Relevance of Gold Standard in current scenario

Carbon Bazaar 2010

New Delhi, 11 May 2010

Neha RaoRegional Manager- India and South AsiaThe Gold Standard Foundation

What is the Gold Standard?

AfterBefore

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The Spirit of Kyoto is The Gold Standard

“The purpose of the CDM shall be to assist Parties not included in Annex I in achieving

sustainable development and in contributing to the ultimate objective of the

Convention, and to assist Parties included in Annex I in achieving compliance with their

quantified emission limitation and reduction commitments...”-- Kyoto protocol, Article 12.2

Gold Standard in a Nutshell

Who we are:• a non-profit organization under Swiss law that operates a certification

scheme for premium quality carbon credits• Endorsed by 65 NGOs worldwide

How we got started:• The Gold Standard quality benchmark emerged and has evolved in

parallel with the emergence and maturation of carbon offset markets. It was developed by a group of NGOs led by WWF, SSN and HELIO International and launched in 2003.

Gold Standard in a Nutshell – cont’d

What we stand for:• promoting sustainable development through carbon offset markets that

are characterized by transparency and equality of access for all market participants

What we do:• GS registers projects that reduce GHG emissions in ways that contribute

to sustainable development and certifies their carbon credits for sale on both compliance and voluntary offset markets.

Gold Standard SupportersGive the brand its value

65 NGOs

Points of ContactsIndia, China, South Africa and Brazil

(REEEP Funding)

Gold Standard BuyersVoluntary Commitment to use majority GS

Assist with marketing and events

Gold Standard SecretariatHQ (11), Regional Managers (7)

Daily Management of GS ActivitiesProject & Meth Reviews

Capacity BuildingRegistry Management

Marketing & Fund Raising

Foundation BoardBudget Oversight

Ultimate Control Over GS Brand

Technical Advisory Committee

GS Structure & Governance

Project & Meth ReviewsRule changes

9 experts of the carbon market8 membersGS NGOs

Roster of External ExpertsProject & Meth Reviews

(to be expanded shortly)

APXRegistry Development

Invoicing

GS TAC

RE

AuditorsExternal Validation

DOEs

GS Supporter NGOs worldwide

Plus 5 International NGOs (WWF Int., Greenpeace Int., Mercy Corps, REEEP, Helio International)

www.cdmgoldstandard.org/NGO-Supporters.178.0.html

Pipeline Overview – Project Activities

Source: GS Registry, 18 March 2010

Number of projects

Pipeline Overview – Volumes

Source: GS Registry, 18 March 2010

tCO2e/year

Pipeline Overview – Type of Activities

Source: GS Registry, 18 March 2010

Number ofprojects

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Why the Gold Standard?

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Growing criticism of the Carbon Market

Compliance market:• Lack of focus on sustainable

development• Lack of local stakeholder

consultation• Lack of participatory approaches

(local ownership)

Voluntary market:• Poor quality offsets, lack of

additionality• Lack of transparency, double

counting• ‘The jungle’ - confusion between

various standards with different scopes & priorities

Relevance of GS in the Compliance Market

• Promotes medium term shift towards sustainable energy consumption & sustainable energy supply

• Enhances local stakeholder involvement• Promotes best practice for project development, validation, and

verification with respect to sustainable development• Beyond carbon reduction - monitor and capture co-benefits all along the

project lifetime

Relevance of GS in the Voluntary Market

• Promotes transparency & enhance credibility• Premium quality benchmark• Enables innovation: Provision of Methodology Submission

– Biogas Digesters– Energy efficiency cooking stoves– Switch to biomass fuels– Methodology for large-scale supply and distribution of efficient light bulbs and

showerhead products to household– Bio-diesel from waste oil/fat (Revised version of AM0047)

Relevance of GS in the Voluntary Market

• Enables innovation: Provision of Methodology Submission– The following methodologies are under development

• Thermal energy from plant oil for the user of cooking stoves• Revised AMS I.C• Bio-ethanol diesel blends for stationary or mobile sources

• Methodology review– 500 USD + Costs of two external experts (separate confirmation will

be asked if more than 5000 USD)

Community-focused Micro Scale Scheme: Voluntary Projects

• Objective is to allow for streamlined procedures and lowered transaction costs for poor community-focused micro scale project activities

• Eligible countries:– Least Developing Countries (LDCs)– Landlocked Developing Countries (LLDCs)– Small Island Developing States (SIDSs)– Projects from other countries will be approved on a case-by-case basis, if the

project participants are able to demonstrate that the project will essentially benefit poor communities.

Community-focused Micro Scale Scheme: Voluntary Projects

• Eligible project activities– Gold Standard voluntary projects are micro-scale if they generate less than 5000

tCO2 in any year of the crediting period.– Renewable energy and end-use energy efficiency– Project activities that generate electricity shall either qualify as on-site generation

OR shall feed into an existing or new, local, low voltage isolated grid.– Project activities feeding electricity into national/regional high voltage grid if it can be

demonstrated that the project will improve electricity access for poor local communities

Community-focused Micro Scale Scheme: Voluntary Projects

• Additionality– Eligible project activities are deemed additional without any further requirement to

demonstrate additionality

• Baseline and monitoring– As per CDM or GS approved methodology– Submission of new simplified conservative approaches are encouraged

• Sustainable development assessment– Project appraisal by independent Objective Observers (appointed by GS, suggested by

project participants)

Community-focused Micro Scale Scheme: Voluntary Projects

• Validation/Verification shall be conducted in one of the following ways:– External Validation/Verification: The contracting of a DOE, as is the case for any other

project activity– Internal Validation/Verification: Opting for a Gold Standard Internal

Validation/verification: Requires paying a fee to the Gold Standard Validation/verification Fund.

• Validation Fund: Flat fee of 10,000 USD• Verification Fund: Flat fee of 2,500 USD per annum

Gold Standard Validation/Verification Fund

• Notification to the Gold Standard• Upload the required documents on the Gold Standard Registry• Notification by Gold Standard on whether the project will be validation/verified by a DOE

or internally by the Gold Standard Technical Advisory Committee• Costs in both cases are covered by the fund• The decision is made through ‘target random’ selection of micro-scale projects opting for

the validation/verification fund• If requested to validate/verified the project through a DOE, selection of a DOE based on

several competitive offers.

Gold Standard: The preferred standard

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In Summary…

• Enhances reputation • Ensure premium prices• Improves market visibility• Contributes to sustainable development • Increases stakeholder acceptance

Thank You

Neha RaoRegional Manager- India and South Asia

neha@cdmgoldstandard.org+91-9811873703

http://www.cdmgoldstandard.orgThe Gold Standard- Premium quality carbon credits