LONDON (Reuters) – Morocco is the latest country to have secured seed cash under a World Bank-steered scheme to help launch pilot carbon markets, while five other countries are likely to get money by the end of May, a bank official said Wednesday.
Fifteen countries have applied for cash under the Partnership for Market Readiness (PMR), a programme funded by developed countries to help less-developed nations curb emissions to tackle climate change beyond 2012.
With the addition of Morocco, ten countries have received $350,000 each in preparation funding, said the World Bank’s Xueman Wang by phone.
“We are expecting the remaining five countries to present their framework proposals in May,” Wang said, adding that this would likely see all fifteen countries awarded cash within months.
The ten countries that have received cash to date are Chile, China, Colombia, Costa Rica, Indonesia, Mexico, Morocco, Thailand, Turkey and Ukraine.
Brazil, India, Jordan, South Africa and Vietnam are also expected to receive implementation cash in the first half of 2012 to help plan for future market-based approaches.
Countries including Chile, China, Thailand, South Africa and Ukraine have proposed to use the funding for domestic emissions trading schemes, while other nations such as Mexico and Morocco are investigating ideas for programmes that issue carbon credits based on Nationally Appropriate Mitigation Actions (NAMAs).
NAMAs are country-wide plans to cut emissions, such as initiatives to reduce the carbon footprint of specific industry sectors.
“Morocco has identified three sectors that could potentially be part of a credited NAMA: electricity generation, cement production and the phosphate extraction sector,” Wang said.
“The long term objective (for Morocco) is to see how NAMA crediting could be linked to other international trading schemes like the EU Emission Trading Scheme (ETS),” she added.
TAKING THE LEAD
Under the next round of funding, governments could receive $3-8 million to put their plans into action.
Several countries that received seed money last year, such as Mexico, Chile, Costa Rica and China, could be in line for the next tranche of cash under the programme before year-end, Wang said, noting that China is particularly advanced with its ETS plans.
China’s National Development and Reform Comission (NDRC) “is keen to use the PMR to help it build its pilot schemes towards a national scheme,” she said.
China is already initiating pilot ETS schemes in several provinces and cities while the Chinese Academy of Social Sciences (CASS) has drafted climate legislation that could see China introduce a nationwide emissions trading scheme within three to five years.
DONOR COUNTRIES
Cash for the World Bank-led scheme has come from eleven donor countries that have so far pledged $75 million.
The bank wants to raise $100 million and Wang said it is in discussions with new and existing donor countries raise the remaining cash.
The donors are Australia, Denmark, the European Commission, Germany, Japan, the Netherlands, Norway, Spain, Switzerland, the UK and the U.S.
