LOW EMISSION

DEVELOPMENT

QUARTERLY REPORT NO. 14: OCTOBER 1 – DECEMBER 31, 2018

CONTRACT NO. AID-520-C-14-0003

January 2019 This document was produced for revision of the United States Agency for International Development (USAID). It was prepared by RTI International for the USAID Low Emission Development Project.

LOW EMISSION

DEVELOPMENT

QUARTERLY REPORT NO. 14: OCTOBER 1 – DECEMBER 31, 2018

January 2019

RTI International 701 13th Street NW, Suite 750 Washington, DC 20005 www.rti.org

DISCLAIMER The preparation of this document is possible with the support of the United States Agency for International Development (USAID), under the terms of contract No. AID-520-C-14-00003. The author's views expressed in this publication do not necessarily reflect the views of the United States Agency for International Development or the United States Government. This document is intended to comply with Section 508 Standard of the Federal Acquisition Regulation. If you have any difficulties accessing this document, please contact [email protected].

CONTENTS

ACRONYMS ··································································································· I EXECUTIVE SUMMARY ···················································································· 1 1.3.4. Result 2.4 ...... 3 1.4.1. Result 3.1 ...... 3 1.5.3. Result 4.3 ...... 4 1.5.4. Result 4.4 ...... 4 1.5.5. Result 4.5 ...... 5 1.6.1. Result 5.1 ...... 5 INTRODUCTION ····························································································· 8 1. PROGRESS PER COMPONENT ································································· 9 1.1. Action plan of the low emissions development strategy formulation process ...... 9 1.1.1. Outcome of the formulation process of the Low Emissions Development Strategy for Guatemala ...... 9 1.1.2. Contributions of the formulation process of the Low Emissions Development Strategy for Guatemala ...... 13 1.1.3. Impacts of the implementation of the Low Emission Development Strategy for Guatemala ...... 13 1.1.4. Launch of the Low Emission Development Strategy for Guatemala ...... 13 1.1.5. Steps to follow ...... 14 1.2. Reliable science and analytics ...... 16 1.2.1. Result 1.1 - Analytical tools, methodologies, models and approaches improved and/or transferred to the GoG and incorporated into LEDS development processes...... 16 1.2.2. Result 1.2 – Mechanisms developed to ensure information transfer of greenhouse gas emissions (GHG) between GoG entities, key entities and partners in Guatemala, including beneficiaries in key sectors, rural and indigenous communities...... 17 1.2.3. Result 1.3 – A comprehensive system to obtain, store and manage the GHG emission and removal information established ...... 17 1.2.4. Result 1.4 – Models and scenarios based on alternative paths to the BAU generated and shared with the government, the private sector and civil society to promote an informed mechanism of the decision-making process concerning the low-emission development ...... 17 1.2.5. Result 1.5 – A comprehensive system of institutionalized GHG inventories and forecasts, GHG mitigation and energy/land use change that integrates data flows between end-users, sectors and MARN to improve analysis ...... 18

1.2.6. Result 1.6 – A comprehensive system to obtain, manage and store GHG inventory and forecast data and aligned with the National Information System designated by the Climate Change Act designed, implemented and institutionalized ...... 18 1.2.7. Result 1.7 – University professors trained to conduct micro-economic analyses to generate cost-effective estimates, abatement curves, and specific information on policies, which can be used in macro-economic analyses ...... 19 1.3. Strengthening Institutional Capacities ...... 19 1.3.1. Result 2.1 – Increased GoG capabilities to obtain and process relevant basic data to design and implement LEDS in each prioritized sector ...... 19 1.3.2. Result 2.2 – Local installed capacity and climate change units strengthened through key consultants located in GoG institutions, in a sustainable manner ...... 22 1.3.3. Result 2.3 – Institutional and legal framework established to institutionalize coordination mechanisms within the GoG on LEDS, including workgroups on sectoral issues ...... 24 1.3.4. Result 2.4 - One or two demonstration regions or municipalities implemented LEDS at the sub-national level ...... 25 1.4. Developing Participatory and Transparent Processes ...... 26 1.4.1. Result 3.1 – A comprehensive system established to ensure the involvement of the private sector, academia, NGOs and key actors of civil society ...... 26 1.5. Encouraging Implementation through Demonstrations ...... 27 1.5.1. Result 4.1 – At least three policies and/or regulatory changes developed and adopted by the GoG in order to facilitate the implementation of LEDS actions nationwide ...... 27 1.5.2. Result 4.2 – The National Strategy for Sustainable Production and Use of Firewood, in its implementation phase ...... 28 1.5.3. Result 4.3 – At least five different agro-industrial initiatives of large and small scale to reduce GHG emissions exhibited and promoted (such as sugar, rubber, palm oil, banana, melon) ...... 28 1.5.4. Result 4.4 – At least two integrated mechanisms to promote emissions reduction identified and promoted (for example: payment for environmental services, carbon-offset programs, watershed management) ...... 30 1.5.5. Result 4.5 – At least five small-scale agricultural initiatives, to promote LEDS at the level of farmers' organizations and individuals. This will include innovative market-oriented, financial or incentive instruments, as well as measurement, reporting and verification (MRV) capabilities...... 31 1.6. Supporting Communication and Education ...... 32 1.6.1. Result 5.1 – LEDS Strategic Communications Plan produced and implemented ...... 32 1.6.2. Result 5.2 – Communication and education tools (e.g. media campaigns, radio, newspaper, press, training modules) designed and implemented in key sectors ...... 36 1.6.3. Result 5.3 – Civil society awareness and increased public perception of LEDS and mitigation of climate change, measured through surveys and other methodologies (e.g. baselines and final surveys) ...... 40

4 LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 2. PRIORITIES FOR THE NEXT QUARTER ······················································· 41 2.1. LED strategy formulation ...... 41 2.2. Reliable science and analytics ...... 41 2.3. Strengthening Institutional Capacities ...... 41 2.4. Developing Participatory and Transparent Processes ...... 41 2.5. Encouraging Implementation through Demonstrations ...... 42 2.6. Supporting Communication and Education ...... 42 3. CROSS-CUTTING AXES ········································································ 43 3.1. Environmental compliance ...... 43 3.2. Rapid Response Fund ...... 43 3.3. Gender equity and social inclusion ...... 43 3.3.1. Quarterly Progress ...... 43 3.3.2. Priorities for the next quarter ...... 43 3.4. Small grants ...... 44 3.5. Inputs to TraiNet ...... 45 4. MONITORING AND EVALUATION ·························································· 46 5. CHALLENGES AND ISSUES ···································································· 57 6. QUARTERLY FINANCIAL SUMMARY ························································ 58

ACRONYMS

ACR Asociación de Combustibles Renovables ADAT Association of Tinecos Farmers (ADAT) ADECAR Association of Cardamom Exporters AFOLU Agriculture, Forestry and Other Land Use AMSA Authority for the Sustainable Management of the Amatitlán Lake Basin ANACAFE National Coffee Association APIB Association of Independent Banana Producers ASAZGUA Sugar Association of Guatemala ASOCUCH Association for the Development of the Cuchumatanes ASODEL Dairy Development Association BAU Baseline or inertial trajectory (Business as usual) CAMAGRO Chamber of Agriculture of Guatemala CATIE Tropical Agronomic Research and Education Center CCS Center for Climate Strategies CEMPRO Cementos Progreso UNFCCC United Nations Framework Convention on Climate Change CO2e Carbon Dioxide Equivalent CPL Chamber of Dairy Farmers CTCN Climate Technology Center and Network LED Low Emission Development LEDS Low Emission Development Strategy EMMP Environmental Mitigation and Monitoring Plan USA United States FEGAGUATE Federation of Ranchers of Guatemala FMO Financial Development Company (Netherlands) FOLU Forestry and Other Land Use FUNDEA Foundation for Business and Agricultural Development FUNSOLAR Fundación Solar FY Fiscal Year

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 i GoG Government of Guatemala GHG Greenhouse gas emissions GIMBUT Interinstitutional Monitoring Group of Forests and Land Uses GREPALMA Palm Growers Trade of Guatemala ha Hectare ICC Private Institute of Research on Climate Change INAB National Forest Institute Regional Platform of Latin America and the Caribbean of the Global Alliance on LEDS LAC Low Emissions Development Strategies M&E Monitoring and Evaluation MAC Marginal Abatement Cost MAGA Ministry of Agriculture and Livestock MASUR Commonwealth of the South MARN Ministry of Environment and Natural Resources MEM Ministry of Energy and Mining MICC Indigenous Forum on Climate Change of Guatemala MINECO Ministry of Finance MRV Measuring, reporting, and verifying NAMA Nationally Appropriate Mitigation Actions NDC Nationally Determined Contribution NGO Non-Governmental Organization PINPEP Forest Incentive Program for Owners of Small Land Extensions UNDP United Nations Development Programme POA Annual Operating Plan RTI Research Triangle Institute SEGEPLAN Presidential Secretariat for Planning and Programming SEPREM Presidential Secretariat for Women SNICC National Information System on Climate Change SNIP National System of Public Investment Sotz’il Asociación Sotz’il (Center for Maya Development Research and Planning) Tg Teragrams TNC The Nature Conservancy USAID United States Agency for International Development ii LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 EXECUTIVE SUMMARY

This report covers the activities developed by the USAID Low Emissions Development Project (hereinafter the Project) during the first quarter of fiscal year 2019 (October 1 – December 31, 2018). The project is executing the POA FY 2019 as scheduled. It is important to note that in this quarter, after two years of joint work in the formulation process of the Low Emissions Development Strategy (LEDS), with representatives of the public sector, private sector, civil society, academia and indigenous peoples, on November 14, 2018 a launch event and introduction of the Low Emissions Development National Strategy was held. Following is a summary of the progress achieved in the five components.

1.1. ACTION PLAN OF THE LOW EMISSIONS DEVELOPMENT STRATEGY FORMULATION PROCESS In this quarter, the LEDS formulation process reached its last step, of the six that comprise the methodology. • As a final step in the LEDS process, each of the 43 prioritized mitigation options received a macroeconomic evaluation based on the review of the financial flows identified in the microeconomic analysis (savings and income). • The following products are left as a contribution for the country: o The Low Emission Development National Strategy (LEDS) of Greenhouse Gases (GHG) developed participatively with representatives of the public sector, private sector, academia, indigenous peoples, producer organizations and civil society, which reflects the vision of each sector oriented towards the development of the country. o A baseline of GHG emissions from the country's economy 1990 - 2050. o 43 prioritized mitigation options, based on the vision of each sector and articulated with existing national policies, programs and goals. o Scenarios of the impact of the implementation of the 43 options on GHG emissions of the economy as a whole and concerning the Nationally Determined Contribution (NDC) proposed by the country. • The results indicate that, if all the options were implemented as designed, in the period 2019-2050, 2,454 million tons of CO2e would be reduced through the reduction in the consumption of fossil fuels, the conservation of forests, improvements in agriculture and proper waste management. Likewise, it is estimated that the total economic benefits (savings) for society would be 41 billion quetzals, which can be used for other necessary actions that benefit the living conditions of Guatemalans. • The LEDS official launch event was held on November 14, 2018, at Hotel Barceló in Guatemala City, during which the summary document for decision-makers of the LEDS was delivered.

1.2. RELIABLE SCIENCE AND ANALYTICS This component focuses on strengthening the GHG information systems and national inventories. The Project continues working with the new authorities to finalize LEDS in Guatemala. For this purpose, during the quarter the Project has executed and managed to fulfill the following actions:

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 1 • Result 1.1—Distribution of the document GHG Emissions Base Line in the Guatemalan economy began, which has been reviewed and validated in its digital version. In addition, a comparison of the baseline, the NDC and the LEDS was completed with four possible scenarios of GHG emissions budgets that could be required by the United Nations Framework Convention on Climate Change (UNFCCC) to maintain global warming below 2 degrees Celsius. • Result 1.2—On November 14 the LEDS was publicly launched, and in other events, presentations of its results were made before the Coordinating Committee of Agricultural, Commercial, Industrial and Financial Associations and the Diploma Program of Climate Change of Universidad del Valle de Guatemala. • Result 1.3—The GHG estimation protocols for each sector, and the lists of institutional delegates trained in the use of the protocols, were delivered to the Third National Communication Project administered by the United Nations Development Program (UNDP). • Result 1.4—The parallel analysis of the different GHG emissions reduction scenarios was presented graphically during the LEDS launch event. • Result 1.5—In FY2018, the estimation of the 2010 preliminary inventories for the sectors of energy, industry, waste management, agriculture, and forestry, and other land uses was completed. This preliminary inventory and the weaknesses found in the data collection were transferred and discussed in meetings with the Third National Communication Project (UNDP). • Result 1.6—The Project designed a conceptual model for the system of collection, management, and storage of information on national inventories of GHG emissions, automated through software. The Climate Technology Center and Network (CTCN) supported by the Ministry of Environment and Natural Resources (MARN) will prepare this software through technical support managed by the project. The CTCN has developed a model proposal that was transferred for the MARN endorsement in the month of October. • Result 1.7—This activity has been completed.

1.3. STRENGTHENING INSTITUTIONAL CAPACITIES This component aims to support the Government of Guatemala (GoG), the private sector, academia and civil society to increase its capacity for the implementation of a Low Emission Development Strategy and the formulation and reformulation of policies, plans, programs and projects, as well as identifying and prioritizing investments oriented towards a low emissions development. During the last three months the Project has executed and managed to fulfill the following actions:

1.3.1. Result 2.1 • An article on good practices of sustainable livestock to be published in the Journal of Zootechnics of the Faculty of Veterinary Medicine and Zootechnics of Universidad de San Carlos de Guatemala was made, which is part of the socialization mechanisms for the implementation of the mitigation options of the LEDS and the dissemination, communication and awareness mechanisms of axis 7 of the National Strategy of Sustainable Livestock for Low Emissions from the Ministry of Agriculture, Forestry and Food (MAGA). • A low emissions sustainable livestock practices socialization event was held with the Cattle Association of the department of Izabal. • The forest carbon calculator was published (calculadora.inab.gob.gt) on the website of the National Forest Institute (INAB). The Carbon Calculator constitutes a significant progress for the forestry sector and its competitiveness, where institutional capacities for entering international carbon markets and the development of carbon markets nationwide are strengthened.

2LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 1.3.2. Result 2.2 • The Project supports INAB in making adjustments to the 2016 forest cover map based on observations made by members of the Inter-institutional Monitoring Group for Forests and Land Use (GIMBUT). Currently, 50% of the observations and adjustments have been completed. • Technical support was provided to the Ministry of Energy and Mining (MEM) for updating the Energy Policy 2019-2050. • The Project, in coordination with the Directorate of Public Investment of the Presidential Secretariat for Planning and Programming (SEGEPLAN), proposed adjustments to the Regulations of the National Public Investment System (SNIP) 2020, and the project formulation guide was adjusted.

1.3.3. Result 2.3 • Sustainable Livestock promoter group was supported to present the results of the micro and macroeconomic analysis of the LEDS mitigation options to the Boards of Directors of the Federation of Livestock Breeders of Guatemala (FEGAGUATE) and the Chamber of Dairy Farmers (CPL), and with presidents of the Cattle Associations of different departments of the country.

1.3.4. Result 2.4 • Todos Santos Cuchumatán, Huehuetenango—Implementation of the local strategy began during the FY2018, which promotes economic growth and reduction of GHG emissions through the restoration of coffee agroforestry systems and shade species, the diversification of crops through the introduction of fruit plants, the establishment of forest plantations, and the transfer of these and other capabilities to the population. Tinecos (ADAT), the Association of Farmers and local partner, implemented a second phase of the agroforestry nursery with the aim of producing new fruit and shade plants for coffee. • Pachalum, Quiché—The Project, through the Solar Foundation, supported the municipality to: manage the entry of 14 hectares of natural forest into INAB forestry incentive programs: Probosque and PINPEP; conduct technical studies for the establishment of 8.7 hectares of plantations through Probosque and PINPEP; with the Paso Seguro Association and the Solar Foundation, build stoves that reduce their demand for firewood by 30%; and coordinate training with the Authority for the Sustainable Management of the Lake Amatitlán Basin (AMSA) on issues such as garbage classification, solid waste, biodegradable waste and strategies to minimize environmental pollution.

1.4. DEVELOPING PARTICIPATORY AND TRANSPARENT PROCESSES Under this component, the project promotes a participative and equitable process that achieves the commitment from the GoG, the private sector, academia, NGOs, civil society, and indigenous peoples for the formulation and implementation of a low emission development strategy. Within this framework, the main achievements of this quarter are presented as follows:

1.4.1. Result 3.1 • The Project along with the Association of Dairy Development (ASODEL) made adjustments to the environmental guide of bovine livestock, which contains the evaluation protocol for the identification of environmental impacts derived from the milk production in farms specialized in milk and dual purpose.

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 3 • The second training module on determination of carbon footprints in the agro-industrial sector was completed with the Chamber of Agriculture (CAMAGRO). The Project presented the results of the LEDS and the examples of the existing carbon footprint calculators for the coffee and pork sector..

1.5. ENCOURAGING IMPLEMENTATION THROUGH DEMONSTRATIONS Under this component, the project provides technical assistance for the implementation of actions of low emissions specific to LEDS in priority sectors to promote and present the benefits of low-emission activities. The following was performed during this quarter:

1.5.1. Result 4.1 • Progress was made with CAMAGRO in the formulation of the monitoring plan proposal for the Environment and Climate Change Policy of the Palm Growers Trade of Guatemala (GREPALMA). Goals, indicators, and implementation mechanisms for the axes related to water, mitigation and adaptation to climate change, organic and inorganic waste, soils and biological diversity were identified.

1.5.2. Result 4.2 • The dissemination was continued on the importance of the use of efficient stoves, which has facilitated access to this type of technologies to about 100 families in the municipality of Pachalum. In Huehuetenango, ADAT has promoted the use of efficient stoves as part of the implementation of the Municipal Low-emission development strategy of Todos Santos Cuchumatán, while the Association for the Development of the Cuchumatanes (ASOCUCH) promoted visits to the demonstration center by communities of San Juan Ixcoy, Huehuetenango and neighboring departments such as Totonicapán and Quiché.

1.5.3. Result 4.3 • Support was given to associations of sugar, banana and oil palm producers in the dissemination of the main mitigation options with their members, whose feedback allowed identifying the main costs or savings associated with their implementation. • Electronic tools for the calculation of GHG emissions and carbon footprint have been presented to the coordinators of the sectoral calculation methodology; based on the tests carried out and feedback from the sectors, the process of updating functionalities that will facilitate the use and adoption of these tools has begun.

• The verification process of the volume of CO2e captured in the rubber sector was completed, which will allow the emission of carbon credits for sale. Likewise, the process of retraining was carried out to the monitoring teams, which collected the information of removals for the current fiscal year.

1.5.4. Result 4.4 • The Southern Commonwealth (MASUR) completed its GHG emissions inventory. Likewise, actions to define mitigation measures, under the methodology proposed by the Project during FY2017 were initiated. In addition, the Work Group on Agriculture, Forests and Other Land Uses (AFOLU) of the Latin American and Caribbean Regional Platform of the Global Partnership on Low Emissions Development Strategies (LEDS LAC) acknowledged the low emissions development strategies at the municipal level driven by the Project.

4LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 1.5.5. Result 4.5 • The Project delivered to the technical team of the National Coffee Association (ANACAFE) the tools for calculating carbon at the level of productive, cooperative and sectoral units. • Support was given to the Association of Cardamom Exporters (ADECAR) in accounting for the planting of about 55,000 trees of cedar, palo blanco, pine and cypress, in the form of agroforestry systems, equivalent to an area of 349 hectares. Likewise, the establishment of nurseries of non-timber forest species, whose seed was collected from trees in the region begun.

1.6. SUPPORTING COMMUNICATION AND EDUCATION The Project’s strategic plan of communication disseminates the best practices to promote GHG low emissions development, through the premise "Create, Communicate, and Connect". During the October- December 2018 quarter, the following advances are highlighted in results 5.1, 5.2 and 5.3.

1.6.1. Result 5.1 • Following the communication strategy of the Project, the visibility of the Low Emissions Development Strategy was prioritized during the quarter, aiming communication towards key multisectoral audiences. • The coordination with representatives of the public sector, private sector, academia and civil society was fundamental during the first quarter of FY 2019, since it allowed for strategic outreach activities focused on socialization, visibility and behavior change.

1.6.2. Result 5.2 • In coordination with MARN and MINECO, on November 14, a public event was held to present the National Low Emission Development Strategy. • In support of the LEDS dissemination of the mitigation options and great results, an informative video was elaborated with the participation of key multisector actors involved in the two-year formulation process. The four-minute video was presented during the launch event of LEDS. • A dissemination document of the Strategy was prepared, with media contents to facilitate the understanding of the submitted information. • A photo exhibition was set up for multisector audiences with the mitigation options prioritized in the Strategy for each sector. • An exhibition and ridetesting of electric vehicles was carried out, promoting the use of efficient technologies that generate social, economic and environmental benefits, prioritized in the Strategy. • Strengthening public-private collaboration, the media were also great allies to carry key messages to target audiences, strengthening the construction of networks and connecting development-oriented actors with low emissions, through the design and publication of an information supplement of 12 pages, inserted in the newspaper Nuestro Diario, which is the largest circulation nationwide. The supplement presents the mitigation options prioritized in the Strategy, with information mediated for all audiences. Advertisers involved corporations, industries, organizations and chambers of the country that are already implementing mitigation actions as part of their planning. • The National Strategy of Sustainable Livestock with Low Emissions was illustrated and designed in coordination with the MAGA.

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 5 1.6.3. Result 5.3 • Focused on behavioral change and in coordination with the Guatemalan Cleaner Production Center, the environment unit of the municipality of Guatemala finalized the internal process necessary to be certified as "Green Office".

1.7. CROSS-CUTTING AXES

1.7.1. Environmental compliance The environmental mitigation and monitoring plans (EMMP) for two small grants were reviewed incorporating the comments of USAID and the EMMPs for two more recent small donations were finalized and remitted to USAID.

1.7.2. Rapid Response Fund There was no use of the Rapid Response Fund during this quarter.

1.7.3. Gender equity and social inclusion Social inclusion, participatory approach, departmental consultations, gender analysis, and observations of Indigenous Peoples were considerations integrated into the LEDS decision-making document for decision-makers and the LEDS technical document.

1.7.4. Small grants Figure 16 presents the status of the four grants under implementation and the progress in the corresponding disbursements, the two donations that are with USAID for approval, and one donation that is in the process of a negotiation memorandum. To date, a total of $398,342.09 has been disbursed.

1.8. MONITORING AND EVALUATION Within the first quarter of FY19, the following advances were made towards the goals of the Project’s monitoring and evaluation plan (M&E): • Indicator 1 (Indicator F 4.5.1-24): A Low Emission Development Strategy (LEDS) led by the country in each of the phases of development as a result of the assistance of the US Government. – National Strategy of Low Emission Development of Greenhouse gas emissions. In this quarter progressing to Stage 4 – Approved: See “Action plan of LEDS formulation process” and Result 5.1. • Indicator 4 (Indicator F 4.8.2-8): Number of tools, technologies and methodologies for the mitigation of and/or adaptation on climate change developed, tested and/or adopted as a result of the assistance of the US Government. – The methodology for the development of GHG inventories in the palm sector progresses to Stage 3 - Adopted. Result 4.3. – 4 tools for GHG emission inventories and Carbon footprint for each sector: palm, sugar, banana and coffee, progress to Stage 2 – Tested. Result 4.3 and 4.5. • Indicator 7 (Indicator EG.13-3): Number of laws, policies, regulations or standards, policies, regulations or standards on sustainable landscapes formally proposed, adopted or implemented, supported by the US Government’s aid. – Energy Policy 2019-2050. After its launch during this quarter, it is incorporated in Stage 2 - Adopted. Result 2.2:

6LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 • Indicator 12: Educational and communication tools designed and implemented in key sectors. – Disclosure Document of the Low Emission Development Strategy See Result 5.1. – Preparation of a four-minute video about the LEDS formulation process, its objectives, goals, sectors and opportunities for the country. Ver Result 5.2. – Preparation of a "Productive Guatemala" supplement on the LEDS, with a print-run of 88,000 copies nationwide. See Result 5.

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 7 INTRODUCTION

This progress report covers the first quarter of fiscal year 2019 (FY2019), which corresponds to the period between October 1 and December 31, 2018 of the USAID Low Emissions Development Project (Low Emission Development Strategy - LEDS), implemented by RTI International (RTI), within the framework of contract AID-520-C-14-00003. The Low Emissions Development Project supports USAID/Guatemala and collaborates with the Guatemalan government, the private sector, academia and non-governmental organizations (NGOs) to develop local capabilities for the implementation of projects for emissions reduction related to large and small scale agriculture, management of natural resources, and other land uses. The Project also supports the Government of Guatemala (GoG) to improve national inventories of greenhouse gases (GHGs) and sectoral information systems that feed inventories, in order to determine emissions projections and alternative scenarios, and implement economic analyses to identify investments that result in significant reductions in GHG emissions. This report contains six sections: section 1 describes the team advances within the five technical components of the project; section 2 summarizes the priorities for the next quarter for each component; section 3 describes the efforts of the project within the crosscutting axes of gender equity and social inclusion, the environmental compliance, and the use of the Rapid Response Fund and the small grants program; section 4 presents a summary of the contributions of the quarter to the annual and overall goals of the project, along with the progress of each activity of the annual operating plan 2019; and section 5 provides an analysis of the challenges faced during this quarter, with a discussion of the steps to take to overcome them. Finally, section 6 includes the financial summary for the quarter. The annexes detailed in the body of this document are enclosed in a compendium accompanying the report.

8LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 1. PROGRESS PER COMPONENT

This section submits the main advances of the project, in each of the five technical components, within the period of October 1 to December 31, 2018. For a summary of progress according to each defined activity within the Annual Operating Plan (AOP) for FY 2019, see Section 4 – Monitoring and Evaluation of this report.

1.1. ACTION PLAN OF THE LOW EMISSIONS DEVELOPMENT STRATEGY FORMULATION PROCESS

1.1.1. Outcome of the formulation process of the Low Emissions Development Strategy for Guatemala The formulation process of the Low Emission Development Strategy (LEDS) began in July 2016 and was led by the Ministry of Environment and Natural Resources (MARN), the Ministry of Economy (MINECO) and Presidential Secretariat for Planning and Programming (SEGEPLAN). The process contemplated the participation of six sectors: 1) Energy, 2) Transportation, 3) Industry, 4) Agriculture, 5) Forests and Other Land Uses, and 6) Waste Management; each of them led by the corresponding government entity. The process was developed in a participatory manner through six work sessions (Figure 1). Each of the mentioned sectors had representatives from the public sector, municipalities, private sector, civil society, academia, indigenous organizations, cooperatives, and organized groups. During two years of planning, dialogue and multisectoral consensus, the joint route was established with two primary purposes: to improve the quality of life of the Guatemalan population and promote economic growth, social development and environmental responsibility with low GHG emissions. This process originates the Low Emission Development National Strategy (LEDS). Figure 1. Formulation process of the Low Emissions Development Strategy for Guatemala

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 9 As a first step for each of the sectors, a baseline of GHG emissions was estimated, consisting of historical data from 1990 to 2015, and a projection from 2016 to 2050. Subsequently, the sectoral baselines were integrated, which generated a baseline of GHG emissions for the country’s overall economy (Annex 1). The integration of the sectoral baselines is shown in Figure 2. Figure 2. GHG emissions base line in the Guatemalan economy

The greatest impact on the baseline of GHG emissions corresponds to the Forestry and Other Land Use sector. This has the particularity of emitting GHG by subtracting trees from the forests, but it can also absorb GHG when establishing new plantations or conserving existing forests. The historical baseline for this sector (1990 - 2015) shows the pressure that falls on national forests to meet the needs of the country. One of them is the demand for wood for the industry and residential energy (firewood) and the other, the change of the use of wooded land to land to meet the food requirements of a growing population. Likewise, the baseline predicts the behavior in this sector after 2015 (2016 - 2050) of failing to address in a better way the causes of the current behavior of GHG emissions. Although the increase in GHG emissions is more evident in this sector, the other sectors also have a similar behavior; in other words, it presents an upward trend, under the scenario in which no mitigation measures are taken, such as those proposed in the LEDS. As a next step, for each sector, catalogs of different options were developed with the potential to reduce the tendency of their sectoral baseline. Subsequently, a prioritizing process was carried out, which resulted in 43 GHG mitigation options. The distribution of these mitigation options within each of the sectors can be seen in Figure 3. Figure 3. Number of mitigation options prioritized for each sector.

A microeconomic analysis was carried out for each of the 43 prioritized mitigation options. This analysis identified the expected changes with respect to the baseline in: a) energy production and use,

10LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 b) resource management, and c) GHG emissions, for the strategy planning period (2019 - 2050). This analysis also quantified expected implementation costs for each option. These costs included: investments, financing, energy, materials, operations and maintenance, and support costs from the government. The summary of this work is shown with the marginal cost of abatement curve (MAC) in Figure 4. Figure 4. Marginal costs of abatement curve for all sectors (2019-2050)

As a final step in the LEDS process, each of the 43 prioritized mitigation options was subject to a macroeconomic evaluation based on the review of the financial flows identified in the microeconomic analysis (savings and income) and the following six factors: • Option’s net cost vs. business-as-usual (BAU): Integration of the costs and savings of the option’s implementation in comparison to the net cost of the BAU scenario without its implementation. • Expenses avoided in energy: Changes in net efficiency or energy’s savings/consumption. • Change to local fuels: Changes in energy sources/production between imported and local. • Local supply chains: Changes in the activity of sectors that buy locally produced inputs. • Job creation: Changes to activities that require more/less labor than the one reported in the baseline. • Import substitution: Substitution of imports by national products. The results of the macroeconomic evaluation are shown graphically for each option. The positive or negative incidence of each factor is shown by the direction (ascending or descending) of the column from the midpoint. The effect of each factor is represented by the size of each of the bars and can be high, medium or low. As an example, the macroeconomic analysis for option AG-2 "Establishment and improvement of agroforestry systems" is presented in Figure 5.

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 11

12LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 1.1.2. Contributions of the formulation process of the Low Emissions Development Strategy for Guatemala The following products are left as a contribution for the country: • The National Low Emission Development Strategy (LEDS) of Greenhouse Gases (GHG) developed participatively with representatives of the public sector, private sector, academia, indigenous peoples, producer organizations and civil society, which reflects the vision of each sector oriented towards the development of the country. • A baseline of GHG emissions from the country's economy 1990 - 2050. • 43 prioritized mitigation options, based on the vision of each sector and articulated with existing national policies, programs and goals. • Impact scenarios of the implementation of the 43 options on GHG emissions of the country's entire economy and concerning the Nationally Determined Contribution (NDC) proposed by the country.

1.1.3. Impacts of the implementation of the Low Emission Development Strategy for Guatemala The implementation of LEDS mitigation options will allow the country to continue on its development path and at the same time reduce the intensity of its GHG emissions. The results indicate that, if all the options were implemented as designed, in the period 2019-2050, 2,454 million tons of CO2e would be reduced through the reduction in the consumption of fossil fuels, the conservation of forests, improvements in agriculture and proper waste management. Likewise, it is estimated that the total economic benefits (savings) for society would be 41 billion quetzals, which can be used for other necessary actions that benefit the living conditions of Guatemalans. Among other impacts of the implementation of the LEDS, are the following: • Avoided deforestation by 2050: 1.2 million hectares; equivalent to the extension of the departments of Retalhuleu, Suchitepéquez, Escuintla and Santa Rosa, as a whole. • Planted forest by 2050: 715,000 hectares; equivalent to twice the size of the department of San Marcos. • Avoided use of gasoline by 2050: 65.1 million gallons. • Avoided fuel use by 2050: equals 1,474 million gallons of gasoline.

1.1.4. Launch of the Low Emission Development Strategy for Guatemala The presentation of the LEDS formulation process results was carried out successfully with the participation of authorities from the leading entities of the process and key people that accompanied the entire formulation process. The LEDS official launch event was held on November 14, 2018 at the Barceló Hotel in Guatemala City, during which the LEDS disclosure document was submitted (Annex 2).

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 13 The Low Emission Development Strategy launch event was attended by representatives of the public sector, the private sector, civil society, academia, and indigenous peoples. Photograph:

The event was attended by 300 people from different sectors that participated in the process. A greater detail of the launch event is presented in Component 5.

1.1.5. Steps to follow Among the next steps of the process is the socialization of the LEDS. Two workshops are scheduled: a) one in the east of the country (Chiquimula or Zacapa) and b) in Quetzaltenango; both will be carried out in the second quarter of FY19. To promote and support the implementation of the 43 mitigation options prioritized in the LEDS as cost-effective options for corporations and/or individuals, visits are made to those financial entities that favor credits concerning climate change. The detail of the information is presented in Figure 6.

14LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 Figure 6. Survey of financial institutions on credit lines related to LEDS mitigation options

FINANCIAL TELEPHON FINANCIAL PRODUCTS CONTACT POSITION ADDRESS EMAIL ADDRESS ENTITY E FUNDEA Credit line for "Investment in Adaptation to Climate Change" and Product 15 2-09, Zona j (Foundation includes mitigation options such as items that can be financed: soil Manager 13. City of for Business conservation, biodigesters, improved stoves, solar panels, among Value Chains Guatemala [email protected] and others. Coordinator Agricultural The interest rate handled is 2.5% per month, which is 0.5% below Financial Development the normal rate because they recognize that measures of ) Services adaptation or mitigation to climate change support not only the Director person/family that takes the credit but also the society in general.

Banco Dutch agency (Development Finance Company, FMO) approved a Corporate Edificio Céntrica Promerica green credit line to Promerica banks in El Salvador and Guatemala, Banking Plaza Zona 10 which will finance small and medium corporations; including US$5 Manager

million for "Green tranche" or green tranche, in other words, for renewable energy promoting energy efficiency. For the short term, Business Banco Promerica will promote good environmental practices F Executive among its clients, design new green products such as financing for solar panels and give them specific financing to reduce their carbon

footprint.

Environmental Credit, aimed at corporations that see a business Ejecutiva de strategy on the subject of sustainability. C t Negocios This line of credit offers funds for: . Sustainable construction. . Low impact transport for the environment (hybrid, electric vehicles) that reduce the impact of CO2. . Sustainable tourism. . Investment in assets that contribute to the reduction of consumption of natural resources or that have a significant impact on ecosystems. Banco Azteca It does not have specific environmental products, it works with the Financial Avenida Reforma population segment of the base of the pyramid. Products 9-00 Zona 9, Director Edificio Plaza Panamericana

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 15 1.2. RELIABLE SCIENCE AND ANALYTICS This component focuses on strengthening GHG national information systems and inventories to improve the quality and accuracy of measuring, reporting, and verifying emissions reductions. Likewise, it generates economic models and projections, such as marginal cost curves of abatement, for long- term planning.

1.2.1. Result 1.1 - Analytical tools, methodologies, models and approaches improved and/or transferred to the GoG and incorporated into LEDS development processes Greenhouse Gas Emissions Base Line The distribution of the document of the GHG Emission Base Line in the Guatemalan economy began in this quarter, which has been reviewed and validated in its digital version. As an analysis tool, this effort constitutes an excellent contribution for the country since it presents the most updated GHG emissions information at the 1990-2015 date, including a projection of the future scenario for the 2016- 2050 period. Socialization of microeconomic and macroeconomic studies of the mitigation options that constitute the Low Emissions Development Strategy for Guatemala In FY2018, the efforts focused on carrying out the microeconomic and macroeconomic analysis of each of the 43 mitigation options prioritized in the LEDS formulation process. These analyzes are part of the key results of the strategy that are being socialized during FY2019, presented through: a) marginal abatement cost curves (MAC) for microeconomic analysis, and b) qualitative charts for the 6 factors defined in the macroeconomic analysis. The information provided by the microeconomic analysis is key to determine compliance with the commitments of Guatemala under the Paris Memorandum of Understanding, within which the government has committed to reduce by 2030 11.2% of GHG emissions and reach 22.6% of GHG reductions if it is supported by international cooperation. Figure 7. Comparison of the base line, the NDC and the LEDS with four possible scenarios of GHG emissions budgets that could be required by the UNFCCC to keep global warming below 2 degrees Celsius.

16LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 Although to date, the United Nations Framework Convention on Climate Change (UNFCCC) has not determined the GHG reductions that countries should reach, some possible scenarios of GHG emission budgets that could be required for each country to maintain global warming below 2 degrees Celsius have already been raised. In Figure 7, these possible scenarios are compared with: a) emissions from the GHG Emissions base line in the Guatemalan economy, b) the goals of the NDC set by the country, and c) the achievements that could be completed through the implementation of the LEDS. As noted, the implementation of the 43 mitigation options proposed by the LEDS can comply with the emissions reduction required under any of the proposed scenarios.

1.2.2. Result 1.2 – Mechanisms developed to ensure information transfer of greenhouse gas emissions (GHG) between GoG entities, key entities and partners in Guatemala, including beneficiaries in key sectors, rural and indigenous communities. LEDS Disclosure During this quarter, one of the information transfer mechanisms used was the launching event of the LEDS in which the information generated by the Project was presented, and the LEDS summary document was distributed. This event was held on November 14, 2018 at Hotel Barceló with the participation of 288 people who accompanied the process, among whom are representatives of government, municipalities, private sector, civil society, academia and indigenous peoples. It can also be mentioned as an information transfer mechanism, the presentation of LEDS results made with different organizations and institutions that have requested it. These are: • November 9: Presentation before the Coordinating Committee of Agricultural, Commercial, Industrial and Financial Associations. • December 4: Diploma course on Climate Change from Universidad del Valle de Guatemala.

1.2.3. Result 1.3 – A comprehensive system to obtain, store and manage the GHG emission and removal information established In this quarter the products generated by the Project during the previous FY were delivered to the staff of the Third National Communication Project administered by the United Nations Development Program (UNDP), who is responsible, within the MARN, for the estimation of national inventories of GHG emissions for 2012, 2014 and 2016. The products delivered were: 1) GHG estimation protocols for each sector; and 2) Listings of institutional delegates trained in the use of protocols. It is expected that the products generated by the project will be the basis for the generation of future inventories in the country. Likewise, during the next quarter, the management of the Ministerial Agreement that formalizes said protocols will be continued, a procedure that has not been resolved due to changes in the vice ministry of natural resources and climate change.

1.2.4. Result 1.4 – Models and scenarios based on alternative paths to the BAU generated and shared with the government, the private sector and civil society to promote an informed mechanism of the decision-making process concerning the low- emission development Within the main results of the LEDS are the scenarios, which show that the implementation of the 43 prioritized options could reduce the trend presented by the GHG Emissions baseline by more than 50% by 2030, and would have an impact of about 60% reduction to 2050. These amounts are much greater than the commitments proposed by Guatemala in its NDC, of an 11% reduction with its own resources and 22% if it obtains support from international cooperation.

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 17 Among the main results of the LEDS are the parallel analysis of the different scenarios around the GHG emissions reduction. For example, by implementing the 43 prioritized LEDS options, the trend of the GHG emissions baseline could be reduced by more than 50% by 2030. In the same way, it could have an impact of around 60% reduction to 2050. The amounts are much greater than the commitments proposed by Guatemala in its NDC, where it is reduced by 11% with its own resources and 22% with the support of international cooperation (see Figure 8). Figure 8. Impact scenarios of the implementation of the prioritized options in the LEDS regarding the GHG Emissions base line

These conclusions were presented at the launching event of the LEDS (November 14) and were shared in the results socialization events mentioned in Result 1.2. The importance of these scenarios is that they allow applying political criteria to implement the options, given the margin with which it exceeds the NDC goals set by the country.

1.2.5. Result 1.5 – A comprehensive system of institutionalized GHG inventories and forecasts, GHG mitigation and energy/land use change that integrates data flows between end-users, sectors and MARN to improve analysis The estimation of the 2010 preliminary inventories for the sectors of energy, industry, waste management, agriculture, and forestry, and other land uses was completed in FY2018. This preliminary inventory and the weaknesses found in the data collection were transferred and discussed at meetings (October 17, 24 and 31) with the Third National Communication Project (MARN-UNDP), which will propose to MARN its review and validation. Likewise, meetings have been held to develop a critical path for the Third National Communication Project to develop the 2012, 2014 and 2016 inventories in the short term.

1.2.6. Result 1.6 – A comprehensive system to obtain, manage and store GHG inventory and forecast data and aligned with the National Information System designated by the Climate Change Act designed, implemented and institutionalized The Project designed a conceptual model for the system of collection, management and storage of information on national inventories of GHG emissions, automated through software. Through

18LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 technical support managed by the project, the preparation of this software will be done through the Climate Technology Center and Network (CTCN) in support of MARN. The technological support that the CTCN will develop for MARN will be the platform of the National Information System on Climate Change (SNICC), within which the inclusion of GHG emissions software designed by the Project is contemplated. For this purpose, CTCN has developed a proposal for a model that was transferred for the MARN endorsement in the month of October. The proposal submitted consists of five documents: 1. Review of relevant experiences at a global and regional level with recommendations for the development and implementation of the SNICC in Guatemala. 2. Definition of the conceptual framework for the indicators and the information system. 3. Diagnosis of the status of information management on climate change in Guatemala. 4. Technical report on development and use of information platforms on climate and/or environmental change for decision making. 5. Technical proposal for the information system.

1.2.7. Result 1.7 – University professors trained to conduct micro-economic analyses to generate cost-effective estimates, abatement curves, and specific information on policies, which can be used in macro-economic analyses This activity was completed in FY2016. For more details, please see the annual report of the FY2016.

1.3. STRENGTHENING INSTITUTIONAL CAPACITIES This component aims to support the GoG, the private sector, academia and civil society to increase its capacity for the implementation of a Low Emission Development Strategy and the formulation and reformulation of policies, plans, programs and projects, as well as identifying and prioritizing investments oriented towards a low emissions development.

1.3.1. Result 2.1 – Increased GoG capabilities to obtain and process relevant basic data to design and implement LEDS in each prioritized sector Project prepares scientific article on good practices of sustainable livestock Based on the Handbook on Good Practices of Sustainable Livestock carried out by The Nature Conservancy (TNC) in coordination with the Project, an article was completed to be published in the Journal of Zootechnics of the Faculty of Veterinary Medicine and Zootechnics of Universidad de San Carlos de Guatemala. This article refers to good practices that can be implemented in the bovine livestock sector to improve productivity and socioeconomic and environmental conditions in livestock territories (Annex 3). This article was made at the request of the Faculty and is the result of the capacity building promoted by the Project through the LEDS, the Sustainable Livestock Strategy and the project profile of the NAMA1 of low emissions sustainable livestock.

1Nationally Appropriate Mitigation Actions (NAMA). NAMAs are a set of feasible activities defined in a sovereign manner by a country leading to reducing emissions in a measurable, reportable and verifiable manner.

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 19 The sustainable livestock practices described in the article have an adequate benefit/cost ratio for the livestock producer, which is demonstrated by the results of the benefit-cost analysis presented in Figure 9. This article shows that 5 of the 10 practices covered in the handbook have a benefit-cost ratio between 2 and 2.64, which means that for every dollar invested, more than two dollars are returned for the practices implemented. It is important to mention that the implementation of these practices not only generates a positive benefit-cost ratio, but also generates Intensive rotational grazing of Suazi grass at Las Violetas farm, Taxisco, Santa Rosa, strategic environmental benefits for Guatemala. Photograph: the achievement of sustainability in the territories, since they improve the characteristics of the soils, increase the infiltration of water towards the phreatic mantles, decrease the runoff and the contamination of the water resources, increase the forest cover and biodiversity in the livestock farms, generating as a result, territories adapted and resilient to climate change. According to this, it is evident that the practices present a high economic and financial viability to be incorporated in the farms, either with own funds, with State funds (incentives) or with funds from a loan. Figure 9. Cost-benefit ratios for sustainable livestock practices

PRACTICE (MITIGATION OPTION) COST-BENEFIT RATIO Rainwater collection systems 2.64 Scattered trees in pastures 2.60 Improved pastures under rational grazing 2.45 for meat and 2.04 for milk Hedgerows 2.01 Protein fodder banks 1.99

Finally, it is important to mention that the publication of this article is part of the socialization mechanisms for the implementation of LEDS mitigation options and the dissemination, communication and awareness mechanisms of axis 7 of the Low Emission National Strategy for Sustainable Bovine Livestock from the Ministry of Agriculture Livestock and Food (MAGA).

20LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 Socialization of the Handbook of Sustainable Livestock with Izabal farmers As part of the socialization mechanisms for the implementation of the LEDS and the National Sustainable Bovine Livestock Strategy of the MAGA, a low emissions sustainable livestock practices socialization event was held with the Cattle Association of the department of Izabal. (Annex 4). During the socialization 98 breeders of said department participated, as well as representatives of the Cattle Associations of Alta Verapaz, Zacapa, Chiquimula, Petén and Jutiapa. This socialization was strategic because in the department of Izabal approximately 11% of the total

Socialization of sustainable livestock practices for livestock farmers of Izabal, Alta Verapaz, Zacapa, Chiquimula, Petén and Jutiapa national cattle are concentrated; it is also a territory where livestock is practiced in a traditional way, in other words with a low animal load and with a low implementation of practices and technologies that can improve productivity, competitiveness and sustainability of livestock activity in that territory. Derived from this socialization, the Cattle Association of Izabal showed great interest to support the development of governmental and/or non-governmental programs and projects that allow the implementation of sustainable livestock practices, in order to improve living and environmental conditions from the department of Izabal. For the next quarter, the Project will carry out two more socializations in the livestock territories of Petén and southeastern area, with which it is expected to disseminate the handbook of good practices and the mitigation options of the LEDS. INAB publishes the forest calculator on its website December 12 of this year, the forest carbon calculator was published (calculadora.inab.gob.gt) on the website of the National Forest Institute (INAB). This tool allows to calculate the carbon stored in a forest plantation in a specific area and selects among 28 of the most used species within the forest incentive program (PINFOR/Probosque). To perform the calculation, select the species and know the diameter at the average breast height of the plantation, the number of trees per hectare and the average height of the plantation (Figure 10). Additionally, the tool allows projections of carbon stored over time. For example, one can think of establishing a plantation in year X1 that will be harvested in year X2, establishing the tentative year of thinning to be carried out and its intensity, and with this it is possible to estimate a projection of the

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 21 storage behavior of carbon, the diameter at breast height, height and even have an estimate of the amount of wood that could be obtained from the plantation in the year of harvest. The Carbon Calculator constitutes a significant progress for the forestry sector and its competitiveness, where institutional capacities for entering international carbon markets and the development of carbon markets nationwide are strengthened. In the same way, it is a useful tool for the country’s decision making, mainly, concerning the commitments acquired in GHG emissions reduction. Figure 10. With the support of the Project, INAB enables access to digital tools

1.3.2. Result 2.2 – Local installed capacity and climate change units strengthened through key consultants located in GoG institutions, in a sustainable manner Follow-up for the 2016 forest cover map finalization Within the framework of the cooperation agreement signed between the Project and the INAB, it relies on making adjustments to the 2016 forest cover map based on observations made by members of the Inter-institutional Monitoring Group on Forests and Land Use (GIMBUT). This product will be used to carry out inventories of GHG emissions for the year 2016 in the Forest and Other Land Uses sector, which will be in charge of the Third National Communication Project (MARN-UNDP). Currently, 50% of the observations and adjustments of the territory have been completed. For the next quarter the process of adjustment, validation and realization of the analysis of the forest coverage dynamics between the maps of 2010 and 2016 will be completed. The Project will support the INAB in carrying out the adjustments requested by GIMBUT, as well as in the realization of the launch event of the 2016 coverage map and its dynamics 2010-2016.

22LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019

The updating and analysis of the forest map of Guatemala is necessary to carry out GHG emissions inventories.

Energy Policy 2019-2050 promoting mitigation options of the Low Emission Development Strategy for Guatemala The specialist in low-emission development of the Ministry of Energy and Mining (MEM) provided technical support for updating the Energy Policy 2019- 2050. The objective is to “Establish the long-term guidelines that guarantee the supply of future energy requirements in a sustainable manner and at competitive prices; encouraging the economic growth and comfort of Guatemalan society, through the efficient use of energy resources and the infrastructure´s technification, being responsible for the conservation and compliance with environmental commitments”. The policy addresses most mitigation options for energy and transport bureaus during the LEDS formulation process and those proposed as axes of action (Annex 5). For example: • The use of biofuels, such as biodiesel and ethanol. • Insertion of mass mobilization technologies (monorails, trains or underground trains) and efficient technologies for combustion of fuels. • Encourage the use of efficient stoves and firewood saving, labeling standards for appliances, electric vehicles, among others. On the other hand, it is evident that the GoG, through some ministries, continues to create policies and instruments that encourage the implementation of the mitigation options described in the LEDS. The following instruments have been generated as a result of the cooperation agreement between the Project and the MEM during the last four years: • National Energy Plan • Indicative Plans for the Expansion of the Energy Generation and Transport System (2018-2032) • Statistical Module on reporting of greenhouse gases in the energy sector

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 23 • Energy Policy 2019-2050 Project manages to make adjustments to the Regulations of the National Public Investment System (SNIP) 2020 for the incorporation of adaptation and climate change mitigation in public investment projects As part of the follow-up for the implementation of the three specific guidelines for the inclusion of climate change in the formulation process of public investment projects, the Project in coordination with the Directorate of Public Investment of the Presidential Secretariat for Planning and Programming (SEGEPLAN) made the proposal for adjustments to the Regulations of the National Public Investment System (SNIP) 2020. This regulation instructs government institutions to consider LEDS mitigation options and to implement them (where applicable) to improve the country's capacity concerning adaptation and mitigation of climate change. Likewise, adjustments were made to the project formulation guide so that in the formulation processes of public investment projects, the threats induced by climate change and the risk management measures to be implemented in order to avoid the loss are analyzed, in order to avoid the loss of infrastructure and human lives during natural events that may cause disasters (Annex 6). For the next quarter, the Project will support the training programs that SEGEPLAN will carry out within the framework of the sectoral planning process and for public investment, planned for the year 2020. In these trainings, the Project will emphasize the specific mitigation options that can be promoted by the government sector to achieve low emission sustainable development.

1.3.3. Result 2.3 – Institutional and legal framework established to institutionalize coordination mechanisms within the GoG on LEDS, including workgroups on sectoral issues Socialization of the LEDS with leaders of the Livestock Associations of the Federación de Ganaderos de Guatemala (FEGAGUATE) and the Chamber of Dairy Farmers (CPL) Within the institutional framework strengthening, the Project supported the Sustainable Livestock promoter group to present the results of the micro and macroeconomic analysis of the LEDS mitigation options for the livestock sector. These options were presented to the Board of Directors of FEGAGUATE and CPL, and to the Presidents of the Cattle Associations of the departments of Guatemala. Approximately 25 leaders from the bovine livestock sector participated during the socialization. This evidenced the interest to replicate the socialization of the LEDS in other departments of the country and promote sustainable livestock practices for the improvement of productivity, competitiveness and environmental performance of livestock activities in the country. This group promoting sustainable livestock, which was created by the Project in coordination with the MAGA, the MARN and the Tropical Agricultural Research and Higher Education Center (CATIE), constitutes a framework for the promotion and institutionalization of actions concerning sustainable development of bovine livestock in the country. Likewise, they will be those who work with INAB as a platform to create the technical criteria for the implementation of forest incentives in livestock farms. For the next quarter, the Project will again support the Promoter Group to hold an event with livestock leaders for the socialization of the Sustainable Livestock Strategy and the LEDS. This will be done in order that the leaders of the associations of livestock farmers in the country know the technological innovations of sustainable livestock and so that they are promoted in the livestock territories for the increase of productivity and competitiveness of the sector.

24LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 1.3.4. Result 2.4 - One or two demonstration regions or municipalities implemented LEDS at the sub-national level Todos Santos Cuchumatán, Huehuetenango Since 2015, the Project works with the municipality of Todos Santos Cuchumatán, in the department of Huehuetenango, to establish a local strategy that promotes economic growth and reduces GHG emissions. During FY2018, the implementation of this strategy began through the restoration of coffee agroforestry systems and shade species, the diversification of crops through the introduction of fruit plants, the establishment of forest plantations, and the transfer of these and other capabilities to the population. The monitoring of the Association of Tinecos Farmers (ADAT), local partner, identify replicas of mitigation actions carried out from the training processes such as: a) change of traditional residential light bulbs by efficient light bulbs, b) adoption of efficient wood stoves in substitution of open burners, and c) the establishment of composters for the adequate use of waste. In addition, ADAT implemented a second phase of the agroforestry nursery with the aim of producing new fruit and shade plants for coffee. Pachalum, Quiché Based on the leadership of its authorities, the proactivity of a large part of its population and the support of cooperation projects, Pachalum, Quiché, has positioned itself as a municipal example in terms of development with low emissions. Currently the Project, through the Solar Foundation, supports the municipality to disseminate and implement actions aimed at improving the living conditions of the population and in turn reducing GHG emissions. The actions of the quarter focused on: • Forest conservation: 14 hectares of natural forest were entered into the forestry incentive program of the INAB. • Establishment of forest plantations: technical studies were carried out for the establishment of 8.7 hectares of plantations through the INAB forestry incentive programs: Probosque and PINPEP. • Efficient use of firewood: the promotion of the use of efficient stoves has generated interest in low-income families who, with the support of the Municipality, have built stoves that reduce their demand for firewood by 30%. • Waste management: trainings were coordinated with the Authority for the Sustainable Management of the Lake Amatitlán Basin (AMSA) on issues such as garbage classification, solid waste, biodegradable waste and strategies to minimize environmental pollution.

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 25 The establishment of 8.7 hectares of forest plantation in Pachalum will remove about 725 tons of CO2e in the next 20 years.

1.4. DEVELOPING PARTICIPATORY AND TRANSPARENT PROCESSES Component 3 is aimed at promoting a participative and equitable process that achieves the commitment from the GoG, the private sector, academia, NGOs, civil society, and indigenous peoples for the formulation and implementation of a low emission development strategy. Within this framework, the main achievements are presented below.

1.4.1. Result 3.1 – A comprehensive system established to ensure the involvement of the private sector, academia, NGOs and key actors of civil society Project finalizes the proposal of environmental guide for the bovine livestock sector Within the framework of the cooperation agreement signed with the Association of Dairy Development (ASODEL), the Project made adjustments to the bovine livestock environmental guide, which contains the evaluation protocol for the identification of environmental impacts derived from the production of milk in farms specialized in milk and dual purpose2 (Annex 7). This guide will be presented and officially delivered by the Project and ASODEL to the CPL and the FEGAGUATE, who, in turn, will look for the mechanisms to present it to MARN for approval. This document will be the reference for the development of the environmental instruments requested by MARN based on Governmental Agreement 137-2016 (Regulation of Evaluation, Control and Environmental Monitoring -RECSA-). The preparation of this guide is an instrument of Public Policy for the bovine livestock sector, since it will not only support the compliance of the Government Agreement 137-2016, but it will promote the implementation of the practices and technologies of the National Sustainable Livestock Strategy of the MAGA and the LEDS. This environmental guide establishes a model accepted by the livestock sector to improve its productivity and economic and environmental performance. The application of this guide will reduce environmental impacts, improve socioeconomic conditions and the country's ability to adapt and mitigate global climate change.

2Farms producing milk and meat

26LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 This result is related to result 2.3, due to the fact that it constitutes a legal framework for the institutionalization and implementation of policy instruments concerning the livestock sector. For the next quarter the Project will focus on the finalization of the environmental guide test on 10 CPL farms. Likewise, the final version of said document will be socialized and officially delivered with representatives of the CPL and the Faculty of Veterinary Medicine of the Universidad de San Carlos de Guatemala. Capacity building in the determination of carbon footprints for the agro-industrial sector Within the letter of collaboration framework signed with the Chamber of Agriculture (CAMAGRO), the second module on the determination of carbon footprints in the agro-industrial sector was completed. During the training, 30 environmental technicians from different sugar factories associated with the Sugar Association of Guatemala (ASAZGUA) participated, as well as environmental technicians from banana producing corporations affiliated with the Association of Independent Banana Producers (APIB). During this training module, participants determined carbon footprints based on activity data from their own corporations. Likewise, they elaborated general greenhouse gas mitigation plans for the reduction of carbon footprints in the productive processes of each sector. Finally, the Project presented the results of the LEDS and the examples of the existing carbon footprint calculators for the coffee and pork sector.. As a result of these trainings with CAMAGRO, the following was achieved: • Empowerment of key technicians from different private corporations related to the agro-industrial sector on issues concerning climate change and especially in the development of carbon footprints. • Interest to continue the promotion of the implementation of good agricultural practices for the greenhouse gas emissions reduction in the agro-industrial sector.

1.5. ENCOURAGING IMPLEMENTATION THROUGH DEMONSTRATIONS Under this component, the project provides technical assistance for the implementation of low emission actions specific to low emissions development in priority sectors to promote and present the benefits of low emission activities.

1.5.1. Result 4.1 – At least three policies and/or regulatory changes developed and adopted by the GoG in order to facilitate the implementation of LEDS actions nationwide Project progresses in the formulation of the monitoring plan of the Environment and Climate Change Policy of GREPALMA Within the framework of the letter of collaboration signed between the Project and CAMAGRO, progress was made with the formulation of the monitoring plan proposal for the Environment and Climate Change Policy of the Palm Growers Trade of Guatemala (GREPALMA). To this effect, goals, indicators, and implementation mechanisms for the axes related to water, mitigation and adaptation to climate change, organic and inorganic waste, soils and biological diversity were identified. This proposal

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 27 will be finalized and socialized with the GREPALMA Environmental Technical Committee during the second quarter of FY2019 (Annex 8).

1.5.2. Result 4.2 – The National Strategy for Sustainable Production and Use of Firewood, in its implementation phase Adoption of efficient wood stoves through demonstrations. In support of the implementation of the National Firewood Strategy, the Project has promoted the use and adoption of efficient firewood stoves through demonstrations. During FY2017 and FY2018, through the Rotary Club, 1,000 stoves were implemented in the Amatitlán lake basin, and during the FY2018 two demonstration centers were established so that users could know the benefits of different technologies. The dissemination of the importance of the use of efficient stoves continued during the first quarter of FY2019, through the Municipality of Pachalum, the Paso Seguro Association and the Solar Foundation, which has facilitated access to this type of technologies to nearly 100 families of the municipality. For its part, in Huehuetenango, ADAT has promoted the use of efficient stoves as part of the implementation of the Low Emission Development Municipal Strategy of Todos Santos Cuchumatán (result 2.4), while the Association for the Development of the Cuchumatanes (ASOCUCH) promoted visits to the demonstration center by communities of San Juan Ixcoy, Huehuetenango and neighboring departments such as Totonicapán and Quiché. The efficient use of firewood is a key factor in the GHG emissions reduction in Guatemala and is one of the options prioritized by the workgroups of the energy sector, the forest, and other land uses sector, within the framework of the LEDS. According to the technical analysis, the implementation of 100,000 low firewood consumption stoves will reduce the emission of 161 million tons of CO2e in the next 30 years, generating net savings to the country for Q.5,900 million quetzals in the same period.

1.5.3. Result 4.3 – At least five different agro-industrial initiatives of large and small scale to reduce GHG emissions exhibited and promoted (such as sugar, rubber, palm oil, banana, melon) Mitigation plans update Since FY2015, the Project has supported agribusiness in the identification of its main sources of GHG emissions, the prioritization of mitigation options and the establishment of mitigation plans. During this quarter, support was given to associations of sugar, banana and oil palm producers in the dissemination of the main mitigation options with their members, whose feedback allowed identifying the main costs or savings associated with their implementation. The incorporation of the economic data provided by different unions allows the generation of MAC curves for each sector, which is a new tool for planning climate actions, driven by the Project, and adopted by the organized private sector of Guatemala (Figure 11). The main axes of mitigation at sectoral level are detailed below.

28LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 Figure 11. Marginal abatement cost curve for the sugar agroindustry

• Sugar production: the electrification of irrigation systems, the recovery of forest land and the harvesting of cane without burning, are the three options prioritized by the sector. Through the outreach sessions with technical teams, the annual reduction of almost 79,000 tons of CO2e was identified as an opportunity, with combinations of costs and savings through the implementation of different mitigation actions. • Banana cropping: in coordination with APIB, a dissemination workshop was held on prioritized mitigation options, geared towards the efficiency in irrigation systems and generation of differentiated electricity. The implementation of these options in their entirety could provide annual savings of up to 50 million quetzals at the guild level, through the reduction in the use of fossil fuels, while at the level of emissions it could reduce up to 24,000 tons of CO2e per year. • Palm oil production: the main mitigation options in the sector are aimed at reducing the use of fossil fuels in transport activities, although in the visits made in the quarter to oil extraction plants, the generation of electric power was identified from the burning of biomass as an opportunity. This action would allow the electrification of irrigation systems that are currently supplied with fossil fuels. Capacity building for monitoring GHG emissions The activities of the first four years of the Project, in coordination with the productive sectors of sugar, banana and palm, have promoted the implementation of efficiency practices, aimed at GHG emissions reduction. They have also promoted the culture of monitoring GHG emissions in associations of palm and banana producers, following the example that the sugar industry has set since 2013. In order to guarantee the continuity in the monitoring of GHG emissions and to transfer the capabilities to the institutions, during the FY2018, the Project developed electronic tools for the calculation of GHG emissions and carbon footprint. During the first quarter of FY2019, these tools were presented to the coordinators of the sectoral calculation methodology; based on the tests carried out and feedback from the sectors, the process of updating functionalities that will facilitate the use and adoption of these

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 29 tools has begun. Figure 12 shows a summary of the calculation functionalities for each tool. For the next quarter, the tools will be delivered to each institution, which will be accessible through the website of each administrative institution. Figure 12. Functionalities for corporations and administrators of electronic tools for calculating carbon footprint.

Increase of sinks in rubber plantations The sale of carbon credits is a complementary activity for rubber producers, who have identified an alternative market niche in view of the price variability of said product. Since FY2016, the Project has supported the incorporation of new production areas to certificate issuance programs. This implies compliance with national labor laws, as well as contributing to other sustainable development objectives. Rubber plantations certified by carbon capture programs in Guatemala generate close to 1,200 jobs, and benefit the same number of families. They also recover land that has been degraded by other crops and remove carbon from the atmosphere. The monitoring of 1,334 hectares during FY18 reported that 48,077 tons of CO2e were captured. During the first quarter of FY2019, the verification process for this volume was completed, which will allow the issuance of carbon credits for sale. Likewise, the process of retraining was carried out to the monitoring crews, which raised the information of removals for the present FY; as part of this process, the removal of around 50,000 tons of CO2e is reported, which must be verified by each producer for the emission of carbon credits.

1.5.4. Result 4.4 – At least two integrated mechanisms to promote emissions reduction identified and promoted (for example: payment for environmental services, carbon-offset programs, watershed management) Low Emission Development at municipal level The implementation model of low-emission development strategies at the municipal level shows its effectiveness in achieving the implementation of actions through local actors. Through a five-step process consisting of organizing, evaluating, prioritizing, implementing and monitoring, the Project supports three municipalities in the definition of their emissions reduction plans oriented to local development. The actions implemented in Todos Santos Cuchumatán, Pachalum and Flores (see result 2.4) generate the interest of replication at national and international level. In the first level, the municipality of Flores in Petén designed its low emissions development strategy in FY2018, and the Commonwealth of the

30LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 South (MASUR)3 completed its inventory of GHG emissions during this first quarter of FY2019. Likewise, they initiated actions to define mitigation measures, under the methodology proposed by the Project during FY2017. At the second level, the Agriculture, Forests and Other Land Uses working group (AFOLU) of the Latin American and Caribbean Regional Platform of the Global Partnership on Low Emissions Development Strategies (LEDS LAC) identified low emissions development strategies at the municipal level, driven by the Project, as a success case to promote resilient and low carbon development.

For dissemination purposes, the Project logged the actions implemented to incorporate them into the planning framework proposed by said group, which will be published at the beginning of 2019.

1.5.5. Result 4.5 – At least five small-scale agricultural initiatives, to promote LEDS at the level of farmers' organizations and individuals. This will include innovative market- oriented, financial or incentive instruments, as well as measurement, reporting and verification (MRV) capabilities. Carbon footprint monitoring tools in coffee The income of foreign currency to Guatemala for coffee exports has declined by 40% in the last 8 years. For this reason, the National Coffee Association (ANACAFE) promotes the identification of differentiated market niches that value sustainable practices carried out by the country's coffee growers. The Project supported ANACAFE in the development of a methodology for monitoring carbon footprint in coffee production (FY2016) and in the development of electronic tools that allow extension workers of the Association to deliver results to coffee growers based on product use statistics. During the first quarter of FY2019, the Project provided the technical equipment of ANACAFE the tools for calculating carbon at the level of productive, cooperative, and sectoral units. These will be used from the 2018-2019 harvest to generate production efficiency indicators. By January 2019, regional extension workers will be trained in the use of these tools. Restoration of cardamom production systems According to MAGA4, the area of cardamom cropping doubled in the period 2003-2010; however, this expansion has also caused the loss of natural ecosystems. As a strategy to restore productive systems, the Project supports the Association of Cardamom Exporters (ADECAR) to promote the

3MASUR is made up of the municipalities of Iztapa, San José, Guanagazapa and Masagua in the department of Escuintla.

4Map of Vegetable Coverage and Land Use, at 1: 50,000 scale of the Republic of Guatemala Year 2010

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 31 diversification of products in the cardamom plantations in the north of the country, through the cultivation of timber and non-timber forest species. The objective is to establish trees such as pepper, cloves and cinnamon, among others, in a second stratum of the crop, and to add trees of mahogany, cedar, whitewood, pine and/or cypress, according to the region, in a third stratum. Under this modality the shade provided by the forest species reduces the vulnerability of the crop to pests and diseases, while the removal of carbon from the atmosphere increases. During the first quarter of FY2019, ADECAR counted the plantation of about 55,000 trees of cedar, white wood, pine and cypress, in the form of agroforestry systems, equivalent to an area of 349 hectares. It also initiated the establishment of seedlings of non-timber forest species, whose seed was collected from trees in the region.

1.6. SUPPORTING COMMUNICATION AND EDUCATION The Project’s strategic plan of communication disseminates the best practices to promote low-emission development of greenhouse gas emissions, through the premise "Create, Communicate and Connect". During the October - December 2018 quarter, important advances were made, which are described below.

1.6.1. Result 5.1 – LEDS Strategic Communications Plan produced and implemented Following the communication strategy of the Project, and with the specific objective of informing prioritized target audiences on the opportunities and benefits of the implementation of mitigation actions, it relied on: coordination with strategic partners, participation and visibility in public events with multiple audiences, the preparation of audiovisual and printed materials, the publication of print media contents, web platforms and social networks of partners and counterparts, emphasizing the social, economic and environmental benefits for the population in general. In addition, there was a photo exhibition of multisectoral mitigation actions and a demonstration and test event of electric vehicles. The activities carried out during the first quarter of FY2019 are described below. Introduction and launching of the Low Emission Development National Strategy The launch event built a platform of opportunity through mediated information to all audiences to show the results of the LEDS. This highlights the benefits and opportunities to contribute to a more competitive country with an approach to improve the quality of life of the population. At the launch event, multisectoral participation was emphasized, so strategically key actors of the process that implement mitigation actions from their spaces were integrated into the agenda. These actors had not been involved in mitigation issues or in national construction processes prior to the technical support of the Project, demonstrating an efficient and dynamic participation model that strengthens the results of the Strategy. Audiovisual, visual and printed communication tools were made as support for the understanding of the audience, which allowed highlighting each of the mitigation initiatives in a simpler way. For greater scope, social media and multisectoral web platforms were used. Below, a description of the resources and communication tools used during the event, aimed at strengthening the key message of the Strategy and empowering the audience: "Building together a prosperous, competitive and efficient Guatemala; with low emissions".

32LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 Presentation Event After two years of joint work in the formulation process of the Strategy, with representatives of the public sector, private sector, civil society, academia, and indigenous peoples, on November 14, 2018, a launch event and presentation of the National Low Emission Development Strategy was held. With the participation of more than 300 people in the event, the main board comprised of the Minister of Environment and Natural Resources, the director of the National Quality System of the Ministry of Economy and the director of USAID Guatemala, who highlighted the benefits and opportunities for the country to implement mitigation actions aimed at economic, social and environmental development. In addition, they emphasized that the great strength of the process was the construction of a strategy generated from the socioeconomic sectors of the country, which promotes a joint vision and establishes a participatory and inclusive route.

The launching event of the LEDS was attended by John Beed, director of USAID Guatemala, and representatives of MARN and MINECO. After the protocol part, an informative video was presented describing during four minutes the formulation process of the Strategy. This integrates the objectives, strategic goals, opportunities and challenges, through key actors that were part of the formulation process. As a leader from the academy, the Strategy was presented by the Director of the Private Institute of Research on Climate Change, who highlighted the support and solidity of the information contained in the LEDS. In the second part of the agenda (Figure 13), the participation of ANACAFE and the Municipality of Pachalum (Quiché) was prioritized in order to show the audience the benefits obtained by some sectors that are implementing mitigation actions. In its production chain, ANACAFE promotes mitigation practices in the field for small producers, strengthens its technical team's carbon footprint capabilities and makes its products more competitive in international markets by offering quality standards with a sustainable approach. As an intervention model in the territory, Pachalum is one of the model municipalities of the Project, which has a Low Emission Development Strategy at the municipal level. Their efforts are focused on energy efficiency, the efficient use of fertilizers and the proper management of waste. The municipal mayor of Pachalum, who had participation in the agenda, indicated that one of the initiatives implemented was the change of incandescent lights in the public lighting of the municipality by LED

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 33 lights. This practice generates economic savings to the population and generates investments to improve the municipal garbage truck for the collection of household waste. Figure 13. Launch event schedule of the National Strategy of Low Emission Development of Greenhouse Gas Emissions. TIME ACTIVITY IN CHARGE , National Quality System 08:30 - 08:35 Welcome remarks (MINECO) Director 08:35 - 08:40 Remarks USAID Guatemala Department of Climate Change 08:40 - 08:45 Remarks Director (MARN) Formulation process of the Low Emissions 08:45 - 08:55 Video Development Strategy for Guatemala Low Emission Development Strategy for , Director for the Private Institute on 08:55 - 09:25 Guatemala Climate Change Research (ICC) , Environment, Climate Change Implementation of the model with low-emission 09:25 - 09:35 and Renewable Energy Specialist development on coffee sector National Coffee Association (ANACAFE) , Mayor 09:35 - 09:45 Reducing emissions in the territory Municipality of Pachalum, Quiché 09:45 - 09:55 Youth and Low Emissions Asociación Ak´Tenamit and Sotzil Delivery of the Low Emission Development 09:55 - 10:00 Group of youngsters to participants Strategy to the sectors , Minister of Environment and 10:00 - 10:05 Closing remarks Natural Resources (MARN) The last participation was made by thirteen young people from non-governmental organizations Ak'Tenamit and Sotz'il, who from their communities implement mitigation initiatives to improve crops. The young people asked the decision makers of the country and the different sectors to consider the application of positive actions aimed on the mitigation of climate change within their planning, since the results of today's decisions will impact their long-term living conditions. Each of the points mentioned as part of the agenda were included with the objective of presenting, to multiple audiences, the solid foundations for the construction of a country strategy from a participatory and inclusive perspective. It is important to highlight the commitment of all participants and citizens for the implementation of mitigation actions from their different areas of action: sectoral, community, business or individual.

34LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 Disclosure Document of the Low Emission Development Strategy It was carried out in coordination with the Strategy's editorial committee, comprised of the Ministry of Environment and Natural Resources, the Ministry of Finance, the Presidential Secretariat for Planning and Programming and the Project, a dissemination document of the Strategy as a simplified tool that summarizes the formulation process, methodology, microeconomic and macroeconomic results of mitigation options prioritized and developed; in addition, the impacts of implementing the Strategy in the medium and long- term. Young people from Ak'tenamit deliver the dissemination document of the National Low Emission Development Strategy to the audience. The document is aimed at decision makers, partners and counterparts; and it contains simple and clear information, which through photographs and graphics provides the reader with an understanding of the mitigation options presented in the National Low Emission Development Strategy. The printed disclosure document was delivered to the participants of the event and an electronic version was made for mass distribution. It was also placed on the websites of some strategic partners from the public sector, the private sector, civil society and academia. Photo exhibition on mitigation options The day of the presentation of the LEDS event a photographic exhibition was held, showing the mitigation options prioritized and developed by each sector. The strength of the exhibition was the participation of unions and associations of the public and private sector, who delivered, to more than 300 participants, the mitigation tools that have worked with the technical support of the Project and implemented as part of the sector planning with funds of the private sector. Corporations from different sectors promote low-emission development actions that they already implement in order to make visible and tangible the mitigation options Among the participants are: prioritized in the Strategy. MARN, MINECO, ANACAFE, APIB, ASAZGUA, CAMAGRO, GREPALMA, Cementos Progreso (CEMPRO) and the Association of Renewable Fuels (ACR); who presented the progress made, in their institutional and business spaces, implementing mitigation initiatives.

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 35 Show and test drive of electric vehicles In order to promote behavior change towards the use of efficient alternatives that reduce GHG emissions, an exhibition and test drive of vehicles, motorcycles and electric chargers was conducted, aimed at more than 300 people from the academy, civil society, public sector and private sector. Likewise, with the objective of building networks, the premise of the Communication Plan of the Project, the exhibition was carried out in coordination with the magazine Energy, Efficiency and Business, comprised of the E-Mobility Guatemala group and importers of electric mobilization technologies, Universidad Galileo, among others. This event was held so that the participants knew about the alternatives of electric mobility available in the country, its operation and the alternatives in sizes and prices. The participants used the different vehicles and informed about the benefits of their use.

The audience participated in the exhibition of electric vehicles, where they could find alternatives for urban mobility with low emissions prioritized in the Strategy.

1.6.2. Result 5.2 – Communication and education tools (e.g. media campaigns, radio, newspaper, press, training modules) designed and implemented in key sectors Audiovisual broadcast In the framework of objective 1 of the Project Communication Plan: "Increase knowledge, attitudes and the use of practices and technologies related to climate change, mitigation and low-emission development", a four-minute video was produced with simple information and clear terms about the formulation process of the Low Emissions Development Strategy, its objectives, goals, sectors and opportunities for the country. Implemented initiatives that bring economic, social and environmental benefits, aimed at improving quality of life of the population were announced through Video interviews and testimonies to key actors of the public sector, private sector, academia, civil society, and indigenous peoples who were https://www.youtube.com/ part of the process. The video is being disseminated through social watch?v=chkETVix-8c networks, institutional web portals and through strategic partners that were part of the process. The video was also made with English subtitles for alternate audiences.

36LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 Radio broadcast With the aim of transferring information on the importance of implementing mitigation actions in the different sectors, in collaboration with the MARN, a thirty-minute space was coordinated in the Environmental Connection program of the TGW Guatemala radio. David Barrera, Engineer from MARN's Directorate of Climate Change participated in aninterview, and spoke about the Low Emissions Development Strategy, the formulation process and the Conexión ambiental is a radio program of the Ministry of Environment and Natural benefits for Guatemalan society. Resources (MARN). This is broadcasted on Thursdays by TGW and through the online radio of the National Coordinator for Disaster Reduction (CONRED). TGW radio is from the Government of Guatemala, so participation in these spaces strengthens the credibility and support for the national process. In addition, the target audience is small producers and peasant networks nationwide, which spreads the message of low-emission development to the whole country.

One of the important factors within the digital media are social networks. These platforms helped to disseminate and emphasize key messages that were transmitted through the different media. Web platforms and social networks content To disseminate information on the Low Emissions Development Strategy to multiple audiences and through various means, the Project generated content for the MARN website and social networks. These promote the LEDS, the prioritized mitigation options and other activities oriented to low emission development headed by the MARN. In addition, mediated information was provided to members of the public and private sectors for publication on their social networks (Annex 9). For the launch event of the LEDS, in collaboration with representatives of the public sector and the private sector, different publications were published in print media, social networks and websites, which allowed the main results of the Strategy to be brought to diverse audiences (Figure 14).

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 37 Figure 14. Media monitoring on the launching event of the LEDS

DIGITAL MEDIA https://twitter.com/PgnzzDCA/status/1062731916560994305 https://twitter.com/Dianamita86/status/1062738279139827712

MAGAZINES Revista Energía: http://www.revistaenergia.com.gt/masonry-2-columns/guatemala-le-apuesta-a-las- bajas-emisiones/ WEB PORTALS http://desarrollogt.com/

PRINT MEDIA Nuestro Diario Guatemala Productive https://www.facebook.com/GuatemalaProductiva/videos/vb.137780236307312/258066401541478/?type =2&theater STRATEGIC Embassy of the United States https://twitter.com/usembassyguate/status/1062862212266639362 PARTNERS https://twitter.com/usembassyguate/status/1062863456011993088 https://twitter.com/usembassyguate/status/1062864596107714561 Chamber of Agriculture https://twitter.com/CamagroGuate/status/1062800353211637760

MINISTRIES Ministry of Finance https://twitter.com/SNC_Alex_Pineda/status/1062733263876300805 Ministry of Environment and Natural Resources https://twitter.com/marngt/status/1062779801491136512 https://twitter.com/marngt/status/1062780883327959040 https://twitter.com/marngt/status/1062781118737534977 https://twitter.com/marngt/status/1062781526205718529 https://twitter.com/marngt/status/1062787356909015041 http://www.marn.gob.gt/noticias/actualidad/Lanzan_Estrategia_Nacional_de_Desarrollo_con_Bajas_Emi siones OTHER https://twitter.com/RTI_INTL_DEV/status/1062449777147809792 PUBLICATIONS https://twitter.com/RTI_INTL_DEV/status/1062711349803921410 https://twitter.com/RTI_INTL_DEV/status/1062735148121235456 https://twitter.com/RTI_INTL_DEV/status/1062742160049668096 https://twitter.com/RTI_INTL_DEV/status/1062743516890177536 https://twitter.com/RTI_INTL_DEV/status/1062780293424263168 https://twitter.com/RTI_INTL_DEV/status/1062782387166294016 https://twitter.com/nicolebarnesNC/status/1062727728946970626 https://www.rti.org/impact/guatemala-low-emission-development-strategy-g- leds?utm_campaign=News&utm_content=1542135416&utm_medium=social&utm_source=twitter

Printed media As a result of the construction and strengthening of networks, and with the objective of disseminating information about LEDS to civil society, 88,000 copies of the Guatemala Productiva supplement were published. The supplement was published on November 13, 2018 in the newspaper Nuestro Diario, the printed media with the largest circulation nationwide. The supplement presented information on mitigation opportunities for the different productive sectors of the country and was carried out in coordination with strategic partners of the private sector that were part of the strategy formulation process. The partners that participated already have business planning oriented towards efficiency and improvement in processes, from a social, economic and environmental development perspective (Figure 15). The coordination and preparation of the supplement is the first exercise carried out by USAID Projects, which is financed entirely by the private sector, which is adjusted to the contents prepared for publication. It is essential to highlight that the advertisers of the supplement used the space to highlight actions that have been jointly carried out with the Project. Through the supplement of sixteen

38LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 pages, the target audience was able to learn about the benefits and opportunities of implementing mitigation actions, such as the case of Pachalum, which with the change of incandescent light bulbs by LED technology in street lighting has obtained savings of Q.250,000.00 for Guatemalan families. These benefits have already been transferred to the user, who has invested them in improvements to the community's solid waste cleaning truck. The content of the supplement is linked to low-emission development and efficient environmental management, from the different sectors prioritized in the LEDS: energy, transport, industry, agriculture and livestock, forests and other land uses, and waste management. Figure 15. Partners of the private sector that participated in the publication of the "Guatemala Productiva" supplement

PARTNER CONTENTS

. Environmental and Climate Change Policy of GREPALMA and its Palm Growers Trade (GREPALMA) partners.

. Environmental and Climate Change Policy of the Chamber of Chamber of Agriculture (CAMAGRO) Agriculture.

. Carbon footprint of sugar in Guatemala Sugar Cane Growers Association of Guatemala . Renewable Energy of sugarcane . Green technology Cementos Progreso . Environmental education . Sustainable solutions for sewage management National Coffee Association (ANACAFE) . Coffee and agroforestry systems

Association of Renewable Fuels . Ethanol in Guatemala

E-Mobility Guatemala . Electric mobility for Guatemala

Association of Independent Banana Producers . Low Emission Development Strategy (APIB)

Guatemala Productiva is a supplement to Nuestro Diario, the most widely circulated print media in the country. The publication of 88,000 copies financed by the private sector was carried out as part of the launch of the LEDS.

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 39 With the objective of promoting the mitigation practices and technologies prioritized in the Low Emissions Development Strategy, the design and layout of the National Strategy of Sustainable Livestock with Low Emissions was carried out in coordination with the MAGA. This strategy is the result of a work process of more than one year with representatives of the public sector, private sector, academia and organizations of dairy products and meat in the country, who will be the guarantors of implementing and promoting the sustainability practices proposed.

1.6.3. Result 5.3 – Civil society awareness and increased public perception of LEDS and mitigation of climate change, measured through surveys and other methodologies (e.g. baselines and final surveys) Aiming on behavior change oriented towards the implementation of practices for economic and environmental sustainability with low emissions, in coordination with the Guatemalan Cleaner Production Center, the "Green Office" program was implemented in the Municipality's Environment Department from Guatemala. The program promotes the change of behavior within the workplace, in order to encourage corporations to switch on a responsible and sustainable operation. This not only optimizes resources, it also generates savings and benefits the quality of life of people within the institution. During the execution of the program, an initial diagnosis was made that allowed to know the situation of the Direction concerning water consumption, energy management, waste management, GHG emissions, transport and sustainable purchases. Subsequently, actions were implemented aimed at improving the short, medium and long-term trend, monitoring progress through performance indicators. After two years of process, the Environment Directorate of the Municipality of Guatemala, fulfilled all the requirements for implementation and follow-up, certifying itself as "Green Office". During the certification delivery event, the mayor of Guatemala City was present, who proposed to implement this initiative in all the municipal units and buildings, implementing an action network aimed at stronger mitigation.

40LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 2. PRIORITIES FOR THE NEXT QUARTER

This section summarizes the priorities for the period from January 1 to March 31, 2019, for each of the five technical components, based on the programming of the FY2019 work plan.

2.1. LED STRATEGY FORMULATION The priorities for the coming quarter will focus on the following activities: • Perform two workshops to socialize the LEDS in different departments of Guatemala. • Continue with visits to financial entities and update the study of financial mechanisms for the implementation of the LEDS

2.2. RELIABLE SCIENCE AND ANALYTICS The priorities for the coming quarter will focus on the following activities: • Continue with the management of the Ministerial Agreement that formalizes sectoral protocols for national inventories of GHG emissions (Result 1.3). • Support and follow-up to UNDP-MARN in the preparation of GHG emissions inventories 2012 and 2014 and the Biennial Update Report 2016 within the framework of the Third National Communication (Result 1.5). • Coordinate with CTCN the development of the SNICC (Result 1.6).

2.3. STRENGTHENING INSTITUTIONAL CAPACITIES The priorities for the coming quarter will focus on the following activities: • Perform two socialization events of the Handbook of Sustainable Livestock and the LEDS mitigation options in the livestock territories of Petén and Southeast (Result 2.1). • Support to INAB in the realization of adjustments and a launching event for the forest coverage map of 2016 and its dynamics 2010-2016 (Result 2.2). • Support the training process that SEGEPLAN will carry out in the framework of sectoral planning and public investment for 2020 (Result 2.2). • Perform an event with livestock leaders for the socialization of the Sustainable Livestock Strategy and the LEDS (Result 2.3). • Delivery of reports of activities carried out with the support of the Project to the municipal authorities of Todos Santos Cuchumatán and Pachalum (Result 2.4).

2.4. DEVELOPING PARTICIPATORY AND TRANSPARENT PROCESSES Priorities for the next quarter will focus mainly on the following activities:

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 41 • Coordinate with ASODEL the testing and implementation of the environmental guide of bovine livestock in 10 additional farms; socialization and official delivery of the guide (Result 3.1). • Coordinate with ANACAFE the preparation of a monitoring and evaluation plan for its environment and climate change policy (Result 3.1).

2.5. ENCOURAGING IMPLEMENTATION THROUGH DEMONSTRATIONS The priorities for the coming quarter will focus on the following activities: • Finalize the formulation of the instruments for the implementation of the Environment and Climate Change Policy of GREPALMA (Result 4.1). • Delivery and training in the use of electronic tools for the calculation of GHG emissions and carbon footprint to associations of coffee, sugar, banana and palm oil producers (Result 4.3).

2.6. SUPPORTING COMMUNICATION AND EDUCATION The priorities for the coming quarter will focus on the following activities: • Update the Project’s web page and boost its contents. • Support in carrying out the LEDS presentation events at the regional level. • Deliver outreach materials on mitigation practices and technologies included in municipal LEDSs for local distribution. • Coordinate with the Chamber of Agriculture to conduct an event for the introduction of the implemented low emission initiatives.

42LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 3. CROSS-CUTTING AXES

This section contains information pertaining to compliance with USAID’s environmental procedures, the use of the ‘Rapid Response Fund’, gender equity and social inclusion in the implementation of the project, the program of grants and reports to TraiNet.

3.1. ENVIRONMENTAL COMPLIANCE The mitigation and environmental monitoring plans (EMMP) for two small donations were reviewed and updated incorporating the comments and modifications requested by USAID, namely: 1) Demonstration project: Supplies for the low-emission development municipal strategy of Todos Santos Cuchumatán, implemented by ADAT, and 2) Demonstration project: Cardamom production with a focus on Low Emission Development, implemented by ADECAR. The EMMPs for the two most recent small donations were finalized and remitted to USAID, namely: 1) Support for the implementation of practices of greenhouse gas emissions reduction in the municipality of Pachalum, implemented by FUNSOLAR, and 2) Transforming Guatemalan coffee production into a climate-smart agricultural system, implemented by Anacafé. Following the supervision recommendations presented in the EMMPs, a monitoring tour in Q2FY19 is scheduled for all the grantees to verify compliance with the respective proposed actions of environmental mitigation.

3.2. RAPID RESPONSE FUND There was no use of the Rapid Response Fund during this quarter.

3.3. GENDER EQUITY AND SOCIAL INCLUSION

3.3.1. Quarterly Progress Integration of social inclusion considerations in the documents of the Low Emission Development Strategy In this first quarter of FY2019, the main activity was the review of the LEDS decision-making document and the LEDS technical document, ensuring that the topics of social inclusion, participatory approach in the methodological part, departmental consultations, results of the analysis of gender for twelve mitigation options and the observations of Indigenous Peoples were incorporated and well represented.

3.3.2. Priorities for the next quarter The priorities for the following quarter are: 1) the socialization of the LEDS with MAGA extension workers that are part of the “Casa y Hogar Saludable" program, and with Indigenous Peoples organizations (possibly the Indigenous Council on Climate Change); and 2) the elaboration of a document that compiles the experience of incorporating "social inclusion" in in a cross-cutting manner in the actions of the Project from the first FY to date.

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 43 3.4. SMALL GRANTS Figure 16 presents the donations under implementation and the progress in the corresponding disbursements. These activities directly contribute to the objectives of various components of the Project, mainly in components 2, 4 and gender equity and social inclusion. The details of the technical advances are described within the sections corresponding to those results. Figure 16. Small grants summary MAXIMUM RESULT NAME OF GRANT SUMMARY OF ACTIVITY STATUS AMOUNT R2.4 Demonstration Project: This demonstration project aims to create Under Inputs for the Low local capabilities for GHG emissions implementation Emission Development mitigation and to generate inputs for the Municipal Strategy of formulation of the low emission Disbursement Todos Santos development municipal strategy of Todos to date: Cuchumatán Santos Cuchumatán.

Grantee: Association of Tinecos Farmers (ADAT) R4.2 Demonstration Project: The objective of this demonstration Under Adoption of Chapina project is to serve as an input to the low- implementation Bonita stove as a emission development strategy and contribution to the Low contribute to the GHG emissions Emission Development mitigation, particularly in the forestry and Disbursement Strategy land use sector (FOLU). The activity to date: contributes to the objectives of the Grantee: Rotary Club National Strategy for the Production and US$43,466.00 Eastern Guatemala Sustainable Use of Firewood. R4.5 Demonstration Project: The objective of this pilot project is to Under Cardamom production promote a model of cardamom implementation with a focus on Low production within the framework of the Emission Development GHG emissions mitigation and to save Disbursement the capacity of the remaining forest cover to date: Grantee: Association of as carbon dioxide (CO2) sinks, Cardamom Exporters strengthening the low-emission (ADECAR) development in the FOLU sector. Gender Strengthening the The objective of this demonstration Under and Social Indigenous Council of project is to technically and institutionally implementation Inclusion Climate Change to strengthen the Indigenous Council of influence the National Climate Change, improving its advocacy Disbursement Council on Climate capacity in favor of the collective rights of to date: Change and indigenous peoples in Guatemala, as well contributing to the as its contributions to the process of building of the Low construction of the Low Emission Emission Development Development Strategy from the base of Strategy. indigenous knowledge.

Grantee: Asociación Sotz’il R2.4 Support for the Support the Municipality of Pachalum, in Under Implementation of the department of Quiché, to promote implementation Practices for the and implement its low emissions Greenhouse Gas development strategy, strengthening Disbursement Emissions Reduction in capabilities in the population to adapt to to date:

44LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 MAXIMUM RESULT NAME OF GRANT SUMMARY OF ACTIVITY STATUS AMOUNT the Municipality of climate variability and reduce the intensity Pachalum of GHG emissions.

Grantee: FUNSOLAR R4.5 Transforming Improve the Guatemalan coffee Memorandum Guatemalan coffee production through the use of a of negotiation production into a technological tool with the ability to forwarded to climate-smart estimate the nutritional needs of each USAID agricultural system productive unit to increase its productivity, reduce production costs and Grantee: ANACAFE reduce GHG emissions through the rational use of agricultural inputs.

3.5. INPUTS TO TRAINET Training data for this quarter have been entered into the TraiNet system.

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 45 4. MONITORING AND EVALUATION

Within the first quarter of FY2019 the following advances were made towards the goals of the monitoring and evaluation plan (M&E) of the Project: • Indicator 1 (Indicator F 4.5.1-24): A Low Emission Development Strategy (LEDS) led by the country in each of the phases of development as a result of the assistance of the US Government. – National Strategy of Low Emission Development of Greenhouse gas emissions. In this quarter progressing to Stage 4 – Approved: after its official launch by the Government of Guatemala. See “Action plan of LEDS formulation process” and Result 5.1. • Indicator 4 (Indicator F 4.8.2-8): Number of tools, technologies and methodologies for the mitigation of and/or adaptation on climate change developed, tested and/or adopted as a result of the assistance of the US Government. – The methodology for the development of GHG inventories in the palm sector advances to Stage 3 - Adopted, after its use to generate and present its first sectoral GHG inventory during the last quarter (see annual report FY 2018), and its use in the development and testing of the tool for GHG emission inventories during this quarter. Result 4.3. – 4 tools for GHG emission inventories and Carbon footprint for each sector: palm, sugar, banana and coffee, progress to Stage 2 – Tested. Result 4.3 and 4.5. • Indicator 7 (Indicator EG.13-3): Number of laws, policies, regulations or standards, policies, regulations or standards on sustainable landscapes formally proposed, adopted or implemented, supported by the US Government’s aid. – Energy Policy 2019-2050. After its launch during this quarter, it is incorporated in Stage 2 - Adopted. Result 2.2: • Indicator 12: Educational and communication tools designed and implemented in key sectors. – Dissemination document of the Low Emission Development Strategy, which summarizes the process of formulation, methodology, micro and macroeconomic results of the 43 mitigation options prioritized and developed, as well as the impacts of its implementation in the medium and long term. See Result 5.1. – Preparation of a four-minute video about the LEDS formulation process, its objectives, goals, sectors and opportunities for the country. Ver Result 5.2. – Preparation of a "Productive Guatemala" supplement on the LEDS, with a print-run of 88,000 copies nationwide. See Result 5.

46LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 Figure 17. Goals for FY2019

PROGRESS PROGRESS PROGRESS PROGRESS GOAL PROGRESS INDICATOR PROJECT GOAL FY15 FY16 FY17 FY18 FY19 Q1 Indicator 1 (Indicator F 4.5.1-24): A Low Emission Phase 1 – Phase 1 – Phase 1 – Stage 2 – Stage 5 – Stage 4 – Stage 5 - Implementation Development Strategy (LEDS) led by the country in Analyzed Analyzed Analyzed Developed Implementati Approved each of the phases of development as a result of the on: assistance of the US Government. Indicator 2 (Indicator EG.13-6): GHG emissions, -- -- 62,981 57,906 60,000 -- 180,000 estimated in metric tons of CO2e, reduced, sequestered or avoided in sustainable landscapes supported by the assistance of the US Government. Indicator 3 (Indicator EG.13-7): Projection of GHG -- -- 57,217,674 -- 635,000 -- 1,431,000 emissions reduced or avoided by 2030 by laws, policies, regulations or adopted technologies related to sustainable landscapes supported by the assistance of the US Government. Indicator 4 (Indicator F 4.8.2-8): Number of tools, Stage 1 – Stage 2 – Stage 2 – Stage 1 – Stage 3 - -- Stage 2 – Tested: 5 technologies and methodologies for the mitigation of Developed: 5 Tested: 5 Tested: 1 Developed: 5 Adopted: 3 Stage 3 - Adopted: 13 and/or adaptation on climate change developed, Stage 3 - Stage 3 - Stage 2 – tested and/or adopted as a result of the assistance Adopted: 1 Adopted: 3 Tested: 2 Total: 18 of the US Government. Stage 3 - Total: 4 Adopted: 5

Total: 12 Indicator 5 (Indicator EG.11-1): Number of people -- -- 159 94 100 -- 400 trained in adaptation to climate change supported by the assistance of the US Government. Indicator 6 (Indicator EG.13-1): Number of people 315 346 906 582 400 -- 1,800 trained in sustainable landscapes supported by the assistance of the US Government. Indicator 7 (Indicator EG.13.3): Number of laws, Stage 1 – Stage 1 – Stage 1 – Stage 1 – -- Phase 2 – Stage 1 – Proposals: 5 policies, regulations or standards, policies, Analyzed: 2 Analyzed: 1 Proposals: 1 Proposals: 0 Adopted: 1 Stage 2 - Adopted: 3 regulations or standards on sustainable landscapes Phase 3 – Phase 2 – Stage 2 – Stage 2 - Stage 3 – Implementation: 1 formally proposed, adopted or implemented, Submitted: 2 Drafted: 2 Adopted: 3 Adopted: 7 Total: 1 supported by the US Government’s aid. Phase 4 – Phase 3 – Stage 3 – Stage 3 – Total: 9 Approved: 2 Submitted: 1 Implementati Implementatio Phase 4 – on: 2 n: 1 Approved: 2 Stage 5 – Total: 6 Total: 8 Implementati on: 1

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 47 PROGRESS PROGRESS PROGRESS PROGRESS GOAL PROGRESS INDICATOR PROJECT GOAL FY15 FY16 FY17 FY18 FY19 Q1 Indicator 8 (custom): Successful experiences of -- -- 5 4 3 -- 10 sectors implementing emissions reduction activities that expand or replicate in other sectors. Indicator 9 (Indicator F 4.6.2-10): Corporations -- 9 15 2 4 -- 20 receiving assistance from the US Government to invest in improved technologies. Indicator 10 (custom): Large, medium and small 2 2 2 6 3 -- 10 productive initiatives exhibited and promoted for GHG emissions reduction. Indicator 11 (Indicator EG.13-4): Investment -- 0 -- amount released for sustainable landscapes supported by the assistance from the US government. Indicator 12 (custom): Educational and 11 23 17 11 8 3 36 communication tools designed and implemented in key sectors. Indicator 13 (custom): Proportion of women 26% 37% 29% 25% 40% -- 40% participating in programs assisted by the US Government designed to reduce GHG emissions.

5For this quarterly report we are correcting the amount of investment mobilized for FY17 (originally reported as $407,502)

48LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 Figure 18. Progress according to the annual operating plan for FY2019

FY 20186 RESULT, ACTIVITIES AND TASKS PRODUCTS PROGRESS7 Q1 Q2 Q3 Q4 Action plan for the Low Emission Development Strategy (LEDS) LED strategy delivery to the GoG: Final documents of the Low a. Development and integration of the final documents (technical and summary) of the LEDS X√ Emission Development Strategy MC b. Review and edition of both final documents of the LEDS X delivered PAP c. Delivery of final documents to the GoG X PAP Promotion and dissemination of actions in the LEDS: LEDS disseminated a. Support to GoG for official launch of LEDS X√ MC b. Two workshops to disseminate LEDS in different departments of Guatemala (e.g. Quetzaltenango, Izabal, Zacapa, Petén) combined with demonstration areas to expose low X X PAP emission practices and technologies Determine monitoring structure of the LEDS X X Monitoring structure defined PAP Promote financing for the LEDS implementation: Study of financial mechanisms a. Follow-up meetings with financial institutions X X updated PAP b. Update the financial mechanisms study X X PAP Component 1: Establishing Reliable Science and Analytics Result 1.1: Analytical tools, methodologies, models, and approaches are improved and/or transferred to the GoG and incorporated into LEDS development processes Socialize and disseminate the marginal abatement cost curves (MAC curves) and the results of MAC curves models disclosed X X PAP the macroeconomic analysis for the six sectors (in coordination with the LEDS activities) Two trainings in interpretation of MAC curves, modeling and development of policy scenarios 20 professionals trained in X interpreting MAC curves and NP modeling policy scenarios Result 1.2: Mechanisms developed to ensure information transfer of greenhouse gas emissions (GHG) between GoG entities, key entities and partners in Guatemala, including beneficiaries in key sectors, rural and indigenous communities Coordination with the Climate Technology Center and Network (CTCN) the development of the Online mechanism to share SNICC web portal for consultations on inventories and mitigation actions in Guatemala: information on GHG emissions a. System development X X with different users in Guatemala PPAP b. Dissemination and training of users (institutional delegates) X X PPAP Two workshops to disseminate the LEDS in different departments of Guatemala (in LEDS promoted and disseminated X X PAP coordination with the activities of the LEDS)

6 X = Scheduled; √ = Completed 7 MC = Milestone Achieved; PAP = Progress According to Plan; PPAP = Partial Progress According to Plan; NP = Not Programmed for this Quarter

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 49 FY 20186 RESULT, ACTIVITIES AND TASKS PRODUCTS PROGRESS7 Q1 Q2 Q3 Q4 Result 1.3: The establishment of a comprehensive system to obtain, store and manage GHG emission and removal information Promote ministerial agreement to formalize sectoral protocols (Result 4.1) X Ministerial agreement PPAP Result 1.4: Models and scenarios based on alternative steps of BAU generated and shared with the government, private sector and civil society to promote an informed process of the decision making process concerning low-emission development. Socialize and disseminate scenarios based on the alternative route to the BAU of the 43 Scenarios based on proposed prioritized actions X√ actions and MAC curves for the MC six sectors, disseminated Two trainings in interpretation of MAC curves, modeling and development of policy scenarios 20 professionals trained in (Result 1.1) X interpreting MAC curves and NP modeling policy scenarios Result 1.5: A comprehensive institutionalized system of GHG inventories and forecasts, GHG mitigation and energy/land use change, integrates data flows between end-users, sectors, and the MARN, to improve the analysis Support to UNDP and MARN in the preparation of GHG inventories 2012 and 2014 and the X X PAP Biennial Update Report 2016 (within the framework of the Third National Communication) Result 1.6: Implementation and institutionalization of a comprehensive system to obtain, manage and store GHG inventory and forecast data aligned with the National Environmental Information System designated by the Climate Change Law Data collection system of GHG emissions and removals integrated to the SNICC in coordination Online system built for with the CTCN: consultations on GHG inventories, a. Development of system inventories (Result 1.5) X X NDC and other information on PPAP b. Create a website to implement the SNICC online system X X climate change PPAP Component 2: Building Institutional Capacity Result 2.1: The GoG increased capabilities to obtain and process relevant basic data to design and implement LEDS in each prioritized sector Development of the National Strategy for Sustainable Livestock Support to TNC in the development of 3 socialization events of the Handbook on Good Socialized guide with 60 people in X NP Practices of Sustainable Livestock three events Support to ASODEL in the socialization of the Bovine Livestock Environmental Guide X X Socialized guide with 50 people PAP At least one socialization event of the Sustainable Livestock Strategy with low emissions with Socialized strategy with 20 X PAP the leaders of the Cattle Associations of the country's departments. livestock leaders of the territories Support to CATIE in the socialization of financial mechanisms for sustainable livestock Financial mechanisms socialized X NP in an event Result 2.2: Local installed capacity and climate change units strengthened through key consultants located in GoG institutions, in a sustainable manner Support to MARN Follow up and support the MARN in the conceptualization and design of the SNICC X X X Summary of the provided support PPAP Support to INAB Support to INAB for a socialization event of the 2016 forest cover map Summary of support provided to X X PAP INAB

50LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 FY 20186 RESULT, ACTIVITIES AND TASKS PRODUCTS PROGRESS7 Q1 Q2 Q3 Q4 Support to SEGEPLAN Support to SEGEPLAN in the socialization of the guides carried out by the Project for the Guides presented in 3 X X PAP incorporation of the topic of climate change in public investment projects socialization events Support to the SEGEPLAN in the incorporation of the advances of the LEDS in the national National report(s) containing the X X PAP reports carried out by SEGEPLAN for the Government of Guatemala progress of the LEDS Result 2.3: Legal and institutional framework established to institutionalize coordination mechanisms within the GoG in LEDS, including work groups on sectoral issues Support for LEDS socialization events outside the department of Guatemala (In coordination 2 LEDS socialization events X X PAP with LEDS activities) Support to GIMBUT for the process of approval and formalization of the map of forest coverage X X PAP of 2016 (Result 2.2) Support to the Sustainable Livestock Promotion Group for the implementation of the NAMA on 2 events held X X X PAP Sustainable Livestock (with the support of CATIE) Result 2.4: One or two demonstration regions or municipalities implementing LEDS at the subnational level LEDS of Todos Santos Cuchumatán under implementation Monitor the agroforestry systems established in FY18 Monitoring of agroforestry X X PAP systems Monitor the implementation of the second phase of agroforestry nurseries Monitoring of agroforestry X NP nurseries Delivery of the process report and conclusion to the municipal authorities Report delivered to municipal X NP authorities Pachalum LEDS under implementation Promote the implementation of agroforestry systems X X Agroforestry systems promoted PAP Support on the training of low-emission development actions Community trained in LEDS X X PAP activities Monitor the implementation of the actions of the LEDS of Pachalum X X Action monitoring of the LEDS PAP Delivery of the process report and conclusion to the municipal authorities Report delivered to municipal X NP authorities Component 3: Developing Participatory and Transparent Processes Result 3.1: A comprehensive system, established to ensure the involvement of the relevant private sector, academia, NGOs and key actors of civil society Support the environmental and climate change mitigation plan (from farm to market) for partners and suppliers of ASODEL Support to ASODEL in the implementation of the environmental guide in at least 5 farms Report on the results of the 5 X X PAP farms evaluated Support the environment and climate change policy of ANACAFÉ Support to ANACAFÉ in the definition of a proposal for the monitoring of its environment and Report of the given support to the X X PAP climate change policy ANACAFÉ

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 51 FY 20186 RESULT, ACTIVITIES AND TASKS PRODUCTS PROGRESS7 Q1 Q2 Q3 Q4 Support to CAMAGRO Support for CAMAGRO in the creation of the environmental unit and climate change Report of the given support to the X X PAP CAMAGRO Conducting a training event on carbon footprint with the private sector (CAMAGRO) X√ At least 20 trained professionals MC Component 4: Promoting Implementation through Demonstrations Result 4.1: At least 3 policies and/or changes in regulations developed and adopted by the GoG to facilitate the implementation of LEDS actions nationwide Assistance to GREPALMA Support to GREPALMA in the formulation of at least one instrument for the implementation of Report on the support provided to X PAP the Environment and Climate Change Policy GREPALMA Result 4.2: The national strategy for sustainable production and the use of firewood, in the implementation phase Support the dissemination of the demonstration center of saving stoves in the Western Demonstration center of saving X PAP Highlands stoves promoted Support to agroforestry systems as a sustainable source of firewood (Results 2.4 and 4.5) Agroforestry systems X X PAP implemented Provide communication tools on efficient use of firewood to local actors (e.g. MEM, INAB, Communication tools delivered to X X PAP Municipalities) local actors Monitor the implementation of saving stoves in four communities of the department of Monitoring report on the X PAP Guatemala implementation of saving stoves Delivery of equipment for efficiency evaluation of saving stoves to research center Equipment delivered to a research X X NP center Result 4.3: At least 5 different agro-industrial initiatives of small and large scale to reduce GHG emissions demonstrated and promoted (such as sugar, rubber, palm oil, banana, melon) Increase of carbon stocks in rubber plantations Monitoring of plantations to validate an increase in carbon stocks Report of measurements of the X√ MC increase of carbon stocks Low Emission Development on sugarcane Validate mitigation proposals with sugarcane producers Mitigation proposals validated with X√ MC sugarcane producers Support the disclosure of prioritized mitigation actions for sugarcane production Priority actions communicated to X√ MC stakeholders of interest Technical assistance to users of the tool for inventories of GHG emissions Technical staff trained in the use X X PAP of the GHG emissions calculator Low Emission Development on banana Validate mitigation proposals with banana producers Mitigation proposals validated with X√ MC banana producers

52LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 FY 20186 RESULT, ACTIVITIES AND TASKS PRODUCTS PROGRESS7 Q1 Q2 Q3 Q4 Support the disclosure of prioritized mitigation actions for the banana production Priority actions communicated to X√ MC stakeholders of interest Technical assistance to users of the tool for inventories of GHG emissions Technical staff trained in the use X X PAP of the GHG emissions calculator Low Emissions Development on palm oil Technical assistance to users of the tool for inventories of GHG emissions Technical staff trained in the use X X PAP of the GHG emissions calculator Low Emission Development in pork production Deliver tool for GHG emissions assessment to CAMAGRO Tool for estimation of emissions X PAP delivered to CAMAGRO Support for the disclosure of the tool for GHG emissions assessment Tool socialized with pig farmers X X PAP and sectoral actors Result 4.4: At least two comprehensive mechanisms to promote emissions reduction, identified and promoted. For example: payment for environmental services, carbon-offset programs Administrative-territorial approach: Municipal LEDS Support to the Southern Commonwealth (MASUR, which includes Escuintla, Puerto San José, MASUR finalizes its climate action X PAP Iztapa and Guanagazapa) in climate planning planning Support for the dissemination of the municipal LEDS approach in regional platforms Municipal LEDS socialized in X X PAP regional platforms LED actions implementation monitoring in Todos Santos Cuchumatán and Pachalum. LED actions implemented in X X Todos Santos Cuchumatán and PAP Pachalum. Economic-sectoral approach: restoration of productive agricultural landscapes Monitoring of forest nurseries and agroforestry systems to improve the production of cardamom Monitoring of agroforestry X X PAP (Result 4.5) nurseries Monitoring of agroforestry actions in coffee production (Result 2.4) Monitoring of agroforestry X X PAP nurseries Support the use of the tool for forest carbon estimation Socialization events and training X X PAP in the use of the forest calculator Result 4.5: At least five small-scale agricultural initiatives to promote LEDS among farmers’ organizations and individuals. This will include innovative instruments aimed at markets, financial or incentives, as well as measurement, reporting, and verification (MRV) capabilities) Low Emission Development in national coffee production Support for disclosure of tools for GHG assessment Tool for estimating GHG delivered X X PAP to extension workers Technical assistance to users of the GHG estimation tool with training for field technicians on X X PAP GHG inventories

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 53 FY 20186 RESULT, ACTIVITIES AND TASKS PRODUCTS PROGRESS7 Q1 Q2 Q3 Q4 Low Emission Development in cardamom production Support to the implementation of nurseries to restore landscapes with cardamom production X√ Established community nurseries MC Administrative processes training for cardamom extension workers Cardamom extension workers X√ MC trained Monitor the implementation of nurseries X X Monitoring of community nurseries PAP Sustainable and resilient production of corn and beans Delivery of training materials to government extension workers, NGOs and cooperation Training material delivered to X X PAP programs. extension workers Sustainable livestock Support to socialization of the National Strategy for Sustainable Livestock National Strategy for sustainable X X PAP livestock disclosed Training for GHG emissions assessment tool for dairy farmers Actors trained to use the tool to X X PAP estimate GHG emissions Component 5: Supporting communications and education Result 5.1: LEDS Strategic Communications Plan produced and implemented Promote and disseminate LEDS: Increased awareness of LEDS and mitigation policies Report on program and recorded audio Media campaign: At least two television, media or radio programs of 15 minutes promoting the X X PAP seven sectors of the LEDS: transport, energy, industry, FOLU, waste, urbanism and agriculture.

Panelists: Representatives of the GoG and private sector Launch of the LEDS: An event to introduce the LEDS, conferences on the seven sectors, Report on event with photos, demonstration area with technologies and mitigation practices, financial mechanisms, technical X√ publications on social media MC support and suppliers of mitigation technologies. LEDS regional events: Support to hold two regional events in different departments of Report on event with photos, Guatemala (eg. Quetzaltenango, Chiquimula) presenting technologies and mitigation practices X X publications on social media PAP (in coordination with the activities of the LEDS) Collaborative relationships with the private sector to promote mitigation practices, technologies Activity reports, Building Networks and GHG tools developed with the support of the Project: bulletins, social media content X NP Final event with agroindustrial counterparts to highlight the mitigation tools that have been developed for the sector (e.g. palm, banana, coffee, pork and sugar) Provide crosscutting communication support to Components 1 – 4 activities, prioritizing support Activity reports, Building Networks for national and sub-national LEDS initiatives, tools, policies, practices and technologies with X X bulletins, social media content PAP specific audiences (GoG, private sector, academia, civil society, NGOs and organized groups) Result 5.2: Communication and education tools (e.g. media campaigns, radio, newspaper, training modules) designed and implemented for key sectors

54LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 FY 20186 RESULT, ACTIVITIES AND TASKS PRODUCTS PROGRESS7 Q1 Q2 Q3 Q4 A four-minute video on Guatemala's LEDS, objectives, opportunities, process, sectoral Four minute video mitigation options and other results

Distribution: X√ MC • Website of the Project • Websites of the GoG and private sector • Events of the Project Two success stories about the national and subnational process of LEDS and its results. X X Two success stories PAP Develop content and tools for virtual platforms (including MARN mitigation website and the Virtual platforms and tools for website of the Project) and social media with persuasive and understandable messages, X X developed social media PAP formats and tools for civil society LEDS Documents: Printed documents, DVD • Technical document X PAP • Summary Document for decision makers • Information brochure Project Documents: Printed documents, DVD • Final report of project X NP • Technical document • Digital summary Result 5.3: Civil society awareness and public perception of LEDS and mitigation of the effects of climate change, increased - measured through surveys and other methodologies (e.g. baselines and final surveys) Participation in at least one event with strategic partners to present and share information on Activity reports X X PAP climate change and LED. Gender Equity and Social Inclusion Activities Support for social inclusion in the final documents of the LEDS, including general socialization A report on developed activities and two workshops with SEPREM and Indigenous Peoples (MICC / ASOCUCH / Sotzil) (Result X PAP 0) LEDS Workshop with female extension workers of MAGA (Casa Hogar Saludable) to promote A report on developed activities technologies with low emissions in a department where FUNDEA operates its financial X X PAP mechanisms Support for the promotion of Demonstration Centers for Efficient Stoves in Paquix and A report on developed activities X X PAP Pachalum, particularly among potential female users. Develop and disseminate a document on social inclusion and gender equity in Project activities A document X NP throughout the life of the Project

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 55 FY 20186 RESULT, ACTIVITIES AND TASKS PRODUCTS PROGRESS7 Q1 Q2 Q3 Q4 Support monitoring for social inclusion and gender equity in Project activities Two quarterly reports and one X X X PAP annual report (of project)

56LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 5. CHALLENGES AND ISSUES

Already in the last year of implementation, the Project is executing its exit strategy. During this quarter, the National Low Emission Development Strategy was launched by the Guatemalan government and actors from the private sector actors, academia and indigenous peoples, officially initiating the process of its implementation. A challenge is presented for the next quarter, with the call for general elections, to maintain the attention of authorities and counterparts to finalize the strategic activities proposed in the POA and to promote the technical and financial implementation of the Strategy. One of the main strengths of the Project is the creation and strengthening of stakeholder networks. The Project has served as a liaison between government institutions, the private sector, academia and civil society, and during the two years of the Strategy planning process it managed to maintain the interest of all these actors and counterparts. Some activities of our POA FY2019 depend on decisions and governmental processes that can be extended or even stopped during electoral processes. The Project will continue to provide technical support to governmental institutions and promote the implementation of the Strategy through these networks of public/private actors strengthened during the life of the Project. The adoption and long-term implementation of the policies, strategies, guides and sectoral tools developed during the life of the Project will be promoted with the latest assistance, dissemination and training activities. It is important to mention that the Project continues to receive new requests for assistance from counterparts, as a sample of the joint work carried out in recent years, and that, although they will no longer be able to be addressed, they will continue to be directed towards and promoted with the rest of the actors be it governmental, municipal, business and civil society that are part of the low-emission development networks of actors. As previously mentioned in this section in previous reports, the identification of financial mechanisms for the implementation of the 43 mitigation options prioritized in the Strategy continues to be a challenge. During the exploration process of the national financial system, it has become evident that the diversity of mitigation actions requires a similar diversity of financial mechanisms directed at the different actors and economic sectors. During the next quarter, visits to national financial entities will continue to promote mitigation options and lines of credit linked to these actors and sectors.

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 57 6. QUARTERLY FINANCIAL SUMMARY

58LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 ANNEXES

The following annexes are presented in a compendium accompanying this report: • Annex 1 – GHG emissions base line in the Guatemalan economy • Annex 2 – Disclosure Document of the Low Emission Development National Strategy • Annex 3 – Scientific article on good practices for sustainable livestock farming • Annex 4 – Presentation of the sustainable livestock manual for Livestock Association of Izabal • Annex 5 – Energy Policy 2019-2050 • Annex 6 – SNIP 2020 regulatory proposal and project formulation guide • Annex 7 – Environmental Guide for specialized double-purpose milk production systems • Annex 8 – Monitoring proposal of the environment and climate change policy of GREPALMA • Annex 9 – Media monitoring on the launching event of the LEDS

LOW EMISSION DEVELOPMENT, QUARTERLY REPORT NO.14 – JANUARY 2019 59