AN INITIATIVE BY: GREEN FUTURE LEBANON

RESPONSIBILITY, SUSTAINABILITY

• Sustainability• Climate Change• Kyoto & CDM• Water Heating Macroeconomic Analysis

– Energy sector in Lebanon– Research Findings– Economic & Environmental Impact– Growth Barriers

• The National CDM Project for Solar Energy (NASEL)• Mission, Vision & Value Statements• Stakeholders• Project description• Municipal role• Progress• SWOT Analysis• Promoting NASEL

Meeting the needs of the present without

Compromising the ability of future generations to meet their own needs

Main challenging factors:Income Growth : increasing consumptionPopulation Growth : fewer resources per head

Source: Our Common Future; Gro Harlem Brundtland

Fewer resources for future generations Fewer resources for future generations due to:due to: Shortage in food and water

with widespread famine and plagues while population is still on the rise

Higher GHG emissions and more abrupt climate change with recurring natural disasters

Photo by: Kevin Carter

•Blue shading indicates that most models (>75%) show an increase in annual rainfall •Red shading indicates that most models show a decrease in rainfall•Lightly shaded areas are where models show inconsistent results

Source: Climate Directorate of the National Centre for Atmospheric Science, University of Reading

A protocol to the United Nations Framework Convention on Climate Change  (UNFCCC or FCCC), aimed at fighting  global warming. The UNFCCC is an international environmental treaty  with the goal of achieving the "stabilization of greenhouse gas  concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system

The Protocol was initially adopted on 11 December 1997 in Kyoto, Japan, and entered into force on 16 February 2005. The only remaining signatory not to have ratified the protocol is the United States

Under the Protocol, 37 countries (“Annex Countries”) commit themselves to a reduction of four greenhouse gases (GHG) produced by them, and all member countries give general commitments

The Protocol allows for several “flexible mechanisms”, such as emissions trading, the clean development mechanism (CDM) and joint implementation to allow Annex 1 countries to meet their GHG emission limitations by purchasing GHG emission reductions credits from elsewhere, through financial exchanges

Source: The Clean Development Mechanism; Energy & Environment Group, Bureau for Development Policy, UNDP

CDM aims to direct private sector investment into emission-reductionprojects in developing countries while promotingsustainable development in these countries. In return, the industrialized countries investing in projects will receive credits against their Kyoto targets

1. Development of project concept note

2. Development of Project Design Doc

3. Host Country Approval

4. Validation of PDD

5. Publish PDD for 30 days

6. Project Validation

7. Registration with CDM

8. Project Implementation & Monitoring

9. Verification & Certification

10. Issuance of CERs

KYOTO CDM activity has been successful so far in creating a dynamic carbon market

More than 2.8 billion CERs generatedCDM has been a catalyst for the transfer

of high technology to underprivileged areas and given them access to investments without which they would never get

CDM is leading to a Market Mechanism for Sustainable Development (MMSD)

CDM is the founding structure of any future carbon market

SOURCE: THE GREEN PACT RESEARCH 2011

UNDP/ LCEC RESEARCH 2009GREEN ARMS RESEARCH

2007

Lebanon depends almost exclusively on imported fossil fuels to fulfill its energy needs.Around 99% of its primary energy consumption is imported, with electricity generation being the main fuel consumerThe use of renewable energy in Lebanon has been limited to hydropower whose share has been dropping with increased electricity production and consumptionHouseholds consume around 200 MW of electricity for heating water (equivalent to 1,500 Gwhr/yr and an actual cost of $330 Million/ yr)Heating water electrically costs EDL $202 Million/ yr in power subsidy sale to households

The UNDP Environment and Energy Office in Beirut has created alongside with the Ministry of Environment and Ministry of Energy an initiative known as Lebanese Center for Energy Conservation (LCEC)

In 2007 and 2008, they have jointly conducted several studies on solar power and specifically a pilot test on domestic solar water heaters

Major Findings:Average annual hot water consumption 13 m13 m33/person /person

and 645 lit/m645 lit/m22 of built areaEquivalent thermal energy is 618 KWh/person 618 KWh/person and

30.9 KWh/m30.9 KWh/m22 of built areaEvacuated tube systems can offset around 98.6% of 98.6% of

electricityelectricity needed to heat waterHousehold actual saving for an SWH system on

electricity bill is $195/yr $195/yr whereas the actual cost of the offset power is $610/yr $610/yr

Each SWH unit will offset 1.6 ton of CO2 emissions/ yr1.6 ton of CO2 emissions/ yr

National need for SWH is estimated at around 1.2 million sq. meters of collector aperture area

SWH systems will save 100 MW of power generation (including grid losses of 25%)

SWH systems will offset $202 Million/ yr in government power subsidy and 700,000 tons of CO2 emissions/ yr (assuming all electricity generation is from oil-fired power plants)

The major factor impeding the growth of solar water heater installations in Lebanon is:People who most need solar water heaters

(rural and suburban areas) are not capable of financing or affording its price

Low technical expertise of installers where many installed units do not perform to the expected or promised standard and warranties are left unfulfilled

Lack of commitment and credibility due to the absence of a capable standardizing body where many installed units do not meet the minimum critical point of failure or their improper installation leads to a reduction in performance

Low value for money where good quality products are very expensive and low price products are very low quality

Water quality in Lebanon is very badVery high hardness resulting in

scaling and reduction in heat transferVery high chlorine and other corrosive

anion concentrations resulting in quick deterioration and corrosion of metals

Limited roof space in Beirut and its suburbs due to the densely developed land with an average population of 19,195/ sq.km and average building height of 21 m

Mission: we will engineer financial Mission: we will engineer financial models through which we can models through which we can harness solar energy to make it harness solar energy to make it widely affordable to every widely affordable to every householdhousehold

Vision:Vision: to act as a catalyst for the to act as a catalyst for the exponential growth in the rate of exponential growth in the rate of adoption of solar energy in adoption of solar energy in LebanonLebanon

Adopt cutting edge clean technologies exclusively

Support government initiatives as a means of offsetting high technology costs

Be a reliable developer, service provider and advisor

Create long term alliances with stakeholders which outlive project lifetimes

Create enterprise value by properly hedging risks and maintaining growth

1. Households consume around 200 MW of electricity for heating water (equivalent to 1,510 Gwhr/yr and an actual cost of $330 Million/ yr)

2. Heating water electrically costs EDL $202 Million/ yr in power subsidy sale to households (baseline of 0.5 million HH with electric heating tank)

3. National need for Solar Water Heaters is estimated at around 1.2 Million m2of collector aperture area

The Green Future Solar Heating Project will save 155 Gwhr of power generation per year

reduce EDL subsidy by $20 Million yearly

SWH systems will offset 120,000 tons of CO2 emissions/ yr (assuming all electricity generation is from oil-fired power plants)

equivalent to removing 55,000 circulating cars out of service

Green Future will provide Solar Water Heaters and retrofit collector systems at a Zero Net Cost to end users

through subsidized interest financing and CER claim under a CDM model

Each municipality will be offered to participate in the project upon signing an MOU through which it will act as a mediator between the households and The Green Pact

For each participating municipality an administrator from within the community will be hired to handle applications and payments

Groups of 50 will be bundled and applied together as a group loan unwritten against default by Green Arms especially that more than 50% of rural households are not eligible for credit from private banks

Technicians from within the community will be hired to do the installation, maintenance and repair of systems. They will be trained free of charge by The Green Pact

Each municipality will stock the purchased units and a reserve of 2% to cover any warranty claim or repair

The municipality will provide advertising space and location for the gatherings related to promoting the project

Households will pay a deposit of $200 which will be deposited in a cash-co account as a guarantee against default

In case of default of any of the bundled group members the bank will withdraw the full borrowed amount and deduct from the deposit until depletion where after this point Green Arms will come in to settle the payments

The balance remaining after deduction of defaulted payments by group members will be used against payment of last installments

In case of default on payment the share will be acquired by the Green Arms

The municipality administrator will collect monthly the due installments and deposit them at the designated bank

A central call center will be dedicated to handle customer queries and complaints in order to refer them to the designated repair technician and log the event for monitoring

Engineers employed by The Green Pact at the LCEC will conduct 100% site audits to ensure proper installation of units before the fees due to installers are paid by The Green Pact

Lebanon Energy ResearchMar 2005

CDM MOU signed with UNDPAug 2009

Capital Raised for CDM PAApr 2006

Lebanon CDM CPA AnnouncedJan 2010

CPA PIN Submitted Aug 2010

PIN ApprovedMar 2011

CER off-take secured with MGMApr 2011

1st draft of PDD submitted for reviewJul 2011

Final PDD Approved for submissionNov 2011

Lebanon CPA initiated

(2,500 m2 of collector area installed)Dec 2011

First CER to be claimedDec 2012

Capitalize on the CDM benefits and subsidized interest to reduce end user price and offer the solar heating system at a Zero Net Cost (i.e. the monthly installment is equivalent to the household saving on electricity or energy bill)

Positioning: premium quality systems at a Zero Net Cost

Consumer Promise: Financing model such that monthly installment equivalent

to energy saving Premium quality product with 5 years warranty endorsed by

LCEC (a UNDP entity) Advanced technology and High performance guaranteed by

regular maintenance and monitoring

With the support of the Ministry of Environment the LCEC and the Ministry of Energy a continuous PR campaign will be maintained throughout the project duration through: Monthly press releases in daily newspapers highlighting major

activities undertaken on the project Frequent TV talk show hosting with community leaders, sector

experts, public figures and government officials to endorse the project and clarify its objectives to the public

Technical TV program free sponsorship on MTV and FTV educating the public on product usage and maximizing savings

Frequent seminars inviting municipalities, heads of syndicates and unions to initiate their involvement

Four branded panels will be placed on the four main entrances of Beirut (Khalde, Hazmieh, Dora, Mansourieh). Each panel will have 4 digital counters displaying: Pollution index at the location Number of units installed to date Carbon credits saved to date Deficit saved on the government budget to date

The objective of the panels is: to show the impact of this project on both the

environment and the budget deficit To call for action those who did not participate in the

program and incite them to install SWH

JOIN THE PACT !!!