unfccc cop 13 bali, 10 december 2007. the business day in perspective bali global business day, 10...

UNFCCC COP 13

Bali, 10 December 2007

The Business Day in PerspectiveThe Business Day in Perspective

Bali Global Business Day, 10 December 2007 2

Moderator

Claude Fusslerformer Program Director WBCSDSpecial Advisor to the UN Global Compact

Once upon a time…Once upon a time…

Voluntary initiatives

Type II partnerships

Walking the talk…

Now…Now…

state of happiness,the Creator, people and naturelive in harmony with each other.


It is about…It is about…

Business solutions

Policy framework

Inclusive, ambitious

OrganizersOrganizers

International Chamber of Commerce

World Business Council for Sustainable Development

PartnersPartners

BUSINESSEUROPEthe Confederation of European Business

International Emissions Trading Association

Federation of German Industries (BDI)

PartnersPartners

KADIN Indonesian Chamber of Commerce and Industry

Nippon Keidanren

International Council of Forest and Paper Associations

PartnersPartners

World LP Gas Association

International Council for Sustainable Energy

Our media partner

an extraordinary support froman extraordinary support from

and its great team!

No breaks

But refreshments available all the time in lobby

As of tomorrow:As of tomorrow:

www.youtube.com/balibusinessday

What do you mean by an

inclusive ‘policy framework?

Would you agree with me that

there are 5 key conditions.

First of all as I wrote in my

paper published for the

Nairoby confrence I cannot

agree with statements like the

one made in your opening

sesssion. How can you

possibly claim that the current

energy generation structure is

obsolete and













obsolete and

Question cards in your folderQuestion cards in your folder

Q & AWHAT DO YOU MEAN BYAN INCLUSIVE POLICY FRAMEWORK ?

WHAT DO YOU MEAN BYAN INCLUSIVE POLICY FRAMEWORK ?

Thank You!

Sorry!...Sorry!...


Biography In your conference pack

Solutions and enabling policiesSolutions and enabling policies

mitigationmitigationsession

Efficiency and demand management Efficiency and demand management

Carbo-neutral energy Carbo-neutral energy

Forests and technical capture and storage

Forests and technical capture and storage

Solutions and enabling policiesSolutions and enabling policies

mitigationmitigationsession

Development and cooperation

adaptation

The Bali StakesThe Bali Stakes

Keynote Speakers

Yvo de Boer

Secretary General, UNFCCC

Björn Stigson

President, WBCSD

Nobuo Tanaka

Executive Director, IEA


What can COP 13 deliver?What can COP 13 deliver?

Keynote Speaker

Yvo de BoerSecretary General, UNFCCC


Enhance business solutionsEnhance business solutions

Keynote Speaker

Björn StigsonPresident, WBCSD


Success factors for mitigationSuccess factors for mitigation

Keynote Speaker

Nobuo TanakaExecutive Director, IEA


INTERNATIONAL ENERGY AGENCY AGENCE INTERNATIONALE DE L’ENERGIE© OECD/IEA - 2007

Nobuo TanakaExecutive Director

International Energy Agency

Bali Global Business Day 10 December 2007

Success Factors for Mitigation

Stimulating markets to outpace climate risks

© OECD/IEA - 2007

© OECD/IEA - 2007

The WEO Reference Scenario Our current trajectory: under-invested, dirty

and vulnerable Leads to a future even worse than projected

just one year ago Consistent with an increase in average global

temperature of up to 6°C

The 450 Stabilisation Case Coincides with the most ambitious of the

IPCC’s scenarios Would limit the increase in average global

temperatures to 2.4°C Unprecedented strong and immediate policy

action would be essential, associated costs very high

Achievable or Science Fiction ?

Two Possible Energy Futures

© OECD/IEA - 2007

Reference Scenario:

World Primary Energy Demand

Global demand grows by more than half over the next quarter of a century, with coal use rising most in absolute terms

0

2

4

6

8

10

12

14

16

18

1980 1990 2000 2010 2020 2030

billio

n to

nnes

of o

il equ

ivale

nt

0

2

4

6

8

10

12

14

16

18

1980 1990 2000 2010 2020 2030

billio

n to

nnes

of o

il equ

ivale

ntOther renewablesBiomassHydroNuclearGasOilCoal

© OECD/IEA - 2007

Global CO2 Emissions: Historical and Future

Although China and India produced just 10% of total global emissions since 1900 they will represent 56% of the increase to 2030. By that time per capita

emissions in China will approach those of OECD Europe.

Cumulative Energy-Related CO2 Emissions

0 100 200 300 400 500

United States

European Union

Japan

China

India

billion tonnes

1900-20052005-2030

© OECD/IEA - 2007

CO2 Emissions - 450 Stabilisation Case Achievable or Science Fiction ?

By 2030, emissions are reduced to some 23 Gt, a reduction of 19 Gt compared with the Reference Scenario

10

15

20

25

30

35

40

45

2005 2010 2015 2020 2025 2030

Gt o

f CO 2

CCS in industry – 3% CCS in power generation - 9% Nuclear – 13% Renewables – 20%Switching from coal to gas - 8%End Use electricity efficiency -17%

End Use fuel efficiency – 30%

Reference Scenario

450 Stabilisation Case27 Gt

42 Gt

23 Gt

Energy-Related CO2 Emissions

© OECD/IEA - 2007

Average Annual Power Generation Capacity Additions in the 450 Stabilisation Case, 2013-2030

A large amount of capacity would need to be retired early, entailing substantial costs

22 CCS coal-fired plants (800 MW)

20 CCS gas-fired plants (500 MW)

30 nuclear reactors (1000 MW)

2 Three Gorges Dams

400 CHP plants (40 MW)

17 000 turbines (3 MW)

0 10 20 30 40 50 60

Other Renewables

Wind

Biomass and waste

Hydropower

Nuclear

Gas CCS

Coal CCS

GW


“We will act with resolve and urgency to meet our

shared multiple objectives of reducing greenhouse

gas

emissions, improving the global environment,

enhancing

energy security and cutting air pollution in

conjunction

with our vigorous efforts to reduce poverty“

-- from “G8 Gleneagles -- from “G8 Gleneagles Communiqué” Communiqué”

“We will move forward with timely implementation

of the

Gleneagles Plan of Action. We have instructed our

relevant ministers to continue the Dialogue on

Climate Change, Clean Energy and Sustainable

Development and report its outcomes to the G8

Summit in 2008” -- from “G8 St. Petersburg -- from “G8 St. Petersburg

Communiqué”Communiqué”

“Technology, energy efficiency and market

mechanisms, including emission trading

systems or tax incentives, are key to mastering

climate change as well as enhancing energy

security.”

-- from “G8 Heiligendamm -- from “G8 Heiligendamm Communiqué” Communiqué”

© OECD/IEA - 2007

In support of the G8 Plan of Action

Energy Usein the NewMillennium

Trends in IEA Countries

ENERGYINDICATORS

© OECD/IEA 2007

Energy Efficiency: Support the IEA’s I3 Initiative

Implement ! Implement! Implement !

0%

1%

2%

3%

1973 - 1990 1990 - 2004

Ave

rage

ann

ual p

erce

nt c

hang

e

Actual energy use

Energyefficiency

improvements

Actual energy use

Energyefficiency

improvements

Hypothetical energy use without energy efficiency improvements

Source: Energy Use in the New Millennium (IEA, 2007)



ENERGYINDICATORS

© OECD/IEA 2007

Since 1990, the rate of energy efficiency improvement in IEA countries has been less than 1% per year – much lower than in

previous decades. We must - and we can - do better!

© OECD/IEA - 2007

Energy Indicators: Factors Affecting Manufacturing Energy Use, IEA19

-2%

-1%

0%

1%

2%

3%

4%

1990-1995 1995-2000 2000-2004 1990-2004

Ave

rag

e an

nu

al p

erce

nt

chan

ge

Actual energy use Activity Structure Energy efficiency



ENERGYINDICATORS

© OECD/IEA 2007

There has been a strong decoupling of energy use from manufacturing output, particularly in metal products, chemicals, non-

metallic minerals and paper and pulp.

In support of the G8 Plan of Action© OECD/IEA - 2007

MindMind thethe GapGap

QuantifyingPrincipal-AgentProblems inEnergy Efficiency

Why Doesn’t Someone Pick up That 20 Euro Note On The Sidewalk?

Energy efficiency potential is trapped beneath these barriers!

“It looks like it’s monopoly money” market failures

principal agent problem asymmetric information

“I have a sore back” bounded rationality and limited energy

costs

“I’ll have to declare it on my income taxes” inefficient government laws and regulation


CoalCoal

CO2 SequestrationCO2 Sequestration

NuclearNuclear

WindWind

Solar PVSolar PV

Replace 300 conventional, 500-MW coal power plants with “zero-emission” power plants, or ...

Replace 300 conventional, 500-MW coal power plants with “zero-emission” power plants, or ...

Install 70 x current German wind generation in lieu of unsequestered coal

Install 70 x current German wind generation in lieu of unsequestered coal

Install 1090 x current US solar generation in lieu of unsequestered coal

Install 1090 x current US solar generation in lieu of unsequestered coal

Install 1000 Sleipner CO2 sequestration plantsInstall 1000 Sleipner CO2 sequestration plants

Build 140 1-GW power plants in lieu of unsequestered coal plants

Build 140 1-GW power plants in lieu of unsequestered coal plants

Efficient lightingEfficient lightingReplace incandescent lamps by CFLs = 0.5 GtReplace other lamps with efficient options = 0.5 Gt

Replace incandescent lamps by CFLs = 0.5 GtReplace other lamps with efficient options = 0.5 Gt

Adapted from Pacala & Socolow, Science 2004

Mitigation Policy & TechnologyAvoiding 1 billion tonnes of CO2 per Year

Early market signals and technology R&D canwork together to assist the market transition – Policies

and R&D are inseparable!


0

2000

4000

6000

8000

10000

12000

14000

16000

18000

20000

1974 1978 1982 1986 1990 1994 1998 2002 2006

Mill

ion

US

$ (

20

06

pri

ces

an

d P

PP

)

-1%

1%

3%

5%

7%

9%

11%

13%

15%

Sh

are

of E

ne

rgy

R&

D in

To

tal R

&D

Energy efficiency Fossil fuels Renewable energy sources Hydrogen and fuel cells Other Nuclear Share of energy R&D in total R&D

Public Sector Energy R&D in IEA Countries

R&D investment is not adequate given the magnitude of the climate challenge. Government spending on energy R&D has fallen, while the private-sector is focused

on projects with short-term payoffs


The Institutional Challenge: What will be

required? The support and cooperation of industry

Good governance, as this will be critical to minimising risk and attracting investment

A post-2012 Framework that: Involves participation of all major emitters

Addresses cost uncertainty, promotes flexibility and accommodate differing national circumstances

Considers sectoral approaches, as these could:

• broaden greenhouse gas reduction actions

• ease concerns for trade-exposed energy-intensive industries

Appropriate bodies, such as the IEA, to provide advice and monitor and report against progress

In support of the G8 Plan of Action © OECD/IEA - 2007

ENERGYTECHNOLOGYPERSPECTIVES

Scenarios &Strategies

to 2050

2 0 0 8

INTERNATIONAL

ENERGY

AGENCY

Upcoming Publication: Energy Technology Perspectives 2008

How to get there:Research, Development and Demonstration

policiesTechnology learning and deploymentTechnology transitions Investment needs and policy costEnergy and CO2 emission indicators

(efficiency)Consequences for consumers

Scenario analysis Country level analysis for G8+5

The Bali StakesThe Bali Stakes

Keynote Speakers

Yvo de Boer

Secretary General, UNFCCC

Björn Stigson

President, WBCSD

Nobuo Tanaka

Executive Director, IEA


Opportunities in Energy Efficiency Opportunities in Energy Efficiency

Moderator

Teresa Presas, President, Confederation of European Paper Industries

Expert view: Low-carbon scenarios for Germany

Klaus Mittelbach, Head of Environment and technology, BDI

Panel

Paul Peeters, Senior Vice President, Philips Lighting Asia Pacific Region

Doug Musyka, President, DuPont Greater China

Gert-Jan Koopman, Director, DG Enterprise, European Commission

Frances Beinecke, President, Natural Resources Defense Council

Policy Review

Nick Campbell, Chair, ICC Task Force on Climate Change


Low Carbon scenarios for GermanyLow Carbon scenarios for Germany

Expert view:

Klaus Mittelbach

Head of Environment and Technology

BDI


Opportunities in Energy EfficiencyOpportunities in Energy Efficiency

Moderator

Teresa PresasPresident, Confederation of European Paper Industries



Panel

Paul PeetersSenior Vice President, Philips Lighting Asia Pacific Region



Panel

Doug Musyka,

President, DuPont Greater China














obsolete and













obsolete and





Panel

Gert-Jan Koopman,

Director, DG Enterprise, European Commission



Panel

Frances BeineckePresident

Natural Resources Defense Council


Opportunities in Energy Efficiency Opportunities in Energy Efficiency

Policy Review

Nick CampbellChair

ICC Task Force on Climate Change


Climate Policy and the PublicClimate Policy and the Public

Expert view

Doug MillerPresident, GlobeScan Incorporated


48

Participating Countries (21*)

22,000 in-person / telephone interviews - June-July 2007

* Urban samples in 8 countries

**Average of 21 countries. Asked in Egypt

POLL

49

Views of Action Needed to Reduce Human Impact on Climate Change

Average of 21 Countries, 2007

Base: Representative samples of 22,000 adults in 21 countries

M3. As you may know there is some discussion these days about whether it is necessary to take steps to reduce the impact of human activities that are thought to cause global warming or climate change. Which of the following . . .

50

Position Held on Limiting Climate Change Gas Emissions in Less Wealthy Countries

By Country, 2007

The white space in this chart represents “DK/NA."

Base: Representative sample of 22 000 adults in 21 countries

51

Wealthy Countries Provide Less Wealthy Countries with Financial Assistance / Technology; Less Wealthy Countries Limit Emissions of Climate Changing Gases along with Wealthy Countries

Average of 21 Countries, 2007


52

Support for Higher Taxes on the Most Harmful Types of Energy So That Individuals/Industry Use Less

“Strongly” and “Somewhat Favour,” Average of 21 Countries, 2007

*Based on subsample results.

53

Support for Higher Taxes on the Most Harmful Types of Energy So That Individuals/Industry Use Less

2007

*One-half of respondents who said they “strongly” or “somewhat opposed” energy tax or did not give an answer were then asked whether they would support an energy tax if the revenues of the tax were devoted only to increasing energy efficiency and developing energy sources that do not produce climate change.


54

Ready to Make Significant Changes to Lifestyle to Help Prevent Climate Change

“Agree” vs “Disagree,” by Country, 2007

The white space in this chart represents “DK/NA.”

Implications of Findings

• Unprecedented global constituency for immediate action on human causes of climate change

• Support for action by ALL countries in parallel

• Strong support for funding and technology transfer to support action in less-wealthy countries

• Pollster’s view: a well-designed and communicated carbon tax is saleable in all countries surveyed

• Citizens and consumers see themselves as part of the solution

• A world-wide FOLLOWERSHIP exists; a time for LEADERS

Details under “News Centre” on: www.GlobeScan.com

http://www.GlobeScan.com/

Towards Carbon Neutral EnergyTowards Carbon Neutral Energy

Moderator

Laurent Corbier, Chair, ICC Commission on Environment & Energy

Panel

Teruaki Masumoto, President, Tokyo Electric Power Company (TEPCO)

Andrew Richards, Executive Manager, Corporate Affairs & Government, Pacific Hydro

Prashant Modi, FICCI

Harlan Watson, Senior Climate Negotiator, US Department of State

Jonathan Lash, President, World Resources Institute

Policy Review

David Hone, Climate Change Adviser, Royal Dutch Shell



Moderator

Laurent CorbierChair, ICC Commission on Environment & Energy














obsolete and













obsolete and





Panel

Teruaki MasumotoPresident, Tokyo Electric Power Company (TEPCO)



Panel

Andrew RichardsExecutive Manager, Corporate Affairs & Government, Pacific Hydro



Panel

Prashant ModiFICCI



Panel

Harlan WatsonSenior Climate Negotiator

US Department of State



Panel

Jonathan LashPresident

World Resources Institute



Policy Review

David HoneClimate Change Adviser

Royal Dutch Shell


What’s the same? What’s different?

The Technology Pathway


Competing technology

More cost competitive

Number of installations / Products

Tec

hnol

o gy

c os t

Incentive

Earlier deployment

Discovery and DevelopmentDiscovery and Development

Demonstration phaseDemonstration phase

Deployment phaseDeployment phase

0

20

40

60

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100

1 10 100 1000

The iPhone





Tec

hnol

o gy

c os t

New features

Earlier deployment

R&D is very well funded in the high technology sector;

• Extreme competition• Spinoffs from other government initiatives.

R&D is very well funded in the high technology sector;

• Extreme competition• Spinoffs from other government initiatives.

Early adopters pay for thisEarly adopters pay for this

Cool new features drive early deploymentCool new features drive early deployment

0

20

40

60

80

100

1 10 100 1000

New Energy Technologies





Tec

hnol

o gy

c os t

Not many early adopters so the demonstration phase will need help.

Not many early adopters so the demonstration phase will need help.

Purchase incentives and/or CO2 price

Purchase incentives and/or the CO2 market drive(s) early deployment

Purchase incentives and/or the CO2 market drive(s) early deployment

Earlier deployment

Probably need to refocus and expand R&D for energy.

Probably need to refocus and expand R&D for energy.

0

20

40

60

80

100

1 10 100 1000

A focussed policy approachPower Generation /

Industry & Manufacturing

Transport Commercial & Domestic (Buildings)

Discover & Develop • Support for infrastructure

(e.g. grids & pipelines)• Support for advanced

fuel development• Urban planning decisions.

• Education and awareness.

Demonstrate • Fiscal support for large-scale CCS demonstrations

• Fiscal support for early 2nd generation biofuel manufacture.

• Public transport

• Encouraging radical design

Deploy • “Cap-and-Trade”

• CCS rules and recognition

• Renewable Energy Certificates

• “Fast-track” planning

Policies Focus on;

• Vehicle efficiency

• New fuels (e.g. biofuels)

• Consumer behaviour and vehicle use

• Efficiency standards (appliances, air-con)

• Use of project mechanisms linked to GHG market.

• Encouraging “electrification”.

Broad energy production and use R&D support

Lunch Break Lunch Break


Short !

13:00 to 14:10

Buffet

Dr. Mari Elka Pangestu Minister of Trade

Indonesia

Session 3 Focus

14:20 – 15.30 hrs Large Scale Carbon Control

• Opportunities in conserving natural carbon sinks and in long-term capture and storage techniques


Session 3 Participants

Moderator: James Griffiths, WBCSD

Panelists: Business Solutions & Policy Options:

• Ernesta Ballard, SVP Weyerhaeuser - capture via sustainable forest management & forest products

• Preston Chiaro, CEO Energy Products Group Rio Tinto – industrial CCS projects

NGO perspective: Toby Janson-Smith, Senior Director Conservation International

Government perspective: Prof Emil Salim, Advisor to President of Indonesia, Head of Delegation

Policy Reviewer: Ian Emsley, Group Advisor Anglo American & Chair ICC UK Committee on Environment & Energy


Context – Natural Carbon Sinks

IPCC 4th Assessment Report:15-20 % of global CO2 emissions caused by

land use change, primarily deforestation for agriculture

Yet forestry can make very significant contribution to low cost mitigation that provide synergies with adaptation & sustainable development, and mitigation options such as storage in harvested wood products, product substitution & bioenergy


Context – Biomass energy

WBCSD – Sustainable Forest Products Industry, Carbon & Climate Change – key messages for policy-makers

“Biomass energy is fundamentally different from fossil fuel energy because biomass recycles carbon to the atmosphere, whereas fossil fuels introduce “new” carbon. This is why biomass from sustainably managed forests is called “carbon neutral”.


Forest carbon sinks - policy options

1. Protect the economic value of trees

2. Mandate certification to sustainable forestry standards

3. Demand mutual recognition among different certification systems.

4. Reduce financial risk

5. Credit sustainable forestry and value chain products.

6. Let the marketplace work.•Bali Global Business Day, 10 December 2007

75

Context – Long term Carbon Capture & Storage

IPCC Special Report:

By 2050, given technical limitations, around 20-40 % of global fuel CO2 emissions could be suitable for capture, including 30-60 % of electricity generation and 30-40 % of industrial CO2 emissions

IEA Technical Report:

CCS in power generation sector has the potential to contribute to reductions of about 4.4 GT CO2 by 2050


2. Preston Chiaro, Rio Tinto

Business solutions

• Energy efficiency

• Low carbon energy (renewables, CCS)

• Adaptation


Policy Options - CCS

• Comprehensive (all sectors, all solutions, global)

• Governments must set CO2 pricing framework(s)

• Set level playing field


Non Governmental Perspective

Toby Janson-Smith, Conservation International


• 18%-25% of global GHG emissions

• Forestry must supply ~35% of required offsets to keep <+2°C by 2030 at <€40 per tCO2 (McKinsey, 2007)

• Community ecosystem service + biodiversity benefits

• Developing-country emissions reduction commitments

• US Lieberman-Warner bill: 2.5% set aside for RED (~$1b/yr)

• Project-based RED must complement national-level schemes

Opportunities for Reducing Emissions from Deforestation

• Key issues: – Additionality– Leakage– Measurement & Monitoring– Permanence– Ancillary social & environmental impacts

• Climate, Community & Biodiversity Standards

• Voluntary Carbon Standard

Importance of Forest Carbon Standards

• The defining issue for AFOLU and CCS projects

• Temporary credits not well received/used

• Immature market for insurance products

• VCS pooled buffer approach could point the way– Credible (atmospheric integrity)– Workable (simple, inexpensive & easy to administer)– Project-friendly (only ~5-10% loss of discounted carbon

revenues)– Investor-friendly (fungible credits + no performance risk/liability)

Addressing the Permanence Challenge

Government perpective

Professor Emil Salim,

Head of Indonesian Delegation, Advisor to the President of Indonesia


Discussion


BUSINESS OPPORTUNITIESTO COMBAT CLIMATE CHANGE

By Emil SalimHead of the Indonesian DelegationNusa-Dua, Bali, 10 December 2007

[email protected], [email protected]

mailto:[email protected]

PUBLIC & PRIVATE FUNDING1. GEF has allocated US$7.4 billion with co-financing

of US$ 29 billion for 1,980 projects in 160 developing countries;

2. Kyoto Protocol’s market-based mechanisms is the clean-development-mechanism (CDM) that enables green-house-gas reducing projects and contribute to sustainable development to earn “certified emission reduction” (cer) credits; There are 840 registered CDM projects in 49 countries with 1,800 projects in the pipe line


TO MEET THE INCREASING NEEDS FOR FUNDS1. To combat climate change, emission of annual

CO2e must be stabilized at 450-550 ppm at an estimated cost of 1% global GDP;

2. Developed countries must make “deeper cuts” in CO2e emissions and developing countries must create co-benefits reducing CO2e emissions through sustainable development;

3. Technology transfer and innovative funding is required through public and private funds;

BUSINESS OPPORTUNITIES

1. Boost CDM in energy conservation/efficiency, promote adoption of renewable energy, reduce long term costs of low GHG emitting energy technology, promote sustainable transport;

2. Simplify Forestation CDM procedure for small scale projects; enhance reforestation projects;

3. Introduce “reduction of emissions from deforestation, conservation and degradation;

4. Explore Carbon-Capture-Storage technology;

PROMOTE BUSINESS INVOLVEMENT

1. Developing countries can reduce emissions of CO2epath by following path of sustainable development through transfer of technology;

2. CDM is a tool of transfer accompanied by P-to-P cooperative arrangements to cut time horizon to re-invent the wheel;

3.Technology transfer with capacity building must be implemented simultaneously to create co-benefits reducing CO2e through sustainable development.

Discussion

Q & A Panelist

Q & A Participants


Policy Review

Ian Emsley, Anglo American & ICC UK Committee on Environment & Energy

1. Forest & Forest Product Carbon

2. Carbon Capture & Storage


Policy Review

Forests & Forest Products Carbon

1. Adequate supplies of wood and recovered fiber

2. Forest products value chain benefits

3. Bio mass-based technologies

4. Reduce cost of capital

5. Remove regulatory barriers to combined heat & power potential


Policy Review

Forests & Forest Products Carbon

6. Avoid unintended policy consequences

7. Recognized carbon stored in forest products

8. Minimize land competition

9. Encourage sustainable forest management

10. Market forcesBali Global Business Day, 10 December 2007

92

Policy Review

Carbon Capture and Storage Many countries depend on coal and

will continue to use it CCS is needed if coal is to be used in

a climate-friendly manner Early action on CCS is needed to

avoid carbon ‘lock-in’ and will not happen without policy support


Policy Review

Requirements for CCS early action:1. Regulatory Framework Incentives (carbon credits, price

guarantees, feed-in tariffs, capital grants, etc)

Legal Clarity Safety, health and environmental

regulation in place Site selection and monitoring / reporting

protocols Assumption of long term carbon liabilities


Policy Review

2. Demonstration Projects

Needed for: Technology reliability Cost reduction Infrastructure development Public acceptance


Development and CooperationDevelopment and Cooperation

Moderator

Andrei Marcu, President, International Emissions Trading Association (IETA)

Panel

Rudi Fajar, President Director Riaupulp, APRIL Group

Dr. Gail Kendall, Director, Group Environmental Affairs, CLP Holdings Limited

Fernando Tudela, Under Secretary for Planning and Environmental Policy, Ministry for Environment and Natural Resources, Mexico

Katherine Sierra, Vice President for Sustainable Development, World Bank

Peter Goldmark, Program Director, Climate & Air, Environmental Defense Fund

Policy Review

Adam Kirkman, Program Manager, Energy and Climate Focus Area, WBCSD



Moderator

Andrei MarcuPresidentInternational Emissions Trading Association (IETA)














obsolete and













obsolete and





Panel

Rudi FajarPresident director Riaupulp, APRIL Group



Panel

Dr. Gail KendallDirector, Group Environmental Affairs

CLP Holdings Limited



Panel

Fernando TudelaUnder Secretary for Planning and Environmental Policy, Ministry for Environment and Natural Resources, Mexico



Panel

Katherine SierraVice President for Sustainable Development

World Bank



Panel

Peter GoldmarkProgram Director, Climate & Air

Environmental Defense Fund



Policy Review

Adam KirkmanProgram Manager, Energy and Climate Focus Area

WBCSD


UNFCCC COP 13Bali, 10 December 2007

Policies to enhance business participation and investment

Evolution of the Debate - 2000


Mitigation

Adaptation

Post-2012 debate in 2007


How do we attract private capital?


1. Understand how and why business invests

2. Recognise that raising money is not the problem – directing the flow toward the development, demonstration and deployment of clean energy technologies is the key

3. Align policy, mechanisms, tools with commercial conditions in which business invests

Need to understand how and why a business chooses to invest


Decision made in dynamic, highly differentiated, competitive market

Every decision relies on commercial returns Money always flows to quickest returns Low carbon projects among more complex and

risky forms of investment Different screening mechanisms, risk appetites,

appraisal criteria Whole host of risks to be taken into account A great opportunity for one investor can be a

step too far for another

Harness the power of the markets


Political risks, legal frameworks, structures all influence pace of investment in the market

In markets confidence is important Determines potential participants and scope of

investment Policy uncertainty increases risks of achieving

a commercial return While uncertainty prevails bulk of capital will

flow to traditional energy sources, or remain uncommitted until definitive policies emerge

What policy is needed?


International policy effort must align with the long range business investment horizon

Supportive regulation and governance to encourage business to invest for the long term

Dismantle trade barriers affecting the diffusion of technologies

Manage IPR issues to balance the need to incentivise innovation and support investment

Clear and strong expectation of CO2 price Create predictable future demand for key

technologies to drive innovation and competition

What can governments in developing countries do?


Build institutional capacity to translate energy and climate strategies into integrated development plans

Stable and transparent regulatory regimes Expand and aggregate (project portfolios) to

standardize and streamline Support investment in SMEs so they can own

and operate projects and support deployment Technology cooperation through competitive

business to business transactions to scale up

What can we do together - public and private


Less developed countries need innovative Clean Energy Investment Frameworks

Engagement in G8 Gleneagles Dialogue MDBs – High potential to leverage private sector

investment in developing countries Public-private financing mechanism to develop

pipeline of clean energy projects buy down incremental investment costs grants and concessional loans increase creditworthiness of the future carbon cash flows

through partial guarantees

Have to get this right….


Must get technologies into developing world Rich countries need to help poor countries Business has capacity to help but needs

policy certainty that brings stability, confidence in markets and facilitates long-term investment

If we get it right it can be used to alleviate poverty, create jobs and build sustainable wealth

Reduces emissions, protects and conserves energy resources, and crucially the ecosystems of the developing world

www.balibusinessday.org

Climate Policy, Climate Policy, Business Engagement, Progress Business Engagement, Progress

Moderator

Claude Fussler, former Program Director, WBCSD

Closing exchange

Yvo de Boer, Secretary General, UNFCCC

Steve Lennon, Delegation Chairman, ICC

Mohamad S. Hidayat, President, Indonesian Chamber of Commerce and Industry (KADIN)

Björn Stigson, President, WBCSD


Climate Policy, Climate Policy, Business Engagement, ProgressBusiness Engagement, Progress

Yvo de BoerSecretary General, UNFCCC



Steve LennonDelegation Chairman

ICC



Mohamad S. HidayatPresidentIndonesian Chamber of Commerce and Industry (KADIN)



Björn StigsonPresident

WBCSD


Up to the challenges? Up to the challenges? Or not yet?Or not yet?

Dr. Gro Harlem BrundtlandUN Special Envoy on Climate Change


Closing StatementClosing Statement

Rachmat WitoelarMinister Of Environment

Republic of Indonesia


Caring for Climate dinnerCaring for Climate dinner

18:30 Cocktails

19:30 Dinner

A few last minuteregistrations possible

www.balibusinessday.orgwww.balibusinessday.org

UNFCCC COP 13Bali, 10 December 2007

Thorsten ArndtThorsten Arndt

Lucy JasminLucy Jasmin

Mary KellyMary Kelly

Kija KummerKija Kummer

Marisa LowMarisa Low

Christian KornevallChristian Kornevall

Carlos BusquetCarlos Busquet

Stephanie HeldStephanie Held

Wendy PoultonWendy Poulton

Neil FranklinNeil Franklin

Tina LaunoisTina Launois

Jacqueline CoteJacqueline Cote

Norine KennedyNorine Kennedy

Marcel EngelMarcel Engel

Jonathan WootliffJonathan Wootliff

Michael MartinMichael Martin

Anne Catherine WernerAnne Catherine Werner

MusicMusic



May you all share it!

unfccc cop 13 bali, 10 december 2007. the business day in perspective bali global business day, 10...

Documents

emissions slide

ambitious slide

storage slide

talk slide

lobby slide

global compact slide

sustainable development

paper associations slide