F. Others

 

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F. Others
 
F.1   How does the facility react to the different abatement costs in different countries?
 
F.2   What is the role of the World Bank in the facility?
 
F.3   How do you plan to reach your goal of 850 MT reductions with just $100m?
 
F.4   How will the PAF make money and be sustainable if the carbon market never recovers?
 
F.5   Who determines the criteria?
 
F.6   Who is part of the governance decision making body? Are there any sub-committees?
 
F.7   Was the PAF’s EHS and Integrity approach reviewed and approved by the World Bank Board of Directors?
 
F.8   Will the Bank become a CDM project participant or focal point?
 
F.9   Will the CERs be used to meet voluntary emission reductions targets or will they be cancelled?
 
F.10   I understand there will be another two or three more auctions, when approximately will be the next one?
 
F.11   Are the documents that the bidder has provided to the World Bank as part of its application, including the executed Participation Agreement, subject to public disclosure under the World Bank’s Access to Information Policy?
 

 

F. Others
Question F.1 How does the facility react to the different abatement costs in different countries?
  The PAF recognizes that there are different abatement costs in different countries as well as in different sectors.  The auction mechanism is designed to discover those differences and only provide the level of financial support needed to incentivize the desired mitigation.
 
Question F.2 What is the role of the World Bank in the facility?
  The World Bank acts as trustee, secretariat, auction manager and issuer. The World Bank liaises with contributors and designs and runs the auctions, issues the put options to the winners and manages the redemptions.
 
Question F.3 How do you plan to reach your goal of 850 MT reductions with just $100m?
  The PAF does not have a goal to reach 850 MT of reductions.  The PAF will only support a subset of potentially eligible projects.  The objective of the PAF is to pilot a mechanism that could be scaled-up or replicated to tackle the full range of available abatement opportunities in the methane and other applicable sectors.
 
Question F.4 How will the PAF make money and be sustainable if the carbon market never recovers?
  Profit is not the PAF's objective. The PAF’s goal is to use donor resources in an efficient manner to leverage private capital in support of projects that are not being realized, or are at risk of being decommissioned due to the low price for carbon credits today. If some PAF resources are not used because put option owners do not exercise their put options, donors have committed to redeploy them to other climate finance activities.
 
Question F.5 Who determines the criteria?
  The governance body of the PAF determines the eligibility criteria for each auction round.
 
Question F.6 Who is part of the governance decision making body? Are there any sub-committees?
  The governance decision making body is made up of contributors, the World Bank and the Climate and Clean Air Coalition Secretariat as an observer.
 
Question F.7 Was the PAF’s EHS and Integrity approach reviewed and approved by the World Bank Board of Directors?
  Yes, the Pilot Auction Facility, including the approach to EHS and Integrity was approved by the World Bank Board of Directors in November 2014.  The Board Paper can be downloaded with this link.
 
Question F.8 Will the Bank become a CDM project participant or focal point?
  The World Bank will not become a project participant or a focal point. CERs redeemed with a PAF put option will have to be transferred to an account in the Swiss Emissions Trading Registry. Details on the procedure will be provided in the PAF bond documentation.
 
Question F.9 Will the CERs be used to meet voluntary emission reductions targets or will they be cancelled?
  Some of the PAF donors have requested that their share of the credits be cancelled, while others have requested that they be transferred to their accounts.
 
Question F.10 I understand there will be another two or three more auctions, when approximately will be the next one?
  Yes, there will be a series of auctions held under the PAF. The schedule for the next auction has not yet been announced. Information regarding the subsequent auction, including the eligibility criteria and participation requirements will be provided at a later time.
 
Question F.11 Are the documents that the bidder has provided to the World Bank as part of its application, including the executed Participation Agreement, subject to public disclosure under the World Bank’s Access to Information Policy?
  Application materials submitted by the bidder are subject to the World Bank’s Access to Information Policy. However, given the confidential nature of these materials (as per Clause 9 of the Participation Agreement), these materials will not be subject to public disclosure. See in particular paragraph 14 of the policy.
 

 

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Disclaimer: 
THE FOLLOWING IS A SUMMARY OF THE WORLD BANK’S PROPOSED PLAN TO ISSUE PILOT AUCTION FACILITY EMISSION REDUCTIONS NOTES (“PAFERNS”). IT IS NOT AN OFFER TO SELL PAFERNS OR AN INVITATION TO OFFER TO BUY PAFERNS. THIS SUMMARY IS SEPARATE FROM, AND SHOULD NOT BE READ IN COMBINATION WITH, ANY FUTURE OFFER OR SALE OF PAFERNS, WHICH WILL BE MADE IN COMPLIANCE WITH APPLICABLE LAWS AND UNDER ENTIRELY SEPARATE LEGAL DOCUMENTATION AND OFFERING MATERIALS. THIS SUMMARY IS VERY HIGH LEVEL FOR SIMPLICITY AND LEAVES OUT MATERIAL INFORMATION AND THE LEGAL DOCUMENTATION THAT IS EXPECTED TO GOVERN THE PAFERNS. FURTHER, IT IS CURRENT ONLY AS OF THE DATE OF POSTING TO THIS WEBSITE AND IS LIKELY TO BECOME OUTDATED AS THE PAFERNS LEGAL DOCUMENTATION IS DEVELOPED. THE STRUCTURE, TIMING AND MECHANICS OF THE ACTUAL PAFERNS, IF AND WHEN THEY ARE ISSUED, ARE SUBJECT TO CHANGE. POTENTIAL INVESTORS MUST OBTAIN A COPY OF THE COMPLETE LEGAL DOCUMENTATION PURSUANT TO WHICH THE PAFERNS WILL BE ISSUED, INCLUDING THE WORLD BANK’S MAY 2008 PROSPECTUS RELATING TO ITS GLOBAL DEBT ISSUANCE FACILITY AND THE FINAL TERMS FOR ANY ISSUANCE OF PAFERNS. POTENTIAL INVESTORS SHOULD NOT RELY ON THIS SUMMARY. BEFORE MAKING ANY INVESTMENT DECISION, POTENTIAL INVESTORS MUST REVIEW THE COMPLETE LEGAL DOCUMENTATION (ONCE AVAILABLE).

 

Last update -- July 13, 2015