Cost of NDCs expected to reach US$3.6 billion by 2030

The net cost of nationally determined contributions (NDCs) mitigation measures to be implemented in Namibia is expected to reach approximately US$3.61 billion by 2030.

The government is therefore looking at market-based mechanisms as part of the financing solution.

This is according to the Japan Supplementary Budget Progress Report, "Steps Ahead: Leveraging NDCs to achieve net-zero, emissions and climate-resilient development, in response to the climate emergency."

The report was launched at the 27th Conference of the Parties (COP27) to the United Nations Framework Convention, which is taking place in Egypt until 18 November.

It is a progress report on the Fiscal Year 2021 Japan-funded global project being implemented in 23 countries and territories under the UNDP's flagship Climate Promise initiative that demonstrates key achievements up to November 2022.

Supportive environment

The project supports two main key areas across the globe: reducing emissions through scaling up clean energy and establishing net-zero pathways, and strengthening adaptation and resilience to climate impacts, particularly in vulnerable and fragile settings.

The project is designed to establish an enabling environment for Namibia to pursue its carbon trading options, placing the country in the lead among sub-Saharan countries to advance the development of a region-wide framework for carbon market mechanisms.

According to the report, the project has three components: designing the building blocks for a national emissions trading scheme (ETS), technical capacity-building for the environment ministry and other institutions, including the private sector, and the development of an enabling investment environment alongside operationalization planning.

In addition, the project aims to increase technology transfer, access to technical assistance, and capacity building through South-South exchange.

Achieving Namibia’s pledges

Submitted in July 2021, Namibia’s updated NDC resolutely commits the country to the goals of the Paris Agreement, with a practical and ambitious plan to reduce emissions by 91% by 2030 and ensure a climate-resilient economy.

This project will help address the financial challenge of fulfilling these targets through the development of a carbon market. The project is a strategic investment with Namibia as a starting point, but it also envisions engagement with other interested African countries.

UNDP Namibia, with the assistance of the environment ministry, is exploring ways to incorporate Japanese companies to take part in and benefit from the promotion of carbon markets in Namibia.

Progress to date

Carbon pricing provides a breath of instruments – the Emissions Trading Scheme and Carbon Crediting Mechanism for Namibia to choose from in the accompanying policy mix to drive down emissions, says the report.

"However, the choice and design of the carbon pricing instrument must suit local situations and the policy expectations of the government."

The report says that the first step would be to understand the state of the policy and legal, technical, and administrative arrangements in Namibia that support any carbon pricing instruments.

Then, follow up with the assessment of three carbon pricing instruments.

According to the report, a comprehensive gap assessment and needs on carbon markets to examine Namibia’s readiness for carbon trading was carried out.

NDCs or intended nationally determined contributions are a non-binding national plan highlighting climate change mitigation, including climate-related targets for greenhouse gas emission reductions.