RBEC UNDP-GEF Climate Change Mitigation Portfolio:

Lessons Learnt John O’Brien

Regional Technical Advisor, Climate Change Mitigation

UNDP – Bratislava Regional Centre

Sub-Regional Workshop for GEF Focal Points & Constituency Meeting

14-15 April 2010

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Presentation Overview

Overview of UNDP GEF CC Portfolio

Lessons Learned during GEF - 4

Looking towards GEF - 5

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UNDP GEF Climate Change Activities Globally

Renewable Energy

Portfolio: US$ 865 m

Energy Efficiency

Portfolio: US$ 1 billion

Transport

Portfolio: US$ 890 m

Objective:Assist developing countries to develop and adopt low carbon and climate resilient strategies/development through promotion of market transformation for EE, RE and Sustainable Transport technologies

UNDP has 132 Country Offices in 6 Regions We are Country Driven

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UNDP GEF Portfolio Overview - Energy-Efficiency is Number One Priority

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UNDP interventions in Europe and CIS region are focused on Removing Barriers to EE

Low energy efficiency (even new EU members), little use of renewable energy (except hydro) → most energy- and carbon-intensive economies globally

Source: World Resources Institute 2008

World average

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UNDP key priority: Energy efficiency in Buildings

Source: UNDP/GEF Project Document, Kyrgyzstan

• 40% of energy used in buildings

• Building stock 2-3 times less efficient than in EU

• Utilities account for 20% in poor households income

• 30% reduction in costs can make a substantial difference

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Barriers to remove:

UNDP key priority: Energy Efficiency in buildings

How do you think about work the heating supply system in your apartment?

Bad30, 1%

Don’t work at all

20,5%No answer

1,8%

Good47, 7%

Turkmenistan: 50% of customers are not satisfied with heat systems

Source: UNDP/GEF Project Report

- Poorly designed and insufficiently enforced legal and regulatory framework

- Weak capacities to identify and implement energy efficiency measures among municipalities, tenants and district heating companies

- Financing Barrier – access to credit is very difficult – Scaling Up

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Lessons Learned: Municipal EE in Croatia

Source: UNDP-GEF Project in Croatia

- Policy-level support: National EE

Master-plan with the Programme of

Implementation 2008-2016

- Energy Charter: signed by ALL

towns and counties in the Republic of

Croatia

- Over 40 million USD

investments leveraged in energy EE

across Croatia

- 91,5% of households are aware of

availability and the

benefits of EE products

related to home appliances

- Project budget: 13 M US$ (on-going)

with UNDP/GEF contribution 3.5 M$

BEFORE

Advocacy kit under UNDP “House in Order” project

Energy Charter

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Lessons Learned: EE Renovation in Bulgaria

Source: UNDP/GEF Project Booklet, Bulagria

- 28 voluntary associations of

condominium owners for the

purposes of renovation and future

maintenance created;

- 7 multifamily buildings fully

renovated and 21 buildings

undergoing renovation

- Annual energy saving: 50-75% due

to EE renovation

BEFORE

AFTER

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Upscaling EE Activities : Options for Consideration

OPTIONS TO CONSIDER OPTION EXPLAINED and WHAT IS NEEDED

Loan Guarantees for Banks Banks are reluctant to provide loans to home owners, due to inability to provide security;If banks provide loans, the interest rates are too highGuarantee by a “third party” could helpMore analysis needed on how this might work and collaboration with the various IFIs.

Free energy audits and/or interest free loans (provided by Government)

Average size of a loan for household EE is low:less than US$ 10,000. A government programme for interest free loans for this purpose and free energy audits could work (Action Energy Programme in UK)Analysis of lessons learnt from similar programs

Carbon finance No impact to date on the EE field – transaction costs are high; number of emission reductions small/project basis.New Programme of Activities (PoA) under CDM – will combine activities at national/sub-national/regional level in one project Analysis needed on the use of the PoA approach in EE in buildings

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UNDP key priorities: Renewable energy

Wind power: Kazakhstan

Biomass: Slovakia, Belarus, Poland, BiH, Slovenia, Latvia

Solar Water Heating: Albania

Small hydro power: Georgia, Kyrgyzstan and Tajikistan

Security of Supply is critical (for biomass projects) Long-term PPA is critical for electricity generation projects Demonstration projects can play a ‘catalytic effect’

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Lessons learnt: Working Well and Areas for Improvement

Coordination with other Agencies Finding Investors/Engaging Private Sector Upscaling Activities & Replication

We are working well when it comes to working at a local level (municipalities, local governments) changes in policies, legislation, regulation awareness raising activities guidebooks, training materials demonstration activities

Where we can and need to improve

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Lessons Learned: Engaging the Private Sector

How do we engage the private sector more effectively

staff/consultants with experience working in the private sector at a senior level – managing risk understand concepts of risks and returns and how wecan assist with reducing risks/enhancing returns choose ‘world class companies’ to work with specific role within our projects of leveragingprivate sector investment

In our projects : reward results, reward sucess

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Primary Focus Energy-Efficiency in Buildings- In particular EE in residential buildings & public buildings Removing Barriers to Renewable Energy- esp. biomass

Secondary Focus Sustainable Transport Carbon Forestry (incl. cross cutting projects)

Integrate focus on linkages with carbon markets (CDM, JI) into our projects under GEF – 5 (Carbon Finance is the future)

Looking to GEF 5 – Areas for Focus for UNDP

Thank you!