Sources and Sinks: UNDP's Approach

MDG Carbon has conducted a series of studies on missing greenhouse gas sources and sinks over the last several years. Based on these studies, MDG Carbon has made various interventions to promote and explore the role of the the carbon markets in funding mitigation actions for these unaddressed sources and sinks, first via the voluntary markets, and then via long-term inclusion into compliance mechanisms.

UNDP’s work has focused on developing the carbon markets as an instrument to finance the costs related to the collection and destruction of existing banks of ozone depleting substances. By combining and sequencing different sources of environmental finance from GEF, the Multilateral Fund and carbon finance, UNDP is also pioneering comprehensive approaches to managing the full life-cycle of appliances from production, to lifetime usage, to retirement.

MDG Carbon developed this illustrative ODS Climate Facility concept to promote carbon finance for ozone depleting substances:

 
Near Term
Medium Term
Long Term
Key Model Limited number of pilot projects in voluntary markets ODS Climate Facility
– Donor-led fund to ensure demand and purchase credits
– Oversight framework to ensure quality
Inclusion in compliance mechanisms
– Uses existing oversight framework
Comment Proof of concept and initial learning-by-doing Objective is to develop the carbon markets, setting an example of best practice
This phase is not a commitment to the carbon markets, but an exploratory step
This phase is only pursued if ODS Climate Facility regarded as successful
Compliance markets now ensure sufficient demand and price
Cost of ODS climate benefits now fully internalized into economy


EXAMPLES OF INTERVENTIONS

MDG Carbon’s approach has included:

Voluntary carbon market standards. UNDP has assisted working groups on ozone depleting substances at two voluntary market standards, the Climate Action Reserve (CAR) and the Voluntary Carbon Standard (VCS).

Initial pilot projects in the voluntary markets. UNDP has assisted with ‘proof of concept’ projects to gain early learning-by-doing experiences.

Policy and architecture. MDG Carbon has been a leading actor in raising awareness of this issue within the Montreal Protocol community, presenting at meetings of the Multilateral Fund and Conferences of the Parties, as well as being requested to submit technical papers.

Communications. In an effort to inform stakeholders, UNDP has produced a number of different communications, including a video clip, brochures and initial press outreach.