UNDP in Ukraine

The new Agreement is an important stage in Ukraine's participation in UNDP Millennium Development Goals Carbon Facility. The Agreement launches a new Project of Lugansk Landfill Gas Recovery in Aleksandrovsk Landfill (Lugansk Region).

During a signing ceremony at Lugansk Regional State Administration, the project developer "Nadra Luganshchyny" Ltd., signed contracts with UNDP and Fortis Bank (which is currently a part of "BNP-Paribas" Group). Fortis Bank will purchase the project's carbon credits.

The new project will introduce modern waste management system in the Lugansk Landfill, one of the environmental "hot spots" in the region. The system will allow to capture and productively use landfill gas, as well as to significantly improve environmental situation in the area around the landfill which used to be the source of complains for local residents over decades.

It is the first of its kind in Ukraine and has a great potential for replication in the country and whole CIS as there exist hundreds of similar "hot spots" across the region. The new project is included in the Sustainable Development Programme of the Lugansk region, which is currently being implemented by UNDP in Ukraine.

The signature of today's Emission Reduction Purchase Agreement (ERPA) will allow its signatories bring in financing for the project's implementation from the sales of greenhouse-gas emission reduction certificates (Emission Reduction Units) to the Fortis Bank, while the Project's outcomes will benefit local community and improve the living conditions for local residents in the entire region.

Specifically, the project aims at designing, building and functioning of the system of collection and pilot-flame incineration of landfill gas on the ground of hard domestic waste (HDW) in Aleksandrovsk (near Lugansk). As of today, all the data needed for the development of an inception project have been collected, with a comprehensive topographical survey and engineer research. It is planned that the remaining documentation needed to create the landfill methane collection and utilization systems in Aleksandrovsk HDW landfill will be prepared very soon.

Aleksandrovsk HDW landfill has 11.6 ha. The area used within the project covers 7.5 ha and contains about 3 mn tones of wastes. Following the expert research findings, it is planned to capture up to 600 cubic metres of biogas per hour, which is estimated of up to 300 cubic metres of 'pure' methane, given that the concentration of methane in biogas amounts to 50%. Over the project's duration it is planned to capture about 23 mn of cubic metres of methane, which will lead to greenhouse-gas emissions amounting to approximately 120,000-140,000 tones of СО₂-equiv. already by 2012.

As a result of this joint project implementation greenhouse-gas emissions will be drastically reduced, actions will be taken in order to eliminate and soften the greenhouse-gas emission impact by improving the overall ecological situation around the landfill.

In addition, the implementation of this project will improve the living conditions within the local communities. For instance, the captured biogas will be used to generate electricity as well as to substitute for the use of fossil fuels. The project will create new jobs, and the wastes will be no longer openly combusted in the landfill, halting the combustion and poisonous smells from spreading.

According to Aleksandr ANTIPOV, Lugansk Regional Administration Head, the Administration is pleased with already existing examples of fruitful partner relations between UNDP and Lugansk Regional Administration.

"While implementing the Lugansk Region Sustainable Development Programme, we've conducted a thorough technical and economic analysis of landfill methane utilization opportunities in Lugansk region. Besides, we have jointly conducted economic analysis to develop a new transport infrastructure in our region. We also started exploring ways to remove barriers for coal bed methane utilization in our region. All of this has been done through a Joint Implementation Mechanism under the Kyoto Protocol. I am indeed very pleased to partner with UNDP and sign this new MDGs Carbon Facility Project. We remain hopeful for continuing our fruitful cooperation in the future," Antipov said.

During the signing ceremony, Jens WANDEL, Deputy Director of the UNDP Regional Bureau for Europe and CIS, who arrived in Lugansk on official visit, noted that UNDP, being an organization which works for  the countries' development did not look for any commercial benefits from the Organisation's participation in the Carbon Facility mechanism. UNDP will collect a fixed fee in order to reimburse its direct expenses.

"Within the last 7 years UNDP has implemented a series of carbon finance projects in more than 20 countries worldwide. This Agreement is the first in Ukraine and the second in Eastern Europe and the CIS. We are attracted to this project because it contributes to the Millennium Development Goals and supports sustainable development in Ukraine's Lugansk region. We are very happy to congratulate our Ukrainian colleagues on signing this ecologically, socially and economically important Agreement," Wandel said.

UNDP has established the MDGs Carbon Facility ("Mechanism") with the dual purpose of: Improving access to carbon finance by enabling a wider range of developing countries and project types to participate - particularly in those countries that are currently under-represented in the carbon market; and promoting emission reduction projects that generate additional sustainable development and poverty reduction benefits, thereby contributing to all MDGs.

The Mechanism is an innovative collaboration between UNDP and its international financial partner - Fortis Bank (BNP Paribas Group). The Facility aims at harnessing the vast resources of the carbon market in order to bring long-term sustainable development to a more diverse share of developing countries. Launched in June 2007, the Facility offers emission reduction projects a comprehensive "one-stop-shop" package of services.

According to Erçan MURAT, UN Development Programme in Ukraine Officer-in-Charge, the participants of this first project in Ukraine will be able to use the last achievement of UNDP in the sphere of solving human development problems, in order to ensure maximum benefits for local communities and Lugansk region environment.

"UNDP implements various energy and environment projects worldwide with a total budget of USD 5 bn which makes UNDP one of the largest providers of technical assistance in the field of climate change. In Ukraine within the last five years the portfolio of our environmental protection projects had reached USD 7,5 mn," added Murat.

In Ukraine, UNDP and Fortis Bank sign a New Agreement with "Nadra Luganshchyny"- a respective legal entity which possesses rights to carbon credits awarded over the project's implementation in Lugansk.

UNDP's role in the Mechanism is based on providing project development services, which includes conducting of due financial and legal assessment.

Besides, "Nadra Luganshchyny" will receive technical assistance in passing approval procedures under the Kyoto Protocol Clean Development Mechanism (CDM) and Joint Implementation (JI) as well as in establishing the project's emission reduction monitoring system.

EDITOR'S NOTE:

The UNDP- Fortis Bank collaboration:

UNDP provides technical assistance, helping project proponents conceive projects that reduce greenhouse gas emissions, and ensuring that these projects meet the Kyoto Protocol's agreed standards while delivering benefits to the environment and broader human development. Fortis then purchases the carbon credits generated by these emission reduction projects. The proceeds from Fortis purchases provide project proponents and their communities with a new flow of hard currency that can finance investment and promote development.

The Facility operates within the framework of the Clean Development Mechanism and Joint Implementation, the market-based mechanisms under the Kyoto Protocol that allow developed countries to meet their compliance targets by financing greenhouse gas emission reduction projects located in other countries.

The UNDP-Fortis Bank collaboration covers an initial set of projects that will generate carbon credits during the Kyoto Protocol's first commitment period of 2008 to 2012. For more information: http://www.mdgcarbonfacility.org

Sustainable Development Programme of Lugansk Region - a UNDP-led joint initiative. Its overall mission is to render support to the Government in efficient application of the sustainable development principles and practices at the regional level in order to improve socio-economic and ecological situation in one of the country's most vulnerable regions. This complex process has been arranged through development and institutionalisation of the national mechanisms of public-private partnership, inclusive approach/community participation in decision making and use of international financing mechanisms for environmental protection and sustainable development.

Find more information about the Project at www.undp.org.ua/en/energy-and-environment

Millennium Development Goals (MDGs) - In September 2000, the largest-ever gathering of world leaders ushered in the new millennium by adopting the Millennium Declaration. Ukraine also took the responsibility of reaching the Millennium Development Goals till 2015. The global MDGs were adapted to the Ukrainian context taking into consideration the particularities of the country's development. They were translated into 6 priority areas and 13 specific long-term targets. It's time to deliver on the promises!

Find more information about MDGs in Ukraine at www.ukraine2015.org.ua