MANILA, January 21, 2016 – Towns and cities in the Philippines now have incentives to invest in technologies to capture methane from municipal wastes, thereby reducing emissions of this harmful gas that contributes to climate change.
Through its Carbon Finance Support Facility, Land Bank of the Philippines (LANDBANK) provides funding and technical assistance for installing methane recovery systems in sanitary landfills. Local government units (LGUs) and operators of sanitary landfills availing of this program can earn “carbon credits” or certificates of emission reductions (CER) that they can sell for extra income.
In a new agreement signed Thursday with LANDBANK, the World Bank commits to buy these carbon credits, providing LGUs and landfill operators more financial incentives to upgrade their facilities. Working with LGUs and landfill operators, LANDBANK commits to deliver 1.7 million carbon credits until 2020.
“This partnership with LANDBANK will help the Philippines achieve its greenhouse gas emission reduction targets while contributing to the global efforts to address climate change,” said World Bank Country Director Motoo Konishi. “Without firmer action, climate change can worsen poverty in many countries and put prosperity out of reach of millions people.”
Experts say climate change makes communities more vulnerable to sea-level rise and extreme weather events like strong typhoons, floods and storm surges, among other impacts.
Under Republic Act 9003 (the Philippines’ solid waste management law), local governments are responsible for proper waste management within their constituencies, ensuring segregation at source, composting, recycling, efficient collection, and environmentally sound disposal.
However, compliance with the law among local governments varies widely due to constraints like limited financial resources, limited markets for recyclable materials, and lack of technical capacity.
According to Gilda E. Pico, President and Chief Executive Officer of LANDBANK, the new agreement can help LGUs comply with the ecological solid waste management law while improving the finances of their waste management operations.
“With rising population and incomes in many cities, local governments are hard-pressed to collect and dispose of increasing volumes of wastes that could cause higher methane emissions,” Pico said. “Together with the World Bank, we are pleased to work with local governments to help address this challenge while strengthening our role as lender to micro-, small and medium enterprises, and environment-related projects.”
Globally, landfills and dumpsites are the third largest sources of methane. In the Philippines, the latest available information (2000) shows that 60 percent of greenhouse gases from waste are generated by towns and cities. The rest is from municipal wastewater (14 percent), industrial wastewater (13 percent), and human sewage waste (13 percent).
The new agreement, technically called emission reduction purchase agreement or ERPA, utilizes the Clean Development Mechanism or CDM set by the Kyoto Protocol in 1997. The Kyoto Protocol is an international treaty that extends the 1992 United Nations Framework Convention on Climate Change which commits countries or parties to reduce greenhouse gases emissions.
CDM allows industrialized countries and companies to fulfill part of their greenhouse gas reduction commitments through the purchase of carbon credits in clean-and-green projects in developing countries like the Philippines.
With CDM, investments in climate-friendly projects displace more carbon-intense technologies, resulting in measurable reductions in greenhouse gases, and yielding CERs or carbon credits. Each unit of CER is equivalent to a metric ton of carbon dioxide.
In October 2015, the World Bank provided a grant of US$410,000 (about 19 million pesos) from the Carbon Partnership Facility to LANDBANK to help build its capacity to implement CDM in the Philippines.
In May 2015, LANDBANK and the World Bank signed an ERPA for the purchase of CERs from livestock farms. This has encouraged 70 pig farms to introduce wastewater biogas systems to capture methane. Two pig farms are now scheduled to deliver on their CERS while 8 more are identified for inclusion in the next 18 months. Also, more farms are adopting cleaner technologies to deliver least 2 million CERs until 2020.