ASSESSING THE INVESTMENTS REQUIRED TO ADDRESS CLIMATE CHANGE IN KEY SECTORS:

Experience of Namibia

Petrus Muteyauli, Namibia

FINANCIAL AND ECONOMIC NEEDS STUDIES FOR CLIMATE CHANGE

UNFCCC & UNDP Side Event11 June 2011, Bonn, Germany

Background

UNDP global project: Capacity Building for Policy Makers to Address Climate Change (2008-11)

1.Increased capacity to co-ordinate Ministerial & stakeholder views on climate change and UNFCCC negotiations;

2.Engage in long-term climate change planning and priority setting via investment and financial flows (I&FF) assessments of key sectors

19 countries participating: Algeria, Bangladesh, Colombia, Costa Rica, Dominican Republic, Ecuador, Gambia, Honduras, Liberia, Namibia, Nepal, Nicaragua, Niger, Paraguay, Peru, St Lucia, Togo, Turkmenistan, & Uruguay

WHY undertake I&FF assessment?

• To quantify the investments required to address climate change in Namibia’s energy sector (mitigation) and agriculture sector (adaptation) in a systematic manner

• To encourage long-term sectoral planning that incorporates investment decisions based on a changing climate

• Ultimate goal is to strengthen Namibia’s position to justify its demand for both multilateral and bilateral funding for mitigation and adaptation to climate change

1. For each sector, evaluate investments and financial flows for two policy scenarios:– Baseline Scenario– Adaptation or Mitigation Scenario

2. Cost the additional flows needed to implement new adaptation or mitigation measures (that is, subtract the difference between the two scenarios)

3. Break the costs down across three entities: government, corporations (including NGOs), and households

METHODOLOGYHOW is I&FF assessment undertaken?

Key features:

•Strong national ownership

•Experts engaged from public and private sector

•Active working groups, meeting on regular basis

Institutional arrangements

Key sectors selected in Namibia

Energy

• Electricity generation (wind, solar, energy efficiency)• Transport (LPG)

Agriculture

• Livestock (cattle, small stock, game)• Crops (maize, wheat, mahangu, sorghum)

• Baseline scenario (business as usual) -- $2.5 billion

- Energy mix (BAU): Coal-fired power and localised diesel generators

• Mitigation scenario -- $3.6 billion

- Energy mix incorporates significant investments in solar and wind power as well as energy efficiency programme

• Incremental cost to address climate change: $1.1 billion

• Although costlier, long-term environmental benefits

• Amount of emissions reduced is 11 million tons of CO2`

Example: Energy sector (cont.)

WHAT does I&FF assessment seek to answer?

The I&FF assessment considers: What are the adaptation/ mitigation options for selected key

sectors in the next 25 years? Who is investing in the sector ? Who are the major players &

funding sources? What shifts/increases in I&FF will be needed in the sector? What will be the overall needs for additional I&FF to address

climate change?

From a development perspective, what does my country need to do to address climate change in selected key sectors, and what financial landscape will be required to achieve those needs?

Next steps

• New studies planned for fisheries and water sectors (under the Africa Adaptation Programme)

• Measures identified in energy sub-sectors would qualify as CDM projects under the Kyoto Protocol modalities

• Engage with private sector and Ministries on results

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Danke schön