PARTNERSHIP FOR MARKET READINESS (PMR)

Chairs’ Summary of the Seventh Meeting

of the PMR Partnership Assembly (PA7)

October 22-23, 2013

Marrakesh, Morocco

PA7 – Chairs’ Summary

OPENING OF THE MEETING

1. The meeting was opened by the co-chairs, Mr. Luis Muñozcano (Mexico) and Mr. Sveinung Kvalø (Norway). Mr. Mohammed Benyahia, Director of Partnership, Communication & Cooperation from the Ministry of Energy, Mines, Water and Environment of Morocco and Ms. Karin Kemper, Director of the Climate Policy and Finance Department of the World Bank provided opening remarks.

2. The PMR Secretariat provided an update on inter-sessional work since the last Partnership Assembly (PA) meeting and the PA adopted the agenda as attached to this document (Annex I).

INFORMATION SHARING

3. Germany confirmed an additional contribution to the PMR of 5 million euros. This commitment brings total contributions to the PMR trust fund to about US$128 million.

4. The following countries and entities presented updates on relevant domestic policy developments or related information:

a. China provided an update on the launch of the Shenzhen ETS Pilot. Allocation of allowances is complete and is based on GHG intensity in various sectors. The trading platform is also complete; the value of trading through end-September 2013 equaled RMB 7 million with an average price of RMB62.8. Key challenges facing Shenzhen’s pilot include the small size of trading, a shortage of professional staff, questions around the consistency and credibility of the data reported, questions on how traded assets will be affected by tax law, and how consistent the trading platform is with that of Guangdong. It was noted that pilot participants are still learning and adapting to trading. ;

b. South Korea provided an Update on Korea’s ETS;

c. European Commission provided an Update on EU ETS. To date, emissions within the EU have been cut by 17.6% despite economic growth of 4%. Today the EU-ETS is in a state of reflection. The link to external credits (CDM) was not envisaged to become as large as it did and today there is uncertainty about how big the role of international credits will be going forward. There are questions surrounding engagement post 2020. Currently, there is a structural surplus of credits (about 2 million tCO2e) and measures are being explored to solve the auctioning problem. Two approaches are available: in the short term and for a small amount of credits, backloading can be used; for the longer term, a strengthening of the post 2020 target is being discussed.

a. Brazil reported on recent South-South collaboration with China, which took place in Brazil in September 2013. Representatives from Shenzhen’s ETS pilot and trading platform met with officials in Brasilia. The Chinese brought dynamism to the ETS discussion within Brazil (e.g., expanding thinking beyond the EU ETS model) and had a strong impact on Brazilian authorities.

b. Mexico provided an Update on its Climate Change Law and new fuel tax;

c. Tunisia shared its Mitigation Objectives and Actions;

d. Japan and Indonesia provided an Update on the Development of the Joint Crediting Mechanism;

e. UNFCCC shared a summary of the outcomes from its Workshop on various framework approaches (VFA) and new market-based mechanisms (NMM). The workshop allowed a platform to discuss agreed upon areas of work to develop common understanding; but

PA7 – Chairs’ Summary

the discussion remains political. A decision on NMM is unlikely during COP 19. Before a decision is reached, draft modalities and procedures are needed and more guidance on the scope and purpose of NMM must be outlined. Overall, the FVA discussion is less advanced than that on NMM.

f. Australia reported that the government reaffirmed its commitment on combating climate change, which would be implemented primarily through regulatory approaches.

PRESENTATION OF A FINAL MARKET READINESS PROPOSAL (MRP)

5. Indonesia presented a final MRP for allocation of Implementation Phase Funding. Indonesia’s MRP focuses on building technical and institutional readiness in the power and cement sectors, including building emissions profiles, setting baselines, and developing and piloting an MRV system. In addition, Indonesia will conduct a technical assessment and policy consultation on various market instruments that could be suitable for Indonesia’s context. The presentation highlighted feedback received from Participants, experts, and the World Bank since the draft version. The final version also included a budget for activities. Given the funding shortfall facing the implementation of the activities identified in the MRP, Indonesia was encouraged to prioritize activities for PMR support and consolidate the proposed budget. As the case for all other Implementing Country Participants, Indonesia is invited to periodically update the PA on the status of its MRP implementation, including an update on the budgetary allocation for the PMR activities at PA8 in March 2014. In addition, Participants are invited to provide further written feedback on the MRP to the secretariat by November 8, 2013. The PA, through Resolution PA7/2013-1 (Annex II), allocated US$3 million to Indonesia for implementation of its MRP.

PRESENTATION OF DRAFT A MARKET READINESS PROPOSALS (MRP)

6. Thailand presented its draft MRP to the PA. The country will focus on designing two specific elements of its GHG mitigation strategy: i) an energy performance certificate (EPC) scheme and ii) the low carbon city (LCC) program. Mr. Balawant Joshi, a member of the Expert Feedback Group for the Thailand MRP, also presented key takeaways from the feedback process.

7. Participants are invited to submit written comments on Thailand’s draft MRP by November 8, 2013. Following its practice, the PMR Secretariat will compile all feedback – both summarized feedback from the discussion at PA7 and any submitted written feedback (which will be recorded verbatim). Thailand is invited to take into account the feedback in finalizing its MRP. The final MRP should be submitted to the PMR Secretariat by February 7, 2013, for circulation to Participants three weeks prior to PA8.

STATUS ON COUNTRIES’ MARKET READINESS PROPOSALS AND IMPLEMENTATION

8. Chile is working on a procurement plan, an internal governmental cooperation plan, and finalization of the grant agreement with the World Bank. The latter is currently being reviewed by the National Comptroller and is expected to take up to four months to complete.

9. China is developing work plans with the World Bank country office to address several MRP implementation issues, including regulatory and institutional arrangements, MRV, state-owned enterprises, province participation, and project management. It also plans to establish a committee of related ministries to monitor and advise on project implementation. China expects to sign its grant agreement by mid-2014.

PA7 – Chairs’ Summary

10. Costa Rica has officially launched its Carbon Neutrality brand and has “branded” nine companies. It has also created a PMR task force within the government’s Climate Change Directorate to oversee the finalization of the PMR grant agreement with the World Bank.

11. Mexico has completed terms of reference for each of its three proposed NAMAs and is now focusing on specifying MRV, crediting baselines, and financial architecture for each NAMA. In the coming months, it will also be working on cost benefit analysis, pilot design, and social benefits analysis for each NAMA.

12. Morocco has discussed its consultation process with participants in the cement, power generation, transport, phosphate, and other sectors. Stakeholders have responded favorably to government plans to initiate an MRV program, as well as other activities. It plans to submit a draft MRP at PA8 in March 2014, which will involve analyses to create sectoral crediting mechanisms (such as studies on reduction potential, institutional arrangements, and regulatory structures), and establish underlying support systems, such as a MRV system.

13. Turkey has created and met with its MRP implementation team to develop a procurement plan to retain outside technical assistance. It has also established a timeline for its MRV pilot program, as well as initiated discussions with potential piloting partners; the MRV pilot program is expected to start mid-2014. MRV training workshops are scheduled to start in early 2014. Turkey expects to sign its Grant Agreement before the end of 2013.

14. Ukraine provided an update on its MRP preparation status. A core part of Ukraine’s planned

MRP activities focus on the development of an installation MRV system. Presently, a draft MRV law is under review and remains in the consultation process. Ukraine hopes to have the outcome of this piece of legislation before completing the draft MRP. In addition, Ukraine is working with a number of other entities (USAID, EBRD, and UNDP) on work that will be integral to its MRP. As a result, Ukraine proposes to submit its draft MRP in time for PA9 in May 2014.

TARGETED TECHNICAL SUPPORT

15. Kazakhstan presented the challenges it faces in the implementation of its emissions trading scheme. Based on the request from Kazakhstan and the secretariat note, Targeted Technical Support to Kazakhstan (PMR Note PA7-1), the PA adopted a resolution that allocates up to US$1 million over three years to help Kazakhstan implement its National Emission Trading Scheme. It was noted that a number of countries and organizations are already actively assisting Kazakhstan with various aspects of its ETS and that it would be important for there to be coordination among these efforts to avoid duplication. Kazakhstan will present a specific proposal for the use of funds at PA8.

TUNISIA

16. With the financial contribution from Germany, the PA has invited Tunisia to present potential activities for PMR support as a PMR Implementing Country Participant. This follows the participation precedent set by Peru through the financial support of Switzerland.

Strategic Orientation of the PMR 17. In anticipation of the allocation of the implementation phase funding by the end of 2014, the

PMR Secretariat presented a draft note on the Strategic Orientation of the Future of the PMR (PMR Note PA7-3), outlining ways in which the PMR can be further scaled up, including:

PA7 – Chairs’ Summary

(a) Deepening readiness support to countries: (i) strengthening and expanding upstream policy analysis; (ii) enhancing the PMR technical work program and supporting countries to build systems that follow the “3Cs”, i.e., systems that are credible, consistent and compatible; (iii) reinforcing in-time expert support to Implementing Country Participants; and (iv) supporting South-South knowledge;

(b) Broadening the reach and scope of the PMR: potentially adding new donor or implementing country participants and considering an option for a new category of country that incorporates countries further along in their market-based policy adoption and implementation;

(c) Supporting the piloting new market-based instruments: piloting is a core objective of the PMR. The secretariat proposes to explore options for a financing tool to support piloting in Implementing Countries. Piloting would take place outside of the PMR (through another financing tool) but would be an extension of PMR countries’ activities; and

(d) Preparing for the second round of resource mobilization in order to provide long term and systematic support.

18. Participants expressed strong support to many proposals outlined in the document. Some participants emphasized that any piloting of crediting mechanisms should take place outside the PMR process.

19. The next steps include the following: - Participants are invited to submit written feedback on the document by November 30,

2013. - As part of the deepening of PMR support, Implementing Country Participants are invited

to indicate complementary PMR support for activities that fall outside the scope of the PMR Implementation Funding, including additional policy and technical support. The PMR Secretariat will further elaborate the modality of such support.

- The PMR Secretariat will prepare the following documents to further elaborate some of the proposals presented in the note on the strategic direction: (i) options for creating a new category of countries for consideration at PA8; (ii) options for supporting piloting scaled-up crediting mechanism for consideration at PA8; (iii) modality for a second round of PMR resource mobilization at PA9 or PA10.

UPDATE ON PMR KNOWLEDGE MANAGEMENT

MRV

20. The PMR Secretariat hosted its first regional MRV training workshop in Beijing, China. About 60 representatives from China, India, Indonesia, Singapore, Thailand, Vietnam, and Rio de Janeiro participated expert-led training sessions in installation-level MRV design and implementation. The next regional MRV training will be held in Mexico, March 6-8, 2014 (dates to be confirmed). Further information will be circulated by the secretariat.

21. The PMR Secretariat has established an MRV Working Group to help define priorities for the PMR’s work on MRV, clarify the scope of its knowledge products and training workshops and guide MRV program execution. As a next step, the working group will focus on guiding work for the developing a GHG Reporting Program Design Guide. In addition, the secretariat is working with the World Bank Institute to design a e-learning module on MRV (this would follow the second MRV training workshop).

Offsets

PA7 – Chairs’ Summary

22. The Secretariat issued a call for an offsets working group to serve as an information and knowledge exchange platform on offsets for those PMR countries that are pursuing offset programs. The WG could help build confidence in offset programs for i) the countries developing offset programs and ii) the international community, and would use the concept of the “3Cs” (credible, compatible, and consistent) as a framework to guide WG discussions. Countries should send their nominees for the working group to the PMR Secretariat.

Baselines

23. Following the publication of the PMR Technical Note: Options and Guidance for the Development of Baselines, the secretariat will begin work on several baseline cast studies to road test the guidance and reflect practical experience. The case studies will focus on urban scaled mitigation action in Mexico and cement sector-wide mitigation action (country to be confirmed).

PMR Website and E-Learning

24. The PMR secretariat shared several new improvements to the PMR website. In September it launched the public, online, searchable roster of experts. Under the new format, experts are responsible for maintaining their own profiles. The secretariat also completed an overhaul of the Participant Pages, making it easier to find country-specific information and documents. Participants are invited to share feedback and updates on their respective pages. In addition, when Participants are logged in, they will be able to view and download the PMR Participants Focal Point contact sheet. Finally, a new space has been created on the Knowledge Center to more easily find information on the PMR Technical Work Program and its various working groups.

25. The PMR Secretariat reported back on the development and ongoing pilot delivery of the first e-course on Emissions Trading Systems, a collaborative effort between the PMR Secretariat and the World Bank Institute. The course had been announced to the PMR Participants, future deliveries (with facilitation) will be planned, and a self-paced version will be made available to the PMR community and the general public.

INTERACTION OF CARBON PRICING INSTRUMENTS AND ENERGY POLICIES

26. Ms. Christine Hood (IEA) reported on the results of the IEA project entitled “Integrating Carbon Pricing Mechanisms with Existing Energy Policies”. The project presents an approach for integrating carbon pricing with energy policies to support low carbon technologies and energy efficiency programs. The approach was applied and presented for the countries of South Africa, which has applied a carbon tax, and Chile, which is considering adoption of an emission trading scheme. The key elements of the IEA approach to support the integration of policies are summarized below:

Climate policy packages usually incorporate both energy policies with broader goals than simply reductions and climate policies with the key intent of reducing greenhouse gases. The elements of such policy packages can interact and either reinforce or undermine one another.

Since national circumstance will define the optimal policy mix unique to each country, there is no single approach for policy integration. IEA proposes a checklist of key questions for policymakers, to help them uncover relevant policy overlaps. The project document will be available for public download from the PMR website once finalized.

APPLICATION OF 3CS TO MARKET-BASED MECHANISM

PA7 – Chairs’ Summary

27. Erik Haites (Margaree Consultants Inc.) presented main considerations related to the credibility, consistency, and compatibility (the 3Cs) of market-based mechanisms in the context of linking. These considerations include environmental integrity, financial flows, price impact, effect on competitiveness, governance, MRV, and ability to sustain a link over time. The presentation and follow-up discussion pointed out that some of these considerations only raise technical issues, while either pose real challenges for linking (e.g., linking intensity with absolute cap) or can be easily overcome (e.g,. coverage). However, for some, discussions will also involve a political aspect (e.g., perception of environmental integrity, competitiveness impact). During the group discussion some participants stated that the political considerations need to be addressed first; if agreement on them is achieved, then the technical issues fall into place. Regarding linking a carbon tax system with an ETS, Mr. Haites felt that, among other reasons, this arrangement would be difficult as the financial flows of tax systems are between participants and governments, whereas the flows in cap and trade systems are between participants. Questions and inputs provided by PMR Participants at PA7 will be integrated into a paper on the subject which is under preparation.

MODALITY FOR MONITORING AND EVALUATION FRAMEWORK

28. The PA adopted a resolution to endorse the Results Framework described in Note PA7 2013-3. In addition, the secretariat presented draft terms of reference for the first evaluation of PMR activities. Participants are invited to provide feedback on these terms by November 30, 2013.

29. The PMR Secretariat proposed establishing a small expert working group, consisting of 1-2 individuals representing Implementing Country Participants and 1-2 individuals representing Contributing Country Participants, as well as one outside expert. To avoid the appearance of a conflict of interest, this working group would advise on the selection of the consultant to perform the evaluation and consult on its scope of work. Brazil and Chile volunteered to join the working group, as did Australia and the United Kingdom.

CO-CHAIRS

30. The co-chairs – Mr. Luis Muñozcano (Mexico) and Mr. Sveinung Kvalø (Norway) will serve again for the next PA meeting. Following the precedent, it was suggested that PA co-chairs serve a minimum of two meetings to facilitate consistency.

MEETING DOCUMENTS

31. Final presentations, resolutions and other meeting documents are available on the PMR website: https://www.thepmr.org/events/eventlist/pa/partnership-assembly-meeting-pa7-marrakesh. Some materials, such as country draft MRPs and expert feedback on MRPs, require a password login for viewing.

DEADLINES FOR COMMENTS, FEEDBACK, AND SUBMISSIONS

32. Participants are invited to provide written feedback to the PMR secretariat on Thailand’s draft MRP and Indonesia’s Final MRP by November 8, 2013.

33. Participants are invited to provide feedback and comments on the draft Note on the PMR Strategic Direction and on the draft terms of reference for the first evaluation of the PMR by November 30, 2013.

34. The schedule for draft and final MRPs leading up to PA8 is outlined below. Participants are requested to take note of relevant deadlines.

Final MRP

PA7 – Chairs’ Summary

November 8, 2013: deadline to submit written feedback on Thailand’s Draft MRP and Indonesia’s Final MRP.

February 7, 2014: deadline to submit a final MRP for funding consideration at PA8.

February 10, 2014: secretariat circulates final MRP to PA.

Draft MRP(s)

December 6, 2013: deadline to inform Secretariat of intent to present draft MRP at PA8.

January 4, 2014: deadline to submit first draft MRP to Secretariat.

January 6 – 31, 2014: expert feedback process.

February 3 – 14, 2014: MRP revision.

February 14, 2014: deadline to submit draft MRP to Secretariat.

February 20, 2014: secretariat circulates draft MRP(s) to PA.

NEXT MEETING

35. The next PMR meeting will be held in Mexico City, March 3-5, 2014. The secretariat envisions a two-and-a-half day assembly meeting, followed by a half day joint event with the Government of Mexico. The second regional MRV training workshop is tentatively scheduled from March 6 to 8, 2014. Agendas for all events will be circulated early 2014.

Annex I

Seventh Meeting of the Partnership Assembly (PA7—Agenda

October 22-23, 2013

Kenzi Menara Palace, Avenue Mohamed VI

40000, Marrakesh, Morocco

Day 1

1. Opening and Introduction

8:30 Registration: Welcome coffee and badge pick-up

9:00

Opening remarks

- PMR Co-chairs (Mr. Luis Alfonso Muñozcano, Mexico and Mr. Sveinung Kvalø, Norway)

- Moroccan Government (Mr. Mohamed Benyahia, Director of Partnership, Communication & Cooperation, Ministry of Energy, Mines, Water and Environment)

- World Bank (Ms. Karin Kemper, Director, Climate Policy and Finance Department)

9:30

Introduction

- PMR Update and Progress Report (Ms. Xueman Wang, PMR Secretariat) - Adoption of the agenda

2. Information Sharing

PMR Participants are encouraged to share relevant policy developments. Updates may be done through PowerPoint presentations or oral briefings.

9:45

- China: Update on Launch of Shenzhen Pilot (Mr. Wang Shu, NDRC)

- South Korea: Update on Korea’s ETS (Ms. Ruth Joo, Ministry of Environment)

- European Commission: Update on EU ETS (Mr. Martin Hession, DG Climate Action)

- Brazil: Report on South-South Collaboration (Mr. Artur de Lacerda, Ministry of Finance)

- Mexico: Update on Climate Change Law (Mr. Luis Muñozcano Alvarez, SEMARNAT)

- Tunisia: Mitigation Objectives and Actions (Ms. Afef Jaafar, Ministry of Industry)

- Japan & Indonesia: Update on the Development of Joint Crediting Mechanism (JCM) (Mr. Yuji Mizuno, Ministry of the Environment and Mr. Dicky Hindarto, National Council on Climate Change)

- UNFCCC: Report on the Workshop on Framework for Various Approaches and New Market-based Mechanisms (Mr. Massamba Thioye, UNFCCC)

11:00 Coffee Break

3. Presentation of Final MRP for Decision on MRP Implementation Funding

Indonesia presented a draft MRP at PA6 in Barcelona for feedback from the PA. Based on this feedback, Indonesia has revised its MRP. The final version was circulated to the PMR Participants on September 30, 2013.

Under this session, Indonesia will present the core elements of its final MRP, highlighting any significant changes from the draft version. Following the presentation, there will be time for clarifying questions and discussion. The PA will consider this version of the MRP for a funding allocation decision. Adoption of a resolution on funding allocation will be made under agenda item 9.

11:15

Indonesia

- Presentation of the final MRP (Mr. Dicky Hindarto, National Council on Climate Change) - Discussion

12:30 Lunch

4. Presentation of Draft MRP

Thailand informed the PMR Secretariat of its intention to submit a draft Market Readiness Proposals (MRP) on July 19, 2013. The draft was circulated to the PMR Participants on October 7, 2013. Under this agenda item, Thailand will present its draft MRP in order to seek feedback from the PA; a representative from the PMR Expert Group who carried out the Expert Feedback Process will also present observations and suggestions. Based on feedback received from the PA, Thailand will revise its MRP and submit a final version for funding consideration at PA 8.

14:00

Thailand

- Presentation of the draft MRP (Thailand Greenhouse Gas Management Organization)

- Presentation by a representative of the Expert Group (Mr. Balawant Joshi, Idam Infrastructure ltd.)

- Discussion and feedback

16:00 Coffee Break

5. Strategic Orientation of the PMR

Based on the initial ideas presented and discussed at PA6 in Barcelona, the PMR Secretariat has circulated a note on the strategic orientation of the PMR for consideration by the PA (PA7 2013-2). Participants are invited to share their views and provide guidance to the Secretariat.

16:15

- Presentation of the note on the Strategic Orientation of the PMR (Ms. Xueman Wang, PMR Secretariat)

- Discussion

18:15 Day 1 wrap-up

Day 2

6. Targeted PMR Support

Kazakhstan presented the development of its domestic ETS at PA6 in Barcelona and requested PMR support on its implementation. Kazakhstan will update on its ETS development. The PMR Secretariat will present a proposal on the modality and scope of targeted support for Kazakhstan for consideration by the PA(PA7 2013-1).

9:00

- Status of ETS Development and Need for Support (Ms. Gulmira Sergazina, Kazakhstan)

- Presentation of a Proposal on Targeted Support to Kazakhstan (Mr. Pierre Guigon, PMR Secretariat)

- Discussion

7. PMR Results Framework

Based on the feedback received from the Participants during and after PA6, the Secretariat has revised the PMR Results Framework (PA7 2013-3), which will be presented for discussion and endorsement by the PA.

The Secretariat will also present the terms of reference for the first evaluation of PMR activities (PA7 2013-4) for consideration by the PA.

10:00

- Presentation of the revised version of the PMR Results Framework and the Terms of

Reference for the First Evaluation of PMR Activities

(Mr. Adrien de Bassompierre, PMR Secretariat)

- Discussion

11:00 Coffee Break

8. Updates on Countries’ MRPs

This session is organized to include three sessions:

- Request for extension of MRP Preparation Phase: per PMR resolution PA 3/2012-4, Implementing Country Participants are expected to submit a draft MRP within two years of receiving preparation phase funding. If more time is required for the preparation phase, countries may request an extension for additional time for MRP preparation;

- Update on MRP preparation: Implementing Country Participants that are in the process of preparing the MRP are invited to update the PA on the status of their work, focusing on developments since their last update to the PA ; and

- Update on MRP implementation: Implementing Country Participants that have been allocated implementation funding are invited to update the PA on the status of the MRP implementation.

Participants may make verbal or PowerPoint presentations.

10:00

- Requests for Extension of MRP Preparation Phase

o Ukraine (Mr. Mykhailo Koval, State Environmental Investment Agency)

- Regular Updates on MRP Preparations

o Morocco (Representative from Morocco’s PMR Steering Committee)

- Regular Updates on MRP Implementation

o Chile, China, Costa Rica, Mexico and Turkey

9. Election of Co-chairs, Decisions, and Next Steps

In accordance with the PMR Rules of Procedure for PA Meetings (Section 6.1), the PA shall, prior to the closing of each PA Meeting, elect a representative each from the Contributing Participants and the Implementing Country Participants to act as Co-chairs for the next PA meeting. Following previous practice, it is proposed that the Contributing and Implementing Country Participants meet separately to elect their respective co-chair. Each group will announce the results of their decision to the PA.

12:00

- Election of Co-chairs

- Adoption of Decisions by Participants: o Allocation of Implementation Funding to Indonesia

o Endorsement of the Results Framework of PMR Activities (PMR Note PA7 2013-3) o Modality for Targeted Support to Kazakhstan (PMR Note PA7 2013-1)

- Next Steps: PMR Upcoming Calendar of Events (Ms. Meredith McGreavy, PMR Secretariat)

12:30 Lunch

10. Information Session on the Interaction of Carbon Pricing Instruments with Energy Policies

The International Energy Agency (IEA) has carried out two studies on policy interactions within Chile and South Africa. Based on these studies, the IEA has prepared a Guidance Document on the interaction of carbon pricing instruments with energy policies. IEA and representatives from Chile and South Africa will share their experience and findings on their analytical work. The PMR Secretariat will seek advice from the PA on the development of the PMR's Technical Work Program in this area.

14:00

- Interaction of Carbon Pricing Instruments with Energy Policies (Ms. Christina Hood, IEA)

- Panel discussion with representatives from Chile (Mr. Ignacio Fernandez, Ministry of Energy) and South Africa (Mr. Peter Janoska, National Treasury)

- Discussion

15:15 Coffee Break

11. Update on PMR Knowledge Management

Fostering knowledge exchange is a core objective of the PMR. Under this agenda item, the PMR Secretariat will report back on recent developments on its Knowledge Management work, including reporting on a recent MRV training workshop held in September 2013 in Beijing, and providing an update on the progress of the Technical Work Program.

15:30

- Update on the First Regional MRV Training Workshop (Mr. Mike McCormick, PMR Secretariat)

- Update on Offsets Work (Ms. Felicity Creighton Spors, World Bank)

- Update on Baseline Setting Work and Other Components of the Technical Work Program (Ms. Martina Bosi, PMR Secretariat)

- New Features on the PMR Website and the First e-course (Ms. Sarah Moyer, PMR Secretariat)

- Discussion

12. Applications of 3Cs to Market-based Mechanisms

During PA6 the PMR Secretariat presented the idea of a 3Cs approaches (credible, consistent, and compatible) to market-based mechanisms and readiness components. This session will start the discussion on how the 3Cs could apply to the key components of a mechanism. Participants are invited to provide input and guidance on further development of such work.

16:30

- Lessons Learned from Linking Emissions Trading Systems: General Principles and Applications (Mr. Erik Haites, Margaree Consultants Inc.)

- Discussion

17:45 Closing remarks and wrap-up for PA7

18:30 Reception: Kenzi Menara Hotel

Annex II

PA7 Resolutions

Resolution No. PA 7/2013-1

Allocation of the PMR Implementation Phase Funding for Activities in Indonesia

WHEREAS:

1. The Partnership Assembly (PA), through Resolution No. PA1/2011‐4, allocated the PMR Preparation

Funding at its first meeting held in May 2011 to Indonesia to develop its Market Readiness Proposal

(MRP);

2. Indonesia submitted an initial draft MRP to the PMR Secretariat in March 2013. Pursuant to Resolution

No. PA2/2011-3, the PMR Secretariat organized the expert feedback process to enhance the quality of the

MRP. Based on the feedback and input from the PMR experts, the World Bank and the PMR Secretariat,

Indonesia revised its draft MRP and formally presented it at PA6 in Barcelona on May 27, 2013 to seek

feedback from Participants. On the basis of the verbal comments expressed by the Participants at PA6,

and subsequent written comments received after the meeting, Indonesia further revised the MRP and

submitted the final version to the PMR Secretariat three weeks prior to this meeting.

3. Pursuant to Section 4.3(c) of the PMR Governance Framework, the PA is responsible for making a decision

on the allocation of PMR funding to the Implementing Country Participants, in the absence of the

establishment of a Partnership Committee.

4. The PA considered the final MRP presented by Indonesia at this meeting and acknowledged efforts made

by Indonesia in preparing and finalizing the MRP.

THE PARTNERSHIP ASSEMBLY:

1. Decides, in accordance with the criteria included in Resolution No. PA 3/2012‐4, to allocate the MRP

implementation funding in the amount of US$3,000,000 for carrying out PMR activities identified in the

MRP.

2. Invites (i) PMR Participants to provide comments, if any, on Indonesia’s MRP by November 6, 2013; and

(ii) Indonesia to take into account such comments during implementation of its MRP.

3. Invites Indonesia to periodically update the PA on the implementation of the MRP.

Resolution No. PA7/2013-2

Endorsement of the Results Framework of PMR Activities

WHEREAS:

1. At the Fifth Meeting of the PMR Partnership Assembly (PA) held in Washington D.C. from March

11-13, 2013 PMR Participants broadly agreed that the PMR Secretariat would prepare a draft

proposal for the establishment of a Results Framework to help monitor and evaluate the

performance of PMR activities for PMR Participants to consider at the next PA meeting.

2. At the Sixth Meeting of the PA held in Barcelona from May 27-28, 2013 PMR Secretariat

presented a note on the Results Framework; based on the feedback received at the Sixth

Meeting of the PA and the subsequent written comments received, the PMR Secretariat revised

the note (Note PA7 2013-3) and presented it for consideration at this Seventh Meeting of the

PA.

The PARTNERSHIP ASSEMBLY:

Endorses the Results Framework described in the Note PA7 2013-3 with the understanding that the PMR

Secretariat will make necessary modifications, taking into account the comments expressed by the PMR

Participants. The final version will be circulated to all PMR Participants by November 15, 2013.

Resolution No. PA7/2013-3

Targeted Technical Support to Kazakhstan

WHEREAS:

1. Kazakhstan, which is not an Implementing Country Participant, presented, at the Sixth and

Seventh Meetings of the Partnership Assembly (PA), its National Emission Trading Scheme and

requested the PA to provide technical support on its implementation.

2. The PA considered the “Proposal for Targeted Technical Support to Kazakhstan” (PMR Note PA7

2013-1) presented by the PMR Secretariat and acknowledged efforts made by Kazakhstan in

establishing and implementing its National Emission Trading Scheme.

THE PARTNERSHIP ASSEMBLY:

1. Decides, pursuant to the ‘Proposal for Targeted Technical Support to Kazakhstan’ dated October

7, 2013 (PMR Note PA7-1), to allocate targeted technical support to Kazakhstan to help

Kazakhstan implement its National Emission Trading Scheme up to an amount of US$1 million

over three years, provided that the allocation of funding to specific activities will be subject to

the following process:

a) Kazakhstan, working with the PMR Secretariat and the World Bank’s operations unit

and, in collaboration with other development partners, identifies and proposes specific

activities for PMR support. Such activities shall take into account and be coordinated

with other ongoing initiatives that support the implementation of Kazakhstan’s National

Emission Trading Scheme to avoid any duplication of efforts.

b) Kazakhstan, at a PA meeting, presents its proposed activities that require PMR funding

support, in order to seek feedback and endorsement by the PA. To provide timely

support, depending on the size of the funding and the scope of activities, the proposal

may be made to the PA through electronic means during the inter-sessional period.

c) Kazakhstan, as it is the case for Implementing Country Participants, will periodically

report to the PA on the progress of the activities supported by the PMR and share the

information on the development of its national Emission Trading Scheme.

2. Requests the PMR Secretariat to work with Kazakhstan to propose a budget for the near term

support to be presented to the PA at its eighth meeting in March 2014.

3. Between the seventh and the eighth meetings of the PA, the PMR Secretariat may provide

expert advice to Kazakhstan to help Kazakhstan in its efforts to implement its National Emission

Trading Scheme. The cost of such expert advice shall not exceed US$50,000.

4. Invites the PMR Secretariat to consider creating a new category of countries under the PMR

Governance Framework to institutionalize the status of countries such as Kazakhstan under the

PMR Governance Framework and to make a proposal on such institutional changes at the eighth

meeting of the PA in March 2014.