Workshop on the preparation of National Communications from

Workshop on the preparation of National Communications from non-Annex I Parties of the UNFCCC JULIA MARTINEZ Director of Climate Change Research General Directorate of Research on Urban, Regional and Global Pollution INE-SEMARNAT Manila, Philippines April 26 -30, 2004

Mexico and the UN Framework on Climate Change § Mexico signed the UNFCCC in 1992, and ratified it in 1993. § The Convention came into force for Mexico on March 21, 1994. § Mexico signed the Kyoto Protocol on June 9, 1998. The Mexican Senate approved the Kyoto Protocol on April 29, 2000.

Mexico’s National Communications § The First National Communication of Mexico was submitted to the UNFCCC in 1997. Funds from US Country Studies Program and UNEP/GEF § The Second National Communication of Mexico was submitted to the UNFCCC in 2001. § § § GHG Emission Inventory Update (1994 -1998) Future Emission Scenarios Mitigation Policies www. ine. gob. mx/ dgicurg/cclimatico/comnal. html

GHG Emissions Inventory Update 1994 -1998 In 1996, the equivalent CO 2 emissions were 686, 178 Gg, of which: Carbon dioxide (CO 2): 514, 047 Gg Methane (CH 4): 157, 648 Gg Nitrogen oxides (N 2 O) 14, 422 Gg (75%) (23%) (2%) The CO 2 emission from energy consumption in Gg 1990 1994 1996 1998 297010 314352 314730 350380 (18% more than in 1990) Interactive data base at INE web site http: //www. ine. gob. mx/dgicurg/cclimatico/inventario/index. html

CO 2 Projections from fossil fuels Latin America year 1972 2000 2010 2020 2030 CO 2 (Mt/year) 360 877 1, 185 1, 571 2, 104 3. 1 3. 0 % Annual Increment Global year 1972 2000 2010 2020 2030 CO 2 (Mt/year) 13, 654 22, 639 27, 453 32, 728 38, 161 1. 8 1. 9 1. 8 % Annual increment Source: A Practical Approach to Identifying Emission Reductions Opportunities. Summary Brochure, ARPEL-IPIECA-UNEP. 2002.

Mexico’s CO 2 emission growth scenarios with different GDPs GDP Annual growth (1990– 2010) 2010 CO 2 Million ton Growth 1990– 2010 (%) Low (2. 5%) 805. 6 55% Medium (4. 5%) 878. 9 69% High (6. 0%) 960. 3 85% Source: Sheinbaum C, Masera O. Mitigating carbon emissions while advancing national development priorities: the case of Mexico, climatic change (2000).

Mexico’s Energy and Forestry emissions for the medium scenario (CO 2 Million tons) 1990 1995 2000 2005 2010 Energy 292. 1 333. 4 397. 9 546. 3 726. 0 Forestry 228. 9 206. 7 186. 6 168. 9 152. 9 520. 0 540. 1 584. 5 715. 2 Total 878. 9 Source: Sheinbaum C, Masera O. Mitigating carbon emissions while advancing national development priorities: the case of Mexico, climatic change (2000).

CO 2 emissions related to energy consumption 200. 0 180. 0 160. 0 Agriculture 120. 0 Commercial Residential 100. 0 Self consumption Electricity generation 80. 0 Industrial 60. 0 Transport 40. 0 20. 0 10 20 07 20 04 20 01 20 98 19 95 19 89 92 19 19 86 19 80 83 19 19 77 19 74 71 19 19 68 19 65 0. 0 19 Million tons 140. 0 Source: Engineering Institute, National Autonomous University of Mexico, 2000

CO 2 Emissions mitigation potential (million tons) Option Combined cycle power plants Efficient lighting in the residential sector Efficient lighting in the commercial sector Water pumping measures Efficient industrial motors Efficient industrial boilers Transportation measures at MCMA Industrial Cogeneration Wind electricity generation Subway at MCMA TOTAL: ENERGY SECTOR 2000 13. 9 0. 7 0. 5 1 0. 2 1 1. 2 0. 4 1 0 19. 9 2005 21. 2 1. 6 0. 8 1. 1 0. 6 1. 8 1. 1 17. 9 6. 6 2. 0 54. 7 2010 70 2. 5 1. 2 0. 9 2. 7 1. 0 35. 4 12. 2 4. 0 131. 2 Forestry management (Template) Forestry management (Tropical) Restoration Agroforestry measures TOTAL: FORESTRY SECTOR 97 10. 9 16. 4 5. 4 129. 7 162 18. 7 29. 7 5. 2 215. 6 190. 8 34. 8 31. 4 5. 1 262. 1 TOTAL 149. 6 270. 3 393. 3 Source: Engineering Institute, National Autonomous University of Mexico, UNAM, 2000

• Studies carried out by the National Institute of Ecology & collaborative projects

Potential of the Scientific and Technology Climate Change Research in Mexico Objectives: v To obtain an inventory and evaluation of the research carried out by national institutions on climate change v To establish cooperation schemes between the research centers and public institutions The data base with the results can be consulted at the INE web site http: //www. ine. gob. mx/dgicurg/potencial. html Study carried out by the “Secretaría de Investigación y Desarrollo” at UNAM

Co-control of Urban Air Pollutants and Greenhouse Gases in Mexico City (2002) Objectives To support the capacity in Mexico to analyze and develop policies addressing local air pollution and climate change in an integrated manner To unify diverse studies of measures for the control of local air pollution and GHGs, creating a harmonized database of options. To develop and apply quantitative methods of policy analysis, based on linear programming (LP) and goal programming (GP), to analyze minimum cost programs that achieve objectives for multiple pollutants: v as a tool that CAM use to support decision-making. v to explore the relationships between controls of local pollutants and GHGs.

Conclusions: v. The PROAIRE measures considered would reduce by 3. 1% of projected CO 2 emissions in 2010. v. Through LP tool, we found that the emissions reductions of PROAIRE could be achieved at a 20% lower cost (West et al, 2002) Ø Support from USEPA, IES Program, National Renewable Energy Laboratory http: //www. ine. gob. mx/dgicurg/cclimatico/cocontrolenred. html

Co-benefit study (2003) Metodological framework Analysis of Controls GHG Emissions Control Costs Local Emissions Air Quality Environmental Concentrations Health Impacts Cases of Mortality and Morbidity Valuation Monetary Benefits Benefit/GHG Cost/Benefit Net Benefits

Goals of Co-benefit study: 1) To improve the economic and emissions (local and global) analysis of the co-control phase. 2) To estimate the local public health impacts and monetary benefits for a few specific control measures that would reduce GHG emissions in Mexico City 3) To develop a tool that summarizes the analysis that is useful to policymakers. http: //www. ine. gob. mx/dgicurg/cclimatico/cobeneficios. html

Saved lives (Acute mortality + Chronic mortality) Cost / Benefit analysis (Discount rate 5%, 2003 -2010)

Dwelling Project Agreement signed by FIDE, INFONAVIT & INE (2003) Other participants: project developers (Casas GEO, etc. ) Future participants: Certifiers (ATPAE, etc. . ) Objective: v Reduce electricity consumption in new dwelling projects in the North region of Mexico (high energy consumption) v Reduce GHG emissions Cities: Ciudad Juarez, Mexicali, Nuevo Laredo. Technologies Air conditioner, Thermal isolation, Windows with double pane of glass, Efficient lamps

• GHG mitigation actions undertaken in the energy sector

Energy sector importance The energy sector is one of the most important economic activities in Mexico and the principal source of public income. – The energy sector represents 3% of the GDP. – Oil exports represent 8. 4% of total domestic exportations. – Hydrocarbon taxes represent 37% of fiscal incomes. – Almost 40% of total public investments is dedicated to energy projects. – The sector has been increasing its efficiency and decreasing its rate of emissions growth. Source: Ministry of Energy, 2004

Energy Intensity 1965 -2000 • Since the last decade, Mexico has been generating more wealth by energy of unit consumed. Kilojoules by GDP produced unit 5. 000 4. 000 Formula = kilojoules 1 GDP produced 3. 000 1965 1970 1975 1980 1985 1990 1995 2000 18% Energy Consumption 2000: Source: Ministry of Energy, 2004 Otros Hidrocarburos 82% Total energy supply

Emissions intensity Likewise, it produces less emissions per energy units. Emissions intensity and GDP 0. 6 800 Emissions intensity 700 0. 5 0. 4 500 0. 3 400 GDP 300 0. 2 US$ Billions 600 200 0. 1 100 0 1999 1997 1995 1993 1991 1989 1987 1985 1983 1981 1979 1977 1975 1973 0 1971 CO 2 kg by US$ • Source: Ministry of Energy, 2004

Emissions and GDP growth • Emissions growth has decoupled from GDP growth. GDP, Gross internal energy supply and CO 2 Emissions (1994) 120 115 110 105 GDP 100 Gross Internal Energy Supply 95 CO 2 Emissions 1999 1998 1997 1996 1995 1994 90 Source: AIE, CO 2 Emissions from fuel combustion, 2001. Source: Ministry of Energy, 2004

Some Mexico’s Government GHG Mitigation Strategies • Combined Cycle (CC) Power Plants (CFE) Almost 90% of new generating capacity projected to 2010 will be satisfied through combined cycles • Electric Motors (FIDE-CONAE) Establishment of Official Mexican Norms (NOM) focused on energy efficiency (National Commission of Energy Savings)

Cont… • Industrial Cogeneration (CRE) It is estimated a potential of 8, 664 MW in cogeneration projects • Residential Efficient Lighting (CFE- FIDE) Substitution of efficient equipment • Public Transportation (DDF) Substitution of small buses (gasoline) for large buses (diesel) in the Mexican City Metropolitan Area (MCMA) Increase of subway and light train routes in MCMA • Renewable energy promotion

Mitigation actions in the energy sector Over the past 10 years, the National Commission for Energy Savings (CONAE) and the Trusteeship for Electric Energy Savings (FIDE) have been implementing programs for a more sustainable use of energy, especially: § Thermal insulation of homes, § The introduction of highly efficient air conditioning equipment, § The replacement of 500 thousand incandescent fixtures by fluorescent ones in residential lighting, § The issuing of 20 official norms on energy saving for household appliances and other products.

§ It is estimated that the energy savings accumulated over the last five years deriving from the programs mentioned reached 39 thousand GWh, which meant a reduction of a little over 24 million tons of CO 2. § During the year 2000 alone the country had energy savings equivalent to 11 thousand GWh and the demand for more than 2, 200 MW was obviated through programs oriented toward improving efficiency in the final use of the energy. § These figures represented a reduction of almost 7 million tons of CO 2 with respect to the baseline of 1990.

CO 2 emissions saved in the power sector CO 2 emissions per GWh in thermal plants 820 v The emissions per GWh generated in thermal plants have been declining. (tonnes of CO 2/GWh) 810 800 790 v In 2001, natural gas was 22. 3% of the total fuel consumption, while in 1990 it was 16. 1%. 780 770 760 750 1. 2 1. 0 0. 8 0. 6 0. 4 0. 2 0. 0 -0. 2 100 80 emissions saved 60 40 20 2000 1999 1998 1997 1996 1995 1994 1993 1992 0 millions of tonnes of CO 2 saved emissions level 120 1991 millions of tonnes of CO 2 2000 1999 1998 1997 1996 1995 1994 1993 1992 Electric system CO 2 Emissions 1991 1990 740 v The substitution of fossil fuels by natural gas in electricity generation, saved 413. 4 thousand of tons of CO 2 in 2000. v The accumulated saving since 1991 -2000 is 4. 5 millions of CO 2. Source: Ministry of Energy, 2004

Energy Efficiency Savings Evolution and Prospectives Consolidated programs ENERGY SAVINGS AVOIDED CAPACITY Energy Savings (MBep's) YEAR 70000 Summer Time Programme 6, 746 Gwh 6, 329 Gwh 1, 000 Mw 863 Mw 2000 Since 1996 60000 Miles of Bep's Technical Standards Conae 50000 40000 30000 20000 Fide 10000 CFE HV 0 1995 Energy Savings Programme 1, 866 Gwh 525 Mw 1999 1997 1996 1999 1998 2001 2000 2003 2002 2005 2004 2007 2006 2009 2008 2010 CO 2 emissions saved by Technical NOMs, FIDE activities and PEMEX programs alone amounted to 8. 5 Mtons in 2000 Source: Ministry of Energy, 2004

Renewable Energy There is an ongoing effort to develop a favorable legal framework to promote renewable energy sources. Renewable Energy long-term infrastructure investment contracts. Regulatory incentives (financial and contracts) including: • Accelerated depreciation plans. • Inter-connection agreements with the possibility of generated energy purchase. • Incorporation of used capacity factors to energy transmission. Green-Fund as a suplement for renewable energy prices. • Multilateral Funds • Trade of carbon certificates. • Others Support the promotion of a market for renewable energy buyers. Source: Ministry of Energy, 2004

Renewable potential • High levels of isolation ü 5 k. Wh/m 2 -day (average) • High potential of small hydro projects ü 3, 500 MW • Geothermal fields ü 1, 500 MW • Wind potential ü 3, 000 MW in Oaxaca • Biomass ü 1, 000 MW (sugarcane) Source: Ministry of Energy, 2004

Recent – future projects CFE ( 1, 773 MW) §Hydro power stations: Chicoacen, Chiapas (936 MW), El Cajón, Nayarit (680 MW) §Geothermal: Los Azufres, Michoacán (107 MW) §Wind energy: La Ventosa, Oaxaca (50 MW) Independent Power producers ( 173 MW) §Wind energy: La Ventosa, Oaxaca (107 MW), Santa. Catarina, Nuevo León (10 MW ) §Biomass Energy: Tizayuca, Hidalgo (15 MW), Waste in Monterrey, Nuevo León (7. 4 MW) §Solar Energy: Baja California (39 MW) Source: Programa Energía y Medio Ambiente hacia el Desarrollo Sustentable. 2003. SENER-SEMARNAT 2002 -2003

ILUMEX Pilot Project Ilumex pilot project was financed by: • US$ 3 million from Norway • US$ 10 million from GEF through the World Bank • US$ 10 million from CFE. Total US$ 23 million During the project approximately 2. 5 million compact fluorescent lamps were sold in the Mexican cities of Monterrey and Guadalajara. Purchase of 3. 6 million incandescent lamps were avoided.

§Ilumex was the first AIJ project that was given a certificate by International Auditing §The total certified energy saving was 275, 313 k. W-hr from 1995 to 1998. §Ilumex was certified with the reduction of emissions : § 171, 169 tons of CO 2 equivalent; §Assuming that 8. 11% of total compact fluorescent lamps were stored.

Landfill project in Monterrey, Nuevo León, México - Useful life: 25 -30 years (44 hectares ) - 54 million m 3 of CH 4 from 7. 6 million tons of waste (1990 -1999). - 700, 000 MW/h (electricity generation) - 7 MW - Avoided fuel consumption : 990 thousand tons (equivalent carbon) - Total Investment US$ 11. 5 million (WB US$5. 2 million) The electric power produced is connected to the CFE grid and transmitted to: 1. Municipality of Monterrey (Public lighting) 2. Serviciosde Aguay Drenaje(Water pumping) 3. Metrorrey(Transport)

PEMEX CO 2 emissions (million tons) In 2001, PEMEX emitted 40. 1 million tons of CO 2 distributed in: Pemex Exploration and Production (PEP) 33. 1%; Pemex Refinery (PR) 34. 2%; Pemex Gas and Petrochemical (PGPB) 16%, and Pemex Petrochemical (PQ) 16. 7% SUBSIDIARIA 1999 2000 2001 PEP 13. 87 14. 23 13. 26 PR 15. 09 14. 18 13. 69 PGPB 6. 27 6. 49 6. 41 PPQ 6. 32 6. 53 6. 68 TOTAL 41. 55 41. 43 40. 05 Source: PEMEX, Informe “Seguridad, Salud y Medio Ambiente 2001”. In 2002 there is a reduction of 3. 1 million tons compared to the same period in 2001 (January – August)

PEMEX actions to mitigate CO 2 emissions § Internal market of Carbon permits § Gas recovery project (Cactus) § Workshop Arpel-Pemex on GHG emission reductions and carbon §Energy efficiency and energy savings campaigns § Training programs in energy and environment

• GHG mitigation actions undertaken in the forestry sector

Policies of mitigation in the forest sector In the sector of land use, change in land use, and forests, the main strategies are: § § § Increasing the rate of accumulation of carbon, by creating or increasing sinks Reducing the rate of carbon liberation already fixed in existing sinks; and Reducing the use of fossil fuels and intensifying that of renewable products.

The main achievements over the past few years in conserving forest ecosystems include: § The reforestation of more than 740 thousand hectares (Pronare Program), § Forest planting of more than 47 thousand hectares between 19972003 (Prodeplan Program), § Reclaiming of over 1. 3 million hectares of agricultural lands forestry production. In the period 1997 -2000 these reclaiming actions would permit a future capture of 3. 3 million tons of carbon.

Sustainable management of forest and rainforest § For the period 1997 -2000, the Program of Forest Development (Prodefor) supported the efficient integration of productive wildlife chains on more than 7 million hectares. § With the complete instrumentation of the Program, the carbon capture was estimated at 288 million tons, of which 237 were accounted for by forests and 27 by vegetation in arid areas. § In addition, the Project of Conservation and Sustainable Management of Forest Resources in Mexico (Procymaf) has included over 116 thousand hectares in programs of sustainable forest management, and brought over 13 thousand hectares under the conservation program.

Participative mitigation of climate change Background In 1997, a preliminary assessment was carried out on the carbon sequestration opportunities in four communities of the Union of Communities Zapoteco. Chinanteca (UZACHI) and in two from the Union of Communities from Ixtlán-Etla (IXETO), in the State of Oaxaca. Objectives • Servicios Ambientales de Oaxaca (Environmental Services of Oaxaca), SAO, in collaboration with other NGOs, are promoting a proposal to develop a one year pilot phase to design a scheme for carbon credits. • It is expected to raise approximately USD $ 700 000, during the first phase of the project. Half of the funds raised would go to finance carbon sequestration citizen projects. The other half would finance agroforestry and improved forest projects from SAO member organizations, with a verifiable and certified 40, 000 t. C from the atmosphere, converted into biomass or incorporated into the soil in one year.

…. . Participative mitigation of climate change • This project could offer technical and financial support to substitute conventional management systems for improved forestry systems by means of: Establishing permanent agriculture frontiers, reforestation and agroforestry plantations; increasing efficacy in fire, pests and diseases fight and prevention; the use and profit of non-timber products; reducing the impact of forest logging; and artificially lengthening of the forest cycle. Lessons learned • The evaluation developed in 1997 indicated that 4. 5 million t. C could be sequestered in those six communities during the next 30 years, without any project intervention. It is estimated that 5. 2 million t. C could be achieved by this project during the same time. The global impact of this project was estimated at 720 kt C. This would imply an annual average of 24, 000 t. C. • Opportunities for carbon sequestration have been identified now in another seven communities of the Sierra Norte and the Coast of Oaxaca. If the community of Santa María Huatulco would also be considered, the additional impact would be around 40, 000 t. C annually. The average cost of carbon sequestration within the project is currently estimated at around US $ 6 -8 per ton.

Switch to biofuels § Firewood still represents the main biofuel used in rural zones in Mexico. In 1990, 25. 6 million people (31. 4% of the country's total population) used firewood to cook. It is estimated that the total demand forest biomass (firewood and coal) is as high as 355 PJ/year. § Traditional and handmade stoves and ovens have an efficiency of only 17%, besides causing damages to the health because of the smoke generated. To reduce these emissions, a rural program is in progress for installing stoves with a greater energy efficiency which are expected to permit a reduction in the use of around 6 million tons of wood per year.

Scolel Té Project Objectives: Develop a carbon sequestration prototype scheme in sustainable forests and agricultural systems. To develop a carbon sequestration model that should be applicable on a larger scale in similar regions of Mexico and Latin America. Location: The project is located in Chiapas, in the southern part of Mexico, covers two distinct bio-climatic and cultural regions of the State of Chiapas: highland Mayan Tojolobal communities and lowland Mayan Tzeltal communities. Participants: El Colegio de la Frontera Sur (ECOSUR) and the University of Edinburgh's Institute of Ecology and Resource Management (IERM) are responsible for providing technical support to local technicians working with farmers' organizations and to the Fondo Bioclimático, and to monitor carbon sequestration and socioeconomic impacts of the pilot phase of the project.

Carbon Sequestration Potential The potential impact of the pilot project, in terms of carbon sequestered, is estimated in 300 thousand tons, through the development of 1, 200 hectares of agroforestry lands and 1, 000 hectares of restoration and management of natural forest. Cost of sequestered carbon The average cost of carbon sequestration within the project is currently estimated at around US $12/t. C, of which US $8 are paid to farmers, US $ 2 for administration expenses, and US $ 2 for technical services. Research associated • Studies of carbon fluxes associated with land use change, involving direct measurement of biomass in different types of vegetation. • Research and development of appropriate protocols for community forestry planning and administration of carbon sequestration schemes. • Research of the cost and potential for large-scale carbon sequestration in southern Mexico, using economic models and geographic information such as satellite images

Calakmul climate action project The Nature Conservancy and its Mexican partner organizations have undertaken a feasibility study to assess the potential for carbon sequestration investment in the Calakmul Biosphere Reserve and surrounding areas, in the state of Campeche, Mexico, in the Yucatan Peninsula. Objectives • Demonstrate verifiable GHG benefits; the benefits of greenhouse gas mitigation • Provide habitat protection important to flora and fauna of the Reserve; • Provide social and economic benefits to local communities. The Nature Conservancy believes that the proposed Calakmul Climate Action Project is feasible and warrants advancing to full project development. Location Located on the Mexican border with Guatemala, the 1. 8 million acre (723 000 hectares) Calakmul Biosphere reserve is one of the largest protected areas in Mexico. Calakmul is the best opportunity to preserve Mexico´s rapidly disappearing tropical evergreen and diverse tropical semi-deciduous forests.

Participants • Winrock International • Consejo Civil Mexicano para la Silvicultura Sostenible • Instituto de Ecología at UNAM • El Colegio de la Frontera Sur (ECOSUR) Project feasibility The following elements have been considered during the feasibility study: • Additionality of carbon credits • Potential leakage and prevention strategies • Ease of monitoring and evaluation • Legal land management agreement options • Risk assessment • Long term social and economic benefits (i. e. sustainable development) • Important long term conservation financing benefits

For more information: General Directorate of Urban, Regional and Global Pollution Research http: //www. ine. gob. mx jmartine@ine. gob. mx