State and trends of carbon pricing initiatives around the ... … · Donor governments pledging...
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ICAO Symposium on Aviation and Climate Change, “Destination Green”, 14 – 16 May 2013 Destination Green State and trends of carbon pricing initiatives around the world Alexandre Kossoy Climate Policy and Finance Department World Bank
Transcript of State and trends of carbon pricing initiatives around the ... … · Donor governments pledging...
ICAO Symposium on Aviation and Climate Change, “Destination Green”, 14 – 16 May 2013
Destination Green
State and trends of carbon pricing
initiatives around the world
Alexandre Kossoy
Climate Policy and Finance Department
World Bank
$0
$60
$120
$180
2005 2006 2007 2008 2009 2010 2011
Other project-based
Other allowances
Secondary CER
Primary CER post-2012
Primary CER pre-2013
EU Allowances
Steady increase of global market value
135
176
11
31
63
(in Billion US$)
144
159
0.3 0.3
EU and other markets increasing value
EU ETS Allowances
147.8
JI AAU
pre-2013 CDM
1.0
-32% +11%
Secondary
CDM + JI
23.1
(in Billion US$)
N. America
0.5
-18%
New Zealand
0.4
+249%
-36% -49%
post-2012
CDM
2.0
+63%
+12%
f(price) = macro-economic scenario & asset risk profile
Contraction of the CDM market
Pre-2013 market values (US$ million)
0
2,000
4,000
6,000
8,000
2007 2008 2009 2010 2011
Pre-2013 CER
CDM & JI Buyers (pre-2013)
2011
0
100
200
300
400
500
600
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
an
nu
al vo
lum
e o
f C
DM
&J
I tr
an
sa
cti
on
s (
MtC
O2e)
Other & Unsp.
Other Europe
UK
Switzerland
Denmark, Finland, Norway, and Sweden
France, Germany, Italy, Netherlands, Portugal, and Spain
Japan
Other Europe includes Ireland, Austria, Belgium, Luxembourg, Iceland and Greece.
Other and Unsp. include s USA, Australia, Canada, New Zealand, Rep. of Korea, and others unspecified.
Japan 1%
France, Germany,
Italy, Netherlands, Portugal, and Spain
19%
Denmark, Finland,
Norway, and Sweden
6%
Switzerland 23%
UK 40%
Other Europe
4% Other & Unsp.
7%
Who’s selling Pre-2013
0
100
200
300
400
500
600
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Pre
-20
13
vo
lum
es t
ran
sa
cte
d (
MtC
O2
e)
Other & Unsp.
Africa
Latin America
Others Asia
China
Latam 2%
China 87%
Others Asia 7%
Africa 4%
Post-2012
China 43%
India 5%
Vietnam 7%
Others Asia 13%
Latam 11%
DRC 5%
Nigeria 2%
South Africa
1%
Others Africa 13%
*Including Iceland, Liechtenstein, and Norway
** Including New Zealand, North America, and Switzerland
MtC
O2e
Market projections indicate
constrained demand over 2013-20
Maximum demand (conservative scenario) Supply
CDM others CDM ETS-eligible
0
1000
2000
3000
4000
Other Annex B** Australia EU gov* EU ETS
3.2 GtCO2e
New CER sub-
limit after the
EU-AU link
1.7 GtCO2e
Remarkable cumulative numbers
• 1.06 bln CERs & ERUs already
surrendered by EU ETS installations
• … equivalent to the annual emissions
of AU and SA combined
• Cumulative pCERs transacted equals
2.4 bln CERs in 2002-11
… larger than annual EU ETS emissions
… and 80% of Kyoto’s total targets (~3
bln tCO2e over 2008-12)
• ERPAs reach US$28 bln (and will
support about US$150 bln in low-
carbon investments, mostly from
private sector) …
Pre-2013 and post-2012
market values (US$ million)
0
2,000
4,000
6,000
8,000
2007 2008 2009 2010 2011
Pre-2013 CER
OVERVIEW OF CARBON FINANCE VEHICLES
€20-28 per tCO2e
($31-43 billion p.a.)
Copenhage
n high
€12-20 per tCO2e
($5-9 billion p.a.)
Copenhage
n low
€35
€40
€ 0
€ 5
€ 10
€ 15
€ 20
€ 25
€ 30
€39 per tCO2e
($150 billion p.a.)
2 degrees
Where Next for Carbon Markets ?
€ 0.00
€ 5.00
€ 10.00
€ 15.00
€ 20.00
€ 25.00
€ 30.00
OVERVIEW OF CARBON FINANCE VEHICLES
11
A Growing Menu of Climate Finance
Instruments to Catalyze and Leverage
11
$648 mln
$115 mln
OVERVIEW OF CARBON FINANCE VEHICLES
Adaptation Mitigation
FY11 FY12 FY11 FY12
$2.3 bln
$4.6 bln
$7.0 bln $7.1 bln
WB: Climate co-benefits in IBRD/IDA lending
OVERVIEW OF CARBON FINANCE VEHICLES
13
A Growing Menu of Climate Finance Instruments to
Catalyze and Leverage
13
$648 mln
$115 mln
OVERVIEW OF CARBON FINANCE VEHICLES
14
The Unit’s first generation of carbon funds
Prototype Carbon Fund
April 2000
$220,000,000
World’s First Global Carbon Fund
Community Development Carbon Fund
March 2003
$128,600,000
Poorest country focused
BioCarbon Fund Tranches I & II
May 2004
$90,400,000
Afforestation, Reforestation, REDD+
& soil carbon
Netherlands Clean Development
Mechanism Facility
May 2002
**
Pioneer purchaser of CDM
Danish Carbon Fund
January 2005
€ 90,000,000
Government & private sector
Spanish Carbon Fund
March 2005
€ 220,000,000
Government & private sector
Umbrella Carbon Facility Tranches
I & II
August 2006
€ 904,100,000
Adding liquidity to market at key moments
Italian Carbon Fund
March 2004
$155,600,000
Government & private sector
Carbon Fund for Europe
March 2007
€ 50,000,000
Governments & private sector
Netherlands European Carbon
Facility
August 2004
**
Purchasing JI
** Unpublished
OVERVIEW OF CARBON FINANCE VEHICLES
57 private sector partners F
ina
nc
ials
O
il &
Ga
s
Uti
liti
es
In
du
str
ials
O
the
rs
OVERVIEW OF CARBON FINANCE VEHICLES
THE UNITED KINGDOM
THE UNITED STATES
JAPAN
SWITZERLAND
THE EUROPEAN COMMISSION
SPAIN
GERMANY
AUSTRALIA
NETHERLANDS
AUSTRIA
SWEDEN
FINLAND
DENMARK
ITALY
NORWAY
REGIONAL GOVERNMENTS OF
BRUSSELS-CAPITAL, FLEMISH
AND WALLOON REGIONS
IRELAND
AGENCE FRANÇAISE
DE DÉVELOPPEMENT JAPAN INTERNATIONAL
COOPERATION AGENCY
LUXEMBOURG
PORTUGAL
24 Public Sector Partners
OVERVIEW OF CARBON FINANCE VEHICLES
17
Responding to the challenges in the market (1 of 2) –
preparing for the future with market readiness support
FCPF Readiness
Fund
National &
sub-national
REDD+
pioneer
Capacity
building to
support
market based
tools for GHG
reduction
Guiding readiness and carbon
finance for REDD+
Forging partnerships between
developed and developing
countries
Enhancing capacity building and
technical assistance
Supporting countries’
development of readiness
component for market
instruments
Helping developing countries
explore, pilot and test emissions
trading
Building on country priorities
for low-carbon growth
Partnership for
Market
Readiness
$258 million
$115 million*
36 country
participants
including 15
donor
governments
28 country
participants
including 12
donor
governments
WB Facility Focus Resources Partners Program
*Target, current $90 million raised
OVERVIEW OF CARBON FINANCE VEHICLES
18
Responding to the challenges in the market (2 of 2) –
pairing readiness with action: carbon credit purchases
Testing
purchase of
REDD+ credits
FCPF Carbon Fund
Scaling-up
carbon finance
$390 million
$147 million
8 public and 2 private and 1 non-
profit participants
6 selling country, 3 buying country
and 2 donor participants
WB Facility Focus Resources Partners
^Resources include pledged and signed readiness components; $17m for BioCF+ and $23m for Ci-Dev Readiness
Financing for
Sustainable
Landscapes
$70 million^
Donor governments pledging results
based finance for blended climate and
development impacts; Structure under
development for private sector BioCarbon Fund
Tranche 3
Support low-
income
countries to
benefit from
carbon finance
$75 million^ Donor governments aiming to sustain
carbon market capacity and test
results based finance frameworks
Thank you
