^{_{UNDP Project Document}}

Governments of Bangladesh, China, Indonesia, Pakistan, Thailand & Vietnam

and

United Nations Development Programme

^{_{BARRIER REMOVAL TO THE COST-EFFECTIVE DEVELOPMENT AND IMPLEMENTATION OF ENERGY EFFICIENCY STANDARDS AND LABELING PROJECT (BRESL)}}

(PIMS# 3327)

Table of Contents

Section                                                                                                                                Page

Acronyms                                                                                                                3

Section I: Elaboration of the Narrative                                                                 5

Part I: Situation Analysis                                                                                          5

Part II: Strategy (Expanded Details Contained in Section IV, Part VI)                                  22

Part III: Management Arrangements                                                                         49

Part IV: Monitoring and Evaluation Plan and Budget                                               53

Part V: Partnerships Strategy                                                                                    54

Part VI: Legal Context                                                                                              55                                                                                                    

Section II: Strategic Results Framework and GEF Increment                               56

Part I: Incremental Cost Analysis                                                                              56

Part II: Logical Framework Analysis(Project Planning Matrix)                                            70

Section III: Total Budget and Work Plan                                                               82

Section IV: Additional Information                                                                        87                                                                 

Part I: Additional Agreements                                                                                  87

Part II: Stakeholder Involvement Plan                                                                                  88

Part III: CO₂ Emissions Reduction Estimates                                                             90

Part IV: Project Risks and Assumptions                                                                    95

Part V: Monitoring and Evaluation Plan and Budget                                                97

Annex A: How the BRESL Concept Paper Evolved into BRESL Project Document  103

Annex B: Summary of Barriers Identified in Regional Survey                                             105

Annex C: Assumptions in Baseline and Alternative Scenarios                                               106

Annex D: Overview of Project Impacts in Terms of Energy Savings and CO2                     112

                Emissions Reductions, by country

Annex E: Electrical Appliances Market Reports                                                        115

List of Acronyms

PART I: Situation Analysis

Context and Global Significance

1. Energy-efficiency standards and labeling (ES&L) are among the most cost-effective types of policies and programs to mitigate global climate change. The reason for this is that these programs have the potential to effect complete market transformations for different classes of energy-saving products, at a cost far below the cost of providing new energy supply.

1. ES&L programs contribute to the realization of the Millennium Development Goals (MDG), particularly MDGs 1, 7 and 8, whereby the program can contribute to the eradication of extreme poverty, improve environmental sustainability of a country’s and/or a region’s development path, and help improve trade ties and develop global partnership for development.

1. Asia accounts for 28% of world energy use, with China, Japan, India and South Korea using 73% of the total energy used in the region. The average rate of growth in energy use in Asia over the past decade has been 3.7%, over double the 1.6% world average. Throughout this region, growth in the demand for electric power is requiring the extension and upgrading of electricity transmission and distribution networks. Energy use related to buildings (including use of appliances and equipment and lighting) accounts for a significant percentage of the region’s total energy consumption. With the rapid economic growth in many countries in the region, the demand for major appliances and equipment - ranging from refrigerators and clothes washers in homes, to photocopiers and lighting equipment in office buildings - is expected to continue to grow. Such technologies primarily rely on fossil fuel based power generation, which is one of the major sources of greenhouse gas (GHG) emissions. It is estimated that, over the next decade, GHG emissions in the region will increase commensurate with economic growth, and these will have to be reduced if the global climate is to be stabilized.

1. Clearly, without focused efforts to better utilize energy efficient technology and reduce energy consumption by household and office appliances and equipment, energy demand in the residential and commercial sectors throughout Asia will continue to outstrip supply. The proposed project is entitled Barrier Removal to the Cost-Effective Development and Implementation of Energy Efficiency Standards and Labeling (BRESL). The goal of the project is the reduction in the annual growth rate of greenhouse gas (GHG) emissions from thermal power generation in selected Asian countries. The objective of the project is the removal of barriers to the development and effective implementation of energy efficiency standards and labeling (ES&L) programs, thereby facilitating the transformation of the regional product markets of targeted energy consuming appliances, equipment and lighting products. It will also facilitate harmonization of test procedures, standards and labels among developing countries throughout Asia, when appropriate. The project is applied for funding from the Global Environment Facility (GEF) and will be implemented by the United Nations Development Program (UNDP).

1. BRESL will be implemented on a regional basis in order to transform the regional product markets of the targeted appliances, equipment and lighting products, and address the common barriers to, and concerns about, ES&L by the participating countries. The harmonization of government policies and programmes that will help these markets deliver more energy efficient products can be most efficiently addressed regionally. The project will focus largely on capacity building and assisting government, manufacturing, distributing, retail, consumer and environmental stakeholders throughout the Asian region to implement the most cost-effective energy efficiency measure available. The technical assistance activities that make up this GEF project will be carried out by key agencies in the participating countries. In each country, priority activities, selected among a menu of interventions that will be offered by the project to help foster each country's preferred process for developing or expanding its ES&L program.

Barriers to Energy Efficiency Standards & Labeling (ES&L) and Regional Harmonization on ES&L

1. Most Asian countries regard ES&L programs as cost-effective ways to realize their energy efficiency goals, since they provide substantial electricity peak demand reduction and energy savings with attractive cost/benefit ratios. Such programs have proven to be effective for mitigating climate change in all countries in which they have been implemented. However, they are hindered by certain persistent barriers, which can be broadly classified into the following categories:[1]

Ÿ  Policy/regulatory;

Ÿ  Institutional;

Ÿ  Technical;

Ÿ  Information and awareness;

Ÿ  Market; and,

Ÿ  Financial.

More details on the barriers can be found in Annex B.

Policy/Regulatory Barriers

1. Country’s growth model hindering the promotion and implementation of ES&L programs: Without a policy framework that requires, or at least encourages, ES&L for energy-using equipment, manufacturers will tend to produce lower-cost equipment that is less efficient. In order to overcome this barrier, it is important to strengthen an understanding among policymakers about the importance and substantial benefits of ES&L programs.

1. No mandatory regulations for minimum energy performance standards (MEPS) or mandatory energy labeling: International experience has shown that a framework for mandatory MEPS is the key underlying sustained product efficiency improvements over time. Without mandatory programs, initial progress can be made, but there is no incentive for suppliers of very low efficiency equipment to improve their equipment. A number of countries have initiated voluntary product labeling, but the ultimate efficiency potential from voluntary labeling schemes is limited for many products because many suppliers of low-efficiency equipment choose not to apply the label. In order to overcome this barrier, it is important to develop a regulatory framework and systematically, over time, implement mandatory ES&L programs.

1. Lack of policy framework on ES&L: Few of the countries in the region have a systematic policy and regulatory framework for ES&L. The policy framework is important because it provides a road map for how to prioritize products; test their energy performance; and how to set requirements for energy labeling and MEPS; and how to regularly review and update the labeling and MEPS requirements, which is critical to maintaining long-term energy efficiency improvements. The regulatory framework is important because it provides the legal basis for implementing the program. The barrier to development of such frameworks may be the belief that energy labeling alone can achieve energy savings, and the limited presence of such frameworks in the region. Korea is one of the only countries in the region with a systematic, integrated framework for testing, establishing MEPS, and integrating the MEPS into its labeling scheme, regularly updating the MEPS levels to make them more stringent. In order to overcome this barrier, it is important to highlight examples of best practice in ES&L and to promote adoption of systematic regulatory frameworks at the national level.

1. Difficulties in negotiations between manufacturers and stakeholders: Policymakers do not have experience with negotiating with equipment manufacturers to increase their efficiency levels. Without an ES&L framework, many countries take an ad hoc approach. The problem with this approach is that if there is a substantial minority of suppliers making or distributing low-efficiency equipment they will not agree to, or stall, efforts to develop aggressive MEPS and energy labeling requirements. The threat of mandatory MEPS and labeling is a necessary tool for the government in its negotiations, as is the possibility of limited technical assistance to help suppliers improve the efficiency of their products.

Institutional Barriers

1. Lack of integrated institutional approach to ES&L implementation: To date, implementation of ES&L in the region has been largely ad hoc, as has the selection of an implementing institution. For example, in Thailand, energy labeling was carried out for nine years by the electric utility (Electricity Generating Authority of Thailand), without any legal mandate, before the first minimum energy performance standard (MEPS) for end-use equipment (air conditioners). Similarly, Electricity of Vietnam (EVN) is carrying out programs to promote energy-saving lighting equipment (compact fluorescent lamps and thin-tube, “T8” fluorescent lamps) while the Vietnamese Ministry of Industry is in parallel developing a scheme for energy labeling and MEPS for these products. This barrier will be addressed through both regional and national-level training and capacity enhancement in the development and implementation of a standards and labeling scheme for the 5 targeted products.

Technical Barriers

1. Lack of regular testing programs for energy performance of end-use equipment: The BRESL project survey indicated that there are few if any regular programs for testing the energy performance of the target appliances in the participating countries. Such testing programs are critical to establishing the basis initially for energy labeling, and then for later establishment of MEPS. This barrier stems from the lack of clear regulatory framework and mandate and also from lack of awareness among policymakers of the importance of having a human and technical infrastructure for testing and certification of a number of products. This barrier will be addressed by strengthening of national and regional testing and certification infrastructure.

1. Lack of training programs on ES&L framework and implementation: There are no systematic training courses or modules covering the step-by-step process of building up an ES&L regime. In the past, there have been some one-off regional courses sponsored by USAID (e.g., for the South Asia Regional Initiative on Energy), but most of the technical assistance has been provided by direct consultancy to specific agencies that are responsible for establishing ES&L programs. The lack of commonly available training and course materials is a real barrier, which will be addressed through an ES&L Capacity-Building Program that will build institutional and individual capacity to secure on-the-ground implementation of regulatory frameworks, as well as actual ES&L programs.

1. Lack of accredited testing laboratories: Accredited laboratories are needed for energy performance testing, and to implement harmonized standards across the region. In some cases, test laboratories are available, and can do testing of products, but the laboratory is not accredited, which means that the test results will not be accepted by any other agency in another country. This means that products have to be re-tested after they are imported into the destination country, and this creates a logistical and financial barrier to wider trade in energy-efficient products. In other cases, there are simply no test laboratories in the country, which means that it is not possible to test and label product efficiency, or that products must be tested overseas, which is very expensive. The lack of test laboratories (accredited or not), generally stems from the lack of a regulatory framework for ES&L and the perceived need among policymakers to fund, and implement, a means of performance measurement. This barrier will be addressed through the establishment of a regulatory framework for ES&L and the subsequent establishment of a testing and certification infrastructure.

1. No laboratories for equipment efficiency testing: This is directly related to the institutional barrier above on the lack of accredited test laboratories. For example, the Philippines has done fairly well on its ES&L programs for several products (e.g., lighting, refrigerators, air conditioners) because they long ago established a appliance testing laboratory to measure the energy performance of equipment. This barrier will be addressed in the BRESL project primarily institutionally, through the long-term strengthening of the infrastructure for testing and certification. In some cases there are labs that can be modified or upgraded to perform the testing; but in many cases, there is a need to develop a plan and seek funding for establishment of a test lab. For such decisions, it is important to do an assessment of existing testing capacity and needs.

1. Lack of technical knowledge on ES&L assessments: In cases where ES&L have been implemented for several products (i.e. China, Thailand), there is some local knowledge of the technical basis and terms for carrying out a benefit-cost analysis for energy labeling and MEPS requirements. For many of the countries, however (e.g., Bangladesh, Indonesia, Vietnam), there will be limited institutional knowledge on the framework for terms of reference for carrying out a benefit-cost analysis for an ES&L regime. Often, the work is done by an outside consultant (paid for by an international agency), with limited direct involvement from the implementing agency in the host country. This barrier will be addressed by building institutional and individual capacity to secure on-the-ground implementation of regulatory frameworks, as well as the design of actual programs for MEPS and energy labeling programs.

Information and Awareness Barriers

1. Insufficient public awareness about energy-saving equipment: The lack of public awareness stems in part from the policy barriers above: in many Asian countries, there is not a strong ES&L framework with a requirement for mandatory labeling of all equipment and gradual adoption of MEPS. As the price of oil increases, consumers become much more aware of their role in saving energy, but without even a comprehensive scheme of energy testing and labeling of appliances (let alone establishment of MEPS), the energy performance of appliances that a consumer purchases is relatively “invisible”. This barrier will be addressed largely at the policy level, through the root cause, by working to strengthen the policy context for EE technologies.

Market Barriers

1. Market not driven to EE equipment because without labeling, energy efficiency is an invisible attribute: Without a requirement for energy labeling, there is no driver either for producers to produce energy-saving equipment, or for consumers to pro-actively select such equipment. This is because without energy labeling, energy efficiency is basically an invisible attribute and plays little or no role in the consumer selection process. This barrier will be addressed through the application and enforcement of ES&L legislation and regulations; as well as through capacity enhancement in the development and implementation of ES&L.

1. Limited or no market monitoring and sampling suffer due to lack of manpower and funds: Unfortunately, enforcement and compliance appears to be an afterthought in the implementation of ES&L programs. Survey respondents pointed to the lack of market monitoring and sampling as a key weak link in the chain of ES&L implementation. This barrier will be addressed through strengthening of policy context for EE technologies; application and enforcement of ES&L legislation and regulations; and capacity enhancement in the development and implementation of standards and labeling for the 5 targeted products.

1. Lack of knowledge about the benefits of ES&L among sellers and buyers: This barrier stems from the general lack of public awareness campaigns, which is due in large part to the lack of widespread energy labeling of products. In most of the countries surveyed, energy testing and labeling schemes were in place for only 1 or 2 products - if at all!  This barrier will be addressed through application and enforcement of ES&L legislation and regulations; and capacity enhancement in the development & implementation of ES&L for the target products.

1. Table 1 below summarizes the barriers identified in a recent regional survey carried out by UNDP, and indicates the project component under which the barrier will be addressed.

Table 1: Summary of Barriers to Implementation of ES&L Programs

1. The identified barriers were discussed, verified and confirmed during a Regional Stakeholder Consultation Workshop, in which the project framework design was developed using logical framework analysis (LFA). The project activities to remove the barriers were also reviewed and confirmed. The agreed project planning matrix (PPM) is shown in Section II, Part II.

Institutional, Sectoral and Policy Context

1. International experience has shown that ES&L programs have the potential to reduce the unit energy consumption of end-use equipment by as much as 30-50% within a time frame of five to ten years. These savings can be obtained systematic application of a regime that includes product testing, energy labeling, and establishment of minimum energy performance standards for the most significant energy-using equipment in the home. These savings pay for themselves over time, and the efficient equipment has a lower life-cycle cost for consumers.

1. Recently, an APEC report based on a set of international expert consultations[2] concluded that ES&L programs should be a national priority; but that at the same time, in order to maximize the impact of a national program, countries should also work internationally with like-minded governments and trading partners to harmonize ES&L efforts. The report also included examples of the significant energy savings and CO2 emissions reductions that can be achieved through ES&L in a relatively short time frame. Figure 1 below shows product efficiency improvements in the range of 40-60% in Korea over a seven-year time period. This level of savings was only possible through application of a combined, integrated program including mandatory labeling linked to mandatory energy performance standards (MEPS).

Fig. 1: Change in Average market Efficiency of Korean Appliances, 1993 – 2000[3]

1. In general, Asian energy policymakers understand the benefits from the implementation of an effective ES&L program, and ES&L program are considered a core part of most countries’ overall energy efficiency programs. However, despite this high awareness of ES&L, and the prevalence of ES&L programs in Asia, only a few Asian countries are systematically implementing ES&L programs in a way that leads to significant, sustained savings. This is because many countries begin ES&L with voluntary energy labeling, and they are reluctant to counter pressure from manufacturers against imposition of mandatory labeling or MEPS.

1. Currently, the number of countries with ES&L programs in Asia is 12 and these programs cover more than 25 different types of products (see Table 2). Although the number of ES&L programs in place is increasing, the rate of increase is slow, and there are many countries with few or no programs in place. In addition, the vast majority of the ES&L programs is mandatory, and is not regularly updated to continually yield efficiency improvements.

Table 2: Cumulative Number of Standards and Labeling Programmes in Asia and Worldwide (as of the end of 2005)

Source: Collaborative Labeling and Appliance Standards Program (CLASP). Based on Wiel and McMahon (2005) and ESIS web site (2006)

1. Clearly, there is a need to increase the number of ES&L programs, while at the same time building capacity to establish the institutions to operate the program and to effectively implement and monitor the programs. There is also a need for more urgency in efforts to harmonize and align regulatory processes. The consensus of the international consultations sponsored by APEC was that the first and most productive area for exploring alignment is in energy performance test procedures, since this facilitates the ability to manufacture and sell products across different markets, and also allows a consistent comparison of energy performance and energy efficiency.

Fig. 2: Exports and Imports of Refrigerators throughout Asia

(70% of product trade shown)

1. Appliance, equipment and lighting products manufactured in the countries in the region are presently found both in regional and global markets. For example, most of the refrigerators that are used throughout Asia are made in China, South Korea, Japan, Singapore, Europe or the United States. However, nearly all countries manufacture some refrigerators for internal sale and export. For instance, Indonesia, which manufactures refrigerators, still imports refrigerators from eleven Asian countries and exports refrigerators to these same eleven plus four other Asian countries. A chart showing this product flow throughout Asia is shown in Fig. 2 above.

1. With regard to ES&L information, a number of authoritative information sources are now available with data and tools on international standards and labeling efforts. Three of the most prominent are the APEC Energy Standards Information System (APEC-ESIS); the Collaborative Labeling and Appliance Standards Program (CLASP); and the International Energy Agency (IEA). APEC has entered into a sponsorship agreement with CLASP, and that this has led to the development of a new Global Standards and Labeling Database, which was formally launched in mid-2005.

Stakeholders and Regional Collaboration in ES&L

1. The proposed project is designed to build on the present capacity for ES&L programs in some of the Asian countries, as well as on the outputs and lessons learned from the implementation of previous and ongoing ES&L initiatives in the region, which are mostly sub-regional collaborations addressing ES&L:

1. APEC Expert Group on Energy Efficiency & Conservation, under the APEC Energy Working Group - For nearly a decade, APEC has been actively working to reduce the barriers to trade from the proliferation of different energy standards, and to facilitate energy efficiency improvements. The APEC Energy Ministers have directed that APEC economies introducing or preparing mandatory energy-efficiency requirements should advise other economies of these proposals before they are implemented. In addition, they have directed APEC to develop a Standards Notification Procedure to facilitate the co-ordination of the development of energy standards and technical requirements. Through the APEC Experts Group on Energy Efficiency & Conservation (EGEE&C), APEC has focused on harmonization to reduce barriers to trade in energy-efficient appliances and equipment. Its efforts since 1997 have culminated in the development in 2002 of an, web-based Energy Standards Information System (ESIS – www.apec-esis.org); a user-friendly, web-based database that provides regularly updated, comprehensive information on technical standards for energy-using equipment in the 21 APEC economies.

1. South Asia Regional Initiative (SARI) – Energy - The SARI-Energy initiative is funded by the U.S. Agency for International Development. SARI countries (Bangladesh, Bhutan, India, Nepal, Maldives, and Sri Lanka) conducted three EE S&L Harmonization Meetings in Sri Lanka and India during 2003 to 2005. The meetings were organized by the Academy for Educational Development (AED), Nexant Consultants, and the Collaborative Labeling and Appliance Standards Program (CLASP). Through the SARI program, countries in the region worked on a Harmonization Road Map, with the objective of harmonizing test protocols, strategy and structure for regional harmonization in the area of appliance/equipment energy standards and labeling. The SARI initiative on ES&L been regarded as an example of the strong potential for regional cooperation. Unfortunately, the ASEAN effort also not gone forward due to lack of funding and lack of strong leadership among the South Asian countries.

1. Association of Southeast Asian Nations (ASEAN) - In 1999, ASEAN energy ministers identified the development of an ES&L initiative for the ASEAN region as an ASEAN priority in the energy sector. The ASEAN leader highlighted ES&L in order to curb growing electricity demand in the region, and in light of the proven success of energy ES&L programs being pursued by some of its ten member countries. The ASEAN Energy Efficiency and Conservation Sub-Sector Network (EE&C-SSN) under the ASEAN Centre for Energy (ACE) was given a mandate to develop and implement the ASEAN Energy Labeling Project. The objective was to accelerate the rate of improvement in the energy efficiency of end-use equipment, while avoiding the introduction of regional non-tariff trade barriers. Due to limited funding, the ASEAN countries decided that the label would be a voluntary endorsement type that could be used alone or with national labels. An initial round of labels were developed for electromagnetic ballasts for fluorescent lamps (2004-2005); followed by refrigerators (2005-2006); and, soon to come, air conditioners, electric motors and fans (2006-2009). Unfortunately, the ASEAN energy labeling project never got off the ground – in large part due to financial constraints and the lack of a strong lead agency.

1. CFL Harmonization Schemes - One set of harmonization schemes that appears headed for success are for compact fluorescent lamps (CFLs). The Efficient Lighting Initiative (ELI) includes a certification scheme for energy-efficient lighting, that currently focuses primarily on labeling of CFLs. ELI was initiated as a seven-country, US$ 15 million GEF-funded initiative managed by the International Finance Corporation (IFC). After the projected ended in 2003, IFC issued an international tender and supported the establishment of the ELI Quality Certification Institute to operate the ELI certification and labeling scheme. The Institute is located in Beijing and is managed by the China Standardization Center (CSC), and ELI’s CFL technical specifications have been adopted by a number of countries internationally that are operating large-scale CFL programs.

1. A related initiative is the International CFL Harmonization Initiative, which is an international effort supported by the major CFL manufacturers, a number of national governments, lighting trade associations, and NGOs active in the energy and lighting field. The CFL Harmonization Initiative has two main objectives: to develop a single, international, harmonized test procedure for CFLs through the International Electrotechnical Commission; and to develop a common set of internationally recognized performance specifications, which can be voluntarily adopted by governments in order to rationalize the way that CFLs are regulated internationally. This is especially important, since 90% of CFLs are made in China, and they are currently regulated internationally by more than 33 different sets of MEPS and labeling programs in countries around the world. Since CFLs are one of the core products in BRESL, the BRESL countries will have an excellent opportunity to coordinate their activities through the two ongoing CFL harmonization efforts -- the ELI program and the International CFL Harmonization Initiative.

1. Through the proposed BRESL project, the participating Asian countries will work together to coordinate and share information on their ES&L programs. Such cooperation is envisioned as something that will yield the benefits of greater market transparency, reduced costs for monitoring and evaluation (M&E) and product testing, enhanced prospects for trade and technology transfer, reduced costs for developing government and utility energy efficiency programs, and open trading of energy efficient appliances/equipment.

1. The BRESL project will also collaborate with IEA countries in the Asia-Pacific region (Australia, Canada, Japan, Korea, New Zealand and the U.S), which are important current and future trading partners. Moreover, BRESL will also collaborate with several other GEF-funded projects that include ES&L components as major activities in achieving GHG emission mitigation goals.

1. The BRESL project will work with national teams and government counterparts associated with the above regional efforts, as well as with other UNDP/GEF projects in the region to collaborate in the design and implementation of national ES&L programs. It will also build on outputs/outcomes of previous GEF-funded ES&L-related projects in the region like the completed Efficient Lighting Initiative (ELI) in the Philippines. ELI follow up activities are currently being handled out of Beijing by CSC, which is also a partner for the End-Use Energy Efficiency Project (EUEEP) project in China. With the National Development and Reform Council’s (NDRC) strong mandate to coordinate all ongoing activities in China, it is hoped that many of the past stand-alone activities on standards & labels by different agencies on different appliances can coherently be brought under one umbrella. The project will pursue new ES&L goals and attempt to stimulate a regional sharing of the expertise that is expanding throughout the region.

1. Table 3 below summarizes the ongoing and planned cooperation efforts for regional initiatives on ES&L. The donor projects include both GEF projects and a range of other donor-funded projects. This indicates the substantial amount of leverage that will be provided by the BRESL project. While many of the initiatives below are in-country efforts to develop standards for specific projects, none of the current or ongoing efforts takes the regional approach that BRESL will take to facilitate regional cooperation, harmonization, and actual implementation, of energy labeling and MEPS for a set of core energy-using appliances and products.

Table 3: Summary of BRESL Country Involvement in Regional Cooperation or Harmonization Efforts Related to ES&L

Source: Based on May 2005 GEF concept paper for BRESL project; May 2006 BRESL survey; and consultant’s research.

Baseline Scenario

1. Countries in the Asian region are at various levels of development and implementation of ES&L programs. Some countries, such as Korea, China, Thailand, and the Philippines have fairly well developed ES&L programs for several products, but are at variance from each other. Other countries have programs in their beginning stages or no programs at all.

1. Presently, ES&L programs are carried out at the national level and – despite the regional cooperation efforts mentioned above – nearly entirely without the benefit of exchange of both technical and human capital with other countries in the region. Initial indications of interest from some of the target countries in the region (particularly those from ASEAN) were expressed during an APEC-sponsored energy efficiency standards and label workshop that was held in Taiwan in November 2003. Table 4 provides an overview of information on the countries participating in the BRESL project.

Table 4: Comparative Information on the BRESL Countries (including Republic of Korea)

1. Table 28 in Annex C shows the volume of stock and sales of each BRESL product in 2004. Only the products that each BRESL country will work on under this regional project are shown. These data were used as baseline in estimating the anticipated energy consumptions and CO₂ emissions under a business-as-usual scenario. These were also used in estimating the potential energy savings and corresponding CO₂ emission reductions from the utilization of the improved and energy efficient versions of the 6 BRESL products under the alternative scenario, which the BRESL project aims to achieve.

1. The baseline scenario is that countries in the region continue to develop their ES&L programs, but still at a slow and uneven pace and hindered by and the mentioned barriers in financing, policy, technology and information. This is the “business-as-usual” scenario in the field of ES&L development and implementation in Asia. Table 5 summarizes the existing status of energy labeling programs among the BRESL countries, and Table 6 indicates which countries have MEPS in place.[4]  Clearly, China and Korea are the most active. Thailand is quite active in the area of labeling, but has only implemented MEPS for one product to date.

Table 5: Current Status of Energy Labeling Programs in BRESL Countries (including Republic of Korea)

Source: May 2006 BRESL survey and consultant’s research; updated at BRESL Stakeholder Consultation Workshop in Beijing during 30-31 August 2006. Data are not available for Indonesia.

Table 6: Current Status of Minimum Energy Performance Standards (MEPS) in Selected BRESL Countries (including Republic of Korea)

Source: May 2006 BRESL survey and consultant’s research; updated at BRESL Stakeholder Consultation Workshop in Beijing during 30-31 August 2006. Data are not available for Bangladesh & Indonesia

1. Bangladesh: Bangladesh enacted a National Energy Policy in 1996. The plan gives special importance to energy efficiency. The plan calls for awareness campaigns, the gradual implementation of ES&L programs, and energy auditing and training. The Bangladesh Standards and Testing Institute has primary responsibility for implementation of ES&L. Bangladesh has plans to initiate energy labeling programs for a number of products. Bangladesh is only likely to make very minimal progress on labeling and MEPS in a baseline mode, without the GEF assistance to attend the regional technical product working groups and the technical assistance in the analysis and implementation of ES&L.

1. China: China enacted an Energy Conservation Law in 1997. The law aims to achieve the rational and efficient use of energy through enhanced energy use management, the adoption of measures, and the reduction of loss and waste in the energy production and consumption chain. Since then, the various state agencies responsible for standardization and certification have been aggressively developing new measures to implement the Energy Conservation Law. These include China the National Institute of Standardization, which is responsible for the development, implementation and supervision of MEPS; and the China Standardization Center (CSC), which is responsible for endorsement labeling. Starting in 1998, China focused on its endorsement labeling program for high-efficiency products. Starting in 2003, China also announced and began implementing a comparative labeling program, which is now mandatory for several products. A Medium- and Long-term Energy Conservation Plan was drafted in 2004. The plan sets the following targets: (a) energy consumption per unit of GDP in 2010 shall 20% lower than the level in 2005; (b) water consumption in industry is targeted for a reduction of 30%; (c) the effective coefficient of irrigation water use is targeted to increase to 0.5; and, (d) the integrated utilization of industrial solid waste rate is targeted to increase to more than 60%. China therefore has a strong base of existing products covered by MEPS, mandatory labeling, and voluntary labeling. China will not participate in the BRESL product for refrigerators and electric motors, since their MEPS for these products are under development; however, they will participate through BRESL in the development of ES&L for the other four products – air conditioners, ballasts, electric fans, and rice cookers.

1. Indonesia: In Indonesia, the Directorate General of Electricity and Energy Development (DGEED), under the Ministry of Mines and Energy (MME), completed a Master Plan in 1995 for Energy Conservation. The plan included an import tax reduction on high-efficiency equipment and soft loans for companies implementing energy efficiency improvements. DGEED is also responsible for developing and establishing national energy standards. However, no minimum energy efficiency standards have been imposed on any electrical products in Indonesia. At present, Indonesia is in the process of drafting national standards for room air conditioners, electric water heaters, televisions and electric irons. When implemented, the standards will mandate minimum energy efficiency levels for these products. Progress on ES&L has been very slow in Indonesia, and without the GEF assistance it is unlikely to actually effectively implement 1-2 labeling programs and the same number of MEPS over the next five years.

1. Korea: The Republic of Korea’s effort to promote energy efficiency and conservation was triggered by the two oil crises of the 1970s. To overcome its high-energy prices and unstable supply, the Korean government developed energy efficiency and conservation policies. The result is one of the most extensive ES&L programs in the region, with mandatory standards and labels covering a broad range of products. The key legislation on energy efficiency in Korea is the Rational Energy Utilization Act of 1992. Programs implemented under the framework of this act include the Energy Efficiency Labeling & Standards Program, the Energy-Saving Office Equipment & Home Electronics Program; and the High-Efficiency Equipment Certification Program. As a long-time regional leader in the implementation of ES&L, Korea will participate actively in the program, but will not be a recipient of GEF funding. Korea will share information, attend meetings, and provide technical assistance. In particular, Korea will participate in a process of coordinating MEPS and labeling for four of the target products: air conditioners, refrigerators, motors, and CFLs.

1. Pakistan: Pakistan developed and adopted a National Conservation Strategy (NCS) in 1992, which emphasizes the adoption of Energy Conservation activities, which include among others, energy standards & labeling of household equipment and appliances. As a follow up to the NCS, a National Environmental Action Plan (NEAP) was formulated, which employed a cross-sectoral and holistic approach in achieving energy conservation and energy efficiency in the use of household equipment and appliances. The Pakistan Standards and Quality Control Authority Act, 1996 also provides some directions for standardization and labeling of products, processes or services. Presently there are no legislations for the development of labeling and standards setting programs but there some voluntary programs conducted which were adjudged as effective. Despite the technical assistance on EC&EE provided by the National Energy Conservation Center (ENERCON), progress in the area of ES&L has been very slow in Pakistan, and without the GEF assistance it is unlikely to effectively secure legislative support for, as well as provide the necessary technical capacity in the development and implementation of, a national ES&L program.

1. Thailand: Thailand has one of the more active energy conservation frameworks in Asia. The Ministry of Energy is the overall agency in charge of energy policy, and the Department of Alternative Energy Development and Efficiency (DEDE) serves as Chair of a Working Group on Energy Standards and Labeling. DEDE has responsibility for setting high-efficiency levels for energy-using equipment and for establishing MEPS; the Electricity Generating Authority of Thailand (EGAT) has been running a voluntary energy labeling program covering several types of end-use equipment since 1996; the Energy Policy and Planning Office (EPPO) is responsible for macro policy and promotion of ES&L programs; and the Thailand Industrial Standards Institute (TISI) is responsible for energy performance test protocols and for publishing the MEPS. All of these agencies sit on the ES&L Working Group. Thailand currently has voluntary energy labeling for refrigerators, air conditioners, brown rice, rice cookers, residential fans, compact fluorescent lamps, and fluorescent lamp ballasts; and MEPS are in place for air conditioners (2005) and will soon be implemented for refrigerators. The GEF support is expected to enhance Thailand’s potential of becoming a big regional player in the trading of the abovementioned EE appliances/equipment.

1. Vietnam: The Vietnamese government passed a Governmental Decree on Energy Conservation and Energy Efficiency (102/2003/ND-CP) on 3 September 2003. The Decree sets forth the roles and responsibilities for all actors in government and society with respect to energy efficiency. The decree calls for suppliers of energy-consuming equipment and facilities to declare the energy consumption of the equipment in the user instructions and on the labels of such equipment and facilities. After verification, the products will receive an Energy Efficiency Quality Products Certificates and then attach an Energy Efficiency Labels to their products. The Prime Ministerial Decision of the 14 April 2006 approved the Electricity Saving Program for the period 2006 to 2010. The Electricity Saving Program authorizes the Ministry of Industry and Trade (MOIT) to issue Circular guides requiring that suppliers put a label on high-efficiency electric appliances: electric motors, fans, air conditioners, fluorescent-tube lamps (FTLs); and FTL ballasts. Actual technical standards for equipment energy performance will be issued by the Ministry of Science and Technology. The Electricity Saving Program also calls for MOIT to develop a road map for replacement of 40 million incandescent lamps with CFLs, FTLs, and T5 lamps. The national utility, Electricity of Vietnam (EVN) has been implementing a national DSM program since 2001, and is currently implementing a national program to distribute 1 million compact fluorescent lamps and thin-tube fluorescent lamps. While Vietnam has recently issued MEPS for a few products, they have yet to actually begin enforcement, and the GEF assistance will be very useful in this regard. In addition, Vietnam has designed both a comparative and endorsement energy label, but it has not yet developed implementing guidelines for the labels and algorithms for applying them. Without the GEF assistance, it is likely that Vietnam would implement no more than two MEPS and two labeling schemes over the next five years.

1. The Baseline Scenario will be a continuation of existing ES&L programs with an assumption that future implementation of programs proceeds at the trajectory of the past five years. For most of the participating countries, this means that under the baseline scenario, perhaps one or two new ES&L programs would be added during the five-year period of this BRESL project.

1. Based on studies carried out on ES&L in the region and from the BRESL Survey, the baseline, or business-as-usual (BAU),  scenario will most likely be characterized by the following:

Ÿ  The rate at which MEPS and labeling programs are implemented proceeds at a very slow pace, with most countries (with the exception of China and Korea) implementing only voluntary labeling programs and no more than one MEPS every five years.

Ÿ  The natural rate of increase in equipment efficiency, will be as follows:

1. Without the BRESL project, efficiency levels would gradually increase under a Business-as-Usual (BAU) scenario, from 0.2 % to as high as 1% per year, depending on the product.

PART II: Strategy (Expanded Details Contained in Section IV, Part VI)

Project Rationale and Policy Conformity

1. The proposed GEF-supported alternative to the baseline scenario is intended to reduce greenhouse gas emissions in the participating countries by removing barriers to effective ES&L programs and policies, leading to significantly expanded ES&L programs in the region, thereby substantially reducing energy consumption in the participating countries. Some of the participating countries (e.g., Bangladesh, Indonesia, Vietnam) have limited or no ES&L programs and policies. This project will provide them with the information and assistance needed to develop and begin implementing such programs. Some of the participating countries (e.g., Thailand) have a number of ES&L programs and policies in place. This project will enable them to significantly expand their programs. A few participating countries (e.g., China, Korea) have extensive ES&L programs. This project will enable them to update and expand their programs and will also use their expertise to help mentor other participating countries.

1. The proposed BRESL project aims to facilitate development of efficiency programs in the participating countries through ES&L capacity building and improved harmonization. Harmonization is envisioned to serve the interests of all countries involved, whether more or less advanced in their development of a program. Countries with well-developed ES&L programs for appliances and equipment have an interest in bringing their programs into better alignment for the purposes of promoting free trade. This means that different existing standards are made to agree by modifying the specifications of one or both existing programs. For those that are in the early phase of initiating an ES&L program, harmonization can refer to the selection of procedures and practices from the list of already existing programs throughout the region. In this way, countries can leapfrog and take advantage of well-established successful practices. However, harmonization is likely to be a gradual, long-term process. Due to differences between countries and resistance to changing established procedures, in many cases harmonization will not be easy. This proposed project will begin this long-term project, achieving concrete harmonization progress by project end.

1. With a major focus on capacity building and information exchange, such a regional program will help to collectively eliminate ineffective practices, reduce financial barriers, and strengthen both policy formulation and enforcement. The technical exchange that is envisioned to happen under such a regional initiative will allow for information and expertise to flow more freely across borders within the region. Facilitating regional cooperation will allow the participating countries to appreciate and gain from harmonization, or mutual recognition of energy performance test procedures. Initiating a dialogue between countries will help to lay the groundwork for eventual harmonization. The overall effect of this will be to increase the rate at which energy-efficient products are developed by local manufacturers and suppliers, recognized and supported by government policy, and purchased and used by consumers.

1. This proposed project will include a major focus on working with and assisting individual countries to actually set and begin to implement standards and labels on a menu of targeted products. In this way concrete energy-saving and carbon-reduction benefits will be achieved during the project period, helping to show participating countries the benefits of ES&L and increasing the likelihood that some project activities will continue even after GEF support ends. This focus on setting minimum standards and implementing labeling programs comes from a survey of participating countries, who asked that this project focus on “doing” and not just capacity building.

1. Based on a survey of participating countries carried out during May 2006, and based on activities elsewhere in the world, the project will focus on six products: (1) refrigerators; (2) room air conditioners; (3) electric motors; (4) ballasts for fluorescent tubes; (5) electric fans; and (6) compact fluorescent lamps. These appliances and equipment account for the majority of electricity consumption in the residential and industrial sectors, and are covered in the national ES&L programs of a number of Asian countries. This list of products was developed during the May 2006 survey and was validated at the Regional Stakeholder Consultation Workshop held in Beijing during 30-31 August 2006. In addition, China will develop a new rice cooker standard as part of BRESL, consulting with Viet Nam and Thailand who also expressed interest in this product (in a vote of participating countries, rice cookers just missed the cut for full-fledged inclusion in  the project’s regional activities).

1. The proposed BRESL project will achieve the objective set out in GEF Operational Programme 5, to remove barriers to energy efficiency and energy conservation. It will address the abovementioned barriers, which if not removed will consequently hinder achievement of the desired market transformation for energy-efficient appliances and equipment in the Asia region. The project will involve ongoing and planned ES&L activities of the various countries in the region, as well as incremental activities for removing barriers, in order to achieve the envisioned regional progress in the field of ES&L.

1. The BRESL project, by developing a regional forum and network for dialogue and action on ES&L, will increase the capacity and political will of Asian countries to develop, implement and finance ES&L programs. Ultimately, the outcome will lower energy intensity within countries in the region. The active policy support of the government in these programs will also result in the integration of the principles of sustainability into country policies and programs, in line with the MDG 7 goals. The opening of the markets in the region to increased trade and sale of energy-efficient appliances and products, and the diffusion of technology through technical exchange and demonstration is in line with MDG 8’s mandate to develop an open trading and financial system that is rule-based and predictable and to cooperate with the private sector to make available the benefits of new technologies.

Alternative Scenario

1. Under the alternative scenario, the participating Asian countries (hereinafter referred to as BRESL countries) will develop a much-improved capacity to design and implement national ES&L programs. Clearly, there is still substantial room for improvement in the ongoing ES&L programs in the countries in the region. As noted earlier, there is little or no ES&L activity in most of the target countries, especially with regard to implementation of the most effective energy-saving policy option – mandatory minimum energy performance standards (MEPS).

1. To achieve the alternative scenario, the proposed BRESL project will involve a serious and sustained effort to expedite and enhance the development of ES&L programs both within and across borders. BRESL will facilitate development of efficiency programs in the participating countries through technical assistance that leads to direct implementation; through capacity building in all aspects of ES&L activities; and through sharing of experience and steps towards harmonization of energy-performance test procedures, product certification procedures, and product standards. Under BRESL, countries with extensive ES&L experience such as Korea, China (for standards) and Thailand (for labels) will help to mentor other participating countries. Such a regional program will help to collectively eliminate ineffective practices, reduce financial barriers, and strengthen both policy formulation and enforcement. The technical exchange that is envisioned to happen under such regional initiative will allow for information and expertise to flow more freely across borders within the region. Facilitating regional cooperation will allow the participating countries to appreciate and gain from harmonization, or mutual recognition of energy standards & test procedures. Initiating a dialogue between countries will help to lay the groundwork for eventual harmonization. The overall effect of this will be the increased rate at which energy efficient products are developed by local manufacturers, recognized and supported by government policy, and purchased and used by consumers.

1. The Alternative Scenario will be a concerted effort that includes substantial regional cooperation and information sharing but leads to concrete implementation of MEPS and labeling programs for the six targeted products within the five-year duration of the project.

1. The realization of the Alternative Scenario is manifested by and large by the following:

Ÿ  Implementation of minimum energy performance standards and energy labeling schemes for all six products in all countries that participate for the particular product.

Ÿ  Mandatory MEPS are announced for each of the products at the end of Year 2 and take effect in Year 4 of the BRESL project. The MEPS are expected to lead to an immediate reduction in energy use of 4 to 30%, depending on the product[5].

Ÿ  Mandatory labeling programs are also implemented in each BRESL country, and starting in Year 5, they lead to additional savings beyond the MEPS of 0.4% to 2% annually, depending on the product.

Ÿ  Increased utilization of energy efficient appliances/equipment in the commercial, industrial and residential sectors of the BRESL countries.

Ÿ  Significant energy savings from the utilization of energy efficient appliances/equipment and the corresponding GHG emissions reduction.

1. The analysis of the Alternative Scenario only models savings for new products being sold – i.e. it does not include efficiency improvements in the existing stock of equipment. In addition, the difference in baseline and alternative electricity consumption does not translate directly to electricity savings attributed to BRESL. This is because electricity savings also include reductions from reduced purchases of incandescent lamps, and these are calculated at 2.75 times the annual unit electricity consumption of CFLs.

1. Table 7 below summarizes the characteristics of the Baseline and Alternative Scenarios and the net project impact in terms of electricity savings (GWh/year) and CO2 reductions (MMT CO2 per year, and cumulative). The summaries of estimated energy savings and CO2 emissions reductions in each BRESL country from the widespread utilization of energy efficient appliances/equipment can be found in Annex D.

Project Goal, Objective, Outcomes and Outputs/Activities

1. The goal of the project is the reduction of GHG emissions arising from the generation of electricity from thermal power generation units and used in appliances/equipment in the residential, commercial, and industrial sectors of the countries participating in the project. Experience in Asia, as well as in many other countries in the world, is that ES&L programs and policies are one of the most effective ways to improve energy efficiency, and energy efficiency is one of the most effective ways to reduce emissions of greenhouse gases. Specifically, the proposed project will reduce carbon emissions by an estimated 23.4 million metric tons (MMT) per year (cumulative total of about 34.5 MMT) by end of the project. Twenty years after the project end (2031), carbon emissions are projected to be around 268.7 MMT lower each year (cumulative total of about 3,787 MMT), for a reduction of about 9.4% in annual emissions below total 2004 emissions in the participating countries. (See Annex D)

Table 7: Summary of Expected Results of Baseline and Alternative Scenarios

1. The objective of the project is the removal of barriers that have persistently hindered the widespread development and application of ES&L programs. These barriers were discussed in Section I above. This project will address these barriers through a combination of training and capacity-building, assessing and transmitting lessons learned, learning by doing, sharing work among countries to reduce the effort needed from each country, and technical assistance. The majority of the project will address barriers that hinder governments from developing and implementing ES&L, but a significant project component will also address project manufacturers and the barriers that can hinder their support for ES&L efforts.

1. A number of outcomes resulting from full project activities are expected. These include:

• New minimum efficiency standards for air conditioners, refrigerators, fluorescent ballasts, CFLs and electric motors adopted in at least 4 countries respectively, reducing energy use for these products by at least 10% relative to business as usual (4% for motors).
• At least 4 countries adopt new or improved appliance and equipment energy efficiency labeling schemes.
• ES&L programs are operating by project end in all participating countries, with plans in place to continue these programs after the GEF project ends.
• Regional coordination on ES&L makes it easier for all countries to develop and maintain ES&L efforts and countries elect to continue this coordination after the GEF project ends.
• A majority of appliance/equipment manufacturers in the region recognize the benefits of, and opportunities for, ES&L efforts to increase their profits.
• Mutual recognition agreements and product certification and posting procedures in place so testing and certification in one country generally meets requirements in other countries, easing burdens on manufacturers and promoting regional trade.
• Increased market share of EE equipment/appliances in the different countries and in the region as a result of the ES&L programs.
• Energy savings from the utilization of energy efficient appliances/equipment in the end use sectors in each participating country.

1. The proposed project focuses on building capabilities and interest to pursue ES&L efforts in each of the participating countries, and then using these capabilities to help participating countries set and implement standards on six target products (air conditioners, refrigerators, three-phase electric motors; compact fluorescent lamps (CFLs); fluorescent ballasts and residential fans). In addition, as noted above, several countries will develop new standards on rice cookers. The heart of the project is six regional product-specific working groups that will conduct and oversee technical work that develops model test procedures, standards, and voluntary labeling levels for each targeted product. These model standards will include multiple levels (tiers) in order to fit the needs of different countries. In this way, some of the more advanced countries can adopt more stringent tiers while countries just starting ES&L programs can adopt less stringent tiers. By working together, workloads can be shared, expenses reduced relative to each country doing their own independent analysis, and standards harmonized (same procedures and formats, with a limited number of actual levels in place). Harmonization on standards will encourage regional trade.

1.  The many standards put in place through this project will transform regional markets for targeted equipment, substantially raising efficiency levels. In addition, the labeling schemes put in place will promote purchases of even higher efficiency products, creating a significant market for efficient products in the region.

1. The proposed project will involve a mix of regional and national activities. Countries will work together on training, technical analysis, compilation of reports on lessons learned, development of model standards and procedures, and regular consultations with each other. Individual countries will then use these regional outputs to develop and implement their own standards and labels. In addition, each country will conduct a few pilot projects to address country-specific needs.

1. The proposed project is comprised of five major components consisting of complementary activities designed to remove barriers to achieve the project objectives. A separate component on project management is also included.

• ES&L Policy-Making Program: Establishment of legal basis for standards and labels and assisting with the development of regulations for the targeted products.
• ES&L Capacity Building Program: Building of institutional and individual capacity to secure on-the-ground implementation of standards and labels, including establishment of regional working groups for each of the targeted products.
• ES&L Manufacturer Support Program: Information and technical assistance for local product manufacturers to help them develop efficient products and realize profit opportunities from efficient products.
• ES&L Regional Cooperation Program: Regional cooperation activities that will aid individual countries with development and implementation of their ES&L programs and that will take important steps towards regional harmonization of standards and labels.
• ES&L Pilot Projects: Pilot activities implemented on a demonstration basis by individual countries, or groupings of countries, showcasing various aspects of the design, facilitation and implementation of ES&L programs, including support activities that build on the regional foundation provided by BRESL. This will include a number of activities implemented at the national level, with coordination across the region, including initial work on regional harmonization led by China.

1. The following paragraphs describe the various major activities and sub-activities under each project component. Note that in the following tables that present the various sub-activities, the “Country” column refers to the country or countries where the sub-activity (national) will be implemented. In the case of regional sub-activities, this column refers to the beneficiary countries (i.e., the BRESL countries) of the sub-activity. The “Responsible Entity” column refers to the institution/agency (and where relevant, also the project partners, i.e., those in-charge of the co-financed and/or baseline activities) in each country that is responsible for the implementation. In the case of regional activities, this column refers mainly to the regional project management unit (and in some cases, together or in coordination with the relevant project partners). It should be noted also that in some cases, as agreed during the Regional Stakeholders’ Consultation Meeting in August 2006, a specific country (or countries) will also implement supplementary sub-activities.

Each country that will carry out supplementary sub-activities will develop specific work plans for such including an appropriate monitoring and evaluation plan. The results of such sub-activities will also be shared to the other countries.

Component 1: ES&L Policy-Making Program

1. This component will include several activities to put in place new laws and regulations enabling and establishing equipment standards and labels. The focus here is to establish a legal and regulatory foundation for ES&L in each of the participating countries. This will include providing information and TA to countries without ES&L enabling authority in place so they can pass necessary enabling laws or regulations, and will also include providing information and TA to participating countries so they can adopt new standards and labels for the six targeted products. Lack of enabling regulations is a key barrier in five of the seven participating countries. In addition, this component will include information and TA on standards and labeling implementation, in order to maximize compliance with ES&L regulations. By working together to establish new standards and labels on the six targeted products, substantial and concrete benefits will be achieved. In addition, documentation of these benefits will help to build support for continued ES&L activities in each of the participating countries. For example, a country achieving substantial benefits from initial standards is more likely to allocate money out of national budgets to continue ES&L activities. In our survey of participating countries, one clear message we received was they want this project to focus on standard-setting actions and not just training and other enabling activities. This project component addresses this need.

1. Activity 1.1: Strengthening of the Policy Context for Energy Standards and Labels: Most of the BRESL countries lack enabling legislation or regulations to establish ES&L programs. The following are the proposed sub-activities that will be carried out to address such barrier/constraint. These will be mainly implemented at the national level:

1. All of the abovementioned activities will be done at the direction of the government in each country and will respond to each country’s specific needs. Each country will provide government personnel to work on this activity. GEF support is required for the technical assistance in the feasibility studies and policy and regulations/laws implementation and for provision of information.

1. Activity 1.2: Adoption and Implementation of Energy Standards and Labeling Regulations: This major activity will involve providing information and assistance to individual countries to help them adopt standards and labels on the six products covered by the project.

1. Each BRESL country will provide government personnel to work on the implementation of this major activity. GEF support is required for the necessary technical assistance on the development, adoption and implementation of energy efficiency standards and labels for appliances, and in the development and piloting of ES&L program enforcement measures.

Component 2: ES&L Capacity-Building Program

1. This component will address several barriers including lack of technical know-how on ES&L, lack of institutional capacity on ES&L implementation, absence of adequate information on appliance and equipment efficiency and trends and limited local energy performance testing facilities. This component will include several key activities to build capacity for developing and implementing energy standards and codes including staff training, establishment of product-specific working groups, provision for adequate testing facilities, establishment of regular data collection and reporting processes, and facilitation of mutual recognition agreements so that equipment tested and certified in one country does not need to be retested and recertified in other BRESL countries.

1. Activity 2.1: Training to Strengthen and Enable Public Institutions to Support Development and Implementation of ES&L Programs: This activity will involve training courses for officials and consultants involved with ES&L development and implementation on standard and labeling processes, technical content, implementation and related issues. These courses will emphasize practical experiences in the region (e.g., Japan, S. Korea) as well as in other regions (e.g., USA) and lessons learned. These courses will be given at several locations in the region and will be designed to make sure that all personnel working on the project have a common basis of knowledge upon which they can build by participating in other project activities. These courses will build on material developed previously by CLASP.

1. GEF support is required for the in-country capacity needs assessments and for updating and customizing the ES&L training material for regional needs, as well as for organizing, delivering and evaluating the training courses.

1. Activity 2.2: Capacity Enhancement in the Development and Implementation of Standards and Labeling for the 6 Targeted Products: This activity will involve establishment of working groups for each of the six targeted products and the development of model test procedures, standards and labeling programs for each product by its respective working group. The intent is to develop a body of common information and approaches each country can use to set standards and labels that will also consider ES&L policies and programs that are in place in countries such the USA and Japan. This is to make adoption easier in individual countries and also bring a degree of harmonization to standards & labels in the region. This is in line with the laying of groundwork for the planned regional harmonization.

1. GEF support is required for the administration and facilitation of the tasks that will be carried out by the working groups, including travel costs to working group meetings, and documentation of technical reports produced, as well as in the technical assistance for the supplementary initial work that China and Indonesia will be doing on regional harmonization.

1. Activity 2.3: Strengthening of National and Regional Testing and Certification Infrastructure: This major activity is meant to address the barrier related to the inadequate capacity of testing and certification facilities and programs in the region. It involves the implementation of the national and regional technical assistance and capacity development sub-activities tabulated below:

1. GEF support is needed for the survey on testing and certification facilities and preparation of recommendations, for provision of technical assistance in the harmonization of test procedures and the establishment of mutual recognition agreements and procedures, and in the performance of the regional round robbing testing.

1. Activity 2.4: Strengthening of Data Collection and Reporting Procedures on Equipment Availability and Sales by Efficiency Level in Participating Countries: ES&L programs rest on a foundation of data on equipment energy use and how this use is changing over time. Such data are needed to set standards and to monitor standard implementation and benefits. Currently, the available data are fragmented as they are collected and reported by various institutions in each country (sometimes in different institutions within the country).  This activity will involve developing a simple model data collection and reporting procedures, based on successful efforts in the region, and provision of technical assistance to countries that now lack such procedures, so they can adopt such procedures.

1. This major activity on data collection and monitoring will be in line with the data banking requirements needed to support the regional harmonization efforts. GEF support is needed for the technical assistance and facilitation of the development and application of the procedure.

Component 3: ES&L Manufacturer Support Program

1. This component has been primarily designed to address the barrier that manufacturers are often distrustful of standards and labels, and their objections can delay ES&L efforts or result in weakening of standards. During the Regional Stakeholder Workshop in August 2006, it was agreed that this manufacturer-related barrier is generic across the region, but must be dealt with in the context of each national economic and cultural setting. Therefore the activities will be carried out separately within each country, but with the sharing of lessons learned at the regular regional BRESL meetings being an important part of the component design. The activities under this component will include the provision of information to manufacturers on ways to improve product efficiency at modest cost; training on ways to use ES&L programs to increase profitability; and technical assistance to individual local manufacturers on these issues.

1. Activity 3.1: Product Technical Analysis and Reports: This is a regional activity that will be supported by all BRESL countries. It basically involves the preparation of a set of six reports (one per targeted product) on ways to improve product efficiency and the costs involved (including capital and product variable costs).

1. This major activity will assist in ensuring that local manufacturers comply with enforced implementing rules and regulations of the national ES&L programs. The reports will also encourage consumers to use energy efficient appliances, and make them aware of the benefits of such products. GEF support is required for the technical assistance in preparing the reports, including logistics needed for data gathering.

1. Activity 3.2: Educational Workshops for Manufacturers and Retailers on Impacts of Standards on Manufacturers and Retailers and Ways to Work with Standards to Increase Profitability: This activity will involve holding one-day training programs for manufacturers and retailers on how standards and labels can affect them and ways to use standards and labels to increase profitability. These will be held in each BRESL country, with the provision of technical expertise facilitated by the Regional PMU.

1. The workshops will review implementation experience in several countries, including actual costs of compliance which are generally much less than pre-effect date perceptions of the costs of compliance. One workshop will be conducted for each country. The workshops will include examples from the region and elsewhere. GEF support is needed for required research work for use in the design of the workshop program and to organize and conduct the workshops.

1. Activity 3.3: Technical Assistance to Manufacturers: This major activity will involve the provision of a limited amount of technical assistance to selected local manufacturers of the 6 BRESL products as identified by the participating countries. GEF support is need for the required technical assistance that will be provided to local appliance manufacturers, including for the evaluation of potential improvements and efficient designs for locally made BRESL products, as well as the capacity building to be provided for banking/financial institutions that can fund production improvement projects of these manufacturers.

Component 4: ES&L Regional Cooperation Program

1. This component is intended to help countries to learn from one another so they can emulate successful efforts and avoid repeating mistakes that others have made. An activity to plan for follow-up activities when GEF funding ends will also be carried out. This is to ensure that regional cooperation and progress and standards can continue. The following are the specific activities under this component:

1. Activity 4.1: Project Web Site: This regional activity will develop a project web portal so that information compiled by the project can be posted and available to all. This web portal will build on the existing APEC ESIS web site (www.apec-esis.org), which is intended to serve as the repository for ES&L information related to this GEF project and to accommodate information intake and dissemination related to the harmonization work that will be carried out.

1. GEF support is required to develop the project web portal and to support development of national portals for the participating countries.

1. Activity 4.2: Lessons Learned Reports: This regional activity will involve the documentation of all relevant lessons (successes and shortcomings) that were learned in the development, implementation and enforcement of ES&L programs/projects. A series of concise “lessons learned” reports will be prepared to address important ES&L issues identified by participating countries.

1. GEF support is required for the preparation (interviews, researches and analyses), publishing and dissemination of the relevant reports.

1. Activity 4.3: Regional Energy Efficiency Standards and Labeling Network: This major activity involves the design and establishment of a Regional Energy Efficiency Standards and Labeling Network (REESLN), which builds on the start-up work funded through the end of 2007 by APEC[39].

1. This particular activity places emphasis on the importance of enhancing cooperation regionally and internationally, and not just within the 6 BRESL countries (including ROK). Through the Regional Project Steering Committee, the project would attempt to build on experience in S&L programs in other countries, both industrialized as well as developing countries, including those supported through GEF projects. This will facilitate more information uptake that will be useful in guiding the collective work for on ES&L harmonization, starting with the test procedures. GEF support is required for administration of the work group and for meeting expenses including travel.

1. Activity 4.4: Regional ES&L Harmonization Initiative - This major activity will consist of specific tasks aimed at laying the groundwork for the facilitation of the planned regional ES&L harmonization starting with test procedures, and later on standards & labels. These will be carried out in consultation with the Working Groups and the Country Teams in the BRESL countries. The technical assistance that will be provided under this major activity will be for the conduct of the following sub-activities:

1. The work on the abovementioned sub-activities will be carried out in an integrated and coordinated fashion with the initial work towards regional ES&L harmonization led by China. GEF support is required for the technical assistance in developing the studies, evaluation, and pilot program design work that will be carried out under this activity.

1. Activity 4.5: Preparation of a Plan for Regional Activities and Coordination after the GEF-Funded Project Ends: When the BRESL project ends, there will be many ES&L activities to continue. It is anticipated that with barriers eliminated or at least substantially reduced, many of these activities will continue, particularly at the national level. However, regional coordination and harmonization will still be useful. Towards the end of the project, a Sustainable Follow up Plan for activities that will be carried out after the BRESL will be developed, so that key regional activities and frameworks that were established under BRESL can continue. It is important to begin development activities in Year 5 for the continuation of the regional coordination activities particularly for sustaining and enhancing the established regional ES&L harmonization.

1. GEF support is required for technical assistance in the development of the sustainable follow-up plan.

Component 5: ES&L Pilot Projects

1. This component is intended to provide flexibility to individual countries, or groupings of countries, to carry out policy research and implement pilot projects at the national level that build on the regional foundation provided by BRESL. Some of the regional activities, e.g., regional training efforts (Activity 2.1) and the Lessons Learned reports (Activity 4.2) – will provide input into the specific activities described below. But the activities under Component 5 will be implemented at the national level, with coordination across the region. An important note is that, for each activity under Component 5, the scope and budget will vary by country depending on the needs and interests of the particular country.

1. Activity 5.1: Government Procurement (Bangladesh, Indonesia, Thailand, and Vietnam): A number of governments in the region – and in particular China and Korea – have developed aggressive government procurement programs that mandate the purchase of high-efficiency equipment (i.e. equipment in the top ranking of a comparative label or that receives a national endorsement label ranking). This activity will build on the review of government procurement schemes included in the Lessons Learned report (Activity 4.2).

1. This major activity is related to the objectives of Activity 2.1. GEF support is necessary for the required technical assistance in the development and implementation of the proposed government procurement schemes, and in the development of mass purchasing agreements.

1. Activity 5.2: Database (and Web Site) of Energy-Efficient Equipment (Bangladesh and China): This major activity will involve the development of an accurate and widely available in-country database (and web site) on energy-efficient products and their usage, similar to that in South Korea. This will be carried out in Bangladesh and China.

1. The information will be presented for use by domestic consumers but will also be linked to the BRESL regional project web site, with the intention of eventually creating a regional database for compliance that shows test results of the energy performance of all major end-use equipment. This major activity will also be linked to Activities 2.3 and 2.4. GEF support is necessary for the required technical assistance in the development of the database of EE appliances/equipment.

1. Activity 5.3: Development of Consumer Education Schemes (Bangladesh, Indonesia and Pakistan): This major activity will address the barrier related to consumers having a low level of awareness about the benefits of energy-efficiency standard and labeling.

1. This activity will be linked to Activity 1.2. GEF support is necessary for the required technical assistance in the design and implementation of the awareness enhancement schemes.

1. Activity 5.4: ES&L Initiatives Financing (Indonesia) - The focus of this activity, which will be carried out in Indonesia, is on ensuring the financially sustainable implementation of the country’s ES&L program. It will include carrying out tasks that would lead to the building of joint government and private sector financing schemes for ES&L programs and the development of consumer-financing schemes for the purchase of ES&L equipment. The sub-activities are the following:

1. GEF assistance is required for supporting the design and development of the financing schemes, as well as in the promotion and evaluation of the same.

1. Activity 5.5: Regional Harmonization Promotion (China) - As the BRESL lead country, China will initiate the implementation of regional ES&L harmonization work that will complement the activities carried out in Component 4. The major tasks that will be carried out under this activity are as follows:

1. GEF support is required for the technical assistance needed in the establishment of the regional ES&L harmonization facility, conduct of training workshops, and the piloting of harmonized ES&L test procedures and tools.

1. All of the BRESL countries will participate in most of the Component 5 project activities. However, a few countries have elected to skip some activities or to emphasize certain aspects of an activity. Country participation by activity is summarized in Tables 8 & 9.

1. Changes Relative to the Project Concept Document. This Project Brief includes some evolution in project thinking since the Project Concept Paper was submitted. Major changes include a reduced number of countries (several countries dropped out due to other priorities for using their GEF allocation) and the expansion of the number of targets targeted from 5 to 6 ½ (the half is work on rice cookers in three of the countries). Most of the activities in the Concept Paper are retained, but have been rearranged to make implementation easier. A few components were dropped because they were either not needed or were too expensive relative to the value they provide. Annex A summarizes how the Project Concept Paper has evolved into this Project Brief.

Project Indicators, Risks and Assumptions

1. The project success indicators are shown in the Project Planning Matrix (PPM) in Section II, Part II. The target values for these indicators based on the PPM, which will be monitored during the course of the BRESL project implementation, are summarized in Section IV, Part VI.

Table 8: Country Participation in the Various Project Elements.

NOTES:

1. Emphasize implementation                              2. Improve framework, make labels mandatory

3. EC law formulation                                        4. Technical assistance resource

5. Help in capacity development                           6. Emphasize laboratory accreditation

7. Emphasize MRA                                           8. MRAs and certifying extra laboratories

9. Emphasize sales of high EE products                 10. ES&L needs assessment; emphasize S&M

1. The likely role of participating countries is shown in Table 9. The table is based on the survey responses and limited informal consultations with likely partners.

Table 9: Role of Participating Countries in the BRESL Project

1. While all possible efforts have been made to ensure the effective design and implementation of the project activities in the project design phase, there are inevitably some unavoidable residual risks that will have to be carefully monitored and managed during the project to ensure its success. The different risks that were identified during the project formulation and the recommended mitigation measures and a commentary on the need for mitigation measures are provided in detail in Section IV, Part V.

1. The overall project risk is moderate. The principal risks, which can potentially hinder the successful project implementation and/or reduce project effectiveness, relate to: (a) the sustainability of the support by key stakeholders in the participating countries; (b) lack of, or fading, interest of the private sector (particularly appliance/equipment manufacturers and suppliers); (c) Financing of investments for manufacturers to modify their production facilities may not be available. (d) ineffective project coordination at the national and/or regional levels; (e) failure of EE products to perform as claimed by manufacturers resulting in customer dissatisfaction; (f) unabated proliferation of illegally traded and unreliable EE equipment/appliances; and, (g) unwillingness of consumers to buy EE products due to bad experiences in the past and high initial cost may lead to failure of the project to induce increased sales and widespread use of EE equipment and appliances. To address these risks, the project has to establish effective means to monitor and to the extent possible mitigate these risks. Mitigation measures include a strong emphasis on hands-on project management and participation of each country, mobilizing private sector participation and a continuous dialogue between the project’s donors, implementing Partner, executing agency, regional organizations and national governments.

Expected Global, National and Local Benefits

Global Benefits

1. The project is projected to reduce GHG emissions from the region by 24.8 MMT CO₂/yr by project end. Savings will steadily mount after the project ends as existing equipment is replaced by more efficient equipment, reducing GHG emissions by about 188.1 MMT/yr ten years after project end, and by about 273.5 MMT/yr twenty years after project end. In addition, the project will demonstrate successful ES&L programs in the BRESL countries, which represent a wide range of situations and experiences. The demonstration of the various aspects of the development and implementation of ES&L programs, and the lessons learned will be helpful for starting or improving ES&L programs in other regions.

National Benefits

1. The participating countries will benefit from a substantial reduction in electricity growth rates, meaning less new power plants that need to be built. This will free up capital for other uses. Consumers and businesses will have lower electricity bills due to reduced electricity consumption. Assuming an average electricity price of US$ 0.08 per kWh, electricity bill savings will total about US$ 2 billion in the last year of the project, rising to about $29 billion twenty years after the project (all figures in 2006$). After considering the slightly higher cost of efficient products and a 6% real discount rate, net consumer benefits will total over US$ 100 billion over the 2011-2031 period (2006$). In addition, equipment manufacturers in the region will be producing more efficient products, allowing them to better compete in world markets. And many of them will be producing more “value-added” products that generally have higher profit margins than “commodity grade” products, increasing profits relative to baseline.

Country Ownership: Country Eligibility and Country Drivenness

1. All of the six (6) participating countries in the BRESL project have ratified the UNFCCC. The ratification dates are as follows: Bangladesh (22 June 1994); China (16 May 1994); Indonesia: (29 June 1994); Pakistan (4 August 1994); Thailand (30 June 1994); and, Vietnam (12 May 1994).

1. All of these countries have completed and submitted their First National Communications under the framework of the UNFCCC. These communications all highlighted that EC&EE, in general, and ES&L, in particular and among the measures each country are considering for the reduction of GHG emissions. At present, some of the participating countries have already carried out ES&L programs. Two of them (China & Korea) are already well-advanced in their activities in this area. The others are either just starting (Bangladesh, Indonesia, Pakistan, Vietnam) or have done significant work on ES&L as part of their demand side management (DSM) activities (Thailand). All of these countries are now preparing their Second national Communications to the UNFCCC.

1. UNDP came up with the concept of this regional ES&L project as part of its initiative to promote energy and environment for sustainable development back in May 2004. Since then, the development of the BRESL has involved consultation meetings with the participating countries starting mainly with energy officials in the ASEAN countries. A regional survey was also carried out to identify ongoing and planned ES&L initiatives in the Asian region as well as the barriers to ES&L development and implementation in each participating country and those that affect and hinder regional efforts to ES&L harmonization. A regional stakeholders’ consultation workshop was also conducted to discuss the identified national and regional barriers. Said consultation workshop also came up with the national and regional activities that are proposed to be carried out under the BRESL project, including the project implementation and management arrangements.

1. BRESL is currently the only regional ES&L barrier removal initiative in Asia. It has direct linkages to and collaboration with ongoing Asia-Pacific regional and national programs. These include ongoing and planned ES&L programs of the participating countries, most of which are in China and Korea. BRESL will also work in collaboration with the ES&L activities of the International Copper Association (ICA) in some of the participating countries, as well as the ongoing project on the International CFL harmonization Initiative. Some of these have parallel activities that, as per agreement with the project proponents/owners, would be subsumed in the BRESL Project.

1. It should be noted that these projects are funded separately and are among the co-financed activities of BRESL. As part of the regional project (and indicated in the PPM), their results are reported as among the outputs of BRESL. Where necessary, GEF resources will be used for technical assistance in the implementation of some of these parallel activities. The matching of these parallel activities and BRESL’s technical assistance is very important in achieving the market transformation envisioned through the widespread implementation of effective ES&L programs. Representatives from these partner organizations are members of the BRESL’s Regional Project Steering Committee.

Sustainability

1. Sustainability is an integral element of the BRESL activities and is ensured through the outputs of most of the project components. The sustainability of the institutional elements of the project will be ensured through the adoption of collaborative approaches and strategies that seek to foster and reinforce the long-term sustainability of existing institutional and coordination structures that have been established and are operational at both the national and regional levels with regards to projects dealing with energy and trade.

1. The establishment of effective energy efficiency standards and/or labels leads to a more sustainable energy future. First of all, energy standards and labels are generally introduced through a formalized process leading to a government regulation or endorsement during the project. Once established with a clear government imprimatur and a solid institutional infrastructure, a properly designed and implemented ES&L program can effectively transforms the market to a higher level of energy efficiency with a gradual ratcheting-up of energy efficiency standards over time to take into account new technological developments and the country’s capacity to pay for that technology.

1. Since the BRESL is designed as a strong capacity-building project (as part of the barrier removal objective), the main project outputs will not only be new energy efficiency standards and labels, but also institutional structural growth with a capacity to effectively maintain and revise the ES&L program over time. The government agency with the ES&L mandate (or those actively engaged in energy conservation and energy efficiency promotion activities) in each Asian country, which will play a significant role in the implementation of the national activities under BRESL, is expected to continue to spearhead and sustain the activities after the project life. The national activities of the BRESL project will be mainstreamed into the country’s energy efficiency program in the next 10 years. If a country has an energy conservation law, the project will strengthen the component that relates to ES&L programs. The proposed project will strengthen the role of these agencies in leading the ES&L efforts and GHG emission mitigation activities in each participating country. Periodic monitoring and evaluation of ES&L programs and activities in each country will be institutionalized and will be continued even after the end of the BRESL project. This will bring sustainability of the project with desired benefits in the long run.

1. Regional cooperation in the area of ES&L will be encouraged and established to enable South-South transfer of technical know how and technology. A network of collaborators throughout the region and around the world with a common mission, bringing attention and high priority to efficiency standards and labels within key development institutions will be established. This is to achieve higher awareness of international developments, benefits of harmonization, and trade advantages. It should be emphasized that BRESL will foster regional collaboration and harmonization throughout the region, which will greatly strengthen the effectiveness of individual national ES&L programs. With this, the market transformation and resulting carbon emission reduction from this project will persist far beyond the term of the project.

Replicability

1. BRESL is designed to have a balanced mix of capacity building and enabling environment activities that are tailored to the participating countries’ specific conditions, markets and regulatory environment, and ES&L programs on the ground. Such balanced mix of activities is expected to promote market transformation favoring energy efficient appliances/equipment in the region and shifting investment patterns from standard quality appliances/equipment toward those of the energy efficient varieties. With enhanced enabling environment and the capacity built through the project, replications of several specific interventions that will be carried out in the project are expected. In particular, the pilot project activities that will be carried out are meant to showcase feasible design and application of ES&L programs, design and manufacturing of energy efficient equipment and appliances, widespread utilization of such equipment/appliances in the commercial, industrial and residential sectors, enforcement of policies and policy support activities, and implementation of financing schemes for supporting projects that promote utilization of energy efficient equipment and appliances. Replication is an integral component of the project design as the expected energy savings from the utilization of energy efficient equipment/appliances (and the corresponding GHG emissions reduction from the reduced electricity demand) rely on the replication of the relevant BRESL activities.

1. Replicability of the proposed project components will be ensured through the documentation of the package of activities/inputs that went into each EC&EE projects that are in one way or another, directly or indirectly influenced by the BRESL.

PART III: Management Arrangements

1. Given the past experience with UNDP-supported project, UNDP seeks to implement an innovative management approach based on a partnership where accountability and responsibility for managing and achieving project outputs are equally shared among the BRESL participating countries. The partnership will be based on strengthened management at the regional level and the national level. The BRESL consists of two levels activities: (i) enhancing the regional cooperation/ multi-recognize and sharing the best practices of energy efficiency standard and labeling (EESL), and (ii) developing and implementing country-specific strategies and activities for energy efficiency standard and labeling (EESL) to overcome the barriers of reducing the energy consumption within each national context. The organizational structure is shown as follows:

Fig. 3: BRESL Project Organizational Structure

Regional Coordination and Implementation Arrangements

1. The management structure of the BRESL project will mirror the aforementioned two-track approach, and will be at 2 levels. The first level will mainly be for the facilitation of regional cooperation. A Regional Project Steering Committee (RPSC) will be established and will comprise of the representatives of the UNDP-GEF Regional Coordination Unit (RCU) for Asia-Pacific, UNDP-China, participating country’s Government Focal Points (GFP), NDRC, and also including CSC and the Director of the Regional Project Management Unit (RPMU). The RPSC will play the role of an advisory committee. The RPSC member will also be invited to participate in the annual project review meetings. The Chairperson of the RPSC will be elected on a rotating basis among the participating countries. The RPMU will be also established to be responsible for coordinating and implementing the regional and national activities of the project. The RPMU Director will serve as the Secretary of the RPSC. BRESL will be Nationally-Executed (NEX) on behalf of the participating countries by China as the host country. It will assume the overall responsibility of ensuring that all activities are executed accordingly and as per the approved Project Document. The National Development and Reform Commission (NDRC) will be the Implementing Partner (or Executing Agency) for the BRESL project while the China Standard Certification Center (CSC) is the Designated Implementing Partner (or Designated Implementing Agency).

1. The Regional Project Steering Committee (RPSC) will be established with the key responsibilities as follow: (a). Reviewing of annual progress reports for necessary guidance; (b) Reviewing and approving the annual work plans and budgets; (c) Providing guidance on the effectiveness of BRESL project implementation, and its linkages to corporate UNDP policy decisions, and other UNDP initiatives; and, (d) Monitoring and evaluating the implementation of BRESL towards the intended outputs, after two years of project execution. As a minimum, the RPSC will meet at least once a year, allowing for the stakeholders to review the progress with the project implementation and to agree on a coordinated annual project implementation strategy and plan.

1. UNDP-China, together with the UNDP-GEF Regional Technical Advisor for Climate Change in the Asia-Pacific region will carry out the GEF oversight. Working in conjunction with the various project partners, UNDP-China will be responsible for monitoring and evaluation (M&E), including organizing project reviews, approving annual implementation work plans and budget revisions, monitoring progress, identifying problems, suggesting actions to improve project performance, facilitating timely delivery of project inputs, and provide linkages to the other sub-regional, Asia-Pacific regional and global initiatives. All M&E functions will be carried out in line with standard UNDP and UNDP-GEF procedures. UNDP China will also provide country office support for all the activities of the project as agreed with the implementation partner of China.

1. As the Implementing Partner for this regional project, China’s NDRC will appoint a Regional Project Director (RPD) to be in charge of overall responsibilities, including planning, coordination, administration and financial management of the project with support by UNDP-China. The RPD will be responsible for the achievement of the project objectives, for all projects’ reporting, including the submission of Annual Work Plans (AWP) and financial reports. He/She will ensure the delivery of the project outputs and the judicious use of the project resources. This will ensure that expected outputs are delivered using the most efficient and cost‑effective implementation strategies and procedures. The RPD will be also a member of the BRESL RPSC. As the project’s Implementing Partner, the NDRC will also provide in-kind contribution to implement the BRESL project.

1. As the Designated Implementing Partner for this regional project, the China Standard Certification Center (CSC) will take responsibility of supporting NDRC and UNDP-China in managing and implementing the BRESL project. The Director of CSC will be a member of the BRESL RPSC. At the same time, the director will also provide guidance to the RPMU Director to manage the project. The CSC will also provide the overall guidance and approval of all operational activities and will report to the Implementing Partner on achievement of project results.

1. A Regional Project Management Unit (RPMU) will be established by UNDP-China, together with the NDRC and CSC. The RPMU will be responsible for the day-to-day management of all the project activities including those on capacity building, demonstration sub-projects and dissemination activities both at the regional and national level. At the same time, the RPMU will undertake some regional activities directly if needed. RPMU will be managed by a RPMU Director, who will be supported by three staff members.

1. A Project Assurance Committee (PAC) will be established with the main responsibility of monitoring the project implementation process and achievements. The Energy Focal Points of UNDP Country Offices (UNDP-COs) in the BRESL countries will be members of the PAC. They will also be called upon periodically to contribute inputs on the relevance of BRESL activities to the on-going and planned national level energy efficiency and related initiatives. Each PAC member will be responsible for the coordination of project activities and activities of the organizations he/she represents to avoid duplication of effort. On request from the RPMU, the PAC will provide guidance on the execution of project activities.

1. Relevant regional activities will be subcontracted to, and executed by appropriate regional organizations with the expertise and time on mutually agreed terms. Regional organizations, which have the comparative advantage vis-à-vis the relevant regional activities, will be designated as the sub-contractor for those activities. One mechanism to determine such possible comparative advantages is procurement via Open International Competition or Limited International Competition, as per UNDP Results Management User Guide.

National Coordination and Implementation Arrangements

1. The second level will mainly be on the implementation of the Country Teams (CTs) in each BRESL country. The CTs, made up of representative from government, the private sector and civil society including NGOs will ensure that the national activities are carried out in coordination with all the parallel activities. Each CT will provide support as per agreed work plan to the BRESL implementation at the regional level to ensure the maximum outputs and achievement of the project. Each country will decide on the most appropriate person to chair the CT. Each CT will appoint their own national experts, as needed, in accordance with the agreed national activities to be carried out under the BRESL project. Each country will appoint a National Project Coordinator (NPC) who will work full time on the project and paid from its country budget. The NPC will also be responsible for the day-to-day management and implementation of all national project activities.

1. In each BRESL country, the national level activities that were identified and defined by the country will be implemented by its CT. These are activities that address specific barriers to ES&L at the national level, delivering on-the-ground activities including appliance and/or equipment testing utilizing local experts and involving entities working on ES&L, as well as those that will contribute to the regional ES&L harmonization efforts. This is to ensure maximum impacts and visibility. It will also give country’s ownership of the project, maximum local participation, particularly of the private sector, NGOs and local authorities, and more importantly the consumers. CTs may subcontract certain activities to regional and international experts where necessary.

1. National government professionals and other relevant national stakeholders from the private sector and civil society will, to the extent possible, manage, coordinate and implement the in-country activities. The CTs will upon request of the RPMU and as per agreed work plans be provided with external technical assistance for implementation of specific in-country activities. Relevant regional organizations, national consultants, regional consultants or international consultants can provide such needed expertise to the RPMU as needed.

BRESL Project Implementation

1. The proposed BRESL project will be implemented for five years. Considering the duration of the process of obtaining GEF funding, it is anticipated that the project will kick-off by the second quarter of 2008 and will conclude by the end of 2013.

1. Each country team will prepare its overall country work plan (5 years) at the inception stage of the project based on the BRESL activities that are described in Paragraphs 75 - 118, specifying the level of activities that will be carried out for the year, the targets to be achieved, and the corresponding inputs (in terms of manpower and budget). During the inception stage, each country will prepare its first year work plan and submit this to the Regional PMU. This is reviewed by the Regional PMU and approved for the allocation of funds for the implementation initial year activities. Succeeding annual work plans, based on the results of the previous year and the planned activities for the current year, will be prepared and submitted for approval and budget allocations at the start of each year.

1. Also during the inception stage, each country team will prepare its overall M&E plan (5 years) based on the overall country work plan, and also based on the BRESL project planning matrix (Table 14), BRESL annual targets (Table 23) and BRESL monitoring plan (Table 24). Like the overall BRESL M&E plan (see Paras 158-160), this will consists of success indicators (output and impact) with realistic targets and time lines, and backed up with clear means of verification, and assumptions. The capacity building on M&E that is part and parcel of the design of the overall EE appliance/equipment market monitoring scheme in Activity 2.4 is expected to enable the country team to carry out the monitoring activities as well as make meaningful assessments of the data gathered/reported. Each activity/task that will be carried out will be monitored in terms of the appropriate output indicators (for the activity deliverables) and the impact indicators (for the impacts). The targets will be reviewed each year and any necessary revision or adjustment of these, as well as the assumptions will be done on a continuous basis during the life of the project as part of adaptive management.

1. To accord proper acknowledgement to GEF for providing funding, a GEF logo will appear on all relevant publications and documents produced by the project, including among others, project hardware purchased with GEF funds. Any citation from any of the BRESL project publications and documents will also accord proper acknowledgment to GEF. The UNDP logo should be more prominent and separated from the GEF logo if possible, as UN visibility is important for security purposes.

PART IV: Monitoring and Evaluation Plan and Budget

1. Project monitoring, evaluation and dissemination will be undertaken in accordance with UNDP and GEF established procedures. The executing agency will be required to prepare Quarterly Project Reports (QPR) and combined Annual Project Reports and Project Implementation Review reports (APR/PIR) to UNDP. The QPR will provide the summary of the project results, progress and variances from the original plan, implementation issues, and steps being taken to address these issues, and work plans for the next quarters for review and endorsement.

1. Quarterly work plans will be prepared based on the overall project objectives and performance indicators. These will be used to measure performance. It is through these reports and meetings that the project approach and activities will be formally refined. The PMO will present the project status and accomplishment to the PSC every quarter. A quarterly work plan based on project objectives and performance indicators will be presented, evaluated and adjusted as and when necessary.

1. The APR/PIR will provide a more in-depth summary of work-in-progress, measuring performance against both implementation and impact indicators. Any adjustments in project approach will be reported to the Regional Project Steering Committee who will evaluate and approve the adjustments recommended.

1. The project is subject to two in-depth independent reviews. One will be conducted in the mid-term (first quarter of the third year) and the other will be scheduled upon project termination. A terminal report would be completed prior to the completion of the project and would detail project achievements and lessons learned. Additional independent evaluation may be conducted if UNDP and the GEF deem it necessary.

1. As executing agency, CSC will carry out continuous self-monitoring of the project implementation performance. The in Section II, Part II states all the success indicators and means of verification for each activity that will be carried out under this project. These indicators are the parameters that will be monitored by CSC under this project.

1. To ensure coherent, coordinated and timely implementation of project activities, appropriate practical mechanisms, monitoring and evaluation (M&E) procedures and implementation arrangements will be developed between and among national and local government agencies, financial institutions, private sector partners, local NGOs and consumer groups. Specifically, an M&E plan for the BRESL implementation will be developed together with the key stakeholders, and this plan will be based on the identified success indicators and means of verification for the project goal, project purpose, project outcomes, and project activities. The Regional PSC will advise and approve this M&E plan.

1. Surveys will be conducted during the project to track these and other indicators of project impact. Monitoring and Evaluation (M&E) activities will be undertaken to best international practice standards with reference to the International Monitoring and Verification Protocol (IPMVP) methodology. This reference to established international best practice IPMVP methodologies will be a vital element in the presentation of the results of the overall BRESL project to the full range of project stakeholders, including but not limited to GEF.

1. Success indicators for each objective and activity in the PPM will be monitored and evaluated during the course of project implementation. Section IV, Part VI provides the annual targets and the monitoring plan. The extent by which the GEF developmental goal is achieved will be evaluated from the monitored results. Annual target values for the indicators will be confirmed during project document finalization.

1. The project will coordinate with all the project partners. The continuous monitoring and evaluation of all project activities, even after completion of the project period, will bring sustainability of the project with desired benefits in the long run. All evaluation reports will be uploaded to the project website for widespread dissemination. A formal Monitoring and Evaluation Strategy will be developed and implemented in the full-scale project to track the activities and contributions of the activities by all the project partners, in terms of both in-cash and in-kind contributions as detailed in the attached letters of commitment. These M&E findings will be reported on in the project’s two in-depth independent reviews.

PART V: Partnerships Strategy

1. The successful implementation of BRESL will depend on the development of effective partnerships between numerous different agencies at multiple levels. Partnerships will be pursued with international and national agencies, as well as international partners to enrich and further project aims. The project will form a partnership strategy with three elements: (a) international coordinating and implementation function; (b) national coordination and implementation function; and, (c) Technical and commercial function.

Key Partners

1. BRESL will undertake the following activities to ensure that the project work is synergized with on-going national and regional level activities, as well as to benefit from the expertise available in the region:

Ÿ  Strengthen its links by developing Inter-agency Partnerships with key energy-related project nationally and internationally. These will include the Efficient Lighting Initiative (ELI), funded by the GEF and managed by the International Finance Corporation (IFC) and currently by the ELI Quality Management Institute; the UNDP-GEF funded End-Use Energy Efficiency Project (EUEEP) in China; and the Vietnam Energy Efficient Public Lighting (VEEPL). This outreach will also include finding synergies with on-going activities funded by the UNDP-GEF or GEF portfolio implemented by the World Bank, UNEP; other initiatives by UN sister agencies such as UN/ESCAP as well as projects funded by the Asian Development Bank (ADB) and APEC, etc. BRESL will work with financing institutions in the region to provide support for energy service related initiatives.

Ÿ  Partner with the NGO funding and implementation agencies such as the International Copper Association (ICA) and the Collaborative Labeling and Appliance Standards Program (CLASP) to broaden the reach and impact of the BRESL project.

PART VI: Legal Context

1. This Project Document shall be the instrument referred to as such in Article I of the Standard Basic Assistance Agreement between the Government of the Peoples Republic of China and the United Nations Development Programme, signed by the parties on 29 June 1979. The Executing Agency and Implementing Agencies shall, for the purpose of the Standard Basic Assistance Agreement, refer to the government cooperating agency described in that Agreement.

1. The UNDP Resident Representative in China is authorized to affect in writing the following types of revision to this Project Document, provided that he/she has verified the agreement thereto by the UNDP-GEF Unit and is assured that the other signatories to the Project Document have no objection to the proposed changes:

• Revision of, or addition to, any of the annexes to the Project Document;

• Revisions which do not involve significant changes in the immediate objectives, outputs or activities of the project, but are caused by the rearrangement of the inputs already agreed to or by cost increases due to inflation;

• Mandatory annual revisions which re-phase the delivery of agreed project inputs or increased expert or other costs due to inflation or take into account agency expenditure flexibility; and,

• Inclusion of additional annexes and attachments only as set out here in this Project Document

PART I: Incremental Cost Analysis

Broad Development Goals

1. Most of the Asian countries consider energy conservation and energy efficiency (EC&EE) to be cost-effective means of achieving their respective national energy objectives. Among these measures is the implementation of energy-efficiency standards and labeling (ES&L) programs. Such programs have the potential to effect complete market transformations for different classes of energy-saving products, at a cost far below the cost of providing new energy supply.

1. ES&L programs contribute to the realization of the Millennium Development Goals (MDG), particularly MDGs 1, 7 and 8, whereby the program can contribute to the eradication of extreme poverty directly and indirectly, improve environmental sustainability of a country’s and/or a region’s development path, and help improve trade ties and develop global partnership for development. Among the reasons for Asian countries becoming motivated to implement ES&L programs are the following:

• Reduce growth in electricity use among the BRESL countries
• Reduce energy bills, allowing consumers and businesses to use money saved to purchase local goods and services.
• Improve products produced in BRESL countries so they can better compete in world markets.

Global Environmental Objective

1. ES&L programs are among the most cost-effective types of policies and EC&EE measures to address global climate change. Such programs have the potential to effect transformation of energy consuming appliance/equipment markets, which translates to widespread utilization of energy efficient appliances/equipment, at a cost far below the cost of providing new energy supply. With the widespread utilization of energy efficient products, GHG emissions from thermal power generation in China, Bangladesh, Indonesia, Thailand and Vietnam can be reduced significantly, as well as additional reductions in South Korea.

1. The project’s objective is the removal of barriers to the cost-effective development and implementation of ES&L programs in Asia (particularly in the participating countries). To achieve the project objective, BRESL will comprise of 5 major components, each of which is a specific program consisting of specific activities designed to address the identified barriers.

Baseline Activities

1. In general, ES&L is known to many of the countries in the region, and some of these countries have already embarked on developing and implementing ES&L programs. However, such programs have progressed slowly and unevenly in Asia. In most Asian countries, even those that have ES&L programs, the average efficiency of products on the market is still far below the most efficient products available. Despite the difficulties, it is expected that countries in the region would continue to develop their ES&L programs, but still at a slow and uneven pace and hindered by and the mentioned barriers in financing, policy, technology and information. Such would be the characteristic of the “business-as-usual” scenario in the field of ES&L development and implementation in Asia.

1. ES&L programs are underway in many countries in Asia region and are under consideration in most of the others. China and Korea both have extensive ES&L programs and update several standards and labels annually. Still, many of the standards in China are old and well below international norms. Thailand has a strong labeling program for several products but to date has set only two standards. A few lighting standards are likely to be set in the baseline. Other countries are just starting or exploring ES&L programs and are likely to make only limited progress without GEF support.

1. Electricity use is growing rapidly in the region with growth rates over the period 1999-2004 ranging from 4.9% – 12.3% annually (a simple average of 8.3% across the participating countries). In some countries such as China and Vietnam are growing at double-digit rates annually, straining electricity networks and requiring large investments in the electricity sector that are hard to sustain given other development goals. Table 10 below provides growth rates for individual countries.

Table 10: Average Annual Growth Rate in Electricity Sales, 1999-2004

Source: Energy Information Administration, U.S. Dept. of Energy

1. Several large global manufacturers are increasingly dominating appliance and equipment sales, squeezing sales and profit margins at many local manufacturers.

GEF Alternative

1. Under the alternative scenario, the BRESL countries will develop a much-improved capacity to design and implement ES&L programs. Barriers will be removed, capabilities improved, and countries will share analyses and experiences, all providing the foundation for adoption of more than 20 new standards and labels as part of this project (e.g., each of the BRESL countries is planning to establish standards and labels on approximately 4 products as part of this project). Furthermore, both national programs and regional cooperation will be well-established, allowing many ES&L activities to continue after GEF support ends.

1. The GEF alternative (i.e., BRESL project) will reduce electricity use in the participating countries by approximately 303,037 GWh/yr in 2031. These electricity savings will translate into billions of dollars of avoided investments in new power plants.

1. Standards adopted and education and technical assistance provided to manufacturers under the proposed project will provide local manufacturers with information on ways to improve product efficiency at moderate cost and on how to better sell more efficient products for increased profits. Manufacturers who adopt these techniques will be able to better compete in world markets.

1. In line with the GEF strategic objective for OP-5, the following interventions will be carried out under the BRESL Project:  

• Creating the legal and regulatory basis for removing lowest EE technologies from the market and promoting high efficient technologies. Support will be provided to develop new laws and regulations including enabling laws, standards and labels on specific products, and implementation regulations and procedures.
• Strengthening institutions and developing capacities both in public and private spheres to secure on-the-ground implementation of the above. Activities will include training, regional technical working groups to develop standards, strengthening the national and regional testing and certification infrastructure, and improving data collection and reporting.
• Assisting manufacturers to better understand standards and labels and ways to use these programs to improve products and profits through modest cost efficiency improvements and improved marketing of high-efficiency, higher-profit products.
• Promoting regional coordination and information sharing through a regional ES&L website, preparation of a report on ES&L lessons learned from the region, establishment of a regional workgroup of ES&L officials from the region, and obtaining and providing information on ES&L activities beyond the region. In addition, planning for follow-up activities will begin in Year 3 and will be put in place by Year 5 so regional coordination can continue after this project ends.
• Undertaking several national level pilot projects to raise consumer awareness about efficient products and increase sales of efficient products that exceed minimum efficiency standards.

1. The following are the expected outcomes by end of the project:

• GHG emissions reduced by 24.8 MMT/yr CO2 compared to business-as-usual scenario and a cumulative savings of 37.3 MMT/yr by the end of the project (2011).
• Electricity savings of 27,799 GWh/yr compared to business-as-usual scenario and a cumulative electricity savings of about 40,473 GWh/yr by end of project.
• New minimum efficiency standards for air conditioners, refrigerators, fluorescent ballasts, CFLs and electric motors adopted in at least 4 countries, reducing energy use for these products by at least 10% relative to business as usual (4% for motors).
• At least 4 countries adopt new or improved appliance and equipment energy efficiency labeling schemes.
• ES&L programs are operating by project end in at least 5 participating countries, with plans in place to continue these programs after the GEF project ends.
• Regional coordination on ES&L makes it easier for all countries to develop and maintain ES&L efforts and countries elect to continue this coordination after the GEF project ends.
• A majority of manufacturers in the region recognize the opportunities for ES&L efforts to increase their profits.
• Mutual recognition agreements and product certification and posting procedures in place so testing and certification in one country generally meets requirements in other countries, easing burdens on manufacturers and promoting regional trade.
• Increased market share of EE equipment/appliances in the different countries and in the region as a result of the ES&L programs.

1. The proposed project is comprised of five major components consisting of complementary activities designed to remove barriers to achieve the project objectives. A separate component on project management is also included. The project components are as follows:

• ES&L Policy-Making Program - Establishment of legal basis for standards and labels and assisting with the development of regulations for the targeted products.
• ES&L Capacity Building Program - Building of institutional and individual capacity to secure on-the-ground implementation of standards and labels, including establishment of regional working groups for each of the targeted products.
• ES&L Manufacturer Support Program - Information and technical assistance for local product manufacturers to help them develop efficient products and realize profit opportunities from efficient products.
• ES&L Regional Cooperation Program: Regional cooperation activities that will aid individual countries with development and implementation of their ES&L programs and that will take important steps towards regional harmonization of standards and labels.
• ES&L Pilot Projects: Pilot activities implemented on a demonstration basis by individual countries, or groupings of countries, showcasing various aspects of the design, facilitation and implementation of ES&L programs, including support activities that build on the regional foundation provided by BRESL. This will include a number of activities implemented at the national level, with coordination across the region, as well as the initial work on regional harmonization led by China.

1. Component 1: ES&L Policy-Making Program - This component will include several activities to put in place new laws and regulations enabling and establishing equipment standards and labels. This will address the barrier that enabling laws or procedures are not in place in several of the participating countries or suffer from significant limitations. The focus here is to establish a legal and regulatory foundation for ES&L in each of the participating countries. This will include providing information and TA to countries without ES&L enabling authority in place so they can pass necessary enabling laws or regulations, and will also include providing information and TA to participating countries so they can adopt new standards and labels for the six targeted products. In addition, this component will include information and TA on standards and labeling implementation, in order to maximize compliance with ES&L regulations. Several of the participating countries lack experience and skills on the analyses and procedures to follow to establish standards and labels. This component will address this barrier. By working together to establish new standards and labels on the five targeted products, substantial and concrete benefits will be achieved. In addition, documentation of these benefits will help to build support for continued ES&L activities in each of the participating countries. For example, a country achieving substantial benefits from initial standards is more likely to allocate money out of national budgets to continue ES&L activities. In our survey of participating countries, one clear message we received was they want this project to focus on standard-setting actions and not just training and other enabling activities. This project component addresses this need. The activities under this component will collectively cost about US$ 8.857 million. Incremental activities will cost US$ 1,611,400 which will be financed by the GEF.

1. Component 2: ES&L Capacity-Building Program - This component will address several barriers including lack of technical know-how on ES&L, lack of institutional capacity on ES&L implementation, absence of adequate information on appliance and equipment efficiency and trends and limited local energy performance testing facilities. This component will include several key activities to build capacity for developing and implementing energy standards and codes including staff training, establishment of product-specific working groups, provision for adequate testing facilities, establishment of regular data collection and reporting processes, and facilitation of mutual recognition agreements so that equipment tested and certified in one country does not need to be retested and recertified in other participating countries. The activities under this component will collectively cost around US$ 11.665 million. Incremental activities will cost US$ 2,607,500 which will be financed by the GEF.

1. Component 3: ES&L Manufacturer Support Program - This component has been primarily designed to address the barrier that manufacturers are often distrustful of standards and labels, and their objections can delay ES&L efforts or result in weakening of standards. During the Regional Stakeholder Workshop in August 2006, it was agreed that this manufacturer-related barrier is generic across the region, but must be dealt with in the context of each national economic and cultural setting. Therefore the activities will be carried out separately within each country, but with the sharing of lessons learned at the regular regional BRESL meetings being an important part of the component design. This component will include the provision of information to manufacturers on ways to improve product efficiency at modest cost; training on ways to use ES&L programs to increase profitability; and technical assistance to individual local manufacturers on these issues. The activities under this component will collectively cost about US$ 6.065 million. Incremental activities will cost US$ 791,400 which will be financed by the GEF.

1. Component 4: ES&L Regional Coordination Program - This component is intended to help countries to learn from each other so they can emulate successful efforts and avoid relearning mistakes that others have made. In addition, this component will include an activity to plan to follow-up activities when GEF funding ends, so that regional cooperation and progress and standards can continue. The activities under this component will collectively cost around US$ 3.952 million. Incremental activities will cost US$ 710,900 which will be financed by the GEF.

1. Component 5: ES&L Pilot Projects - This component is intended to provide flexibility to individual countries, or groupings of countries, to carry out activities that can showcase specific aspects of the various aspects of the design, facilitation and implementation of ES&L programs, including support activities. The specific pilot projects are on ES&L-related policy research and implementation, marketing and promotion of energy efficient equipment (equipment that exceeds MEPS) that is identified though energy labeling, consumer education on how to identify efficient products or the benefits of purchasing these products. Information on successful pilots will be shared with other countries, so they can replicate them. The activities under this component will collectively cost about US$ 3.325 million. Incremental activities will cost US$ 1,298,800 which will be financed by the GEF.

Incremental Cost Matrix and Project Indicative Budget

1. The proposed budget for each project component is shown in Table 11 below. In total we are requesting US$ 7,800,000 from the GEF.

Table 11: Summary Cost of Each Project Component (US$)

1. Table 12B provides the summary of budget cost sharing among GEF and the co-financiers of the full-scale project by components/activities (excluding the US$50,000 GEF plus co-financing for the PDF-A exercise).

Table 12B: BRESL Cost Sharing Matrix (US$)

Table 12C: Summary of Project Co-Financing

1. Bangladesh: The Bangladesh co-financing budget (baseline) is US$ 2.0 million. This includes budget for national and international experts from current and ongoing programs related to ES&L. The funds come from a number of sources, including development agencies, but the cost share is shown in the budget as a Bangladeshi government contribution.

1. China: The China co-financing budget (baseline) is US$ 11.0 million. The largest portion is US$ 7.551 million for equipment, staff, and training for test laboratories for six products. US$ 2.517 million is for manufacturer promotion; US$ 755,000, US$ 101,000, and US$ 76,000 are for in-kind salary contributions from SAC; manufacturers; and NDRC, respectively.

1. Indonesia. The co-financing budget from Indonesia is basically the budget allocated for ES&L-related activities by the DGEEU. This amounts to US$ 2,908,900.

1. Korea: The Korean co-financing budget (baseline) is US$ 78,000. This includes the man-days contributed by two Korean experts at each of the 5 Technical Working Group meetings each year. It also includes an estimated US$ 2,600 per year of S&L-related program costs.

1. Pakistan: The co-financing budget (baseline) from Pakistan is US$ 626,000, which basically is the budget for the Ministry of Environment’s EC&EE activities, which include among others ES&L, under its "National Awareness Campaign on Energy and Environment Conservation” (ACE) program. Some in-kind contribution of about US$ 100,000 in terms of staff time and facility use from the MOE’s Appliance Testing Laboratory is part of the country’s co-financing for BRESL.

1. Thailand: The Thai co-financing budget (baseline) is US$ 4.478 million. This includes US$ 0.228 million as in-kind salary contributions from the Thai government, and an estimated US$ 4.25 million from the government’s current and ongoing national ES&L programs operated by DEDE and EGAT.

1. Vietnam: The Vietnam co-financing budget (baseline) is US$ 3.085 million. This includes US$ 0.285 million as in-kind salary contributions from the Vietnamese government, and an estimated US$ 2.8 million from the government’s current and ongoing national ES&L programs operated by EVN, MOST, and MOIT.

1. Australian Government Office – This Australian government agency is contributing US$ 100,000 as co-financing for the regional harmonization activities that will be carried out under the BRESL.

1. International Copper Association (ICA): In China and in Southeast Asia (Indonesia, Malaysia, Thailand, and Vietnam), ICA is working on three of the core BRESL products: air conditioners, electric motors, and fluorescent lamp ballasts. ICA’s in-kind contribution to BRESL (US$ 2.90 million) involves support for development of MEPS and labeling schemes, market awareness and education, and technical assistance to manufacturers. The following are the work program activities of ICA for 2007-2012 that it has agreed to be subsumed under BRESL:

1. The International CFL Harmonization Initiative is an alliance of governments, private sector companies, associations, and non-governmental organizations that is working together to develop a single, improved international harmonized test protocol for compact fluorescent lamps; to carry out round-robin testing in order to validate the new test protocol; to develop a set of discrete performance levels that can be adopted on a voluntary basis by any country; and to share these results with the wider international community. Cost-sharing activities (US$ 200,000) include round-robin testing; a series of international events; an international web site (www.apec-esis.org/cfl); consulting input and analysis; and in-kind participation by industry.

1. The Energy Foundation in China has also committed US$ 600,000 for activities focusing on ES&L policy making and capacity building, appliance/equipment manufacturer support and regional cooperation activities on ES&L.

1. CLASP, which is active in ES&L capacity building in the region, has also committed US$ 5,000 cash technical assistance support for the ES&L policymaking and regional cooperation programs of the BRESL project.

1. Table 13 shows the incremental cost matrix. The baseline and alternative courses of actions are presented together with the costs of achieving them.

Table 13: Incremental Cost Matrix 

US$ 7,245,700

US$  8,857,100

US$ 1,611,400

US$ 9,057,900

US$ 11,665,400 

US$ 2,607,500

US$ 5,273,200

US$ 6,064,600 

US$ 791,400

US$ 3,240,700

US$ 3,951,600 

US$ 710,900

US$ 2,026,600

US$ 3,325,400

US$ 1,298,800

PART II: Logical Framework Analysis (Project Planning Matrix)

Table 14: Project Planning Matrix (PPM)

SECTION III: Total Budget and Work Plan

Table 15: BRESL Project Budget