Within this general philosophy, ITPO Italy’s Energy and Environment Program contributes to sustainable industrial development in developing countries with activities to promote the transfer of technology, know-how, managerial skills, and other resources. The aim is to increase investments (local or foreign) in projects that may have a lower environmental impact than alternatives, and/or intend to supply environmentally sound or preferred goods and/or services to the market. Energy has been a central theme of UNIDO’s work addressing both the supply (provision of energy for industry, use of renewable energy resources) and the demand sides (improving the efficiency of power production and of industrial energy end-use ). Many UNIDO activities are aimed at solving two fundamental problems: ♦
Reducing the income elasticity of energy (reducing energy intensity i.e. energy per unit of
GDP); and, ♦
Reducing the environmental impact of energy production and utilization.
In 2008, UNIDO ITPO Italy worked to reinforce the concept that environmental protection is not only a challenge but also an opportunity for companies in developing countries. This movement is often referred to as “corporate social responsibility”, another potential case of the principal/agent problem (shareholders may want profits maximized, managers want to be seen a good corporate citizens). In this context, and taking into consideration that requirements for higher environmental standards are being set also in developing countries, the business of environmentally-preferable goods and services is showing a huge growth potential. ITPO Italy collaborated with institutions in some selected developing countries in order to give some of them the practical and methodological instruments to help SMEs in their countries deal with these new demands that present at the same time a great challenge or risk, that of being excluded from rich markets, but also a huge opportunity for both making money and improving the environment.
CLIMATE CHANGE AND KYOTO PROTOCOL
Thanks to national and international regulations, there are new economic opportunities in the generation and trading of environmental values like emissions reductions, capture, or renewable energy certificates. These mechanisms can add flexibility to, and lower the costs of compliance in relation to the more traditional command & control approach. In many cases, these new mechanisms allow the participation of stakeholders (public or private) from developing countries. This is the case for the market for emissions reductions and capture established through the Kyoto Protocol of the United Nations Framework Conference on Climate Change (UNFCCC). In fact, particularly after the linkage between this market (Kyoto) and the European market for emission allowances (EU ETS), the possibility of importing Certified Emission Reductions (CERs) of greenhouse gases, obtainable through projects in developing countries, created a great amount of interest both on the supply and the demand side of these linked markets.
Annual Report 2008
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UNIDO ITPO Italy