NAMA: Clean Production Agreement (CPA) in Chile

Title: Clean Production Agreement (CPA) in Chile
DescriptionOfMitigationAction: <span style="font-size: 11pt; line-height: 115%; font-family: Calibri, sans-serif;"><strong>**Updated entry on 07.12.2021**</strong><br /> <br /> The CPAs are intended to contribute to the sustainable development of companies through the definition and compliance with specific goals and actions, in environmental, health, hygiene and occupational safety matters, efficient use of energy and&nbsp; productive development. In particular the CPA shall be understood to be the agreement between a business sector, company or companies, with the Institutions of the State that have competence in the aforementioned matters.<br /> </span> <br /> It is the responsibility and main purpose of the Climate Change and Sustainability Agency (ASCC) of the Production Development Corporation, to carry out the coordination activities between the organs of the State Administration and the companies or entities of the private sector that correspond, in any of the stages of elaboration and implementation of the Clean Production Agreements. The Climate Change and Sustainability Agency has a governing board composed by the several ministries and agencies, representatives from the main industrial associations of the private sector, and a representative from the main workers organization of the country. The public and private sector have a balanced representation in this board. The ASCC has been Certified the CPA&rsquo;s under ISO 9.001 and is working to get an accreditation under ISO 17.065.<br /> <div><br /> The ASCC is financed by the Republic of Chile. Most human resources are directly or indirectly dedicated to the management of CPAs. The ASCC has a fund available to the private entities that can co-finance up to the 70% the expenditure on projects that support the creation and implementation of these agreements.&nbsp;<br /> </div>
SectorNR: Energy supply; Residential and Commercial buildings; Agriculture; Waste management; Transport and its Infrastructure; Industry; Forestry; Tourism, Education, Fishing, Mining, etc. a CPA can be signed with different sectors depending on the priorities of the country and the industries in a given time
TechnologyNR: Bioenergy; Energy Efficiency; Wind Energy; Carbon Capture and Storage; Land fill gas collection; Cleaner fuels; Solar Energy; Low till / No till; best practices in waste reduction, valorization, recycling and reuse; energy management; water use, reuse and treatment; workplace safety, food safety and food composition; biodiversity and pesticide usage; compost, fertilizer application and livestock manure management; product labeling; pollution emission management; others
TypeOfActionNR: National/Sectoral policy or program
EntityName: Climate Change and Sustainability Agency
EntityName1: Veronica Baquedano
EntityName2:
EntityAddress1: Amanda Labarca 124 floor 2, Santiago, Chile||
EntityAddress2: Almirante Lorenzo Gotuzzo 124 Piso 2, Santiago. Chile||
EntityAddress3: ||
EntityContactPerson1: Ambrosio Yobánolo Del Real|Ismael Diaz Vergara|
EntityContactPerson2: ||
EntityContactPerson3: ||
EntityContactPerson1Alternate: Ximena Ruz||
EntityContactPerson2Alternate:
EntityContactPerson3Alternate:
EntityPhone1: +5626884500|+56226884500|
EntityPhone2: +563223143718||
EntityPhone3: ||
EntityPhone1Alternate: +5626884500||
EntityPhone2Alternate:
EntityPhone3Alternate:
EntityEmail1: ambrosio.yobanolo@ascc.cl|ismael.diaz@ascc.cl|
EntityEmail2: vbaquedano@cpl.cl||
EntityEmail3: ||
EntityEmail1Alternate: xruz@cpl.cl||
EntityEmail2Alternate:
EntityEmail3Alternate:
YearsForCompletion: 10
StartYearOfImplementation: 2020
UsedCurrency: USD
EstimatedFullCostOfPreparation: 4100000
EstimatedFullCostOfImplementation: 45050000
EstimatedIncrementalCostOfImplementation: 321000000
EmissionReductionsAmount: 2.27
EmissionReductionsUnit: MtCO2e
EmissionReductionsComments: This value is estimated based on the following parameters: New facilities entering an agreement per year (that feed into the active facilities per year parameter), technology obsolescence, CO2 reduction per year per facility, CPA failure rate, certification success rate, Time to certification, Time to baseline. Total emission reduction 2, 270,000 ton CO2 eq, This value is estimated based on the following parameters: New facilities entering an agreement per year (that feed into the active facilities per year parameter), technology obsolescence, CO2 reduction per year per facility, CPA failure rate, certification success rate, Time to certification, Time to baseline. Values for the parameters: 475 new facilities entering a CPA agreement from 2021 to 2030. This value corresponds to the average between 2010 and 2020 excluding one CPA that involved trucks* . It also considers the facilities that are still in an agreement by 2020 and real adhesion from that year. This is used to estimate the number of active facilities per year. Obsolescence of technology 7 years after the signature of the agreement (which is consistent with the provisions of the Clean Development Mechanism). This means that the difference between the baseline and the CPA’s results for the intermediate effects** of the CPA are assumed to be 8 years after the signature of the CPA. it is assumed a estimated reduction of 204 tons of CO2 equivalent per year per facility, which corresponds to the average of the reductions per facility between 2012 to 2020 for businesses in CPA’s*** . A CPA failure rate of 14% was included (About 14% of all Agreements that are signed end before reaching certification stage), as well as a certification success rate of 44% (on the agreements that do reach certification stage, only about 44% of the facilities can demonstrate a 100% compliance with the agreement). These values are the historical values for the CPAs since their inception in 1999. Time to certification from agreement signature is assumed to be four years. This is based on historical values (see previous paragraph). This parameter is important because all the data of the facility that is used to calculate the impact, is made available to the ASCC at the time of certification, and this has a lagging effect on the inclusion of those facilities in the report. It also means that the report of a given year has to include retroactively the data from previous years that belong to the facilities that get certified the year of the report. This also means that only the data from facilities that are certified is available for the calculation. Time to baseline is assumed to be one year. This means the difference between the First year of data used to make the baseline, compared to the year of signature of the agreement. This is relevant because of the following: If the baseline data is captured after the signature of the agreement, as it actually happens, it makes the obsolescence of technology timeframe much shorter than the 7 nominal years, and since the baseline data correspond to the first year of implementation it is highly likely that some upgrades are already in place, and those are going to be captured in the baseline, which results in a smaller impact. The current estimate is based on the historical values. (See previous paragraphs for reference). Explanation on how the reporting works The methodology used to estimate the reduction of emissions and other co-benefits began with the definition of the actions and goals to be implemented in each of the Agreements, considering the data to be recorded to estimate the changes achieved with the implementation of such actions. The logic of data collection is bottom up (i.e. from the facilities, company and group of companies). Once the agreement is implemented, data is collected at the production facility level, and the number of indicators and possible areas will depend on the specific topics of each agreement (these may be indicators related to electricity consumption, fuel consumption energy, waste disposal and its destination, water consumption and source, and other indicators). Once the data are obtained, they must be systematized in a spreadsheet and classified according to categories consistent with those existing in the national greenhouse gas inventory, in order to be able to use the corresponding emission factors. In the case of categories not associated with the national inventory, the data are categorized in such a way that they can be compared between companies and facilitate their subsequent valuation or assignment to an SDG. Also, all data is converted to a single base unit, which depends on the category. Subsequently, calculations are applied to estimate scenarios. Each base category, which usually coincides with an intermediate effect, is assigned a processing model for the calculation of base scenarios and scenarios with APL: The base scenario corresponds to what would have happened without the Agreement, so the value is taken at the first available year, and with this an intensity coefficient is established (factor use/production), which is multiplied by the effective production of certain years; while the scenario with APL, will correspond to the effective data observed for the years of implementation of the agreement. The effect per intermediate category is considered per year, which is added for each year, considering a maximum period of 7 years (which is established as the minimum ceiling for technological replacement in the Clean Development Mechanism (CDM)). The resulting values are then multiplied by emission factors, global warming potentials (GWP) and/or other values, as appropriate, in order to obtain the scenarios for the impact categories. *That single CPA has more than 2000 transport trucks, since they behave differently than a regular installation it was decided to exclude that value to avoid a biased estimation. ** Any decrease in organic waste in one year (the intermediate effect) will have a lasting effect on CH4 emissions (the final effect) several years after due to the First Order Decay Model used in the decomposition of the organic waste over time. ***Not all facilities handed over their data, this estimate is based on 632 facilities of 44 agreements that complied with the commitments. The data on facilities that did not finalize the agreements is scarce.
OtherIndicatorsComments: i) New facilities entering an agreement per year<br /> ii) CO2 reduction per year per facility,&nbsp;<br /> iii) CPA failure rate,&nbsp;<br /> iv) certification success rate,&nbsp;<br /> v) Time to certification,&nbsp;<br /> vi)Time to baseline.&nbsp;<br /> <div><br /> </div>
OtherRelevantInformation: The CPA&rsquo;s can have several co benefits depending on the specific goals and actions.&nbsp;<br /> <br /> Using the SDGs as a taxonomy, we have developed a reporting framework for these different co-benefits. In the latest update, we reported (and developed) several indicators using the SDGs as a framework. As a result we have covered almost all of the SDGs.&nbsp;<br /> <br /> Additionally, we were able to&nbsp; do conversion to a monetary value on several of them. The rate used is based on social value estimates supported by literature . By aggregating this number we created a form of sustainable index that represents the social value created (or damage avoided) with the CPAs. Based on the same assumptions explained in F.3, we reach a result of MM US$836 for the period 2020-2030, using the observed 2012-2020 average per year per facility of US$75,086.<br /> <br /> This considers the economic valuation of avoided costs for the economy as a whole, in relation to less energy use, less water use, less waste disposal and fertilizer uses. There is the challenge of evaluating more indicators, and moving from market value to values that also have externalities embedded into them. This is one of the challenges that will be addressed on future reports during this 2020-2030 period.<br /> <div><br /> </div>
RelevantNationalPolicies: Clean Production Agreement Law<br /> [https://www.bcn.cl/leychile/navegar?idNorma=1010668&amp;idParte=8861304]<br /> <br /> Nationally Determined Contribution (NDC 2020). Contribuci&oacute;n Determinada a Nivel Nacional de Chile, Actualizaci&oacute;n 2020. In page 50, The CPAs are mentioned as a vehicle for the inclusion of the circular economy in companies.<br /> [https://mma.gob.cl/wp-content/uploads/2020/04/NDC_Chile_2020_espan%CC%83ol-1.pdf]<br /> <br /> National Climate Change Action Plan (2017). Plan de Acci&oacute;n Nacional de Cambio Clim&aacute;tico 2017-2022, 2017.&nbsp; (Page 122, Sheet MM22. The agreements are considered as an instrument to achieve synergies with the program of the Ministry of the Environment in quantifying emission reductions.)<br /> [https://mma.gob.cl/wp-content/uploads/2017/07/plan_nacional_climatico_2017_2.pdf]<br /> <br /> National Climate Change Action Plan (2017). Plan de Acci&oacute;n Nacional de Cambio Clim&aacute;tico 2017-2022, 2017.&nbsp; (Page 122, Sheet MM22. The agreements are considered as an instrument to achieve synergies with the program of the Ministry of the Environment in quantifying emission reductions.)<br /> [https://mma.gob.cl/wp-content/uploads/2017/07/plan_nacional_climatico_2017_2.pdf]<br /> <br /> Climate Strategy for technology development and transfer (2021). The more general term &ldquo;agreement&rdquo; is used in page 20 letter e) and in the table of page 50. Those are the roles envisioned for the CPA&rsquo;s in the context of that strategy, but it was referenced in a more open way in order to not narrow the implementation of that strategy to a single type of agreement.<br /> [https://www.minciencia.gob.cl/legacy-files/estrategia_de_transferencia_tecnologica_para_el_cambio_climatico_1.pdf]<br /> <br /> Chile Long Term Climate Strategy (2021). The CPA&rsquo;s are specifically mentioned in page 225, under instruments for financial leverage, due to the role of the CPA&rsquo;s in mobilizing the private sector. Also in page 172 the CPAs are mentioned as an instrument to manage hydric resources.<br /> [https://unfccc.int/sites/default/files/resource/CHL_LTS_2021.pdf] <div><br /> </div>
OtherNAMA: Implementation of a National Forestry and Climate Change Strategy, including the development and implementation of a Platform for the Generation and Trading of Forest Carbon Credits.
UNParty: Chile
CommentsOnFullCost: <span style="font-size: 11pt; line-height: 115%; font-family: Calibri, sans-serif;">This includes activities that are considered additional regarding&nbsp; the calculations and updating of the NAMA, that represent around the 10% of total cost of the professional in charge of this update. There are significant costs regarding design changes in the NAMA, but they are considered part of the operational and&nbsp; continuous improvement costs of the institution and the program, and therefore not additional to this particular update.</span>
CommentsOnFullCostImplementation: <span style="font-size: 11pt; line-height: 115%; font-family: Calibri, sans-serif;"></span>This only includes the cost incurred by the Climate Change and Sustainability Agency (ASCC). This value is calculated assuming the annual budget for the ASCC will be the same that was allocated in 2020 , extrapolated to the time frame considered in this update (2020-2030). That is US$ 4.096 million, multiplied by 11. <div><br /> </div> <div> <div id="ftn1"> <p><span style="font-size: 10pt;"></span></p> </div> </div>
CommentsOnIncrementalCostImplementation: <p style="background: #dbe5f1;"><span></span></p> The incremental unit is 1 Clean Production Agreement.&nbsp;<br /> <br /> The incremental cost is estimated using the average life cycle costs (not a yearly cost) of the agreements that were certified in 2020. This includes the human resources, the procurement of services and direct transfers made to the private sector by the ASCC in the context of these agreements.&nbsp;<br /> <br /> It can be argued that for a few extra CPA the increment should not be linear but is not unreasonable to expect that for a large enough increase changes to the institution structure itself might be needed in terms of new hires and training, coordination costs, and so on. In that sense this value can be used as an upper limit, if other factors remain equal.<br /> <div><br /> </div>
CoveredGreenhouseGases: CO2; N2O; PFCs; CH4; HFCs; SF6; precursor ghg, for example: carbon monoxide and VOC’s.
AttachmentDescription: Reporte_Interactivo_ODS_y_Cambio_Climático_2020.pdf;Interactive Report on SDGs and Climate Change 2020 (2021-2020) (Report on the results of the NAMA in the period 2012-2020, in terms of mitigation indicators and co-benefits (environmental, social and economic) https://datastudio.google.com/u/0/reporting/508a6d6e-72cc-4cbc-b573-8401ab9eeccf/page/kBSvB?s=g3gxLHnD0sk|Reporte_Interactivo_ODS_y_Cambio_Climático_2020.pdf;Interactive Report on SDGs and Climate Change 2020 (2021-2020) (Report on the results of the NAMA in the period 2012-2020, in terms of mitigation indicators and co-benefits (environmental, social and economic) https://datastudio.google.com/u/0/reporting/508a6d6e-72cc-4cbc-b573-8401ab9eeccf/page/kBSvB?s=g3gxLHnD0sk|Copy of Simulación Nueva Meta NAMA APL.xlsx;Simulación Nueva Meta NAMA APL: Spreadsheet with the simulation used to define the new goal.
Item Status: Published
Publishing date: 12/20/2021
NAMAId: NR-11
ConversionRate:
GeneralComments:
Approval Status: Approved
Attachments: Copy of Simulación Nueva Meta NAMA APL.xlsx; Reporte_Interactivo_ODS_y_Cambio_Climático_2020.pdf

Created at 10/14/2013 3:07 PM by Milan Klima
Last modified at 12/20/2021 12:48 PM by System Account
 
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