Transcript the unfccc technology development and transfer process

EXPERIENCE WITH TECHNOLOGY NEEDS
ASSESSMENT, DEVELOPMENT AND
IMPLEMENTATION
ANNEX I EXPERT GROUP SEMINAR ON WORKING TOGETHER
TO RESPOND TO CLIMATE CHANGE
21-22 MARCH 2005, OECD HEADQUARTERS, PARIS, FRANCE
WILLIAM KOJO AGYEMANG-BONSU
NATIONAL CLIMATE CHANGE COORDINATOR
ENVIRONMENTAL PROTECTION AGENCY, GHANA
OUTLINE OF
PRESENTATION
 Elements of UNFCCC Technology
Development and Transfer Framework
 Ghana’s Technology Needs Assessment
 CFL Example
 Challenges
 Conclusions
Elements of UNFCCC Technology
Development and Transfer Framework
1) Technology Needs Assessment
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Information needs
Capacity building needs – institutional, human
Assessment of enabling environment – systemic capacities,
including barriers and actions to overcome them
Financing
Technology information
Enabling Environment
Capacity building
Mechanisms for technology transfer – institutional
and financing aspects
Ghana’s Technology Needs
Assessment
Goals of the TNA
 Contribute to global effort towards sustainable
development and in particular the protection of the
climate system.
 Communicate to COP under UNFCCC and the global
community Ghana’s climate change technology
requirements.
 Identify a portfolio of technology development and
transfer programmes that have the potential to reduce
greenhouse gas emissions and contribute to Ghana’s
sustainable development
Immediate Objectives
 Identify, analyze and prioritize technologies that can
form the basis for a portfolio of ESTs projects and
programmes
 Identify human, institutional and systemic capacity
needs that ensure the smooth development, transfer and
acquisition of ESTs
 Enlist interest and commitment from key stakeholders
and forge partnerships to support investment or barrier
removal actions for purposes of enhancing the
commercialization (or otherwise), and the diffusion of
high priority technologies
Stakeholders
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Government
Quasi-Government
Business Associations
Financial Institutions
NGOs
Research/Academia
Development Partners
Resources for Ghana’s Needs
Assessment
 Major funding from UNDP/GEF
 Technical support provided by NREL with
funds from CTI/USDOE
Overview of Ghana’s Approach to
Needs Assessment
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Development of background documentation
Stakeholder identification (national/international)
Organization of scoping meeting/stakeholder consultations
Establishment of Technology selection criteria
Choosing sectors/sub-sectors for assessment
Establishment of core/expert teams
Prioritizations of technologies
Holding donor consultations
In-depth analysis
Preparation of needs assessment report
Development of technology transfer implementation plan
Publication of TNA final report
Technology Priorities Setting
Selection Criteria
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Development benefits
Market Potential
Contribution Towards Mitigating
Climate Change
Additional Attributes
Selection Criteria
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Development benefits
Job creation
 Wealth creation for the poor
 Capacity building
 Use of local resources
 Contribution to GDP growth
 Good effect on balance of trade
 Health Improvement
 Skills development
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Selection Criteria
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Market Potential
 Level
of initial capital outlay
 Affordability
 Investment sustainability
 Low maintenance – durability
 Commercial availability and
 Replicability
Selection Criteria
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Contribution Towards
Mitigating Climate Change
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No or low GHG emissions
Low potential for “leakage”
Enhance sinks and waste recovery
Selection Criteria
 Additional Attributes
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Able to meet other social need(s) and are
socially acceptable
Promote international trade in the context of
north-south and south-south cooperation
Promote sub-regional cooperation with respect
to optimization in use of resources for
development
Contents of the Needs
Assessment Report
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Executive Summary
Technology Transfer Implementation Plan – Indepth Analysis
National Environmental Context
Technology Priorities
Review of Legislative and Institutional
Framework
Conclusions and Recommendations
Technology Implementation
Plan – In-depth Analysis
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Background of Technology - information
Barriers to the development and transfer
Suggested Actions to Remove Barriers
Ghana Actions
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Existing programmes and policies
Additional actions
Actions expected from International
Community
Technology Implementation
Plan – In-depth Analysis
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Expected results of technology transfer
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List of stakeholders
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Development, Economic and Social Benefits
Market Penetration and sustainability
GHG reduction and other environmental benefits
National
International (Informed by TT Clear website, CTI personal
communication and website)
Capacity needs
Recommendations for the creation of enabling
environment and general conclusions
Top Priority Technologies
 Energy efficient lighting using compact fluorescent
lamps
 Industrial energy efficiency improvements –
demand side management including power factor
improvement and boiler efficiency enhancement
 Methane gas capture from landfills
 Use of bio-fuels (jatropha)
CFL EXAMPLE
Background
 Power shortages
 Drought and low hydro availability
 Electricity rate reform
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~100% retail rate increases in 2002
 Lighting end use significant
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One third of energy share
Coincident with peak
 CFL promotion as key part of response
Goals
 Transform the Ghanaian lighting market
from incandescent lamps to CFL
 Reduce the risk of a power crisis
 Mitigate the impact of electricity price
hikes, on electricity consumers
 Reduce power demand and need for added
generation
Impacts
 Easing of tight electricity supply situation
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Reduction in consumption of 350 MMkWh/year
170 MW reduction in peak load
 Sustainable, self-financing transformation of
lighting market in Ghana
 Value to Ghana economy $10 million NPV (25%
discount rate)
 Eventual cash flow + $15 million per year
Timing
Bulbs in service
Installation Schedule
Dec-03 Dec-04 Dec-05
780,000 2,220,000 3,780,000
Organization
 Initiative of Ghana Energy Foundation
 Integrated into Ghana’s Technology Transfer
Needs Assessment under the UNFCCC
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Ghana EPA lead organization
VRA, ECG, Energy Commission, broad representation
of other Ghana stakeholders
Technical support from NREL on behalf of Climate
Technology Initiative
 Ministry of Energy formed Committee on CFL
Promotion
Delivery Modes
 Installation by task force members
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Initial emphasis on this mode
 Retail sales by task force
 Sales through employers
 Sales through retail outlets
Cash Flow Summary
(NPV at 25%)
Ghana NPV
Consumer NPV
Utility NPV
Tariff Revenue
$ 10,146,000
$ 11,963,000
$ (4,547,000)
$2,730,000
Important utility benefits are omitted, e.g.
deferred investments in new generation
Cash Flow Profile
$1,600
$1,400
$1,200
$1,000
$800
$600
$400
$200
$0
Carbon Credits
Oct-05
Jul-05
Apr-05
Jan-05
Oct-04
Jul-04
Apr-04
Jan-04
Oct-03
Jul-03
Apr-03
Reduction in
generation cost
Jan-03
Cash Flow (000)
Sources of Cash Flow
Cost Profile
1800
1600
1400
1200
1000
800
600
400
200
0
Ja
n03
Ap
r- 0
3
Ju
l-0
3
O
ct
-0
3
Ja
n04
Ap
r- 0
4
Ju
l-0
4
O
ct
-0
4
Ja
n05
Ap
r- 0
5
Ju
l-0
5
O
ct
-0
5
Costs (000)
Utility Costs
CFL Retailing
Taxes
FOB bulb costs
Utility rebates to consumers
Financing
 CFL installation
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Self financing
$250,00 line of credit sought to cover initial
purchases
 Public Awareness and Outreach
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$500,000 Grant financing sought
Global Assumptions
Reference Case Parameters
Unit price
$2.64
CFL power
14
Replaced Incandescent
71
% Savings rebated to consumers
81%
Hours per day operated
4.5
Marginal cost of electricity
$0.05
Value of carbon credits
3
Bulb nominal lifetime
6000
Std. Deviation of life
25%
Retail margin
8%
wholesale
W
W
/kWh
per ton CO2
hours of use
of lifetime
Customer Assumptions
Fraction of
Fraction of all
savings
customers
Customer class
rebated
I: 0-50kWh/mo
60%
90%
II: 51-300kWh/mo
30%
70%
III: 301+ kWh/mo
10%
60%
Average rebate over all customers
81%
Potential Policies
Residential, 0-50 kWh/mo
Consumers get 90% of Savings
$.34/mo/bulb
Residential, 51-300 kWh/mo
Consumers get 70% of Savings
$.27/mo/bulb
$2.50
$14.00
$12.00
$10.00
$8.00
$6.00
$4.00
$2.00
$0.00
$2.00
$1.50
$1.00
$0.50
$0.00
Average bill before
Average bill before
Average bill after
Residential, 301+ kWh/mo
$.23/mo - 60% of savings
$20.00
$15.00
$10.00
$5.00
$0.00
Average bill before
Average bill after
Average bill after
Bulb Pricing Assumptions
CFL wattage
FOB price (from E.F.)
Taxes
Wholesale price
Fraction of bulbs sold
Wattage of replaced bulb
12.5
$1.90
$0.70
$2.60
80%
62.5
18
$2
$0.74
$2.74
10%
90
23
$2.10
$0.78
$2.88
10%
115
Average
bulb
14.1
$1.93
$0.71
$2.64
70.5
Bulb Survival
Average Lifetime 6,000 hours, Use 4.5 hrs/day
1.2
Percent Surviving
1
0.8
0.6
0.4
0.2
0
-
10
20
30
40
Months of Service
50
60
70
80
Sensitivity to Bulb Lifetime
Price
Breakeven Price (NPV=$11 million)
$3
$2
$1
$0
0
2000
4000
6000
AverageBulb Lifetime
8000
10000
CHALLENGES
 Access to technology information
 Development of bankable project portfolios
 Developing implementation models and business
plans – capacity, barrier removal strategies
 Creation of the enabling environment for
sustained technology development and transfer,
including market transformation
 Building of business partnerships and
identification of technology transfer
intermediaries
CHALLENGES
 “Distressed” international political will to discuss
the issue of technology development and transfer
(compared to e.g. CDM) as reflected under
UNFCCC
 Lack clear direction for engaging the private sector
to promote cooperation and effective partnership
development
 Inadequate and uncertainties in financing options –
where (under UNFCCC and other donor sources),
when, what and how?
CONCLUSIONS
 Technology needs assessment is the critical niche
 The weakest link of the technology development
and transfer chain is the mechanism for
technology transfer - including financing
 Technology transfer is not a formula but an
innovative process, involving learning by doing
 Therefore there is the need for joint research and
development through partnerships that will
address the fear of loss of IPRs
CONCLUSIONS
 Opportunities for financing technology development
and transfer arise from barrier identification and
removal strategies identified during technology needs
and needs assessment
 Sustained partnership that is built on mutual trust and
benefit sharing is crucial for technology transfer
 There is need to work to reduce risk associated with
needed technologies to make them marketable
 Entrepreneurial skills development is required