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Draft Final Report Technical Assistance Consultant’s Report Project Number: 44068-012 December 2016 FINAL REPORT RDTA-8119 REG: Economics of Climate Change in Central and West Asia (Co-financed by the Asian Clean Energy Fund under the Clean Energy Financing Partnership Facility and the Climate Change Fund) This consultant’s report does not necessarily reflect the views of ADB or the Government concerned. ADB and the Government cannot be held liable for its contents Prepared by: CARDNO Emerging Markets (UK) Ltd Oxford Road Thame OX9 2AH England United Kingdom 1 | P a g e ACKNOWLEDGEMENTS This report was prepared by Cardno UK Emerging Markets for the Asian Development Bank (ADB). The key authors of the report were: Peter Mackay (Team Leader/Climate Adaptation Specialist); Philip Buckle (Climate Change and DRR Specialist); Alexander Mueller (Economic Specialist); Timothy Hannan (Water Sector Specialist); and Dr. Joanta Green (Energy Sector Specialist). The International Team was supported by a team of National Consultants from Afghanistan, Kyrgyzstan and Tajikistan. The International Team is grateful for contributions and support from: Mars Amanaliyev (National Team Leader), Larisa Bazhanova (Water Resource Specialist and Rysbek Satylkanov (Energy Resource Specialist) from Kyrgyzstan; Bahrom Mamadaliev (National Team Leader) and Zarina Rassoeva (Project Coordination) from Tajikistan; and Professor Ghulam Nasere (National Team Leader), Abdullelah Rasooli (Energy Specialist) and Sediq Reshteen (Water Resource Specialist) from Afghanistan. We would also like to acknowledge the valuable contributions of the many people and organizations. In particular, we would like to thank all the participants of the Country Working Groups for their contributions and active support - without which this report would not have been possible. Indispensable interpretation, translation and organizational services were provided by Zarina Rassoeva. Lastly, we would like to thank Dr. Chris Hope from the University of Cambridge for his valuable advice, training and guidance on the PAGE09 modelling and interpretation of the results. 2 | P a g e ABBREVIATIONS ADB Asian Development Bank AF Adaptation Fund AfDB African Development Bank AFN Afghan Afghani (October 2016: USD 1 = AFN65.91) AFOLU Agriculture, forestry, and land use AR4 Fourth Assessment Report AR5 Fifth Assessment Report ASEAN Association of South East Asian Nations AKT Sub-region Afghanistan, Kyrgyzstan and Tajikistan BAU Business as Usual ºC Degree Celsius CAPS Central Asia Power System CASA-1000 Central Asia-South Asia Electricity Transmission & Trade Project CCRA Climate change risk assessment CDM Clean Development Mechanism CH4 Methane CHPP Combined Heat & Power Plants CIFs Climate Investment Funds CIS Commonwealth of Independent States CMIP5 Coupled Model Inter-comparison Project Phase 5 CO2 Carbon Dioxide CO2e Carbon Dioxide equivalent COP21 21st Conference of Parties of UNFCCC (December 2015) CPI Climate Policy Initiative CRI Global Climate Change Risk Index CSOs Civil society organizations CTF Clean Technology Fund CWA Central West Asia DABS Da Afghanistan Breshna Sherkat DC Direct current DFI’s Development Finance Institutions DMC Developing member country DPSP Dedicated Private Sector Programs DRR Disaster Risk Reduction EBRD European Bank for Reconstruction and Development ECA Europe & Central Asia EEU Eurasian Economic Union EM-DAT The International Disaster Database EoI Expression of Interest EIB European Investment Bank FAO Food and Agriculture Organisation FAR IPCC’s Fifth Assessment Report FDI Foreign Direct Investment FIP Forest Investment Program FSF Flexible Support Funding GCF The Green Climate Fund GCMs General circulation models GDP Gross Domestic Product GEF Global Environment Facility GHG Greenhouse Gas 3 | P a g e GNI Gross National Income GW Giga watt (billion watt) GWh Giga watt hour ha Hectare HEADS Highly Effective Adaptation and Development Strategies HPP Hydropower Plant IADB Inter-American Development Bank IAMs Integrated Impact Assessment Models IIASA International Institute for Applied Systems Analysis ICWC Interstate Commission for Water Coordination IMF International Monetary Fund INC Initial National Communication INDC Intended Nationally Determined Contributions IPCC Intergovernmental Panel on Climate Change IWRM Integrated Water Resources Management KGS Kyrgyzstan som (October 2016: USD 1 = KGS68.10) kV Kilo volt kWh Kilo watt hour LDCs Least Developed Countries LDCF Least Developed Countries Fund LEDS Low Emission Development Strategies LUFC Land use and forest change MAC Marginal abatement cost masl Meters above sea level MCA Multi-Criteria Analysis MDB Multilateral Development Banks MENAP Middle East, North Africa, Afghanistan & Pakistan MIT Mitigation scenario Mt Mega ton (million ton) MW Megawatt (million watt) MWh Megawatt hour N20 Nitrous Oxide NAP National Adaptation Plan NAPA National Adaptation Program of Action NDCs Nationally Determined Contributions ND-GAIN Notre Dame Global Adaptation Index NEPS North East Power System NGO Non-Governmental Organization NPV Net Present Value ODA Official Development Assistance OECD Organisation for Economic Co-operation and Development PAGE09 Policy Analysis of Greenhouse Effect version 9 PPCR Pilot Program for Climate Resilience PPP Purchasing Power Parity PRC People’s Republic of China QUELRO Quantified Emissions Limitation & Reduction Objective RCM Regional Climate Model RDTA Research and Development Technical Assistance RUB Russian ruble (October 2016: USD 1 = RUB 62.29) SA South Asian region SCCF Special Climate Change Fund SCF Strategic Climate Fund 4 | P a g e SEPS South East Power System SF6 Hexafluoride SPCR Strategic Program for Climate Resilience SREP Scaling up Renewable Energy Program SRES Special Report on Emission Scenarios TA Technical Assistance TJS Tajik somoni (October 2016: USD 1 = TJS 7.72) TWh Tera Watt hour (trillion-watt hour) UNDP United Nations Development Program UNEP United Nations Environmental Program UNFCCC The United Nations Framework Convention on Climate Change UNISDR United Nations. International Strategy for Disaster Reduction U.S. United States of America USAID United States Agency for International Development USD Unites States Dollar WBG World Bank Group WCDRR World Conference on Disaster Risk Reduction WDI World Development Indicators 5 | P a g e KEY TERMS Adaptation Adaptation is defined by the Intergovernmental Panel on Climate Change (IPCC) as “The process of adjustment to actual or expected climate and its effects. In human systems, adaptation seeks to moderate or avoid harm or exploit beneficial opportunities. In some natural systems, human intervention may facilitate adjustment to expected climate and its effects.”1 Adaptation deficit The difference between the existing systems in place and those required to reduce the impact of climate change.2 Adaptive capacity Defined by the IPCC as “The ability of systems, institutions, humans, and other organisms to adjust to potential damage, to take advantage of opportunities, or to respond to consequences.” 3 This capacity is demonstrated by the resources and strengths a country is able to put into adaptation. In some cases, these capacities reflect sustainable adaptation solutions. In other cases, they reflect the ability of a country to put newer, more sustainable adaptations into place to address the needs of a particular sector. Adaptation costs The cost of adapting to the impacts of climate change, including adaptation measures and transition costs.4 Adaptation gap The adaptation gap can be defined generically as the difference between the level of adaptation actually implemented and a societally set target or goal, reflecting nationally determined needs related to climate change impacts, as well as resource limitations and competing priorities. Adaptation finance The adaptation finance gap can then be defined and measured gap as the difference between the costs of meeting a given adaptation target and the amount of finance available to do so. Assessment of the adaptation finance gap is facilitated by the availability of a common monetary metric. However, it must be noted that finance is a means rather than an end – availability of funds does not guarantee that such funds are used efficiently and effectively to increase climate resilience and reduce vulnerability. Adaptation options The range of actions and steps which can be taken to adapt to climate change: can be split into social, institutional and structural actions. 1 IPCC, 2014: Annex II: Glossary [Mach, K.J., S. Planton and C. von Stechow (eds.)]. In: Climate Change 2014: Synthesis Report. Contribution of Working Groups I, II and III to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change [Core Writing Team, R.K. Pachauri and L.A. Meyer (eds.)]. IPCC, Geneva, Switzerland, pp. 117-130. 2 ibid 3 ibid 4 ibid 6 | P a g e Aggregate impacts The combined impact of climate change across all regions and/or sectors. Aggregated data may include the total economic cost or the number of people affected and is generally divided by time, place, region or sector. Autonomous Adaptation which is not a result of an intentional response to adaptation climate change, but is likely to be triggered by changes in human systems or ecological responses within natural systems. Central Asia Central Asia is defined as Armenia, Azerbaijan, Georgia, Kazakhstan, the Kyrgyz Republic, Tajikistan, Turkmenistan, and Uzbekistan. Climate Change The United Nations Framework Convention on
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