First loans worth more than USD $3 Million approved under CDM Loan Scheme

Cook stoves in Nepal Photographer: Bhagirath Prasad Ghimire, CDM Project: 4530 Efficient Fuel Wood Cooking Stoves Project
First loans worth more than USD $3 million approved under CDM Loan Scheme

(Bonn, 12 September 2012) – A newly launched loan scheme aimed at increasing the number of clean development mechanism (CDM) projects in developing countries has authorized the funding of more than USD $3 million towards 23 CDM projects.

The loan scheme is run jointly by the United Nations Office for Project Services (UNOPS) and the United Nations Environment Programme (UNEP) Risoe Centre on behalf of the United Nations Framework Convention on Climate Change (UNFCCC). It provides interest-free loans for CDM projects in least developed nations with fewer than ten registered CDM projects.

“We are pleased to see the momentum the CDM Loan Scheme is creating. Often these are small scale and innovative project ideas that benefit traditional communities,” said Jan Mattsson, UNOPS Executive Director. “The next step for UNOPS is to distribute the loans to the selected entities and to monitor their progress towards clean energy solutions – making a real difference.”

The selected projects are very diverse – ranging from household-level energy efficiency (such as energy-efficient cook stoves) to methane avoidance to transportation.

“The strong interest in the loan scheme and wide range of project types and locations are further indications of the continuing strong interest in, and relevance of, the CDM in the fight against climate change,” said John Kilani, Director of the Sustainable Development Mechanisms programme at the UNFCCC secretariat.

The bulk of the selected projects come from Africa, with 17 of the 23 projects located on the continent.

“It is indeed very positive to see that the majority of the selected projects come from Africa,” said John Christensen, Director of UNEP Risoe Centre. “This indicates that the offset project infrastructure is transforming market access.”

There are also three projects in Asia, two in the Middle East and one in Latin America. The majority of the approved loans are programmes of activities (PoA), of which there are 13. Seven are small-scale projects and three are large-scale projects. The loans, subject to a formalized agreement, will cover the development of project design documents, validation by designated operational entities and the first verification of emissions.

Applications are currently being accepted for the second round of the CDM Loan Scheme.

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