Summary of Project Activities:
Capacity for Climate Protection in Central and Eastern Europe

May 2002

World Resources Institute
Dr. Elena Petkova
Project manager
elenap@wri.org

The Regional Environmental Center for Central and Eastern Europe
Dr. Zsuzsanna Ivanyi
Project manager
zivanyi@rec.org

Introduction

The Regional Environmental Center for Central and Eastern Europe (REC) and the World Resources Institute (WRI) formed a partnership in 1999 to address climate policy issues in Central and Eastern Europe (CEE). The primary goal of this partnership was to help Annex I CEE countries with economies in transition (EITs) to 1) find less emission intensive development paths and 2) create policy and institutional environments to support compliance with the UN Framework Convention on Climate Change and the Kyoto Protocol. In support of these overarching goals, the project had the following specific objectives:

1) strengthen Non-Governmental Organization (NGO) and private sector capacity-in the CEE countries-for analysis and contribution to the climate debate, and in so doing improve the credibility of national communications;
2) promote dialogue between governments, businesses and NGOs within the countries;
3) inform and influence discussions at the COPs;
4) facilitate information exchange at the regional level as well as between East and West;
5) increase understanding of the institutional needs-of the countries in transition-for emission reporting, independent verification by the private sector and NGOs, and implementation of flexibility mechanisms; and,
6) respond to specific national and regional needs.

Project Background

Currently the economies of Annex I countries in transition are highly greenhouse gas-intensive. The Kyoto Protocol has created an opportunity for these countries to upgrade their infrastructure and achieve low-cost carbon emission reductions. The Protocol's flexibility mechanisms and on-going energy sector reform give CEE and NIS countries the unique chance to adopt a sustainable development path. However, the commitments under the UNFCC and the Kyoto Protocol also increase the urgency in these countries for greater capacity to:

• Measure and report fossil fuel use and greenhouse gas emissions;
• Link on-going restructuring to the UNFCCC objectives and Kyoto targets; and
• Create a policy environment conducive to the implementation of flexibility mechanisms.

This urgency underscored the activities of the Capacity for Climate Protection project. The window of opportunity for creating sustainable development paths and for complying with the targets and monitoring and reporting requirements exists now, as these countries undergo reform and as the above requirements are being developed.

Strategy

The project engaged an Advisory Committee of decision-makers from CEE, of representatives of the EU, Japan, OECD and the US to share successes and identify steps that their governments can undertake to implement flexibility mechanisms and achieve compliance.
Our regional approach has sought to provide information to all EITs in CEE. It has been our expectation that wide outreach would increase understanding of the opportunities under the Climate convention and increase compliance with commitments. However, our principal work was targeted towards eight countries: Bulgaria, the Czech Republic, Estonia, Hungary, Poland, Romania, Slovakia and Slovenia.

CEE Partners

The Capacity for Climate Protection project partners were the following CEE NGOs:

Project activities:

1. Country-Based Capacity Building Activities

Grants were provided for national NGOs to work on different climate-related issues. The scope of the grants was decided in consultation with the project's Advisory Committee. The following topics were covered:

• Activities Implemented Jointly;
• Integrating Climate Objectives in Sectoral Reform;
• Capacity Needs for Implementing the Kyoto Protocol;
• Best Practices in Policies and Measures; and
• Public Participation in National Climate Policy.

Activities Implemented Jointly (AIJ)
The selected NGOs assessed national experience and institutional and policy issues in AIJ implementation. The national reports provide analysis and recommendations for next steps to be undertaken by CEE governments as well as the COP(s) to streamline and facilitate AIJ and prepare countries for a crediting regime. They illustrate the different experience, ability and value of AIJ/JI for the different EITs in Central and Eastern Europe, and clearly identify bottlenecks that need to be addressed for successful implementation of a Joint Implementation (JI) crediting regime. Our research has found that decisions and actions are required by national governments to: 1) align and integrate JI into national priorities, 2) specify clear legal authority for project selection and approval, 3) create the institutional infrastructure to manage the JI cycle, 4) set up systems to ensure transparency of decisions and ensure public participation. Capacity for Climate Protection in Central and Eastern Europe, Activities Implemented Jointly was published in June 2000, and is available at www.rec.org/Climate/index.html. In addition, each of the national reports was published in respective local languages.

Integrating Climate Objectives in Sectoral Reform
National NGOs assessed their countries' policies and measures as well as existing opportunities to integrate climate objectives in the on-going reform of the energy sector and the changing landscape of transportation. The national reports produced a set of recommendations to governments and the private sector for a more effective integration of climate objectives and mechanisms in the energy and transportation sectors. The case studies were completed in March 2000. Each report is available in the respective local language.

Capacity Needs for Implementing the Kyoto Protocol
The partner NGOs in six selected CEE countries conducted an assessment of the current national capacity for reporting GHG gases and participation in the mechanisms. Respondents included staff of national statistical offices, national focal points for the UNFCCC Secretariat, members of the national commissions on climate change, staff of private companies, researchers and members of various ministries. Based on the country surveys, a report was completed that identifies the major capacity-building issues related to climate protection, including:

• Building and adjusting legal and institutional frameworks
• Strengthening the ability to collect and use national emissions data
• Increasing financial resources

In addition to the general needs, more specific requirements emerge in the context of implementing the Kyoto Protocol, including improving the quality of GHG inventories and formulating policies to reduce emissions. Complying with the Kyoto Protocol Requirements: Capacity Needs in Central and Eastern Europe, published in July 2001, is available at www.rec.org/Climate/index.html.

Best Practices in Policies and Measures
In this phase of the project, partner NGOs analyzed national policies and measures to mitigate climate change. The research task was to develop comprehensive case studies assessing good/best practices, as well as to create a methodology and criteria with which to assess proposed mitigation strategies. Partners focused on national plans for energy efficiency, renewables, CHP, economic instruments, and transport, and applied a common set of quantitative and qualitative criteria to assess the effectiveness of these specific policies and measures. The case studies demonstrate that stable and, in some cases, relatively cheap reductions can be achieved, and that a menu of common criteria allowing flexible application, can and should be used to assess potential outcomes of particular policies and measures. The final report, Good Practices in Policies and Measures to Mitigate Climate Change - a Central and Eastern European Perspective (April 2002), is available at www.rec.org/Climate/index.html, and includes a regional summary.

Public Participation in National Climate Policy
This ongoing work (started in September 2001) assesses the degree of public access to information and participation in national climate policy. The project has developed and applied an indicator framework that focuses on access to general information about GHG emissions (national communications, inventories, facility level information), access to participation in decision-making affecting climate change (regional policies, plans and participation in decisions on AIJ/JI related activities) and efforts to build the capacity for public participation (government efforts and investments, conditions and capacity of an independent sector, sources of general understanding of climate change). The studies identify gaps between stated commitments and actual performance on the part of the public authorities, and will make recommendations for the future development of public participation. A report will be available in second half of 2002.

2. Outreach Activities

With support from the REC's Country Offices, partner NGOs have undertaken outreach activities that inform their governments and a wider NGO community of the issues related to climate policy, obstacles and benefits of participating in the flexible mechanisms. Country meetings have been held in eight CEE countries dedicated to the issues mentioned above. Reports from these meetings indicate that they have reached targeted government and private audiences and have produced a set of recommendations for institutional and policy measures to facilitate and streamline the implementation of the Convention and the Kyoto Protocol. Country meetings also contributed to the increase of public awareness in the field of climate change and relevant documents have been widely distributed in national languages. For example, the REC's Country Offices translated fact sheets on public participation in climate policy. These fact sheets exist in local languages and target local governments, the general public and government agencies not directly involved in climate issues.

3. Workshops and Events

• Side event during COP5, Bonn, Germany, November 2, 1999
  
  A side event was held introducing the output of the case studies about the experiences of Activities Implemented Jointly (AIJ). Problems revealed by the country studies on AIJ were listed as project selection and approval procedure, baseline, additionality, and credit-sharing. Recommendations were made for capacity and methodological needs required by the successful implementation of the Joint Implementation.
  
  
• Financing Climate Protection in CEE" workshop Szentendre, Hungary, February 21-22, 2000
  
  The workshop was held to promote discussion and dialogue on the opportunities for and experience in financing climate protection in Central and Eastern Europe.
  Participants at the workshop included representatives of CEE governments and NGOs, donor agencies involved in Activities Implemented Jointly in CEE, OECD/Annex I Expert Group, the European Commission, the European Bank for Reconstruction and Development, the World Bank, the International Finance Corporation and CEE and West European companies (involved in the implementation of AIJ projects and their countries' climate policies).
  The workshop agenda was organized to address the following main themes:
  - CEE and donor experience in Activities Implemented Jointly as a project
  - based financing mechanism;
  - Energy reform, accession to the EU and climate protection;
  - Finance institutions and climate protection.
  Other issues were discussed at the workshop, including: industry's response to public policies in the energy sector; the role of Export Credit Agencies in financing AIJ and other climate-friendly projects in CEE; and possible synergies between the Environment for Europe process and climate protection.
  
  
• Annex I Expert Group on the UN FCCC Transition Country Perspectives and Linkages between the Kyoto Mechanisms and Articles 5,7, and 18, Bratislava, Slovakia, May 17 2000
  
  The objective of the workshop was to discuss the capacity building needs of EIT countries and outline some international and national programmes and funding that could potentially be used to help meet these needs. Policy, resource and management developments required to establish national systems for inventory preparation were also discussed. In the context of the implementation of the Kyoto mechanisms, presentations were made about the lessons learned for AIJ in selected EITs as the output of the REC-WRI joint project.
  
  
• Consultations for the Annex I countries
  
  Following the Joint Conclusions of the Ministerial consultation on Environmental Policy-making in CEE, held June 19, 2000 in Szentendre, the REC and WRI prepared two informal consultative meetings of Annex I governments. The informal consultations provided an opportunity to openly exchange views and ideas, identify important issues and promote understanding of different positions of the Annex I countries.
  A) Consultation in Lyon, September 9, 2000 during the 13th SBSTA/SBI
  The agenda focused on two topics:
  - Joint Implementation
  - Capacity Building
  B) Consultation in The Hague, November 18, 2000 during COP6
  Topics were discussed as follows:
  - CEE countries capacity under Articles 5,7 and 8 of the Kyoto Protocol
  - CEE countries capacity under Articles 6 and 12 of the Kyoto Protocol
  
  
• Joint Implementation in CEE workshop Szentendre, Hungary, April 18-19, 2001:
  
  The main objectives of the workshop were as follows:
  - To identify the main barriers to business involvement
  - To make recommendations on how to create a framework for further involvement of businesses in JI
  Overall 45 participants were present from CEE and western governmental organizations, international organizations, NGOs, business sector. Many barriers to successful JI implementation were identified. As a follow-up to the recommendations, the REC plans to create a clearinghouse for GHG emission reduction projects. The mission of the clearinghouse is to create a platform that allows buyers and sellers of GHG reduction projects to meet based on transparent and agreed rules compatible with those of UNFCCC.
  
  
• EC CP Workshop WG1, JI/CDM Subgroup, Brussels. Belgium, 22-23 March 2001
  
  A presentation was made about the results of the capacity needs of selected EITs related to the implementation of the Kyoto Protocol. Capacity needs were identified in the following areas: national systems for inventory preparation, management and reporting, expert review, and participation in the Kyoto Mechanisms.
  
  
• Climate Technology Initiative Seminar on Effective Means of Transferring
  Climate Technologies and Practices, REC, Szentendre, Hungary May 31 2001
  
  Presentation was made on the experiences of AIJ in the CEE region as a tool of
  technology transfer.
  
  
• PCF-WBI Training workshop: Prototype Carbon Fund and Joint
  Implementation Opportunities for Economies in Transition, REC Szentendre,
  Hungary July 11-13, 2001
  Presentations of the lessons learned from the AIJ projects in selected
  EITs and actions needed for the implementation of JI.
  
  
• Policies and measures to mitigate harmful effects of climate change" workshop Szentendre, Hungary, September 13-14. 2001:
  
  Objectives of the workshop were to:
  - Inform and build constituency for climate change mitigation strategies
  - Develop a set of common criteria for assessing the effectiveness of
  policies and measures
  - Identify practical steps for support of climate change mitigation policies
  and measures in CEE.
  Representatives of CEE governments, energy centers, the REC Country Offices and NGOs from 10 countries participated. Five case studies evaluating good practices on policies and measures in CEE were presented by partner NGOs. The findings of each study provided important information about the effectiveness of certain policies and measures in reducing greenhouse gases emissions and meeting national development objectives. The findings and the discussions also showed that there are several policies and measures that can be considered mature and therefore ready-to-use for the CEE countries while other policies and measures need some more work before they can be applied on a wide scale in the CEE.
  
  
• UNFCCC workshop on PaMs: Roundtable assessing good Practices in Policies and Measures to mitigate Climate Change in Annex I Economies in Transition, Copenhagen, Denmark, October 8-11, 2001
  
  The mandate of the workshop, defined by COP - bis, was to facilitate exchange of information and contribute to defining policies and measures and countries' approaches to them. The session presented the methodology and two case study applications developed through the Capacity for Climate Protection in CEE Project.
  
  Participation at the workshop helped strengthen our partners' impact on the approach of governments to the assessment of good practices in climate change mitigation policies and measures. It was a unique opportunity for partner NGO contribution to governments' discussions and, eventually, to COP decisions. The report from the workshop with the recommendations was submitted for the next COP.