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Problem
Kazakhstan’s President K. Tokayev identified climate change as one of the key global challenges and called on businesses to adopt cutting-edge technologies in this area and establish a modern emissions monitoring system. One of the most significant issues standing in front of Kazakhstan’s initiatives for combating climate change is that the standardization for carbon emissions and corresponding legal regulation is not corresponding to international standards.
1) Lack of policy signal to attract foreign investment on climate technologies: Kazakhstan's economy is heavily reliant on fossil fuels, leading to high levels of carbon emissions. In the absence of standardized metrics, industries may not prioritize emissions reductions, resulting in a failure to meet international climate commitments. Furthermore, this lack of clarity can deter foreign investment, as potential investors may be wary of the country’s environmental practices.
2) Lack of transparency in MRV, hindering effective policy implementation: The present MRV (Measurement, Reporting, and Verification) system in Kazakhstan is not transparent, which hinders the realization of the commitments of the Paris Agreement and participation in the mechanisms of climate financing.
Without a transparent framework for measuring and reporting emissions, it becomes difficult to assess the true impact of various sectors on the environment. This inconsistency can hinder effective policy-making and the implementation of targeted climate actions.
3) Underreporting of high emitters and inefficient ETS systems: The underdeveloped regulation framework also negatively affects the efficiency of the quota and ETS systems, that are highly criticized for not covering some sectors and being too generous to emitters. Thus, general assessment of the efficiency of decarbonization practices implemented by businesses becomes vulnerable to underreporting and manipulation.
Updating the MRV would enable Kazakhstan to develop more effective regulations, enhance accountability, and promote sustainable practices across various sectors. It could also facilitate participation in international carbon markets, potentially leading to financial benefits and improved environmental outcomes.
1) Lack of policy signal to attract foreign investment on climate technologies: Kazakhstan's economy is heavily reliant on fossil fuels, leading to high levels of carbon emissions. In the absence of standardized metrics, industries may not prioritize emissions reductions, resulting in a failure to meet international climate commitments. Furthermore, this lack of clarity can deter foreign investment, as potential investors may be wary of the country’s environmental practices.
2) Lack of transparency in MRV, hindering effective policy implementation: The present MRV (Measurement, Reporting, and Verification) system in Kazakhstan is not transparent, which hinders the realization of the commitments of the Paris Agreement and participation in the mechanisms of climate financing.
Without a transparent framework for measuring and reporting emissions, it becomes difficult to assess the true impact of various sectors on the environment. This inconsistency can hinder effective policy-making and the implementation of targeted climate actions.
3) Underreporting of high emitters and inefficient ETS systems: The underdeveloped regulation framework also negatively affects the efficiency of the quota and ETS systems, that are highly criticized for not covering some sectors and being too generous to emitters. Thus, general assessment of the efficiency of decarbonization practices implemented by businesses becomes vulnerable to underreporting and manipulation.
Updating the MRV would enable Kazakhstan to develop more effective regulations, enhance accountability, and promote sustainable practices across various sectors. It could also facilitate participation in international carbon markets, potentially leading to financial benefits and improved environmental outcomes.
Solution
To address the underdeveloped standardization and legislation of carbon emissions in Kazakhstan, a comprehensive multi-faceted approach is necessary and Green Academy is working to :
1. Establish a National Carbon Registry: Create a centralized database that tracks carbon emissions across all sectors. This registry should set clear guidelines for measurement and reporting, ensuring consistency and transparency.
Collaborate with international organizations to adopt recognized frameworks for emissions assessment. These standards would guide industries in calculating and reporting their emissions accurately.
2. Reform the Regulatory Frameworks: The Environmental Code sets penalties based on exceeding emission limits, regardless of the actual harm caused, while OECD countries calculate fines based on the environmental damage inflicted, requiring more substantial evidence of harm. Thus, a more rigorous evidence base for the damage caused by enterprises is required, and the predetermined standard ceases to be the sole benchmark for companies with the potential to pollute the environment.
3. Promote Capacity Building, Cooperation and Partnerships: Provide training and resources for businesses and local governments on emissions reporting and reduction strategies. This can include workshops, online courses, and partnerships with environmental organizations. Foster collaboration between the government and private sector to develop innovative technologies and practices aimed at reducing emissions. This can include funding for clean technology initiatives.
Engage with global partners to share best practices and participate in international climate initiatives. This can help Kazakhstan align its standards with global expectations and improve its standing in climate negotiations.
Increase awareness about the importance of emissions reduction and the benefits of standardization among the general public, businesses, and policymakers.
4. Improve the Quota and ETS system: Unfortunately, Kazakhstan's ETS, which covers only six major sectors and has a surplus of free quotas, does not sufficiently incentivize companies to cut emissions. Meanwhile, sectors such as agriculture, transport, and construction, which account for over 60% of emissions, are not included in the National Carbon Units Plan and do not participate in Kazakhstan's ETS. Moreover, Kazakhstan's approach to calculating quotas is not optimal compared to OECD countries. In Kazakhstan, quotas are based on acceptable limits for the entire country, which are gradually reduced annually. Quotas are then allocated to companies emitting over 20,000 tons of CO2 equivalent annually. This approach relies on historical data, whereas OECD countries set quotas based on the Best Available Techniques (BAT), motivating companies to improve production processes instead of merely penalizing excess emissions. While Kazakhstan's legislation does include BAT principles, they have not yet been fully implemented. If the new measures in the Environmental Code are put into practice, they could significantly enhance the quota system and ETS. By implementing these measures, Kazakhstan can create a robust framework for carbon emissions management, facilitating sustainable economic development while meeting environmental obligations.
1. Establish a National Carbon Registry: Create a centralized database that tracks carbon emissions across all sectors. This registry should set clear guidelines for measurement and reporting, ensuring consistency and transparency.
Collaborate with international organizations to adopt recognized frameworks for emissions assessment. These standards would guide industries in calculating and reporting their emissions accurately.
2. Reform the Regulatory Frameworks: The Environmental Code sets penalties based on exceeding emission limits, regardless of the actual harm caused, while OECD countries calculate fines based on the environmental damage inflicted, requiring more substantial evidence of harm. Thus, a more rigorous evidence base for the damage caused by enterprises is required, and the predetermined standard ceases to be the sole benchmark for companies with the potential to pollute the environment.
3. Promote Capacity Building, Cooperation and Partnerships: Provide training and resources for businesses and local governments on emissions reporting and reduction strategies. This can include workshops, online courses, and partnerships with environmental organizations. Foster collaboration between the government and private sector to develop innovative technologies and practices aimed at reducing emissions. This can include funding for clean technology initiatives.
Engage with global partners to share best practices and participate in international climate initiatives. This can help Kazakhstan align its standards with global expectations and improve its standing in climate negotiations.
Increase awareness about the importance of emissions reduction and the benefits of standardization among the general public, businesses, and policymakers.
4. Improve the Quota and ETS system: Unfortunately, Kazakhstan's ETS, which covers only six major sectors and has a surplus of free quotas, does not sufficiently incentivize companies to cut emissions. Meanwhile, sectors such as agriculture, transport, and construction, which account for over 60% of emissions, are not included in the National Carbon Units Plan and do not participate in Kazakhstan's ETS. Moreover, Kazakhstan's approach to calculating quotas is not optimal compared to OECD countries. In Kazakhstan, quotas are based on acceptable limits for the entire country, which are gradually reduced annually. Quotas are then allocated to companies emitting over 20,000 tons of CO2 equivalent annually. This approach relies on historical data, whereas OECD countries set quotas based on the Best Available Techniques (BAT), motivating companies to improve production processes instead of merely penalizing excess emissions. While Kazakhstan's legislation does include BAT principles, they have not yet been fully implemented. If the new measures in the Environmental Code are put into practice, they could significantly enhance the quota system and ETS. By implementing these measures, Kazakhstan can create a robust framework for carbon emissions management, facilitating sustainable economic development while meeting environmental obligations.
Performance and impacts
The “Green Academy” has been working on development of legislation for the Paris Agreement on the national level since 2013, including the concept for the transition to the green economy in Kazakhstan (2013), INDC justification in Kazakhstan (2015), the Strategy for achieving carbon neutrality in Kazakhstan by 2060, and the first national standard for certification of experts in verification and validation of GHG emissions.
We have actively participated in the development of the Strategy for achieving carbon neutrality in Kazakhstan by 2060, that was later approved by a Presidential Decree. This Strategy has become the foundation for Kazakhstan’s goals and decision-making for combating climate change.
Additionally, the Green Academy has made a big contribution to the development of an Action Plan for the aforementioned Strategy. This work included a capacity building program, research, scientific publications, expert interviews from academia and business and the integration of their ideas into the governmental Action Plan.
The Green Academy also emphasizes the importance of consistently publishing scientific articles and engaging with media. Besides internationally recognized journals publishing scientific works by out authors, we have had extensive media coverage of events organized by the Green Academy. These events, such as Round Tables, Expert Seminars, Stakeholder dialogues and Panel Sessions in the frameworks of different Conferences (such as the COP), are the cornerstone of developing partnerships, business and academia to government cooperation and highly interconnected capacity building.
We have actively participated in the development of the Strategy for achieving carbon neutrality in Kazakhstan by 2060, that was later approved by a Presidential Decree. This Strategy has become the foundation for Kazakhstan’s goals and decision-making for combating climate change.
Additionally, the Green Academy has made a big contribution to the development of an Action Plan for the aforementioned Strategy. This work included a capacity building program, research, scientific publications, expert interviews from academia and business and the integration of their ideas into the governmental Action Plan.
The Green Academy also emphasizes the importance of consistently publishing scientific articles and engaging with media. Besides internationally recognized journals publishing scientific works by out authors, we have had extensive media coverage of events organized by the Green Academy. These events, such as Round Tables, Expert Seminars, Stakeholder dialogues and Panel Sessions in the frameworks of different Conferences (such as the COP), are the cornerstone of developing partnerships, business and academia to government cooperation and highly interconnected capacity building.