Progress Report on
Phase I of the UNEP Project in Egypt
“Capacity Building Development
The Clean Development Mechanism”
Phase I Country Report Outline
I.1. Project background
I.2. Capacity development needs
II. Country Circumstances Relating to Cc and CDM
II.1. Institutional arrangement in the context of climate change Country-specific institutional arrangement
and its potential linkage with this project
II.2. Prior & on-going activities related to CC
II.3. Prior & on-going activities related to the CDM and perspectives for CDM
III. Country Specific Issues in Relation With The UCCEE/UNEP Project
III.1. Institutional arrangement for the implementation of the project
III 1. 1. Focal point
III 1. 2. National institution (Technical Support Entities)
III 1. 3. participants
III.2. Status of the contractual arrangements with national institution (Technical Support Entity)
and MOU with government
III.3. Evaluation of institutional and overall capacity in relation with the CD for CDM project
III 3. 1. Focal point
III 3. 2. National institution (Technical Support Entity, TSE)
III 3. 3. National institution
Iv. Status OF Objectives, Outputs & Activities In Phase I
IV.1.Tasks in Phase I: completion of a work plan for phase II presentation of the workplan for
phase II, and description of the activities
IV.2. Outputs: workshop proceedings & presentation files, work plan, etc.
V. Notes From Initial Contacts With Stakeholders
Iv. List Of Potential Participants & Stakeholders In The Project
Annex-I: Detailed National Work Plan
Annex-II: Workshop proceedings & presentation
I. Introduction and objectives
The United Nations Environment Program
(UNEP) has launched the project “Capacity
Development for the Clean Development
Mechanism” with financial support from the
The UNEP Collaborating Center on Energy
and Environment (UCCEE) is the
supporting organization contracted by
UNEP to implement the project.
• generating in participating developing
countries a broad understanding of the
opportunities offered by the Clean
Development Mechanism, and
• developing the necessary institutional and
human capabilities that allows them to
formulate and implement projects under the
I.2. Capacity development for the CDM needs
The CD for CDM project objectives:
1-Definition of regulatory framework that supports CDM
2- Identify prospective CDM projects,
3- Formulate investment plans,
4- Validate CDM projects, and
5- Monitor and report the results of CDM activities.
The main products of this preparatory phase are:
1- Establishment of a country specific strategy approach in order
to obtain the highest degree of political support.
2- Designate an appropriate focal point agency that will
coordinate national CDM activities and investments.
3- Prepare terms of reference and determine the organizational
structure for the focal point agency.
4- Develop a multi-year work plan for promoting national CDM
activities and investments.
5- The phase-I progress depicts the previous products.
II. Country Circumstances Relating to CC and
II.1. Institutional Arrangement in the Context of Climate
Governmental institutions potentially participating in the
Private Sector Institutions and NGOs in Egypt with CDM
Institutions and Authorities responsible for the foreign
direct investment system of Egypt
Annex-III.( 1 ) encounters the most important current
initiatives for GHG reduction in Egypt.
Existing National Governmental Institutions
Ministry of State Ministry of Ministry of Ministry of Ministry of Ministry of
for Environ- Petroleum Electricity & Industry & Agri- Transport
mental Affairs Energy Technological culture
-The Egyptian - New & - Tabbin Institute The Central
General Renewable for Metallurgical Department for
Petroleum Energy Authority Studies (TIMS) Afforestation &
Corporation (NREA) -Egyptian Environment
(EGPC) -Organization of Accreditation
-Egyptian Natural Energy Planning Council (EGAC)
Gas Holding (OEP)
Existing Governmental Institutions Potentially Participating in the CDM
EXISTING PRIVATE SECTOR
INSTITUTIONS AND NGOs
Federation of Private Audit/ World
Egyptian Industries Consulting Energy
(FEI) Firms Council
Energy Efficiency The Egyptian Energy Service
Council (EEC) Business Association
Private Sector Institutions and NGOs in Egypt with
Different Authorities and Their Roles & Responsibilities in the Foreign Direct
Investment System of Egypt
Role and Responsibility Institution
Attraction of 1.External promotion to attract Ministry of Foreign Affairs, Ministry
potential investors potential foreign investors and of Information - State Information
investments Office, Ministry of Economy -
Commercial Offices in Egyptian
2.Information on foreign Ministry of Economy, The General
investments in Egypt Authority for Industrialization (GOFI),
The General Authority for Investment
(GAFI), Federation of Egyptian
Industries (FEI), NGOs
3.Facilitation of investments Cabinet of Ministers – Prime
Approvals 4.Allocation of land GAFI, governorate or New
5.Issuance of the preliminary The General Authority for
approval for the project Industrialization (GOFI) or The
General Authority for Investment
6.EIA approval Egyptian Environmental Affairs
7.Final approval for the project The General Authority for
Industrialization (GOFI) or The
general authority for investment
8.Acquiring a permit for Municipality/governorate or New
construction Communities Authorities
Different Authorities and Their Roles & Responsibilities in the Foreign Direct
Investment System of Egypt
Role and Responsibility Institution
Organizational 9.Issuance of an import card for the Ministry of Economy and Ministry of
procedures & project (if necessary) Finance
10.Issuance of a license for Municipality/governorate or New
operation Communities Authorities
11.Issuance of a tax card and Ministry of Economy/ Ministry of
registering in the commercial Finance/ Ministry of Internal trade
12.Registering at the Federation of Federation of Egyptian Industries
Egyptian Industries (FEI), for (FEI)
industrial projects under companies‟
13.Insuring the workforce Social Insurance Authority – Ministry
of Social Affairs
14.Acquiring a certificate of Egyptian Standardization Authority –
production compliance with Ministry of Industry & Technological
standardized specifications Development
15.Verification of the share of the The General Authority for
local component in products Industrialization (GOFI)
16.Acquiring other permits for General Authority for Investment
production expansions or product (GAFI)/ The General Authority for
diversification Industrialization (GOFI)
II.2. Prior & on-going activities related to Climate
The prior and on-going activities are divided into two
- Measures for reducing GHG emissions
• Governmental firms and;
• Complementary voluntary activities by non-
II.2.1. Prior activities related to Climate Change
The following are the activities related to the climate change
and prior to the CDM.
a. Egypt‟s Climate Change National Action Plan (ECCNAP)
• The project deals with both the assessment of Egypt‟s
vulnerability to the adverse impacts of climate change as well
as the assessment of the potential GHG mitigation.
• Within the assessment GHG mitigation, the project has been
providing an in-depth coverage of the financial,
environmental, social and economic impacts of a set of seven
energy efficiency technologies.
• These technologies are fuel substitution, co-generation,
combustion control, waste heat recovery, efficient lighting, use
of renewable energy and steam condensate recovery.
Building capacity for Egypt to respond to UNFCCC, it
• Strengthening Egypt‟s capacity to comply with the
requirements of the UNFCCC,
• Institutionalizing the national communication to
comply with the UNFCCC, and
• Contributing to the emergence of Egyptian
approaches and responses to the UNFCCC.
• Training of experts,
• Setting-up of seminars, workshops and studies
related to climate change, and
• Establishing close links with regional
UNEP/GEF projects in general and taking part
in international training programs
C. Egypt‟s Initial National Communication on
• The Initial National Communication on Climate Change
(NCCC) was issued in the year 1998 as a necessary
document for evaluation of Egypt‟s inventory of green
• It is one of the main documents on which the National
Strategy Study (NSS) on clean development mechanism
(CDM) was based.
II.2.2. On-going activities related to Climate
These initiatives can be classified into:
•Institutional, (encountered in item II.1)
The Institutional Initiatives are encountered in item
II.1, “Institutional arrangement in the context of
b. Technology/Market Initiatives
Technology Cooperation Agreement Pilot Project (TCAPP)
• Acknowledging technology transfer as one of its highest
priorities, Egypt is focusing on such initiatives as the
Technology Cooperation Agreement Pilot Project
(TCAPP), in cooperation with the U.S. Country Studies
• The TCAPP is chartered to develop consensus among key
Egyptian organizations on a set of high priority, climate-
friendly, technology issues aimed at successful
• Results are expected to produce candidate technology
transfer areas for consideration under the guidance of the
National Climate Change Committee. Market
development plans for selected technologies are currently
Promotion of Wind Energy for Electricity
• This is an active program within the Ministry of
Electricity and Energy, through the New and
Renewable Energy Authority.
• Supported by many international donors, this project
aims at installing 600 MW of wind turbine by the year
• The first 300 MW is already contracted through
different donors, and most of them are scheduled to
be operating by 2006.
Fuel Cell Bus Demonstration Project
• Funded by the GEF, the UNDP is currently supporting
fuel cell bus projects in Cairo, The demonstration in
Cairo features eight fuel cell buses with associated
hydrogen production and supply facilities.
• The program will run for five years, with three years
devoted to driving, monitoring and testing performance.
• Service is targeted for implementation in the year 2001.
• With a focus on technology transfer, Egypt hopes to
expand the success of this demonstration in its
Other Projects are:
• Hybrid-Electric Bus Technology in Egypt
• Natural Gas Motorcycles
• Methane Recovery from Landfills
• The Integrated Solar Thermal/Natural Gas
Power Plant at Kuraymat
• The Energy Efficiency Improvement and
Emissions Reduction Project
• Fuel Switching
C. Other Activities in Egypt for GHG Emissions
Egyptian Energy Efficiency Council (EEC) programs
The Energy Efficiency council (EEC) is a voluntary consortium
of public and private sector organizations associated with the
generation, distribution, and use of energy resources in Egypt.
The council currently includes 12 organizations representing
seven Ministries and two organizations representing the views
and interests of the private sector.
Its aim is to oversee the development of a national energy
efficiency strategy that will be used as a roadmap to increase
Egypt‟s efficient use of its natural resources.
d. Overview on Current GHG Emissions in Egypt and
Projection of Emissions Until 2017
• The latest comprehensive inventory of GHG emissions and sinks
(removals) for Egypt has been compiled for the fiscal year
1990/1991 (July 1st, 1990 – June 30, 1991).
• The net GHG emissions of Egypt in 1990 were 106,608 Gg of
CO2 equivalent, while the total GHG sinks in the land use sector
recorded 9,900 Gg of CO2 equivalent. CO2 is the main
greenhouse gas in Egypt. It represented about 72% of the total
GHG emissions in 1990.
• The main emitters of GHG in Egypt are fuel combustion in the
energy (22%), industry (21%), transport (18%), sectors.
• The total energy-related emissions (”All energy”) are responsible
for 71% of the total GHG emissions.
• Therefore, the sectors energy production, industry and transport
are the primary target for GHG emission reductions measures.
Total = 106,708Gg
% CO2 Equivalent 15%
All energy emissions, % GHG
All energy emissions = 71% of total GHG
Sector Percentage Share of Net GHG Emissions, 1990/1991
Source: Extracted from OECP (1998)
The estimation of Egypt‟s GHG emission projection until 2017 for
the all energy sector is based on the SNAP project at OEP. For the
waste sector, the GHG emission growth rate was estimated at 1.6%
annually based on the assumed annual average population growth
CO2 Equiv 1000 Gg
GHG Emission Projection for all Sectors (in 1000 Gg of CO2
-20 0 1000 2000 3000 4000 5000 6000
1000 Ton C
0 1000 2000 3000
Marginal Abatement Cost Curve for Egypt
Summary of Technologies, Saved Carbon and Cost of Saved Carbon
Area of Application Technology Ton C Saved
1. Textile Cogeneration -380 544,414
2. Fuel switching in transportation Fuel switching -300 20,640
3. Chemicals Cogeneration -260 353,869
4. Food and beverage Cogeneration -220 73,496
5. Metals Cogeneration -160 306,233
6. Building Cogeneration -90 274,929
7. Buildings Combustion Control -80 1,093
8. Hotels Combustion Control -80 6560
9. Metals Combustion Control -80 8201
10. Food & Beverage Waste Heat Recovery -80 13,649
11. Food & Beverage Combustion Control -80 37085
12. Metals Waste Heat Recovery -80 38,515
13. Textile Combustion Control -80 55309
14. Textile Waste Heat Recovery -80 58,240
15. Chemicals Waste Heat Recovery -80 101,336
16. Chemicals Combustion Control -80 103,145
17. Hotels Cogeneration -45 152,436
18. Fuel switching in industry Fuel switching -21 97,608
19. Organic waste management Waste Management 0 37,336
Methane recovery from Municipal solid
20. Solid Waste Management 0 310,600
21. Coastal sand dune fixation LULUCF 7.11 101,870
Casuarina and sissoo plantations around
22. LULUCF 12.29 240,000
Planting along irrigation and drainage
23. LULUCF 14.11 967,900
24. Planting of roads and highways LULUCF 17.71 1,123,650
Renewable energy for electricity generation
25. Renewable Energy 30 401,380
Acacia stenophylla plantations around new
26. LULUCF 32.62 240,000
Integrated solar thermal Combined Cycle
27. Other Renewable Energy 65 161,820
28. Waterway transportation Transportation 97 32,000
29. Railway electrification Transportation 1600 44,375
30. Solar pumps Renewable Energy 2141 48,000
31. Underground mass transit system Transportation 3169 28,948
• The Energy Efficiency technologies Previous studies
(such as SNAP, 1997 and ECEP, 1998) also support
the current results.
• Implementing the energy efficiency in different
sectors in Egypt may result in GHG reduction
between 1 to 2 million Ton C under the conservative
and optimistic scenarios respectively.
• The waste management sector
• Renewable energy,
• The transportation projects
• LULUCF activities,
1.2.2 Analysis for International Market for
Certified Emission Reductions (Demand)
Principal Results of the CERT Model in the Standard Scenario
Expected Quantity Export revenues of non
International Price internationally Annex I countries
7.8 US$ 388 MtC 3 billion US$
Egypt's Position in the International GHG Offset Market
Assumed Internatio Total Quantity Egypt‟s Export
Scenarios nal Price that can be Revenues in
Sold by Egypt Million US$
Standard 7.8$ 2.6 20.28
Medium 7.8$ 1.8 14.04
Low scenario 7.8$ 1.25 9.75
Standard, 100%, Medium 70% and low 50% sail of GHG emissions
II.3.Prior & on-going activities related to the CDM and perspectives for CDM
The National strategy study (NSS) on CDM
Institutional Needs for the Implementation of CDM in Egypt
National CDM Committee and CDM Unit
As for the institutional framework, two levels of coordination are proposed, the first is a
national committee for CDM and the second is CDM implementation unit.
The mandate of such a CDM unit will include the following:
• Undertaking CDM activities as pertains to awareness and promotion;
• Issuing guidelines for the proposed CDM projects as well as following up CDM project
activities initiated in Egypt;
• Acquiring various approvals and permits on behalf of CDM investors without having
them go through a timely and tiresome process themselves. This will lower transaction
costs considerably and thus, be instrumental in catalyzing CDM projects in Egypt; and;
• Liaise and coordinate with line ministries and governmental agencies to prepare
position papers for Egypt on CDM and representing Egypt in international meetings
and conferences in this field;
• Coordinating technical capacity building;
• Facilitating pilot CDM projects and build relations with potential CDM investors.
Facilitating pilot CDM projects and build relations with potential CDM
The proposed CDM Unit will be responsible for the day-to-day activities of
CDM. It will be the executive secretariat of the National Committee on
Climate Change in the area of CDM. This Committee nonetheless, will be
regarded as the executive board or policy-making body for the CDM in
As for other institutional and logistical prerequisites, Egypt has to look for
international broker firms to promote for CDM projects and carry out
matchmaking with Egyptian partners. Nonetheless, financial auditing firms in
Egypt can play a role in various CDM related activities. They require,
however, intensive capacity building in this field in terms of awareness, skills
and human resources. Many of these firms can utilize the expertise and
experience of their international partners and alliances in the area of CDM.
This will inevitably lead to strengthening and enhancing the domestic skills
and capabilities of those auditing firms in the field of CDM project related
activities and services.
Egyptian non-governmental organizations can play an important
and instrumental role in implementing CDM projects in Egypt.
Accordingly, this role needs to be strengthened and encouraged.
One general recommendation regarding institutional, legal and
technical prerequisites is that there is a pressing need for capacity
building for CDM related activities in Egypt. This is required for
the various agencies and institutions acting as stakeholders in the
investment process in Egypt. It is also urgently needed to advise
the Egyptian Accreditation Council, (EGAC) to take the necessary
actions for recognition of national institutions. The CDM project
cycle mainly consists of project validation, monitoring,
verification and may be certification on both national and regional
basis. This recognition requires capacity building for the national
institutions to meet the required qualifications of operational
entities set forth within the CDM decision adapted at COP-7.
Tasks to be carried out prior to the initiation of the CDM project
Table ( 5 ) summarizes the tasks to be carried out prior to the initiation of the CDM project cycle
activities. These tasks can be conducted by the following options:
Option (1): through which government agencies play the only or main role in fulfilling such task.
Option (2): whereby the private sector and NGOs play the only or main role in fulfilling such
Table 5: Tasks to be Carried Out Prior to the Initiation of the CDM Project Cycle Activities
Option 1:“government” Option 2: “private”
Awareness raising EEAA/ CDM Unit/ NGOs
Training in GHG mitigation Governmental Institutions Private Firms
Continuous monitoring and analysis EEAA/ CDM Unit/
of international GHG offset market CDM Committee
Supporting the Egyptian Ministry of Foreign Affairs
government in international / EEAA/ CDM Unit/ CDM
Attraction of foreign investors for Ministry of Foreign Affairs The Federation of
CDM in Egypt and facilitation of / EEAA/ CDM Unit/ CDM Egyptian Industries
matchmaking between investors Committee (FEI), NGOs, Media &
and Egyptian hosts Public Relation Firms
Tasks in the CDM Project Cycle
Project eligibility measures, National and international
Registration is the formal acceptance of a validated project as a CDM project
Monitoring is the systematic surveillance and measurement of after being
implemented aspects related to the implementation and the performance of a CDM
Verification is the periodic independent review and ex-post determination by a
designated international entity of the emission reductions by sources and/or
enhancements of removals by sinks that have occurred because of a specific
Certification is the written assurance by a designated international entity that
during the verification period a project has achieved the stated emission reductions
and/or removals by sink in compliance with all project performance criteria.
A „Certified Emission Reduction‟ (CER) unit shall be equal to one metric ton of
CO2 equivalent emissions reduced or sequestered arising from a CDM project.
Issuance is the formal release of CERs based on a certification by a designated
international entity. International entities shall certify the emission reductions
resulting from a validated project upon request from a project participant.
Key Actors Tasks/Functions
Governmental Private Companies
- National CDM committee - Project participants
- CDM implementation unit - Engineering/ - Consulting companies
- Project participants - NGOs Project Identification
- Under ministerial bodies - Such as FEI, EEC Project Formulation
- Development Agencies Baseline Determination
- under ministerial bodies - Project participants
(other than the above bodies) - Private Consulting /Auditing Companies
acting as operational entities acting as Operational entities CDM Project Validation
- CDM implementation unit
- Project participants
- Project participants Project Implementation
- Project participants
- Project participants - Project participants CER Monitoring/Reporting
- International or Domestic - International or Domestic Accredited
Accredited body acting as body acting as Operational entities CER Verification
- Int‟l or Domestic Accredited - Int‟l or Domestic Accredited body acting
body acting as Operational as Operational entities CER Certification
CDM Executive Board
A Note on Transaction Cost
The transaction costs and any rent seeking in
CDM projects should be minimized as much as
possible in order to achieve a more efficient and
cost-effective CDM mechanism in Egypt. The
anticipated CDM unit will, through its “one stop
shop”, facilitating and coordination role be to a
large degree responsible for low transaction costs
in CDM projects. wherever this issue need to be
addressed on more global level under
UCCEE/UNEP project and on national level at the
time of implementation of phase II.
III. Country Specific Issues In Relation With The
Objectives Assigned to the Work Plan
Through the period from 2003 to 2005, it is required to realize the
• Establishment, development of an operational Designated
National Authority Of CDM
• Awareness enhancement
• Capacity development among relevant national stakeholders
• Development of a pipeline of marketable CDM projects, this
„shopping list‟ includes all the necessary documentation for
soliciting investments. The package will be dynamically
overviewed and updated.
The Designated National Authority (DNA) is a part of a National
well-planned institutional setting. The following are the
suggested institutional arrangements.
III.1. Institutional Arrangement For The Implementation Of
A suggested regulatory framework that supports CDM activities is
defined in the following arrangements.
III.1.1. Focal point
The Egyptian Environmental Affairs Agency (EEAA), through its
Climate Change Unit (CCU), is the official technical focal point for
climate change activities in Egypt. In this capacity, the
EEAA/CCU is also identified as the Focal Point Agency (FPA) for
the duration of the present project.
At some time in the future, a CDM Unit (also referred to in
UNFCCC terms as a Designated National Authority (DNA)) is
expected to be established. The establishment and development of
this CDM Unit or DNA is a principal objective of the project.
III.1.2. National institution (Technical Support Entity)
A Technical Support Entity (TSE) will be assigned to implement
certain project tasks on behalf of the FPA, under direct contract to
the UNEP Collaborating Center on Energy and Environment
(UCCEE). The entity UCCEE is the supporting organization
contracted by UNEP to implement the present project.
The relationship of the TSE to the FPA is specified in a
Memorandum of Understanding between the FPA (EEAA/CCU)
and the TSE, while the assignment for the remainder of the
project will be decided towards the end of Phase 1). The MoU
between FPA and TSE will also refer to the contractual
relationship of the TSE to the UCCEE. The draft MoU is attached
as Appendix 3.
Technical support on methodological issues related to the CDM
will also be provided to the FPA and TSE by the Regional Center
(APEX in the case of the region in question).
EEAA Technical support on
methodological issues related to
Preparation for Phase 2
Suggested relations between the main
entities involved in the CDM activities
For the first year, the CDM Unit is suggested to be consist of:
- A full-time executive director
- A secretariat consisting of an expert for training and public relation including mass media, an economist,
preferably with technical background.
The direct human resources needed for the CDM Unit itself for the first two years are estimated within 3-5
staff. They are supposed to be assigned primarily by EEAA. After initiation of CDM projects for
implementation, it is expected to be self-funded by local and foreign partners of CDM.
The technical support for CDM regulatory framework is planned to be supplied by Technical Support Entity
(TSE). The following are criteria for the selection of the national institution for conducting the project
activities at national level.
5 to 10 years experience in conducting Climate Change studies
A good knowledge of the CDM related issues and stakes at national and international levels
Capacity to undertake focused technical studies and researches relevant to CDM
Expertise (or capacity to mobilize expertise) in the main areas concerned by CDM (Energy, Industry,
Forestry, Agriculture, waste);
Capacity to undertake capacity development programs
Capacity to undertake and handle training programs and workshops
A minimum of five years experience in conducting mitigation assessments
Capacity to liaise and coordinate between the experts involved in the activities of the project at national
Capacity to mobilize the stakeholders to be targeted by the project
Capacity to liaise with the national authorities in charge of the climate change and CDM activities
Suggested Role of the Designated National Authority (DNA) for CDM
in the Implementation of the CDM Work Plan
The national committee for CDM is expected to recommend the policies,
submit them to the EEAA committee for approval and forming the CDM
implementation unit and follow up of implementation to cover the
• Preparation of the scope of work and putting rules for current work of the
• Studying and reviewing of Egypt‟s NSS for preparation of the CDM
• Approving the plans, follow up the implementation of the CDM activities
broken down in the modules above, while the implementation work is
expected from the CDM implementation unit.
• Suggesting the legislations required for CDM implementation facilitation.
• Preparing intergovernmental agreements (memorandum of
understanding) with possible investor countries or institutions for the
implementation of CDM projects.
Participants can be defined as the Consulting engineers,
representatives from private enterprises and other stakeholders
receive training in key GHG abatement technologies, CDM
methodologies and project cycle.
Capacity Development Among Relevant National Stakeholders
• Define steps to assist local firms in developing capacity for
project validation, verification and certification.
• Develop a database for local firms having capacities for CDM
project implementation, validation and verification.
• Resources are expected to be provided through the available
climate change donor funding, later fees will cover the training
costs. These activates are to be carried out by existing institutions
such as training university centers and CDM technology
Awareness Enhancements Activities
The following is the suggested list of activities required for awareness raising:
1. Definition of the targeted groups, e.g. technology suppliers for CDM
consulting engineers and registration of interested parties in database.
2. Communication with the key players through networking and publications
3. Participation and presentations in existing conferences, industry fairs and
other suitable forums (industry associations, NGOs, etc.). Organizing
between 2 to 3 workshops annually for investors and candidate project hosts
for promotion of GHG reduction through CDM. Emphasis will be laid on
the private sector and the use of existing structures.
The CDM unit will mandate most activities to specialized companies,
governmental and non-governmental institutions, making optimal use of
existing skills, manpower and networks.
Resources needed for the CDM unit staff is supposed to be allocated by
governmental contribution. Funding of activities and campaign is expected
to stem from governmental contributions (also in kind), foreign donations
and contribution by CDM customers.
Development of A Pipeline Of Marketable CDM Projects
1. This module consists of establishment of feasibility
studies for 1-3 most promising CDM project candidates in
Egypt. The studies include the assessment of the technical
and financial project feasibility, the evaluation of the
eligibility under CDM, the evaluation of environmental
and socio-economic impacts and the assessment of the
proposed financing schemes.
2. The studies should be carried out in close cooperation
with potential investors and candidate project host.
Resources for project package preparation are suggested to
be funded by potential investors and candidate project
host while supported by governmental in kind
III.2. Status of the contractual arrangements with
national institution (Technical Support Entity)
and MOU with government
Currently there is a preliminary acceptance for
entities that will be sharing in the institutional setting
for the second phase of the project. Official
documents will be coming into force by issuance and
acceptance of the present report as the coming logical
step towards CDM implementation.
III.3. Evaluation of institutional and overall capacity in relation with the CD
for CDM project
The Focal point capacity
The Egyptian Environmental Affairs Agency (EEAA), through its Climate
Change Unit (CCU), is the official technical focal point for climate change
activities in Egypt. In this capacity, the EEAA/CCU is also identified as the
Focal Point Agency (FPA) for the duration of the present project. In this concern,
the EEAA/CCU has the full capacity for taking the responsibility of the FPA.
National institution (Technical Support Entity)
For the present phase, Tabbin Institute for Metallurgical Studies TIMS assumed
the responsibilities for the phase I of the present project. Tabbin Institute, TIMS
has a long experience in the energy efficiency work and environmental issues.
Tabbin Institute, TIMS was contracted by EEAA for implementation of the NSS
National institution (complementary institutions for CDM)
Egypt has a lot of governmental and non-governmental entities that are eligible
for sharing in the CDM activities. These entities are well defined in item (II.1)
Complementary Outputs Suggested To The
• Implementation of the first pilot project,
establishment of national criteria and baseline for
• A published annual Egyptian CDM report,
• An annual training package on CDM activities
Investor Relations and Monitoring of International Offset
• Continuously monitoring of the size, prices and characteristics of the international
GHG offset market.
• Continuously monitoring of the international and national GHG related regulations
and procedures such as the UNFCCC, GHG taxes and levies, trading systems etc.
to early identify demand for CERs.
• The public relation expert will handle the investor relations.
• Development and continuous update of a short list of possible foreign investors.
• Publishing flyers and articles for the promotion of CDM projects in Egypt.
• Establishment of communication channels with commercial attachee‟s in the
Egyptian Embassies and the Ministry of Foreign Affairs.
• Presentation of CDM projects opportunities in Egypt at international conferences
e.g. by holding side events at the COPs.
• Pro-active approach to possible investor institutions, such as PCF, the Dutch
Center CERUPT programme, commercial carbon funds and carbon brokers.
The investor relation activities will be carried out in close cooperation with existing
investment institutions such as GAFI, FEI. Funding of activities is expected to
stem from governmental contributions (also in kind) and foreign donations.
CDM Handbook for Egypt
Evaluation / Feedback / Corrections”
1. All outputs of other modules are to be reported to a central
coordination office in the CDM implementation unit.
2. The performance indicators of all the modules are to be
3. A comparison on regular intervals of the performance indicators
will lead to a fair evaluation of the whole components of CDM
4. Relevant corrections have to be suggested by the coordination
office and feed-backed to the National CDM committee.
For transparency and justice this module must be funded by
national governmental fund.
Iv. Status of objectives, outputs & activities in phase I
Objectives, outputs and activities in phase-I are realized. Tasks and outputs targeted are
achieved. The present report with appendices encounters the main outputs.
IV.1.Tasks in phase I: completion of a work plan for phase II presentation of the
workplan for phase II, and description of the activities
Tasks declared in the “Memorandum of understanding between the Egyptian Environmental
Affairs Agency (EEAA) and the Tabbin Institute for Metallurgical Studies (TIMS)
regarding Phase 1 of the UNEP project “Capacity Development for the Clean Development
Mechanism”, Ref  are completed.
Annex-I encounter the work plan. The work plan is represented in the workshop held in Dec
17-18, 2002. The concerned parties, EEAA, APEX and TIMS as well as Egyptian
stakeholders were represented in the workshop.
The work plan earns a preliminary concurrence between the concerned parties, EEAA,
UNEP representative, APEX and the technical support entity of phase I, TIMS. The plan as
observed from the concerned parties is completely in line with the recommendations and
preliminary time expectations of the issued NSS on CDM.
The work plan as declared in Annex-I encounter a detailed description of the activities.
IV.2. Outputs: workshop proceedings & presentation files, work plan, etc.
The present progress report declares the main required outputs as defined in the statement
of work of phase I, the preparation phase of the project. Appendices encounter the details.
Annex-I encounters the “Detailed National Work Plan” of phase II.
Annex-II: encounters the “Workshop proceedings & presentation files”.
V. Notes From Initial Contacts With Stakeholders
Regarding the discussions held in the workshop held in Dec 17-18, 2002, the following are the main outputs:
• The First National Workshop on CD for CDM was held in the Federation of Egyptian Industries (FEI) in Cairo on 17-
18/12/2002 as a result of cooperation between EEAA & TIMS (E2RC) with the assistance of UCCEE & APEX-Regional
Center for North Africa and the Middle-East (Tunisia).
• The participants declared their requirement to participate in the future discussions for determining the baseline, in receiving
training on the CDM topics, in networking, …etc.
• The necessary integration & cooperation between the different International Funds in Egypt in order to avoid any
contradictions between the ongoing projects.
• The participants highlighted the awareness of the donors in dealing with projects by starting with reviewing the previous
works dealing with their projects. They focused on the specific nature of the CDM project, which depends upon the desire of
different parties to work together in a specific project, accepted from a certain authority according to certain criteria. They
clarified the definition of CDM market as a relationship between seller & buyer, who will make use of the DNA if exists in
the country, otherwise this country will be unattractive as a result of high transaction cost.
• The participants requested the representation of the private sector or NGO‟s in the DNA. The request earned a general
• It is accepted to start implementation by the lowest carbon price projects with respect to the international price despite the
quantity of carbon emission is low.
• The necessity of enlarging the law of investment by adding new articles regarding the investment in CDM projects. The
taxes on these projects should also be considered. The growing role of commercial representatives in the Egyptian
Embassies abroad in this concern (spreading the projects) has to be considered. A general stress was raised upon the
importance of the participation of the Investment Authorities in the activities of the CD projects, whether by changing or
renewing the existing laws or by training on the new issues to attract more and more projects.
• Small-scale projects with high emission are of big concern. They can be collected in bundles. This is suitable in Egypt for
the case of foundries. But, care must be taken with regard to the transaction costs. In this concern there was a question
regarding the definition limits of these projects.
• Dr. Amous clarified that there will be no project financed 100% through the CDM (about 20% from the donors and 80%
from other international and/or national investors). This will be the role of bankers to get involved in the process by training
• A declaration was raised to the stakeholders that the NSS on CDM contains the study of the carbon inventory of Egypt and
the situation of Egypt in the international market of carbon abatement. Also, it contains a vision bout the organization of the
DNA, the role of the TSE, capacity building, staffing of the technical secretariat, the role of EEAA & the role of other
Annex-I: Detailed National Work Plan
Suggested Work Plan For The Implementation Of
Phase 2 Of The Project In Egypt
A period of three years is assigned for the present
project phase number two for implementation. It starts
from 2003 and ends at 2005. The following figure
illustrates the suggested work plan.
Figure ( 1 ): Work plan for the implementation of phase
2 of the project in Egypt (ATTCHED)
Annex-II: Workshop proceedings, participants
& presentation files
The “Report on the First National Workshop on
Capacity Development (CD) for the Clean
Development Mechanism (CDM)”, TIMS, Cairo
18/12/2002 is attached.
Presentation files are attached.
A list of participants is attached.
Annex-III: Important issues
Annex-III. 1. Current Initiatives for GHG Reduction
Currently, many donors‟ initiatives are being implemented. These initiatives can be classified into institutional, technical
and strategic initiatives. The coordination between these initiatives and CDM activities could support or contribute to
specific needs for CDM realization in Egypt. Also, lessons learnt from donor funded projects may help in replicating these
projects as CDM projects. The following are examples of these initiatives:
1. Institutional Initiatives
a. National Committee on Climate Change
An inter-ministerial committee was formed in 1997 representing a wide range of governmental and non-governmental
b. Climate Change Capacity Building Phase II
This initiative is a continuation of the previous GEF-assisted Capacity Building Project aimed at institutionalizing climate
change issues on a national level. This second phase focuses on assessing technology needs for adaptation measures for
coastal zones, agriculture, and water resources. Other activities include studying impacts on coral reefs and human health,
and assessing technology needs to alleviate negative effects.
2. Technology/Market Initiatives
1. Technology Cooperation Agreement Pilot Project (TCAPP)
b. Promotion of Wind Energy for Electricity Generation
c. Fuel Cell Bus Demonstration Project
d. Hybrid-Electric Bus Technology in Egypt
e. Natural Gas Motorcycles
f. Methane Recovery from Landfills
g. The Integrated Solar Thermal/Natural Gas Power Plant at Kuraymat
h. The Energy Efficiency Improvement and Emissions Reduction Project
i. Fuel Switching
Details of technology/market initiatives are given in item (II. 2.2).
3. Other Activities in Egypt for GHG Emissions Reduction
1. Egyptian Energy Efficiency Council (EEC) programs
1. Egypt‟s National strategy study on CDM Project and Ideas