46555 Transferof environmenTallysound Technologies: Thegefexperience foreWord 1 The Global Environment Facility (GEF) is a unique partnership among 178 countries, international institutions, non-governmental organizations (NGOs), and the private sector. As the financial mechanism of the United Nations Framework Convention on Climate Change (UNFCCC), we address global environmental issues while supporting national sustainable development initiatives. We began in 1991 and have evolved into the largest funder of Monique Barbut projects to improve the global environment. Over our history, the GEF has provided $7.6 billion in grants and leveraged $30.6 billion in co-financing for more than 2,000 projects in more than 165 countries. And as part of our mission to act locally for worldwide impact, we also have become one of the largest public-sector technology transfer mechanisms in the world. Promoting the transfer of environmentally sound technologies (ESTs) and know-how to developing countries is enshrined in Article 4.5 of the UNFCCC. As the financial mechanism of the Convention, the GEF has a mandate to provide financial resources to support such transfers under the guidance of the Conference of the Parties. Much of our work has been devoted to supporting the deployment and diffusion of ESTs that address climate change mitigation and adaptation. This publication offers a progress report on the GEF's experience over the years in these areas. 2 Since the early 1990s, GEF activities on climate change have Some of our success stories and lessons learned are in this centered on removing barriers to the widespread adoption of document; what is perhaps most striking is that the variety energy efficiency, renewable energy, and sustainable of experience is so broad. transport technologies and practices. The GEF has played a catalytic role in supporting the transfer of ESTs that are both In Morocco, for example, we found that the market failure of climate-friendly and country-driven in order to meet a wide first-generation solar water heaters was a relatively simple variety of development priorities. During its 17 years of matter of poor materials and installation. In Bhutan, we existence, the GEF has allocated $2.5 billion to support more contributed to highly complex efforts to reduce the risks than 30 climate-friendly technologies in over 50 developing of massive melt lakes created by receding glaciers. In China, countries. This funding has leveraged an estimated additional we helped boost the manufacture of more energy-efficient $15 billion in co-financing from the GEF's partner agencies, refrigerators from 360,000 to 4.8 million units between national and local governments, non-governmental 1999 and 2003. organizations, and the private sector. All of my colleagues at the GEF and our partner institutions In addition, the GEF has provided funding for technology would agree that vitally important work is underway--and that needs assessments and other enabling and capacity-building far more remains to be done. It is our hope that the examples activities in over 100 countries throughout the world. on the following pages will inspire new enthusiasm, new invention, and many more successes. Today, we are at a critical crossroads, when consensus among international stakeholders is necessary to move forward with a new strategic roadmap. Put simply, we need to act in real time, in real places, to achieve real results. It is important to remember that achieving this goal will not Monique Barbut just be a matter of bringing new tools to a new location. All Chief Executive Officer and Chairperson sides must understand that success will require a suitable policy environment, unobstructed markets, adequate financing, and capacity building. 3 introduction 55 Technology transfer is seen as playing a critical role in the of technology, is hereby defined. It shall function global response to the challenges of climate change. Indeed, under the guidance of and be accountable to the the transfer of environmentally sound technologies (ESTs) is Conference of the Parties, which shall decide embodied in the very fabric of the United Nations Framework on its policies, program priorities and eligibility Convention on Climate Change (UNFCCC). Article 4.5 of the criteria related to this Convention. Its operation Convention states: shall be entrusted to one or more existing international entities." "The developed country Parties and other developed Parties included in Annex II shall take all practicable steps to promote, Since the time of the First Session of the Conference of facilitate and finance, as appropriate, the transfer of, or access Parties (COP), the Global Environment Facility (GEF) has to, environmentally sound technologies and know-how to other served as an entity operating the financial mechanism of the Parties, particularly developing country Parties, to enable Convention. It has responded to guidance given regularly by them to implement the provisions of the Convention." the COP on policies and program priorities, and has reported to the COP annually. Much of the COP's guidance has In order to pursue these goals, the Convention proposed the addressed the financing of ESTs. creation of a financial mechanism for the Convention. Article 11 of the Convention reads: This brochure summarizes GEF strategies and policies that have evolved with respect to the transfer of ESTs and provides "A mechanism for the provision of financial resources on examples of GEF experience in supporting the transfer of a grant or concessional basis, including for the transfer climate change mitigation and adaptation technologies. 6 box 1 . Definitions of Technology Transfer In the Special Report of the UN Intergovernmental Panel on Climate to the smooth working of the market for a specific technology, such Change (IPCC) Working Group III, Methodological and Technical Issues as limited capacity, an unsuitable policy environment, or a lack of a in Technology Transfer, the IPCC defined technology transfer as: financing mechanism, will limit its diffusion. ...abroadsetofprocessescoveringtheflowsofknow-how,experience The COP established the Expert Group on Technology Transfer andequipmentformitigatingandadaptingtoclimatechangeamongst (EGTT) under the Subsidiary Body for Scientific and Technological differentstakeholderssuchasgovernments,privatesectorentities, Advice (SBSTA). This COP decision defined a framework citing five financialinstitutions,NGOsandresearch/educationinstitutions. key requirements for increased and improved transfer of ESTs and Therefore,thetreatmentoftechnologytransferinthisReportismuch access to related know-how: (1) country-driven activities to broaderthanthatintheUNFCCCorofanyparticularArticleofthat determine technology needs and priorities through a widespread Convention.Thebroadandinclusiveterm"transfer"encompasses stakeholder consultation process; (2) availability of thorough, diffusionoftechnologiesandtechnologycooperationacrossand actionable technology information; (3) enabling environments withincountries.Itcoverstechnologytransferprocessesbetween defined by government actions, including the removal of technical, developedcountries,developingcountriesandcountrieswith legal, and administrative barriers to technology transfer; sound economiesintransition,amongstdevelopedcountries,amongst economic policy; and regulatory frameworks that facilitate private developingcountries,andamongstcountrieswitheconomiesin and public sector investment in technology transfer; (4) capacity transition.Itcomprisestheprocessoflearningtounderstand,utilize building, a process of building, developing, and strengthening andreplicatethetechnology,includingthecapacitytochooseand existing scientific and technical skills, capabilities, and institutions adapttolocalconditionsandintegrateitwithindigenoustechnologies.1 in developing country Parties so they can assess, adapt, develop, and manage ESTs; and (5) a set of mechanisms that support This definition includes a wide range of activities, extends to a broad financial, institutional, and methodological activities and enhance range of institutions, and provides the basis for much of the current coordination among stakeholders. These mechanisms should understanding of technology transfer. The IPCC describes three major engage stakeholders in cooperative efforts to accelerate the dimensions necessary for effective technology transfer: capacity development and diffusion of ESTs while facilitating the building, enabling environments, and transfer mechanisms. Barriers development of projects and programs. 1 Metz, Gert, O. Davidson, J.W. Martens, S.N.M. Van Rooijen, and L.V.W. McGrory, Methodological and Technological Issues in Technology Transfer, Cambridge, UK: Cambridge University Press for the IPCC, 2001. 7 EvolutionofGEf PoliciEsandstratEGiEs rElatinGtotEchnoloGytransfEr 9 During the GEF's Pilot Phase (1991­94), projects focused mature, available on the international market, and largely on demonstrating a wide range of technologies profitable, but were prevented from dissemination by that would be useful in stabilizing the concentrations of human, institutional, technological, policy, or financial greenhouse gases (GHGs) in the atmosphere. barriers. These projects were termed "barrier removal" projects, as they sought to remove such barriers to promote After the restructuring of the GEF in 1994, the GEF Council faster adoption of new technologies and practices. approved a strategy in the climate change focal area to "support sustainable measures that minimize climate change In contrast to these projects, another operational program damage by reducing the risk, or the adverse effects, of climate focused on reducing the long-term costs of low-GHG-emitting change." The strategy also stated that the "GEF will finance electricity generating technologies. The technologies included agreed and eligible enabling, mitigation, and adaptation in this program were not yet commercially available and were activities in eligible recipient countries." 1 very expensive relative to the baseline or conventional alternatives. In these cases, such as concentrating solar The operational strategy approved by the Council in 1995 power (CSP) plants, fuel-cell buses (FCBs), biomass-integrated identified three long-term operational programs to support combined-cycle generation (BIG/GT), stationary fuel cells, and climate change mitigation and a window for cost-effective microturbines, significant incremental costs remained--the short-term response measures (STRMs).2 The long-term technology and its costs were themselves the barrier to programs were designed to support less cost-effective greater dissemination. interventions and to allow for a distinction between technologies on the basis of their maturity and commercial Finally, a sustainable transport program was availability. Both programmatic long-term approaches and approved by the GEF Council in 2000 that contained a short-term projects focused primarily on mitigation through the combination of approaches, including one focusing on use of commercialized or nearly commercialized technologies cost-effective technologies and practices that were that were not yet widely disseminated in developing countries underutilized, and another on technologies that were or in countries with economies in transition. not yet fully developed. Subsequent GEF operational programs focused on energy In 2004, with the benefit of several years of implementation efficiency and renewable energy technologies that were and monitoring, the GEF's operational strategy focusing on 1 GEF Secretariat, 1995, GEF Operational Strategy, p. 31. 2 Short-term projects are considered extremely cost-effective, with a unit abatement cost of less than $10/ton of carbon avoided, or roughly $2.7/ton of CO2 equivalent avoided. 10 barrier removal and renewable energy and energy-efficiency technologies was judged successful, but in need of codification. Five key potential barriers were identified that need to be addressed to move toward more efficient, market-driven dissemination of technologies in developing countries: a.Policy frameworks: Governments must play an essential role in setting policies favorable to the adoption of ESTs. b.Technology: Should be robust and operational. The more mature a technology, the easier it is to transfer. c.Awareness and information: National stakeholders, especially market participants, must be aware of the technology and have information on its costs, uses, and markets. d.Business and delivery models: Market-based approaches are preferred; businesses and institutions must be in place that can deliver to and service those markets. e.Availability of financing: Financing must be available for technology dissemination, though it is insufficient in itself to ensure uptake of ESTs. As part of the GEF-4 replenishment process, the climate change strategy for mitigation was revised to focus primarily 11 on six strategic programs to promote: (1) energy efficiency in buildings and appliances; (2) industrial energy efficiency; (3) market-based approaches for renewable energy; (4) sustainable energy production from biomass; (5) sustainable innovative systems for urban transport; and (6) management of land use, land-use change and forestry (LULUCF) as a means to protect carbon stocks and reduce GHG emissions. Historically, the GEF's strategy and development have meant that its work in climate change has always focused on ESTs. GEF approaches are closely allied to the UNFCCC's technology transfer framework. GEF experience points to a number of conclusions about technology transfer that can be applied to future operations: (1) technology is transferred primarily through markets: barriers to the efficient operation of those markets must be removed systematically; (2) technology transfer is not a single event or activity but a long-term engagement, during which partnerships and cooperation, often requiring time to develop and mature, are mandatory for the successful development, transfer, and dissemination of technologies; and (3) technology transfer requires a comprehensive approach, incorporating capacity building at all relevant levels. GEfExPEriEncEwithtEchnoloGytransfEr: MitiGation 13 Since the creation of the GEF, about $2.5 billion has been programs, energy efficiency standards and appliance labeling, allocated to climate change projects. These resources have and building codes and standards. leveraged an estimated additional $15 billion in financing, and resulted in over one billion tons of GHG emissions Achievements of GEF-funded projects include: (1) major avoided. Altogether, the GEF has supported more than transformation of the efficient lighting market in the 30 technologies in the years of its existence. The following residential sector; (2) significant project replication sections illustrate the range of those technologies as well and extension, both in the countries themselves and as some lessons learned. in surrounding countries; (3) significant benefits for consumers in cost savings and improved product quality; and (4) development of capacity for DSM and energy efficiency within government institutions. Mitigation: EnErgy-EfficiEncy tEchnologiEs The GEF has also launched a global efficient lighting Table 1 summarizes the energy-efficiency technologies and initiative, approved by the Council in 2007, to accelerate technology sectors that the GEF has supported in various the phase-out of inefficient lighting through UNEP and countries. This is not to claim that all of these technologies UNDP, while it is extending support to more countries have been successfully transferred, but rather that and programs at the national level. the countries listed have expressed interest in growing markets for them. In some cases, technology transfer Energy-Efficient Appliances has been successful, while in others, barriers remain to market maturation. The GEF has built a portfolio promoting energy-efficient appliances and technologies in developing countries. Efficient Lighting GEF-supported interventions typically focus on instituting energy-efficiency standards and labels, Since the mid-1990s, the GEF has supported the dissemination consumer education, and testing and certification of efficient lighting technologies in more than two dozen of appliances. In countries where there is substantial countries. The types of intervention include sector-specific manufacturing capacity, the GEF has also supported lighting initiatives, utility demand-side management (DSM) enterprises in developing new energy-efficient appliance 14 Table 1 . Energy-efficiency technologies and countries supported by the GEF Energy-efficiency technology Countries supported Efficient lighting (compact fluorescent lamps, efficient street lighting, Argentina, Bangladesh, Brazil, China, Czech Republic, Egypt, Ghana, Hungary, Indonesia, Jamaica, Kenya, Latvia, light-emitting diodes, etc.) Malaysia, Mexico, Morocco, Pakistan, Peru, Philippines, Poland, Russia, Slovakia, South Africa, Thailand, Uruguay, Vietnam Energy-efficient appliances (refrigerators, air conditioners, washers, Argentina, Bangladesh, Brazil, China, Cuba, India, Indonesia, Kenya, Mongolia, Pakistan, Russia, Thailand, Tunisia, dryers, cookers, stoves, etc.) Vietnam Energy-efficient building design Belarus, Bosnia-Herzegovina, Brazil, Bulgaria, China, Cote d'Ivoire, Czech Republic, Kyrgyzstan, Lebanon, Mauritius, Morocco, Senegal, Tunisia Energy-efficient building materials (windows, doors, perforated bricks, Bangladesh, Bosnia-Herzegovina, China, Mongolia, Pakistan, Poland straw bales, etc.) Industrial energy-efficiency technologies (steel, brickmaking, cement, Bangladesh, Belarus, Bulgaria, China, Costa Rica, Cote d'Ivoire, El Salvador, Honduras, Hungary, India, Iran, Macedonia, ceramics, textile, foundry, rubber, wood, cokemaking, tea processing, Malaysia, Morocco, Nicaragua, Panama, Philippines, Poland, Tunisia, Vietnam food processing, pulp and paper, charcoal production, etc.) District heating systems Armenia, Belarus, Bulgaria, China, Croatia, Czech Republic, Georgia, Hungary, Kazakhstan, Latvia, Lithuania, Moldova, Mongolia, Slovenia, Slovak Republic, Ukraine, Poland, Turkmenistan, Romania, Russia, Uzbekistan Power generation (rehabilitation) and distribution Brazil, China, Ecuador, Guinea, India, Philippines, Sri Lanka, Syria Cogeneration (including heat recovery for power generation from China, Czech Republic, Ethiopia, Kenya, Malawi, Swaziland, Tanzania, Uganda, Sudan, Russia industrial processes) Energy-efficient motors Bangladesh, China, India, Indonesia, Poland, Thailand, Pakistan, Vietnam Energy-efficient boilers China, Poland, Russia Energy-efficient CFC-free chillers Brazil, Colombia, India, Thailand 15 models and in acquiring technical information and materials (brick, cement, and glass), steel, cokemaking, knowledge from more advanced countries. foundry, paper, ceramics, textiles, food and beverage, tea, rubber, and wood. A number of projects also promote In Tunisia, for example, 10 of 12 local appliance manufacturers energy-efficient equipment such as boilers, motors, and are offering more energy-efficient models. In China, the GEF pumps, as well as cogeneration in the industrial sector. project to promote energy-efficient refrigerators adopted a two-pronged approach-- technology push and market pull. In some projects, the GEF has promoted South-South Technology push is achieved through technical assistance to technology transfer, as in the transfer of energy-efficient refrigerator and compressor manufacturers, technology brick kiln technology from China to Bangladesh. The upgrades, and designer training programs, while market pull technology was developed, adopted, and disseminated is achieved through the promulgation of energy-efficiency in China, and is being transferred to Bangladesh. standards. Participating refrigerator manufacturers improved their average energy efficiency by 23 percent between District Heating Systems 1999 and 2003. The market's response--increased sales of top-rated energy-efficient refrigerators from 360,000 to 4.8 The GEF has financed projects to promote energy-efficient million units--helped drive increased production capacity. district heating in more than 20 countries, most of them in Eastern Europe and the former Soviet Union, but also in China Industrial Energy-Efficiency Technologies and Mongolia. Most of these projects involve demonstrating technologies and practices that improve the technical and The GEF has funded more than 30 projects in the industrial operating efficiency of heat and hot water supply; creating sector to promote technology upgrading and the adoption enabling policies and regulations; and facilitating access to and diffusion of energy-efficient technologies. Some projects financing and investment. Some of the projects in Eastern focus on the development of market mechanisms such as Europe have also led to switching fuel from coal to biomass. energy service companies, the creation of dedicated financing instruments, and technical assistance to stimulate High-Efficiency Boilers investments in new technologies. Other projects identify one or more sub-sectors and specific technologies to The China Efficient Industrial Boilers project received a $32.8 promote. The range of industries includes construction million grant from the GEF to (1) upgrade existing boiler 16 models by introducing advanced combustion systems and replacement. Financial return from energy savings and auxiliary equipment from developed countries; (2) adopt reduction of ozone-depleting substances (ODS) and GHGs new high-efficiency boiler models by introducing modern have exceeded expectations, and replication and market manufacturing techniques and boiler designs; and (3) provide transformation have taken place rapidly post-project. technical assistance and training for boiler producers and consumers. Completed in 2004, the project successfully supported international technology transfer of boiler technologies that benefited nine boiler manufacturers and Mitigation: rEnEwablE EnErgy tEchnologiEs nine boiler auxiliary equipment makers. With GEF support, the Chinese manufacturers acquired advanced efficient From 1991 to 2007, the GEF approved grants totaling more boiler technologies, built prototypes, and began commercial than $800 million for approximately 150 projects that production. Through technical assistance, the project also promote the transfer of renewable energy technologies led to the revision and formulation of national and sector in developing and transition countries (Table 2). standards while it strengthened the technical capacity of the Chinese boiler sector. Off-Grid Photovoltaics Energy-Efficient CFC-Free Chillers Since its inception, the GEF has helped deploy renewable energy technologies to those lacking access In several countries, including Thailand, Brazil, and India, to electricity--and to those whose use of kerosene for GEF support has aimed to accelerate the replacement of lighting and wood for cooking produces GHG emissions. old CFC-based chillers with CFC-free energy-efficient As these people often live in remote areas, expansion of models. These projects have also created synergy, pooling the power grid is neither cost effective nor affordable by the resources of the GEF and the Multilateral Fund under governments. In response to this need, the GEF funded a the Montreal Protocol on Substances that Deplete the number of projects that provided access to electricity Ozone Layer. through the use of Solar Home Systems (SHS). In Thailand, a GEF project successfully demonstrated the Several lessons have emerged from these projects, technical feasibility, financial viability, and benefits of chiller including: the importance of the technical quality 17 of the SHSs; the need to raise awareness of the technology; the importance of system maintenance and business infrastructure; and the need for sustainable financing in appropriate instruments. Though solar photovoltaics (PVs) and SHSs are a least-cost option for remote electricity supply, they are not necessarily affordable to those who need them. In such a case, financing is needed according to customers' ability and willingness to pay for the services provided. The Transformation of the Rural Photovoltaic Market in Tanzania project was designed to incorporate the lessons learned from earlier rural PV projects. Reports indicate that this project has contributed to the removal of taxes and VAT on all PV components. Standards and a code of practice have been approved and are now in place. A Rural Energy Agency has been put in place and a Rural Energy Master Plan has been developed. PV awareness among key government decision makers at district level has been raised through a series of seminars. Most importantly, the private sector has been responsive to the project and a PV curriculum has been adopted by the Vocational Education and Training Authority of Tanzania. Technicians have been trained in sizing, installing, repairing, and maintaining the systems, 60 percent of which are operational. Financial models for supply-chain and consumer financing are being developed to increase the number of consumers and companies that request financing for their PV investments. 18 Table 2 . Renewable energy technologies and countries supported by the GEF Renewable technology Countries supported Off-grid photovoltaics (PVs) Bangladesh, Bolivia, Botswana, Burkina Faso, China, Costa Rica, Ethiopia, Eritrea, Ghana, India, Kenya, Lesotho, Morocco, Malawi, Namibia, Nepal, Peru, South Africa, Sri Lanka, Sudan, Swaziland, Tanzania, Uganda, Zambia, Zimbabwe On-grid PVs India, Mexico, Philippines, (also considered as OP7) Solar water heating Albania, Algeria, Chile, India, Lebanon, Mexico, Morocco, South Africa, Tunisia Wind turbines Azerbaijan, Bangladesh, Brazil, China, Costa Rica, Cuba, El Salvador, Eritrea, Ethiopia, Ghana, Guatemala, Honduras, Iran, Jordan, Kazakhstan, Kenya, Korea DPR, Madagascar, Mauritania, Mexico, Nepal, Nicaragua, Pakistan, Russian Federation, South Africa, Sri Lanka, Tunisia, Uruguay Geothermal Armenia, Bulgaria, Djibouti, Eritrea, Ethiopia, Indonesia, Hungary, Kenya, Lithuania, Philippines, Poland, Romania, Russian Federation, Tajikistan, Turkey, Ukraine, Tanzania, Uganda Methane from waste (mixed municipal and/or China, Czech Republic, Jordan, Latvia, Mexico, Uruguay (some also qualified under STRM; see below) liquid biological) Small hydro Benin, Bhutan, Burundi, Cameroon, Central African Republic, Congo, Congo DR, Gabon, Haiti, Hungary, Indonesia, Macedonia, Mali, Montenegro, Nicaragua, Rwanda, Togo Biomass cogeneration Hungary, Malaysia, Thailand Biomass boilers (heat production) Belarus, China, Egypt, India, Kenya, Latvia, Poland, Slovak Republic, Slovenia, Sri Lanka Biomass gasification for electricity Chile, India, Uruguay 19 Solar Water Heaters distributed-generation PV power plant was built and integrated into the 80-MW distribution network of the Cagayan de Oro Although solar water heater technology is sometimes considered Electric Power & Light Company (CEPALCO), a private utility simple, that perception can be misleading. The quality of the on the island of Mindanao in the Philippines. The PV system fittings, the solar collectors, and the installation has substantial operates in conjunction with a 7-MW hydroelectric plant with impact on satisfactory operation. Accordingly, inexpensive dynamic load control, enabling the joint PV/hydro resource to materials, poor workmanship, and shoddy installation have often reduce distribution-level and system-level demand, effectively resulted in nonfunctional units and abandonment of installations. providing reliable generating capacity. The PV plant helped The GEF's experience has shown that knowledgeable staff and postpone the need for additional substation installations in the the observance of high standards are critical to the successful distribution system for up to three years, reducing the need for dissemination of this technology. CEPALCO to purchase additional thermal-plant-based power and reducing its GHG emissions. More importantly, the plant provides In Morocco, for example, early solar water heaters tended to be the first full-scale demonstration of the environmental and, of low quality. As a result, they fell into disuse and the market ultimately, economic benefits of the conjunctive use of languished. Through a GEF project, the older nonfunctioning hydro- and PV-based power and represents the first significant installations were repaired; new higher-quality standards were use of grid-connected PV in a developing country. adopted; and technicians and staff were trained to ensure future installations would be of satisfactory quality. In addition, This project marks significant progress toward solving to encourage production and sale of the higher-quality units, a the storage issue faced by many renewable energy subsidy was offered to early adopters of water heaters meeting technologies. If conjunctive use allows current hydro the new standard. These initiatives revived the market, which is facilities to be used for storage, many renewables, now growing rapidly, along with the industry as a whole. including PV and wind, can be viewed in combination as a "firm hybrid"--a completely renewable source of power. On-Grid Photovoltaics Wind Power The GEF-supported CEPALCO Distributed Generation PV Plant in the Philippines aimed to demonstrate PV's effectiveness in The GEF has supported a variety of wind energy projects addressing distribution system capacity challenges. A 1-MW around the world. Experience has shown that resource 20 availability as well as familiarity with the technology are important considerations. However, the most significant barriers to successful growth in the wind market are the regulations on renewable generators' access to the grid and the incremental costs to distributors of turbine-generated electricity. Worldwide experience shows several successful approaches to this problem, including the creation of a renewable portfolio standard and a guaranteed renewable "feed-in" tariff. The GEF has helped countries understand and adopt these regulations. In Mexico, for example, GEF agencies provided: (1) support to assist in improving windspeed measurements; (2) training and capacity building; and (3) regulatory changes that provide a "green energy" fund to help pay the incremental costs of renewable generation. One of the most visible and successful GEF projects supporting the fledgling market for wind energy in developing countries is the China: Renewable Energy Scale Up Program (CRESP). It adopted a programmatic approach to secure long-term structural change and provided support for the creation of the Chinese Renewable Energy Law in 2007, which included an important renewable portfolio provision. The main global benefits of the project are: (1) the removal of multiple barriers to the introduction of cost-effective renewables, especially wind energy, in China; (2) the reduction in cost and improvement in performance of small 21 hydro, wind, and selected biomass technologies; and (3) imaging techniques have been used to locate commercially increased market penetration by renewables, with exploitable geothermal power in Kenya and East Africa. subsequent reduction in GHG emissions from power Microseismic event sensing, electromagnetic sensing of generation. It is estimated that by 2010 the scale-up will lightning strikes, and Earth's magnetic field help locate result in incremental annual production of electricity from steam trapped in fractures underground. renewable sources of 38 terawatt hours (Twh), equivalent to about 7.9 gigawatts (GW) of installed capacity. The carbon Results to date indicate that wells targeted using this savings of the project are estimated at 187 metric tons (MtC). approach, when combined with directional drilling, yield 4 to 6 China now hosts the world's sixth largest wind energy MW per well as opposed to the previous 2 MW per well. The market, with an estimated installed capacity of 2.6 GW, a success rate for test wells has also improved, as has targeting figure that doubled during 2006. of wells for re-injection of spent geothermal fluid--which creates sustainable geothermal field output over time. This Geothermal Energy will result in substantial savings for the planned development of 512 MW from geothermal resources in Kenya. The project The GEF has supported a number of projects to help countries has helped establish sustainable, world-class capacity using exploit their geothermal energy potential. This experience has these advanced techniques at KenGen's Olkaria facility; shown that, in addition to the barriers to access of renewable KenGen is now able to provide these services to other energy generators to the grid, an additional--and especially countries in the region. difficult --barrier is the cost of confirming the presence and location of exploitable geothermal resources. Traditionally, Waste to Energy each site is confirmed exploitable by drilling--at a cost of up to several million dollars. To deal with this barrier, the GEF has A number of projects have supported utilization of methane established several contingent funding mechanisms to from municipal waste, either from solid wastes in landfills reimburse the costs of drilling nonproductive wells. or from liquid biological wastes. Many of these projects have qualified for GEF support as both renewable energy A more recent approach to this barrier is found in the Joint projects and short-term response measures because of their Geophysical Imaging for Geothermal Reservoir Assessment cost-effectiveness. The GEF played a role in helping increase project in Kenya. In this project, advanced geophysical the uptake of these technologies; now its support is no longer 22 needed, as the projects are eligible and highly profitable identified and tested, it is vitally important to continue when implemented under the Clean Development to the dissemination stage. Systematic integration into Mechanism (CDM). national policy, coupled with the buildup of a national industry, provides the equipment and services needed The India Biomethanation project, proposed in the early for sustainable production and dissemination. 1990s, addressed endogenous capacity in India to adapt and replicate biogas technology for industrial wastes. A Mini- and Micro-Hydro Power pre-existing challenge was that biological waste from agroprocessing and related industries deposited Small hydro is a mature technology, but it is not well substantial quantities of methane and other pollutants disseminated. The GEF has supported this technology around into nearby waters. The project's intent was to produce the world from early on and has identified several barriers to its the methane in a controlled environment, capture it, adoption, including lack of information about the technology and use it to produce energy. and about the resource; unsupportive institutional frameworks; regulatory obstacles; and absent or inadequate financing. The GEF project supported capacity building at five national R&D laboratories and other institutions that were One promising project is The Integrated Micro-Hydro involved in the project as a network. In addition, the GEF Development and Application Program in Indonesia, co-financed more than a dozen demonstration units in which aims to reduce GHG emissions from fossil fuel-based a variety of industries, including agroprocessing, pulp power generation. This will require accelerating the and paper, tanneries, slaughterhouses, rice mills, and development of micro-hydro resources and optimizing commercial dairies. their utilization by eliminating or reducing current barriers. These capacity building activities were successful and The four main outcomes of the project are expected sustainable, and the demonstration units clearly indicated to be: enhanced private-sector interest and involvement in which industries could reach the highest levels of GHG capacity building in the micro-hydro business community; abatement. The project also clearly illustrated the need to capacity building in small residential communities to continue after the initial development or local adaptation increase micro-hydro utilization; improved local knowledge of a technology. When suitable technologies have been and availability of the technology and its applications; 23 and increased implementation of micro-hydro projects for helping local commercial partners reduce 4 million tons of electricity and productive purposes. GHGs (carbon equivalent) by accelerating the growth of biomass cogeneration and power generation technologies to The project targets a cumulative GHG reduction of 304 kilotons replace fossil fuel consumption. of CO2; the establishment of at least 40 community-based micro-hydro projects for productive use each year; and The project: (1) builds capacity to provide information and cumulatively, in 3 years, 130 gigawatt hours (GWh) produced, services to potential biomass project investors; (2) improves with 100 GWh sold. the regulatory framework to provide financial incentives for biomass cogeneration and power projects; (3) increases Biomass Cogeneration access to commercial financing for these projects; and (4) facilitates the implementation of two initial biomass power Biomass waste from agricultural and forestry production can pilot plants by supporting commercial guarantees. The project provide significant energy for heat and electricity generation. generates 65,520 megawatt hours (MWh) of electricity Typically consisting of either crop residues or sawmill waste, annually from renewable energy. biomass can provide opportunities for carbon-neutral energy production, as the CO2 released through combustion is originally Heat from Biomass grown and fixed as part of a closed cycle. If this energy source is used instead of fossil fuels, the benefits are even greater. Issues related to the use of agricultural and forestry wastes to generate heat are similar to those related to biomass Common barriers to biomass waste utilization are the cogeneration. In both cases, changes in the regulations regulatory framework's non-recognition or inadequate governing heating networks are required. And in both cases, acceptance of small-scale renewable generators and lack such projects can improve overall resource-use efficiency of financing, technology, and information. The GEF has and reduce GHG emissions. supported a number of projects that have contributed to the cogeneration of heat and electricity using biomass residues. The Economic and Cost-Effective Use of Wood Waste for Municipal Heating Systems in Latvia project addresses several One instance is The Removal of Barriers to Biomass Power of these issues. The project aims to: (1) promote the use of Generation and Cogeneration in Thailand project, which is wood waste by removing or reducing barriers to replacing 24 imported heavy fuel oil (mazut) with local, sustainably There are signs of success in the Biomass for Rural India produced wood waste in municipal heating systems; (2) project, which aims to develop and implement a GHG-reducing promote the development and implementation of an bioenergy technology package that will provide a sustainable economical, commercially run, municipal heating system, and participatory approach that meets village energy needs. providing generation, transmission, and distribution in the The project is implemented mainly in 24 villages in municipality of Ludza; and (3) help remove or reduce Karnataka's Tumkur district. technical, legislative, institutional, organizational, economic, information-related, and financial barriers related to the Project goals include: (1) demonstrating the technical replication of a pilot project in the municipality. feasibility and financial viability of bioenergy technologies-- including biomass gasification for power generation--on Since project inception, 11,200 tons of CO2 emissions have a significant scale; (2) building capacity and developing been avoided annually in Ludza, accounting for about 80 mechanisms for project implementation, management, percent of the emissions from using heating oil. The project and monitoring; (3) developing financial, institutional, and the financial scheme developed through the project have and market strategies to overcome barriers to large-scale encouraged more than 12 other municipalities to make use replication of the bioenergy package for decentralized of forest wastes in their district heating networks, resulting applications; and (4) disseminating bioenergy technology in over 100,000 tons of CO2 avoided annually. GEF funding and relevant information on a large scale. was $0.75 million, with $2.73 million in co-financing. The project has stimulated significant forest growth Biomass Gasification for Electricity in the form of energy plantations (2,965 acres), forest regeneration (2,100 acres), and tree-based farming The biomass gasification process has been known for many (about 2,471 acres) by villagers. The wood is used to years. Historically, the technology has faced an engineering generate electricity in locally manufactured gasifiers. challenge in the need to clean the gases to prevent The power generated is sold to the regional electrical obstructions in the system. New gasifiers are becoming more distribution company to supply the local population. effective at solving this issue. Especially in rural areas where The project has also resulted in 171 families replacing biomass residues are plentiful, this provides a promising new fuel wood with biogas--reducing GHG emissions by opportunity for generating electricity. 256 tons annually over the past 3 years. 25 Low-GHG-emitting energy generating Mitigation: nEw low-ghg-EMitting EnErgy Table 3 . tEchnologiEs technologies and countries supported by the GEF The GEF's objective in this field was to provide support for early technology demonstrations in developing countries (Table 3). Increased experience with these technologies Low-GHG-emitting accelerates reductions in the cost of subsequent installations. energy technology Countries supported The most significant technology to receive support has been Biomass-integrated gasification Brazil Concentrating Solar Power (CSP) technology. combined- cycle generation Building-integrated photovoltaic power Malaysia Concentrating Solar Power (CSP) production Concentrating solar power production Egypt, Morocco, Mexico The GEF, together with India, Mexico, Morocco, and Egypt, Externally fired combined-cycle generation Brazil developed a portfolio of four CSP demonstration plants. The Microturbine cogeneration Indonesia projects built solar fields, typically of 30 megawatts (MW), as On-grid PV power production Mexico, Philippines part of hybrid gas-turbine plants. Successful hybridization of Stationary fuel-cell power generation South Africa the gas turbine and the solar power plants would enable the projects to dispatch power at will, making them more economically attractive. However, the projects have progressed very slowly, indicating One lesson from these experiences is that it is difficult for that the technology did not meet with the enthusiastic uptake developing countries to adopt technologies from developed originally anticipated. Only recently have new plants been countries that are not fully commercialized. Failure to planned and constructed in developed countries, most notably achieve market viability in developed countries damages in Spain, where generous incentives were provided through a the technology's credibility elsewhere. In the case of the high feed-in tariff for solar energy. Now, spurred by these CSP plants, construction costs increased as the projects activities in developed countries, the projects in Egypt, progressed. Host countries were burdened with both Mexico, and Morocco are moving forward. additional costs and the risk that the projects might not 26 produce the rated power on a firm basis. In fact, in two Table 4 . Transport sector technologies cases, the additional costs exceeded the GEF's funding. and countries supported by the GEF Both countries have had to provide significant cash subsidies to enable the plants to move forward. Transport technology Countries supported In the future, projects of this sort should look to multi-country Bicycle paths, non-motorized transit Botswana, Chile, Nicaragua, Peru, partnerships for information and experience sharing. Philippines, Poland, Vietnam Bus-rapid transit systems Argentina, Brazil, Ghana, Senegal, South Africa, Tanzania, Dedicated bus lanes Argentina, Brazil, Chile, China, Ghana, India, Mitigation: transport sEctor tEchnologiEs Indonesia, Iran, Mexico, Peru, South Africa Electric three-wheelers India The GEF program on sustainable transport was approved Hybrid buses Egypt by the Council in 2000. It combines support for new Hydrogen-based fuel-cell buses Brazil, China technologies with efforts to remove barriers to Traffic demand management Argentina, Brazil, Ghana, Mexico well-established technologies that are not disseminating well. The technologies and countries where GEF has supported activities are in Table 4. In the end, the projects in Egypt, India, and Mexico were Fuel-Cell Buses cancelled. When the operational program on sustainable transport was Of the two projects that progressed to implementation, approved in 2000, fuel-cell buses were included as eligible China was the first to receive buses; they have been in under that program. A portfolio of fuel-cell bus projects in operation since 2004. Brazil also received buses, which Brazil, China, Egypt, India, and Mexico was developed. All five appear to be operating well. However, it is not clear that either were approved by the GEF Council, but three faced limited project will lead to a sustainable fuel-cell bus industry absent industry interest in the form of limited or no response at the rapid advances in the technology and reductions in the "expressions of interest" stage of the procurement process. production costs of hydrogen. 27 MiTiGaTion: THE SHoRT-TERM WindoW Table 5 . Technologies as short-term response The Short-Term Window in climate change was established measures (STRM) and countries supported to support opportunities that were considered "too good by the GEF to refuse" (Table 5). Projects were eligible if they yielded $10/ton of CO2-equivalent avoided. Short-term response Coalbed and Coal Mine Methane technology Countries supported Coalbed methane/coal mine methane China, India, Russia Coal deposits yield a significant amount of methane, Coal-to-gas conversion Poland which is released to the atmosphere when coal is mined. Because methane (CH4) is a GHG with a Global Warming Landfill gas utilization China, India, Jordan, Latvia, Uruguay (also included above in OP6 Table) Potential (GWP) more than 20 times that of CO2, using it as fuel offers several benefits: (1) it converts the CH4 back to less LPG substitution Yemen harmful CO2; (2) it reduces CH4 presence in the atmosphere, Natural gas system leakage repair China, Venezuela and (3) it reduces dependence on other fossil fuels. The GEF has supported coalbed and coal mine methane projects in China, Russia, and India. In China, the project led to the creation of the National Coalbed Mining Authority, which has fostered methane tapping and is utilizing joint venture investments in several large coal deposit areas. The process is similar to that of tapping and utilizing natural gas, and holds promise for improving China's gas reserves. GEfExPEriEncEwithtEchnoloGytransfEr: adaPtation 29 Since the creation of the Strategic Priority on Adaptation drought-resistant crops; climate-proofing investments in (SPA) in the GEF Trust Fund, and the establishment of the infrastructure; and the physical transfer of high-tech Least Developed Countries Fund (LDCF) and the Special electronics for data logging and alert systems. Climate Change Fund (SCCF), GEF-administered funding for adaptation has totaled about $130 million. Technology Adaptation projects also seek to build additional capacity to transfer has been a major component in most adaptation increase local participation and ownership and, ultimately, projects funded under the SPA, SCCF, and LDCF, all of which therefore, increase the sustainability of any interventions. are operated by the GEF under guidance from the COP. Many adaptation pilot activities are also centered on improved management of current local or traditional knowledge and Because the portfolio of adaptation projects is relatively new, technologies, or on improved access to adaptation-relevant there is less experience with successful technology transfer information that increases the efficiency of current under it than there is under the GEF's mitigation portfolio. management. Capacity building and public awareness are Recognizing that there are key differences between components of many GEF-administered adaptation projects. technologies appropriate for adaptation and those suited for mitigation, adaptation projects will require significant Because of the differences between mitigation and adaptation, attention to technology deployment. As the adaptation and because their respective use of hard and soft technologies portfolio evolves and matures, it will be important for the GEF differs, the following sections are organized by project activities. to assess experiences and lessons learned, drawing on its own A wide variety of adaptation technology transfer activities past work as well as that of others. are illustrated in Table 6, including those for: ecosystem management; agriculture; water management; disaster risk GEF-administered funding for adaptation technology transfers management; coastal zone management; and health. has gone to both "soft" and "hard" technologies. Soft technol- ogies may include: technical assistance for pilot Technology Information Transfer demonstration activities; wetland and/or mangrove restoration; beach nourishment; and institutional support for The GEF, through its three sources of adaptation funding, knowledge transfer to decision makers on how to mainstream has supported numerous adaptation activities related to adaptation concerns in sector development planning. Hard technology information transfer. In Colombia, advanced technologies may include innovative irrigation systems; climate and statistical models allow continuous evaluation 30 of the effects of global climate change on dengue and malaria In Bhutan, the GEF (through the LDCF) is funding measures to transmission. The models will help guide appropriate reduce the risks of glacial lake outburst floods (GLOFs) from preventive actions. In Cape Verde, a country expected to massive lakes created by receding glaciers. The intervention experience severe climate change-related water stress, a pilot is directly reducing the risk of GLOFs by installing pumps to demonstration of climate-resilient techniques for harvesting, artificially lower the water levels of lakes below dangerous storing, conserving, and distributing water will be thresholds, and by installing an automated monitoring and implemented. This project includes several innovative alarm system based on new technologies. technologies, such as wind traps, underground screens that prevent groundwater seepage, and new water treatment Capacity Building, Coordination, and Policy techniques. Manytechnologytransfer activities can be grouped under this Pilot activities such as these will help generate the awareness heading.Theseactivities do not involve the targeted transfer of and experience necessary to successfully scale up activities at specificinformation or physical investments, but rather the the national level. generationofgeneral knowledge, experience, and capacity--which provide the necessaryfoundationforpolicymainstreaming, Infrastructure and Hard Technology Transfer projectimplementation, and eventual scaling up of pilot activities. InEritrea,forexample, GEF-administered resources will be utilized Another group of activities involves direct investments totrainagricultural extension staff in climate-resilient rangeland (in modern physical infrastructure, for example) that managementtechniques. The successful implementation of these specifically target climate change vulnerabilities. In West activitieswillgivethecountryaflexible,sustainablepoolof Africa, the GEF supported dissemination of alternative energy knowledge,aswell as staff who can advise local communities on technology to local communities that previously collected sustainablelivestock and rangeland management under changing firewood from sensitive coastal mangrove forests. Providing climatesfordecadestocome. these communities with alternative energy sources significantly reduces human pressure on the mangrove forests--a natural buffer against the effects of climate change--induced sea level rise and storm surges. 31 Table 6 .Elements of adaptation technology transfer in ecosystems, agriculture, water management, coastal zone management, disaster risk management, and human health Water Coastal Zone disaster Risk Ecosystems agriculture Management Management Management Health Technology Pest management Improved seasonal Demonstration of Planting /conservation of Improvement of drought early Climate and statistical information technologies forecasts and improved small-scale innovative protective mangroves (Sri warning systems and models developed to transfer introducedintosustain- access to seasonal techniques for Lanka) coordination of food and monitor and track the able forest climate information for climate-resilient harvest, forage banks (Burkina Faso) effects of climate on management to combat farmers through storage, conservation, malaria and dengue. severe pest problems extension services and distribution of water (Colombia) caused by decreasing (Niger) (Cape Verde) rainfall (Armenia) infrastructure Dissemination of Promotion and Upgrade of irrigation Installation of breakwater/ Reduced risks of glacial lake and hard alternative energy dissemination of facilities to promote sea walls at key vulnerable outburst floods (GLOFs) technologies technology to reduce drought-tolerant crop efficient usage of available coastal locations (Pacific through artificial lowering of human stresses on varieties and water resources (Malawi) Islands) lake levels and automated important mangrove technology; knowledge monitoring/warning system ecosystems, previously for improved dry- land (Bhutan) used for firewood farming (such as dry collection (West Africa) seeding, minimum tillage, etc.) (China) Capacity Updating of coastal Training of adaptation Development and Improvements in human Increased coverage of existing Increased capacity and building, zoning and fisheries experts for agricultural implementation of and technical capacity early warning system and understanding among coordination, management based on extension services integrated water (such as GIS technology) improved flow of early warning local health detailed analysis of (Eritrea) management frameworks for monitoring and information to vulnerable professionals through and policy saline front changes for rational prioritization responding to coastal coastal communities pilot implementation of induced by climate of limited resources erosion (West Africa) (Bangladesh) preventive and change (Uruguay) (Ecuador) responsive public health programs specifically targeting climate change- induced illnesses (Samoa) conclusion 33 The GEF, over its 17-year history, has extensive experience in Transfer of environmentally sound technologies is playing the transfer of climate change mitigation and adaptation a crucial role in the global response to climate change. technologies. A total of around $2.5 billion has been allocated Lessons learned at the GEF will help improve the to support climate change projects in over 100 countries. efficiency and efficacy of future efforts to transfer These catalytic projects have addressed more than 30 ESTs to developing countries. technologies and leveraged $15 billion in co-financing. 34 appendix i . Abbreviations and Acronyms BiG/GT Biomass-Integrated Combined Cycle LPG Liquid Propane Gas CdM Clean Development Mechanism MP Montreal Protocol CFL Compact Fluorescent Lamp MWh Megawatt Hours CiF Climate Investment Funds nGo Non-Governmental Organization CoP Conference of the Parties odS Ozone-Depleting Substance CSP Concentrating Solar Power PV Photovoltaic dSM Demand-Side Management SBi Subsidiary Body for Implementation EGTT Expert Group on Technology Transfer SBSTa Subsidiary Body for Scientific and Technological Advice EST Environmentally Sound Technology SCCF Special Climate Change Fund FCB Fuel-Cell Bus SHS Solar Home System GEF Global Environment Facility SMEs Small and Medium Enterprises GHG Greenhouse Gas SPa Strategic Priority on Adaptation GiS Geographic Information System STRM Short-Term Response Measures GWh Gigawatt Hours TWh Terawatt Hours GWP Global Warming Potential UndP United Nations Development Programme idB Inter-American Development Bank UnEP United Nations Environment Programme iGCC Integrated-Gasification Combined-Cycle UnFCCC United Nations Framework Convention on Climate Change iPCC Intergovernmental Panel on Climate Change VaT Value Added Tax LdCF Least Developed Countries Fund 35 appendix ii . GEF Implementing and Executing Agencies African Development Bank Asian Development Bank European Bank for Reconstruction and Development Food and Agriculture Organization of the United Nations Inter-American Development Bank International Fund for Agricultural Development United Nations Development Programme United Nations Environment Programme United Nations Industrial Development Organization World Bank 36 PHoToGRaPHY CREdiTS PRodUCTion CREdiTS Cover photos: Clock wise, George B. Diebold/ Text: Richard Hosier, Robert Dixon, Zhihong Zhang, Corbis, Chinese Ministry of Agriculture, Bonizella Biagini, Lars Christiansen, John D. Wickham, Chinese Ministry of Science and Technology, Dimitrios Zevgolis, Rawleston Moore Arne Hoel/World Bank Inside front cover: Michael S. Yamashita/Corbis Review and Edits: Monica Fernandes and Maureen Lorenzetti Page 3: Dominic Sansoni/World Bank Page 4: Chinese Ministry of Agriculture Design: Patricia Hord Graphik Design Page 7: Chinese Ministry of Science Printing: Mosaic and Technology Page 8: Orjan F. Ellingvag/ Dagens Naringsliv/Corbis Page 10: Chinese Ministry of Agriculture Page 11: Dominic Sansoni/World Bank Copyright october 2008 Page 12 Curt Carnemark/World Bank Page 17: Dominic Sansoni/World Bank Page 20: iStockphoto Global Environment Facility Page 28: Bill Lyons/World Bank 1818 H Street nW, Washington, dC 20433 Page 32: Liu Quanlong/Corbis Page 35: Curt Carnemark/World Bank The text of this publication may be reproduced in whole or in part and in any form for educational or nonprofit uses, without special Inside back cover: Xinhua Press/Corbis permission, provided acknowledgement of the source is made. 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