11

UNFCCC WORKSHOPON PREPARATION OF NATIONAL COMMUNICATIONS

FROM ANNEX I PARTIES

Bulgaria GHG Emission Projections - Methodology and Institutional Arrangements

Dr. Christo Christov, Teodor Ivanov

Energoproekt, Sofia Ministry of Environment and Water

e-mail: nhh@enpro.bg IvanovT@moew.dovrn.bg

tel: ++359 2 68 80 34 ++359 2 981 44 12

Bonn, Germany

28 February - 2 March 2001

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Energoproekt - coordinator of Climate Change study, research and development of National Communications, Inventories, Projections and Policies&Measures

Company was established in 1948

Study and design of power projects

Energy and power system study and research, electric system expansion planning, mid and long-term energy planning, environmental impact of power projects, energy efficiency, policy analysis, nuclear safety, hydro, thermal and nuclear power plants, transmission lines,

substation, urban and rural networks design and supervision.

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Bulgaria and UN Framework Convention on Climate Change

Bulgaria signed the Framework Convention on Climate Change in Rio. The country ratified the Convention in March 1995 thus taking the commitment to keep its GHG emissions below those in the base year.

Pursuant to article 4 (paragraph 6) of the UNFCCC, Bulgaria used its right to choose as a base year a year different from the commonly accepted 1990, and adopted 1988 as a base year under the Convention.

COP 3 Kyoto - the reduction target for Bulgaria during the first commitment period is 92 (i.e. 8% reduction). Such a reduction requires timely development of mitigation measures and their implementation at different levels - households, region, state.

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Bulgaria as one of the countries with economies in transition undergoes economic transformation, accompanied by the process of privatisation and restructuring of the industry. The process of transformation brings industrial production decline and related decrease of energy demand and CO2 emissions levels.

. Trend of GHG emissions – [CO2 equivalent emissions] GHG 1988 1990 1991 1992 1993 1994 1995 1996 1997 1998 CO2 equivalent (Gg)

CO2 103 856 84 136 66 043 59 183 61 859 59 178 62 332 60 710 58 742 55 150 CH4 28 009 29 602 28 420 26 188 23 550 17 178 18 641 17 370 14 775 13 743 N2O 25 225 23 964 21 217 18 339 16 675 16 230 17 110 16 642 16 295 14 777 HFCs 0 0 0 0 0 0 0 0 0 577 PFCs 0 0 0 0 0 0 0 0 0 69 SF6 0 0 0 0 0 0 0 0 0 0 Total 157 090 137 701 115 679 103 710 102 084 92 586 98 083 94 722 89 811 84 316 Trend - % 100 88 74 66 65 59 62 60 57 54 1988 = 100%

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Under the existing social and economic circumstances in Bulgaria, the guiding rule of the Bulgarian climate change policy is joining the international efforts in the field to the level consistent with the national economy and the potential for attracting foreign investments to be used for GHG mitigation.

Mitigation policy and measures should be as cost-effective and economically beneficial as possible.

DOCUMENTS First National Communication February 1996. Second National Communication April 1998. National Action Plan June 2000.

Third National Communication ??? November 2001.

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First National Communication First National Communication Projections, Policies&Measures Projections, Policies&Measures

Objective: Developing and analyzing: Baseline emission scenario Emission mitigation scenario Mitigation policy and measures identification at macroeconomic, sectoral and

utility level Effect of the policies and measures at sectorial and utility level

Tools: Macroeconomic econometric model of neokeynsianian monetary type on macro

and intersectoral level Bottom-up energy demand model + expert judgements ENPEP modules (ELECTRIC, BALANCE, IMPACT), IRP and DSM Manager -

EPRI

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Macroeconomic Alternatives

Two scenarios: Baseline scenario - no major changes in the economic structure and

energy demand structure, moderate technology innovation process, slow energy efficiency improvements (business-as-usual scenario)

Mitigation scenario - significant restructuring of economy, energy demand pattern change, including natural gas supply to households, use of renewable sources, intensive DSM in households and industry, energy conservation policy

Results: Projections on GDP and production volumes for sectors and subsectors Socio-demographic projections (population, employment,

unemployment, number of households)

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Energy Demand ForecastBased on two macroeconomic alternatives (GDP growth and structure, industrial production volumes, investment levels, import-export, etc.)

andBottom-up approach with expert judgements for the penetration of new technologies.

Policies and Measures were developed at this stage.

Useful and final energy demand projections for energy and fuels -electricity, heat, coal, natural gas, etc.for:

• industry (metallurgy, chemistry, building materials and other subsectors);

• transport ( by types: railways, automobiles, public, water, air and pipeline);

• agriculture;

• public sector (households and services);

• energy sector (including oil extraction, oil processing and gas transportation, coal mining, coke and briquettes production as subsectors).

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Energy System Simulation ELECTRIC and IRP Manager provide Power Sector least cost expansion plan

BALANCE provides projections on primary fuel quantities, fuel and energy flows

Emission ProjectionIMPACT provides projections on energy sector GHG emissions :

- by sectors and total (“bottom-up” approach)

- total/reference approach (“top-down” approach for CO2 emissions)

Non-energy emissions were not projected in the 1st NC.

Implemented emission calculation methodology follows the IPCC Guidelines for GHG inventory, including structure and emission factors.

Policies&Measures - general survey of strategies, legislation and sectors status. Effect is assessed at sector level

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Second National Communication

The same methodology and approach as in the First Communication Additional objectives were set to the projections:

• to identify whether Bulgaria will be able to meet its obligations under Kyoto • to identify the most efficient policies and measures at macroeconomic,

sectoral, utility, enterprise and households level. Single macroeconomic scenario was used, due to the understanding that the

introduced Currency Board would not allow for path of economic development

other than the planed one. Non-energy emissions were projected based on the forecast for the emission

source categories.

Uncertainty of the macroeconomic forecast is the main source of the emission

projections uncertainty

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Macroeconomic Alternatives - First and Second National Communication - Macro-economic indicatorsMacro-economic indicators

Indicator Unit Scenario 1995 2000 2005 2010 2015 2020Population thousand BS 8460 8417 8375 8333 8292 8250

people EES 8460 8417 8375 8333 8292 8250CBS 8385 8040 8020 8000 7980 7960

GDP billion BGL BS 187.7 232.5 320.0 436.4 575.8 741.9(prices ‘92) EES 187.7 211.3 276.3 376.7 507.3 713.6

CBS 205.6 194.2 257.6 337 423.8 520.6Production index:

Industry % BS 100 118 155 204 263 336EES 100 105 134 182 248 345CBS 100 93 131 167 207 253

Construction % BS 100 133 181 251 334 432EES 100 106 136 183 244 338CBS 100 86 114 149 188 231

Agriculture and Forestry % BS 100 129 174 232 300 379EES 100 118 156 214 291 413CBS 100 91 123 165 211 263

Transport % BS 100 141 206 302 422 580EES 100 126 172 247 347 509CBS 100 102 138 183 230 286

Note: BS - baseline scenario; EES - energy efficiency scenario; CBS - currency board scenario

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Aggregated Emission Projections

2008

70000

80000

90000

100000

110000

120000

130000

140000

150000

160000

1990 1995 2000 2005 2010 2015 2020

Year

GH

G e

mis

sion

s - k

tBaseline scenario

Mitigtion scenario

1988 level

Kyoto target

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CO2 Emissions inventory and projections 1st and 2nd NC

50000

60000

70000

80000

90000

100000

110000

120000

130000

140000

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

2020

Gg

Inventory Base 1 Mittig.1 Base 2 Mittig.2

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CO2 Emission Inventory and Projection

50000

60000

70000

80000

90000

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

Gg

Base 1 Mittig.1 Base 2 Mittig.2 Inventory

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1. Political issues: is there a change in the governmental policy towards the national

commitments under the UNFCCC&KP? are there changes in the governmental and other institutions

involved in the field of climate change? are there new governmental and other institutions established to

meet the requirements of the UNFCCC&KP? are there personal changes of managing staff and experts (decision-

makers), dealing with the issue? what will be the official sources of information for the 3-rd NC

regarding the national policy? who will approve the 3-rd NC before sending it to the UNFCCC

Secretariat?

Key issuesKey issuesto be addressed before developing the III-rd National Communicationto be addressed before developing the III-rd National Communication

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2. Legislative/regulatory issues: is there a change in the national legislation related to the

meeting of the commitments under the UNFCCC&KP ? is there a change in the legislative basis? are there new governmental documents adopted (programs,

plans, etc.) regarding the climate change problem? where from the above information could be gathered? is there a legal document, governmental decisions or other

official act needed with regard to the development of the 3-rd NC?

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3. Methodological issues: is there a change in the guidelines and methodology for

development of the NC? is it possible to use available sources of information used

before? what other information sources could be used? in what way the information will be checked and verified? are there unsolved problems regarding information

confidentiality? what are the main recommendations of the In-depth Review

Team on NC-2, to be taken into consideration when developing the III-rd NC?

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4. Technical issues:

what methods will be used for correspondence with the sources of what methods will be used for correspondence with the sources of information?information?

is the capacity of the team selected to develop the 3-rd NC is the capacity of the team selected to develop the 3-rd NC enough to cope with the new requirements?enough to cope with the new requirements?

is there a need for new experts and what new experts to be is there a need for new experts and what new experts to be included?included?

is training of the team needed?is training of the team needed? is there sufficient hardware and software support for the is there sufficient hardware and software support for the

development of the 3development of the 3rdrd NC? NC?

5. Financial issues: what funding is necessary for the 3rd NC? are they available and who provides the funds? would be additional financing needed in the course of the

development of the 3rd NC and who can supply it?

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Third National Communication

The methodology and approach are the same as in the First and Second Communications

Additional objectives were set to the projections:• to identify the status and effect of implementation of the NCCAP P&M at

governmental, sectoral, utility, enterprise and households level• to identify whether Bulgaria will be able to meet Kyoto obligations under

current assumptions and projections• to identify whether enough capacity is available to meet the

requirements of the UNFCCC guidelines• to identify necessity of JI projects to meet the target and potential for

ET• to identify P&M (under implementation or planned for implementation)

that would provoke GHG emission increase

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Institutional setting

The Ministry of Environment and Water continues to be responsible for the climate change related activities. The NCs and GHG inventories used to be approved by the Highest Expert Council to the Ministry

A Climate Change Interministerial Commission at the level of deputy ministers was established by the Government after the approval of the NCCAP (no activities undertaken yet). It has the authority to approve the 3rd NC

Energoproekt continues to be a coordinator of the Climate Change study, research and development of National Communications, Inventories, Projections and Policies&Measures. An interdisciplinary team of 60 to 80 experts was involved in climate change related activities over the period 1994-1998

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Organizations involved in the preparation of the 1st and 2nd NCs

Ministries and State Committees:• Environment and Water• Energy and Energy Resources• Energy Efficiency• Industry• Finance• Agriculture and Forestry• Transportation• Regional Development• Justice• Education and Science

Research organizations:• Energoproekt• Bulgarian Academy of Sciences

Institutes:– Hydrology and Meteorology– Forest Research– Nuclear Research and Nuclear Energy– Economics• Academy of Agriculture

NGO s Private Experts

The 1st and 2nd NCs and NCCAP were developed in the frame of of the USCSP. Bulgaria has received methodological and financial support.

USCSP support for Bulgaria was closed in March 1999.

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Financing of the preparation of the Third National Communication

Energoproekt has received financial support to prepare the 1st and 2nd NCs and the NCCAP from the US DoE in the frame of the USCSP.

Starting from December 1999 Energoproekt is receiving financial support for the climate change activities from the National Environmental Fund at contractual basis. The financing that Energoproekt will get from the fund is as follows:

• Processing of 1999 Inventory - 610 US $• Preparation of the Third National Communication - 3 100 US $

Practically these activities are performed in Energoproekt at a voluntary basis.

No other research institutes and/or private experts are involved due to the

lack of financing

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Conclusions

The chapters on the P&M and Projections

form the core of the NCs.

These chapters reflect in the best way the concern with the

climate change related activities in the countries,

the measures undertaken and the professional

level of the experts involved in the field.

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Conclusions

Uncertainty of the macroeconomic forecast is the major source of

uncertainty of emission projections. A single macroeconomic scenario is acceptable for the

short and mid-term projections. The GHG inventory approach to the emission calculations in the projections is

the best way to achieve comparability across inventory results and

projected emissions. P&M implementation should be reflected in the projections as

a change in activity data and emission factors. Financing is the critical issue for a high quality and timely development

of the III-rd NC of Bulgaria.