Program of Activities (PoA)

Program of Activities (PoA) is a modality of project development under the Clean Development Mechanism (CDM) of the United Nations Framework Convention on Climate Change (UNFCCC).

The aim of PoAs was to allow replicable projects with low and physically spread Greenhouse Gas reductions into the CDM. This type of project is often linked to higher sustainability benefits, but are too small to pay back the transaction cost involved in the CDM process. It was expected to allow African countries a higher participation in the CDM in particular.

The PoA idea originated from a decision made at the December 2005 Conference of the Parties/Meeting of the Parties in Bonn, Germany where it was decided that local/regional and national policies or standards cannot be considered as CDM project activities, but project activities under a PoA can be registered as a single CDM project activity. By its thirty-sixth meeting (November 2007), the CDM Executive Board approved the official templates for Project Design Documents suitable for Programme of Activities (titled PoA-DD), its constituent activities (CPA-DD), and issued procedures to register PoAs and issue CERs. It also amended small-scale CDM methodologies to make them suitable for programmatic activities. By its forty-seventh meeting (May 2009), an improved version of PoAs guidance was published. The new guidance, along with a grace period that allowed retroactive PoAs to be submitted before 31 December 2009, had allowed more submission of PoAs to the EB, which rose to around 40 by the end of 2009. As of November 2010, after the 57th meeting of the CDM Executive Board, a total of 54 PoAs were under validation and 5 were registered.

The classical structure of CDM uses a project-by-project process for registering and verifying projects. This approach involves very high transaction costs, a long time to market, and a high risk of non-registration. It is also very difficult to implement such a process in least developed countries and small island states where average project sizes and the scale of national markets tend to be smaller, so relative transaction costs are higher. In order to reduce transaction costs in CDM and expand the mechanism’s applicability to micro project activities, the CDM Executive Board launched the Programme of Activities modality. Under this modality, a PoA Coordinating/Managing Entity (CME), which can be (for examples) a government agency, NGO or business, develops a PoA which defines broad parameters for project activities (referred to as CDM Programme Activities or CPAs) that are eligible for inclusion in the PoA. Whereas stand-alone CDM projects must be approved individually by the CDM Executive Board, a PoA needs to be registered only once by the CDM Executive Board. After that, it can include an unlimited and unspecified number of individual CPAs without recourse to the CDM Executive Board.

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