Tag: SEMARNAT

This March, more than 80 officials from Mexico’s states responded to the Ministry of the Environment and Natural Resources (SEMARNAT) call and were trained in the use and promotion of the Subnational Climate Action Monitoring System (SIAT-Subnational).

The system was built with the support of the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ Mexico) GmbH, and its objective is to measure, report and evaluate government climate action efforts implemented in the country, both adaptation to climate change and mitigation of greenhouse gases (GHG). By tracking the efforts on the matter, each official will be able to contribute and access the subnational governments’ technical knowledge regarding climate action.

 

subnational officials work on building technical capacities through training. © GIZ

Through the SIAT-Subnational, climate and environmental policy tasks throughout the country will benefit from an updated, and dynamic repository of the subnational administrations contributions to national and international objectives to address the climate crisis. Likewise, it leads to the establishment of a cost-effectiveness reference framework that enables the entire Federation to qualify, modify and replicate the different policies implemented.

At the subnational level, the system facilitates the creation of a good practices network for common problems, encouraging key actors to share their innovations, improve their implementation processes and nurture methodologically standardised learning throughout the country.

Finally, the training and use of the system are also part of a significant victory for citizens, who now have access to an updated, robust, methodologically uniform, and official tool to monitor public actions that seeks to transcend administrations.

All of these makes the training a milestone in the construction of comprehensive instruments aimed at achieving the climate, environmental and social commitments adopted both within the country through all levels of government, as well as with the international community and future generations.

If 10% of the hotels in Mexico reduced their energy consumption by 30%, the CO2 mitigation potential that could be achieved would be 287 thousand tons of CO2 eq. per year. This and other data can be found in the Guide to Energy Efficiency in the Design, Construction and Operation of Hotels in Warm Climates, which illustrates energy efficiency measures, cost-benefit data, and information on the importance of promoting energy efficiency in the hotel sector, as well as business models and financing options.

The guide was produced within the framework of the PEEB and FELICITY global programs of the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH in conjunction with the Mexican Ministry of Environment and Natural Resources.

It is possible to achieve a 30% reduction in energy in a beach hotel, with a return on investment of 2.5 years, using passive and active energy efficiency measures. The Guide to Energy Efficiency in the Design, Construction and Operation of Hotels in Warm Climates uses practical examples to illustrate the energy efficiency and renewable energy measures that can be used, with even zero-energy hotels possible.

This guide was presented during the virtual forum “Experiences, Models and Alternatives of Energy Efficiency in Accommodation Establishments”, which served as a space to publicize the economic and environmental benefits of implementing the environmental sector’s energy optimization model for lodging establishments.

Representatives of the Ministry of Environment (SEMARNAT), Ministry of Tourism (SECTUR), National Commission for the Efficient Use of Energy (CONUEE), GIZ México, Global ABC, EDGE, Green Key, Grupo Posadas and Hoteles Misión participated in the Forum.

Virtual Forum: “Experiences, Models and Alternatives of Energy Efficiency in Accommodation Establishments” © SEMARNAT, PEEB, FELICITY.

The event was broadcast on digital platforms such as Cisco Webex and Facebook, reaching more than 500 attendees in total and more than 15,000 reproductions on the social network.

The guide was developed within the framework of two global programs: the Programme for Energy Efficiency in Buildings (PEEB), which combines the technical knowledge of GIZ with that of the Agence de l’Environnement et de la Maitrise de l’Energie (ADEME) and the Financing Energy for Low-carbon Investment – Cities Advisory Facility (FELICITY) financed in collaboration with the European Investment Bank (EIB). This collaboration is an example for both projects supported by the International Climate Initiative (IKI) of Germany’s Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU) and implemented by the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH.

Guide to Energy Efficiency in the Design, Construction and Operation of Hotels in Warm Climates. © SEMARNAT, PEEB, FELICITY

The guide is available for download on the SEMARNAT page: https://www.gob.mx/cms/uploads/attachment/file/565858/Gu_a_de_eficiencia_energetica_hoteles__comprimida_.pdf

Hotel Misión Tulum Sky Roof © Hoteles Misión

The GIZ project “Preparation of an ETS in Mexico” (SiCEM) provides support to the Ministry of Environment and Natural Resources (SEMARNAT) in the continuous development of capacity-building activities for relevant actors and decision-makers from public and private sectors. The project, which began on January 1, 2020, is carried out within the framework of the Emissions Trading System (ETS) Test Program in Mexico.

In this context, the 2020 ETS Academy was held for the second consecutive year. On this occasion, it was successfully carried out virtually, and focused on the implementation aspects of the Test Program. The course was convened by SEMARNAT and developed with the support of the World Bank’s Partnership for Market Readiness (PMR), the International Carbon Action Partnership (ICAP) and GIZ Mexico.

Between August 18 and September 10, productive space for exchange and networking was generated among around 60 course participants. During these four weeks, learning was strengthened with presentations of the lessons learned, merits and challenges in the implementation of an ETS by national and international experts (China, Quebec, California, European Union, etc.), as well as the use of innovative digital tools and images that captured the key points discussed during the sessions.

Finally, there were two sessions open to the public, attended by Mr. James Grabert, Director of Mitigation of the United Nations Framework Convention for Climate Change (UNFCCC), as well as an exchange session between Latin American countries on carbon price instruments.

Photographic Archive 2020 ETS Academy © GIZ

Week 1. ETS Architecture, Pilots from Mexico and the World

The first week set the stage for subsequent sessions, introducing the concept of carbon pricing instruments and the opportunities presented by the ETS in order to meet the NDC mitigation climate targets based on the Paris Agreement. Although the international experience has shown that it is a cost-effective instrument, its effective implementation requires clear regulatory frameworks, a national policy that responds to international commitments, and close communication with the actors involved in the process.

Jurisdictions such as China, Quebec, and Spain (as part of the European ETS) shared their ETS experiences in the early phases. They stressed the importance of having a strong regulatory and political framework, creating opportunities for dialogue with the regulated sectors and ensuring the quality and robustness of emissions data. In recent years, Mexico has implemented a legal and institutional framework on the matter based on the reform of the General Law on Climate Change in 2018 and the publication of the Agreement establishing the preliminary bases of the ETS Test Program, in which the figure of the Advisory Committee is also created as a space for dialogue and feedback. It also has a robust MRV framework, reflected in the National Emissions Registry (RENE).

Week 2. Allocation and Market Dynamics. What are the Options?

During the second week, the methods to allocate Emission Allowances (DEM) were discussed. Each jurisdiction chose a method (or combination of methods) to use based on national priorities and ETS objectives, among which the following stand out: incentivizing abatement measures, increasing revenue at the government level, protecting the competitiveness of regulated facilities or manage a gradual transition to an ETS. In the case of Mexico, the Trial Program will start a free scheme based on historical emissions per installation in order to facilitate the transition to the Formal Phase of the ETS; later on, the implementation of a percentage of allocations through auctions is envisaged.

Once DEMs are assigned, they can be traded on the secondary market. In the sessions, actors involved in DEM trading in the European ETS covered the different alternatives that exist for this trade, such as exchanges or stock exchanges, or bilaterally through a mechanism known as over-the-counter, as well as looking at the relevant difference that exists between regulated carbon markets (a public policy instrument with a defined legal framework and jurisdiction to reduce GHG emissions) and voluntary ones (a decentralized initiative to promote the reduction of emissions and facilitate the participation of more actors in mitigation activities).

 

Photographic Archive 2020 ETS Academy © GIZ

Week 3. Monitoring, Reporting and Verification Systems (MRV): ETS Challenges and Successes

An effective ETS requires a robust MRV scheme, as this allows designing the top of the ETS and making a better DEM allocation. Also, it ensures environmental integrity and enables compliance monitoring of the covered sectors. It was highlighted that it is crucial to incentivize compliance in an SCE, since otherwise, there is a risk of distorting competition between regulated entities. Jurisdictions such as California, Germany, the Netherlands, and China, shared the mechanisms used to strengthen compliance in their jurisdictions, such as the involvement of the regulated from the early stages of the process so that they are well aware of their obligation, the constant and proactive communication of obligations, listening to feedback, even administrative and economic sanctions.

Week 4. ETS Social and Environmental Benefits and Progress in Latin America. Where are we, and where are we going as a region?

During the last week, the 2020 ETS Academy addressed two topics: offset mechanisms and carbon price instruments in Latin America.

Regarding the first, the ETS includes mechanisms to encourage mitigation actions in non-regulated sectors under the offsets scheme. These contribute to the sustainable development of other sectors and actors indirectly linked to the ETS. Similarly, they allow cost reduction by improving the efficiency of the ETS. With a view to the Operational Phase, a global overview of these mechanisms was presented, as well as an exploration of the possibility of generating offsets for sectors such as forestry, livestock and agriculture, and transportation, within the Mexican context.

On the closing, the 2020 ETS Academy culminated with the exchange of experiences in the Latin American region. The participants had the opportunity to learn about the different advances in the area based on carbon prices. In this regard, countries such as Chile, Peru, and Colombia have implemented a tax on carbon or fossil fuels, while Brazil is analyzing the most cost-effective instrument for the country. Mexico is positioned as the first country in the region to have both a carbon tax and an ETS, so it will be of great interest to learn about their valuable experiences during the design of the ETS and the implementation of the Test Program.

 

Participants and speakers at the 2020 ETS Academy © GIZ

For more information on this topic, please contact us at: Comercio.Emisiones-MX@giz.de

The National Emissions Registry (RENE) is a public policy instrument derived from the General Law on Climate Change (LGCC) in 2012, with the aim of compiling information on direct and indirect emissions of greenhouse gases and compound emissions (CyGEI) generated by the fixed and mobile sources of the different productive sectors across the country, which is used to trace climate policies in Mexico.

Annually, Establishments Subject to Reporting (ESR) regulated by the RENE Regulation, report their CyGEI emissions to the Ministry of Environment and Natural Resources (SEMARNAT). The reports must be verified every 3 years by a Certification Body for the Verification and Validation of GHG Emissions (OC-VV-GEI) accredited by the Mexican Accreditation Entity (EMA) and approved by the Federal Attorney for Environmental Protection (PROFEPA), which certifies the relevance, integrity, consistency, transparency and precision of the information they contain.

The recent Emissions Trading System (ETS) Test Program in Mexico, effective as of January 1, 2020, is integrated with the information reported in the RENE and establishes the obligation of regulated facilities in the preliminary bases of the ETS, to present positive verification opinion on an annual basis only for its direct carbon dioxide emissions, in accordance with the procedure and criteria provided in the RENE Regulations.

In order to continue strengthening and creating OC-VV-GHG capacities in Mexico, SEMARNAT, in collaboration with the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH through the project “Preparation of an Emissions Trading System in Mexico ”(SiCEM), organized the series of online seminars “Methodological Aspects for GHG Verification within the Framework of the report to the National Emissions Registry and the Emissions Trading System for Mexico”, with the participation of the EMA, PROFEPA, and 16 OC-VV-GEIs.

The seminars were held on August 24, 27 and 31, 2020 with the purpose of reinforcing the knowledge of the OC-VV-GHGs on the methodological aspects for the development of a risk analysis, the preparation and planning of sampling plans, and the calculation of materiality in the GHG emissions verification process based on the CyGEI Emissions Verification Criteria issued by SEMARNAT. In this way, it seeks to strengthen the verification process to provide reliability and transparency to the RENE and the ETS.

Seminar 1: Monday, August 24, 2020. Development of Risk Analysis.

Seminar 2: Thursday, August 27, 2020. Data Sampling and Materiality – Regulation, Concepts and Calculation.

Seminar 3: Monday, August 31, 2020. Materiality Calculation and Application of Sampling Methodologies.

With the entry into force of the Test Program of the Emissions Trading System in Mexico (ETS), the project “Preparation of an Emissions Trading System in Mexico” (SiCEM) of GIZ is supporting SEMARNAT in the design of the various components, with one highlight being the design of the auction scheme for the Mexican ETS.

The preliminary bases of the Test Program state in its 20th article: “As of the second year of the pilot phase of the Test Program, the Ministry may implement an auction scheme for the emission rights deposited in the auction reserve without economic effects, depending on the behavior of the emissions market.”

Therefore, the study “Design of Auctions for the Emissions Trading System in Mexico” was carried out. This study is a first effort to establish scenarios that show what an auction scheme could look like for Mexico.

The analysis presents an overview of international best practices, the necessary elements in auction design, as well as technical and operational decisions that must be considered in the design process. For this purpose, four guiding principles were taken as a reference that include a broad review of the institutional structure in Mexico:

  1. Efficiency: Efficient allocations and prices while maintaining low transaction costs for participants.
  2. Simplicity: Reduction of administrative barriers for regulated participants, avoiding unnecessary complexity and achieving the qualification of a wide range of participating entities.
  3. Credibility: Operation through a regulatory financial framework that safeguards effectiveness against inappropriate market behavior.
  4. Compatibility: Compatibility with a broad design and objectives of the ETS including, but not limited to, future pricing prefeasibility, as well as international links.

Likewise, a preliminary analysis of the Mexican regulatory and institutional context was carried out, preliminarily identifying the relevant actors that would play a role in the implementation of the auction scheme and the regulations that could potentially to be adapted as a result of the implementation of the four proposed scenarios. These scenarios are mainly based on the following elements:

  1. Monitoring auctions using existing government agencies (regulators) or outside vendors (independent).
  2. Using the infrastructure of existing stock exchanges or use a new personalized platform.

Each of the proposed options represents advantages and disadvantages that will have to be further analyzed, but at the moment it is possible to list a series of recommendations for the design and subsequent operation of auctions guided by the aforementioned principles.

The presentation was carried out through a virtual session on August 10. This meeting was held within the framework of the project “Preparation of an Emissions Trading System in Mexico (SiCEM)” developed by GIZ and commissioned by the German Government in support of SEMARNAT. The session was attended by highly relevant institutions such as the Ministry of Finance and Public Credit (SHCP), the Mexican Stock Exchange (BMV), the National Banking and Securities Commission (CNBV), the Mexican Banking Association (ABM), Mexico2 and Laguna Sustentabilidad and Law. The study was developed by the Vivid Economics consulting team.

For more information on this subject, please contact us at: comercial.emisiones-MX@giz.de

The Ministry of Environment of Mexico (SEMARNAT) has signed a commitment to reduce N2O emissions from nitric acid production to a minimum, through implementing appropriate political instruments by the end of 2024.

Nitric acid is used worldwide as a raw product for the manufacturing of artificial fertilizers and explosives. During the manufacturing process, significant amounts of N2O are emitted. This gas is one of the most climate-damaging; 265 times more harmful than CO2. All nitric acid producing plants located in Mexico have an impact on the climate equivalent to the emissions of 200,000 passenger vehicles driven for one year. With a goal to substantially reduce N2O emissions from the production of Nitric Acid worldwide, the Nitric Acid Climate Action Group (NACAG) was initiated by the German Federal Ministry for the Environment, Nature Conservation, and Nuclear Safety; funded through the International Climate Initiative.

Minister Svenja Schulze, “German Federal minister of Environment commended this saying, “We are very glad to welcome Mexico as the first Latin American Country that commits to a climate friendlier nitric acid production. With this important milestone, NACAG gets closer to its goal of transforming a whole sector”.

Following this decision they have identified three nitric acid production plants in Mexico that can switch to climate-friendly operation with funds from the Nitric Acid Climate Action Group (NACAG). A total of EUR 4 to 5 million is available for the conversion to N2O abatement technology, capable of reducing up to 98% of the N2O emissions of a plant.

Mexico’s commitment represents an important milestone in NACAG’s achievements in the Latin American Region. It also contributes to Mexico’s efforts towards fulfilling the climate targets set in the framework of the Paris Agreement.

The Emissions Trading System (ETS) in Mexico is a reality, and its Pilot Program will begin on January 1st, 2020. In this context, GIZ’s project “Preparation of an Emissions Trading System in Mexico” continuously carries out capacity building activities for the facilities required to participate within the ETS so that they have the theoretical and practical tools in order to participate in the System.

 

 

 

Within this framework, the Federal Electricity Commission (CFE), the Ministry of Environment and Natural Resources (SEMARNAT) and the ETS project implemented by the Deutsche Gesellschaft für Internationale Zusammenarbeit (German Cooperation for Sustainable Development, GIZ) on behalf of  the Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU), joined forces and organized the workshop “Introduction to the Emissions Trading System (ETS) for representatives of the Federal Electricity Commission (CFE)”, with the main objective of building capacities for compliance with the ETS in participating facilities of this System in Mexico. The workshop was held on April 1st and 11th at the facilities of the CFE in Mexico City.