Scale Project Activities: Project Activities Not _________________________ Considered Small Scale: I. General Project Information -same- II. Economic Dimension -same- III. Environmental Dimension -same- IV. Social Dimension -same- V. Monitoring Measures VI. Mitigating Measures V. Overall Sustainable Development -same- (Item VII) Impact of the Project First Proposed CDM Project Issued with a Letter of Approval by the Philippine DNA The NorthWind Bangui Bay Project Regular Scale: 33MW wind turbine power plant by the NorthWind Power Development Corporation Region I: Bangui Bay, Ilocos Norte est. 51,855 tCO2-e/yr by displacement of grid power generated from fossil fuels First commercial wind power project in Southeast Asia First of its kind to be connected to the Philippine main grid Sustainable Development Benefits of the Project: Economic Dimension Serves as the model for the advancement of other indigenous renewable energy sources in the country and the greater ASEAN region Provides training assistance for government personnel of the Department Energy, making the project an effective medium of transfer of wind power technology and know-how Contributes to tourism growth as it has become a prime attraction in itself Opens economic opportunities by attracting investors as a result of the dramatic improvement in the power supply, and by drawing tourism- related industries to set up in the area Provides discounted power rates to beneficiary residents as the project will sell electricity at about 7% lower than the NPC rate Sustainable Development Benefits of the Project: Economic Dimension Commits 1 centavo/kWh of total electricity sales as financial benefit to host community Provides additional tax revenues for the local government even as this pioneer project did not obtain subsidy from the State to improve its profitability Improves employment opportunities by prioritizing the hiring of local labor Use of sustainable/renewable energy contributes to energy independence/self-sufficiency thereby supporting the country’s transition to a low carbon economy that limits emissions intensity of future economic growth Sustainable Development Benefits of the Project: Environmental Dimension Broadens the country’s resource base by utilizing an indigenous, inexhaustible and more environmentally sound energy source Complies with the Philippine Environmental Impact Assessment System and has been issued an Environmental Compliance Certificate (ECC) Construction mirrors the curvature of the shoreline to blend with the natural terrain Use of the natural resource, i.e. wind energy, is sustained through the 20-year Electricity Sales Agreement with the local electric cooperative for the provincial consumption of the power to be generated by the wind plant Sustainable Development Benefits of the Project: Social Dimension Maintains open access to the beach or sea for the local fishermen and the pebble pickers Provides an access road to the shore area, making it convenient for the local population to get around as they go about their usual business in the shoreline area Allocates funds for the social development programs benefiting the host villages Challenges Technical gaps in baseline determination, monitoring methodologies, et al. stalls the development of priority sectors such as energy efficiency, transport and afforestation/reforestation, which have high CDM potential Sizeable rural population presents a large trade and investment potential but CDM-eligible project activities in the Visayas and Mindanao regions remain untapped Nature of small scale CDM project activities provides huge potential for benefiting poor sectors of society but the associated proportionately higher risks prevent these from taking off; lacks the capacity to develop bundled projects for various sectoral scopes Timely updating in light of the quickly evolving international rules as well as developments in national policies, laws, rules and regulations requires continuous capacity building to manage the complex CDM process Challenges The evaluation of sustainable development (SD) benefits needs to be further refined; conduct of case studies per sector on how CDM projects have actually contributed to national and local sustainability is crucial Limited capacity of relevant groups such as sector-specific/ industry associations, rural cooperatives and NGOs to develop CDM projects across the country Limited pool of locally based qualified CDM advisors to assist in CDM project development and the absence of locally based operational entities that can provide competitive validation and verification services -Mabuhay at Maraming Salamat!