Facing China's Coal Future - IEA
Facing China's Coal Future - IEA
Facing China's Coal Future - IEA
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<strong>Facing</strong> China’s <strong>Coal</strong> <strong>Future</strong>: Prospects and Challenges for CCS © OECD/<strong>IEA</strong> 2011<br />
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The Green Climate Fund Board was created in Durban and charged with creating rules and<br />
procedures to make the GCF operational. The World Bank is currently serving as interim trustee,<br />
an arrangement that will be reviewed after three years of operation.<br />
One of the key principles of the GCF is that it should support country‐driven actions. For CCS it<br />
means that if a developing country views CCS as part of its mitigation strategy it could request<br />
assistance through the GCF for this technology development and deployment. Currently the<br />
agreement is to have mitigation and adaptation windows under the GCF. However, additional<br />
windows could be created, and some countries proposed creation of a CCS window or a window<br />
that could facilitate financing of long‐term actions that are not cost‐effective today. The fund is<br />
also supposed to provide resources for readiness, including for development of nationally<br />
appropriate mitigation actions (NAMAs) and strengthening of in‐country institutions that also<br />
includes domestic financial institutions. Given the complexity of legal, institutional and financial<br />
arrangements that may be required for successful implementation of a CCS project, countries<br />
with interest in CCS may find it beneficial to request assistance for CCS‐related capacity building.<br />
The Durban Decision on GCF also allows a private‐sector facility to enable private‐sector<br />
involvement. CCS projects that currently require both private and public sector funding could be<br />
good candidates for multi‐source financing under the GCF.<br />
The fund could be accessed through accredited UN agencies, multilateral development banks,<br />
international financial institutions and regional institutions. This provision leaves room for<br />
financing opportunities through the initiatives of regional banks and institutions. For example, a<br />
proposal from the Asia Development Bank to create a CCS Fund, if implemented, could<br />
potentially be a vehicle for accessing GCF resources for CCS development in the Asian region.<br />
Framework for nationally appropriate mitigation actions (NAMAs)<br />
The emerging post‐2012 framework recognises that major developing countries will need to<br />
contribute to global emission reduction efforts through domestic action. It also recognises that a<br />
substantial proportion of costs that developing countries incur in reducing their emissions may<br />
be met by developed countries. Some of this may be achieved through nationally appropriate<br />
mitigation actions, which will outline the costs, emissions reductions and time frame associated<br />
with these actions.<br />
A registry of NAMAs and available support was officially created at the COP 17 in Durban. Now<br />
developing countries will be able to submit their NAMAs seeking support while developed<br />
countries will submit information on resources available to support NAMAs. The registry will<br />
match NAMAs and support. The idea is that some NAMAs will be unilateral actions by developing<br />
countries and will be registered in the NAMA Registry for the purposes of recognition. While<br />
other NAMAs may seek international support for their implementation and will be submitted to<br />
the Registry to be matched with offers of support made available by developed countries. These<br />
offers of support could cover both capital and operating costs. In addition, NAMA support can<br />
take the form of building capacity, overcoming financing barriers, reducing the costs of<br />
implementing policies (e.g. feed‐in tariffs), and developing and demonstrating advanced<br />
technologies that are not cost‐effective today.<br />
The NAMA framework will significantly differ from the Clean Development Mechanism. First,<br />
supported NAMAs will produce GHG emissions reductions that are developing‐country<br />
contributions to the global effort to control climate change; they will not deliver offsets for<br />
developed countries. Second, in most cases, support for NAMAs will begin after developing<br />
countries achieve a certain level of emissions reduction from business as usual (BAU) with their