It is important to promote energy efficiency and renewable energies in developing countries, with their great contribution to sustainable development through realizing various socio-economic benefits and their large potential of GHG emission reductions. However, CDM has limited success to meet this goal so far while collection and destruction/utilization of HFC-23, N2O and LFG CDM projects are dominated in the present market scene.

              Under such a circumstance, there were many voices, at COP 10, from both developed and developing countries advocating promotion of CDM projects in energy efficiency and transportation. As a result, energy efficiency and transportation were set as prioritized sectors of CDM, particularly in terms of developing and considering methodologies, by the COP 10 decision on the matter related to the CDM.

              In order to realize the decision at COP 10, we held a workshop in March in Tokyo, as the first step of the project. The workshop focused on institutional design issue of CDM as incentive mechanisms to promote energy efficiency and renewable energy in developing countries with participation of international experts, representatives of DNAs of major CDM host countries and stakeholders. In the workshop, invited experts presented their own proposals in the light of how to improve the current CDM in order to promote energy-related CDM project, followed by discussions with the participants. Future actions of the project were also discussed in the workshop.

              The second phase, following up the March workshop, was to take concrete actions toward the goal of the project. We decided to focus on the development of methodologies in previously underrepresented CDM areas, identified in the March workshop. In particular, we divided the task into the five areas, establishing five working groups (WGs), as shown below. We also assigned leaders for area in the table below.

During the course of the project, we hold, as appropriate, meetings of “Future CDM Committee,” which consists of the WG leaders as well as representatives of governments of major investment/host countries (Brazil, Canada, Chile, China, India, Japan, Netherlands). The Committee, whose assumed main task is to supervise and manage the activities of the working groups, will discuss the overall strategy and future directions of the project. The first Committee meeting took place on May 21, 2005 in Bonn.