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Pilot Auction Facility for Methane and Climate Change Mitigation (PAF)

The Pilot Auction Facility for Methane and Climate Change Mitigation (PAF) is an innovative, pay-for-performance mechanism developed by the World Bank Group to stimulate investment in projects that reduce greenhouse gas emissions while maximizing the impact of public funds and leveraging private sector financing.

The key objective of the PAF is to demonstrate a new, cost-effective, and results-based climate finance mechanism that incentivizes private sector investment and action on climate change in developing countries by providing a guaranteed floor price on emission reductions in the form of carbon credits.
In 2013, the G8 requested for innovative pay-for-performance approaches to addressing methane. A report by the Methane Finance Study Group supported the establishment of the facility. In its design and development phase, the facility benefited from the support of the Climate and Clean Air Coalition.
The PAF auctions are supported by Germany, Sweden, Switzerland (through a joint contribution of the State Secretariat of Economic Affairs (SECO) and the Climate Cent Foundation), and the United States.

Support provider

Germany, Sweden, Switzerland (through a joint contribution of the State Secretariat of Economic Affairs (SECO) and the Climate Cent Foundation), and the United States.

Purpose of support

Project and program implementation

Eligible countries and regions

Afghanistan, Albania, Algeria, Andorra, Angola, Antigua and Barbuda, Argentina, Armenia, Azerbaijan, Bahrain, Bangladesh, Belize, Benin, Bhutan, Bolivia, Bosnia and Herzegovina, Botswana, Brazil, Brunei, Burkina Faso, Burundi, Cambodia, Cameroon, Central African Republic, Chad, Chile, Colombia, Comoros, Cook Islands, Costa Rica, Côte d'Ivoire, Cuba, Democratic Republic of the Congo, Djibouti, Dominica, Dominican Republic, Ecuador, Egypt, El Salvador, Equatorial Guinea, Eritrea, Ethiopia, Fiji, Gabon, Gambia, Georgia, Ghana, Grenada, Guatemala, Guinea, Guinea-Bissau, Guyana, Haiti, Honduras, India, Indonesia, Iran, Iraq, Jamaica, Jordan, Kazakhstan, Kenya, Kiribati, Kyrgyz Republic, Laos, Lebanon, Lesotho, Liberia, Libya, Macedonia, Madagascar, Malawi, Malaysia, Maldives, Mali, Marshall Islands, Mauritania, Mauritius, Mexico, Micronesia, Moldova, Mongolia, Montenegro, Morocco, Mozambique, Myanmar, Namibia, Nepal, Nicaragua, Niger, Nigeria, Pakistan, Palau, Panama, Papua New Guinea, Paraguay, Peru, Philippines, Republic of Congo, Rwanda, Saint Kitts and Nevis, Saint Lucia, Saint Vincent and the Grenadines, Samoa, Sao Tome and Principe, Saudi Arabia, Senegal, Serbia, Seychelles, Sierra Leone, Solomon Islands, Somalia, South Africa, South Sudan, Sri Lanka, Sudan, Suriname, Syria, Tajikistan, Tanzania, Thailand, Timor-Leste, Togo, Tonga, Trinidad and Tobago, Tunisia, Turkmenistan, Tuvalu, Uganda, Uruguay, Uzbekistan, Vanuatu, Venezuela, Vietnam, Yemen, Zambia, Zimbabwe, East Asia and Pacific, Europe and Central Asia, Latin America and Caribbean, Middle East and North Africa, South Asia, Sub-Saharan Africa

Eligibility criteria

A detailed description of the eligibility criteria and auction rules visit the PAF Website. The PAF can modify the eligibility criteria but it often takes into consideration the following factors: Emission Reductions Eligibility, Eligible Methodologies, Ineligible Methodologies (Adipic Acid), Eligible Countries, Eligible Generation / Issuance Period, Sub-Auctions &Abatement Project’s Operational Status before the Auction Date, Environmental, Health & Safety and Social Criteria (EHS), and Integrity Criteria.

Financial instruments

Equity

Information on how to...

Find relevant information about the auction here. The fourth auction will be held in the first half of 2020, to address methane abatement from landfill, animal waste, and wastewater sites. Availability of the Bidder Application Package will begin December 1, 2019 and the deadline will be mid-January 2020. Once available, the PAFERNs draft final terms and Bidder Application Package can be requested by sending an e-mail to PAF_Secretariat@worldbank.org

Climate objective

Mitigation

Sectors and themes

Forestry and Land-Use, Waste Management

Type of support provider

Multilateral

Type of recipient

Private sector

Co-financing required

Application timeframe

Annual auctions

Trustee or administrator

World Bank

Contact information

https://www.pilotauctionfacility.org/content/about-paf

paf_secretariat@worldbank.org

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Pilot Auction Facility for Methane and Climate Change Mitigation (PAF)

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