Assessing a new methodology

Once a proposed methodology has been created and submitted, it must be considered by the Executive Board as quickly as possible, but at least within 4 months:

The Executive Board shall expeditiously, if possible at its next meeting but not later than four months, review the proposed new methodology in accordance with the modalities and procedures of the present annex. Once approved by the Executive Board it shall make the approved methodology publicly available along with any relevant guidance and the designated operational entity may proceed with the validation of the project activity and submit the project design document for registration. In the event that the COP/MOP requests the revision of an approved methodology, no CDM project activity may use this methodology. The project participants shall revise the methodology, as appropriate, taking into consideration any guidance received (3/CMP.1, paragraph 38).

In practice, the Executive Board has delegated much of this function to the Methodologies Panel, which in turn seeks assistance from experts to conduct a desk review, as described in this section. At the end of this assessment process, the Methodologies Panel will provide a recommendation to the Executive Board on whether the methodology should be accepted.

The process for consideration and assessment of new methodologies is set out in EB 37, Annex 1. The current guidance is version 13 and replaces earlier guidance in EB 32 Annex 13, EB 25 Annex 17, EB 23 Annex 2, EB 22 Annex 1, EB 21 Annex 2, EB 20 Annex 2, EB 15 Annex 10, EB 13, EB 11 Annex 3, EB 10 Annex 5, EB 9 Annex 4 and EB 8 Annex 2.

Overview of the assessment process

In summary, the assessment process is as follows (adapted from EB 37, Annex 1):

The secretariat prepares a draft pre-assessment using the CDM: Proposed new methodology assessment form (F-CDM-NMas), and forwards it (together with all documentation) to a member of the Meth Panel.
Either:
1. The AE/DOE undertakes a voluntary pre-assessment, in which case the proposed methodology is forwarded directly to the Meth Panel and the Executive Board (the grading by the Meth Panel member described below is not required); or
2. If no voluntary pre-assessment is undertaken, the Meth Panel member reviews the documentation and grades the proposed methodology as ‘1' (ready for Meth Panel review) or ‘2' (further work required). If the proposed methodology is graded 1, it is forwarded by the secretariat to the Meth Panel and the Executive Board (at least 10 weeks prior to the next meeting of the Meth Panel). If it is graded 2, it is sent back to the proponents, who may amend and resubmit it. Resubmission will incur another application fee of USD 1000.
The secretariat makes the proposed methodology publicly available on the UNFCCC website and invites public comment (using the public comment form F-CDM-NMpu) for a period of 15 working days. Comments received are forwarded to the Meth Panel at the moment of receipt.
Two experts are chosen from a roster of experts, one as lead reviewer and one as second reviewer. The experts each produce a desk review report using the lead expert desk review form (F-CDM-NMex_3d) and the second expert desk review form (F-CDM-NMex_2d).
The proposed methodology is assessed by the Meth Panel as follows:
1. Four members of the Meth Panel are selected to review the draft pre-assessment prepared by the secretariat.
2. The secretariat compiles the inputs from the experts, the members of the members of the Meth Panel appointed to review the draft pre-assessment (and any other members that have provided input) and members of the public, and forwards these inputs to the Meth Panel.
3. The Meth Panel prepares a summary recommendation using the CDM - Proposed new methodology - Meth Panel recommendation summary to the Executive Board form (F-CDM-NMSUMmp) and a full recommendation using the CDM - Proposed new methodology - Meth Panel recommendation to the Executive Board (CDM-NMmp), based on the draft pre-assessment and taking into account the inputs compiled by the secretariat.
4. The summary recommendation is sent to the proponents. The proponents may, within a timeframe stipulated by the Chair of the Meth Panel (not more than 4 weeks), submit clarifications to the Meth Panel.
5. Based on the clarifications received, the Meth Panel drafts a final recommendation to the Executive Board, which is forwarded to Board members via the secretariat. The final recommendation consists of an updated version of each of CDM-NMSUMmp and CDM-NMmp prepared earlier.
6. The Executive Board considers the proposed methodology and the Meth Panel recommendation and approves or does not approve it.

The current version of the procedures does not refer to CDM-NMmp, and requires the Meth Panel to prepare only a summary recommendation using CDM-NMSUMmp. However, the current version of CDM-NMSUMmp states that it is to be used in conjunction with CDM-NMmp, and CDM-NMmp is still available on the ‘Forms' section of the CDM website, indicating that it is still used by the Meth Panel to make recommendations to the Executive Board.

The overall timeframe for the completion of the above-described assessment process is four months:

The Executive Board shall expeditiously, if possible at its next meeting but not later than four months after the date of receipt of the proposed new methodology, review the proposed new methodology in accordance with the CDM modalities and procedures (CDM-PDD) for registration (EB 37, Annex 1, paragraph 3).

Step 1: Pre-assessment

Once the registration fee and all documents have been received, the secretariat will prepare a draft pre-assessment using the CDM: Proposed new methodology assessment form (F-CDM-NMas) and will forward this to a member of the Meth Panel:

Having checked that the "CDM: Proposed new methodology form" has been duly filled by the DOE, documentation provided by the DOE is complete and the proof of payment of the stipulated submission fee has been received by the secretariat, the secretariat shall prepare a draft pre-assessment using the latest version of the "CDM: Proposed new methodology assessment form" (F-CDM-NMas) to assess the quality of the submission and forward it along with the documentation submitted by the project participant (CDM-NM & CDM-PDD) to one member of the Meth Panel for consideration (EB 37, Annex 1, paragraph 7).

F-CDM-NMas requires the secretariat to respond 'Yes' or 'No' to ten questions relating to the proposed methodology:

The responses to the evaluation criteria below shall be considered as substantiation to evaluate a case as 1 or 2.

If one of the evaluation criteria below is checked as NO the documentation will be graded as 2 and is to be sent back to the project participants.

If all the evaluation criteria below are checked as YES the documentation will be graded as 1 and shall be considered as received by the Board and be forwarded by the secretariat for consideration of the Board and the Meth Panel (F-CDM-NMas, Ver 04)).

If any 'No' answers are given, an explanation is required on the form.

The evaluation criteria in EB 32 Annex 16 require the Meth Panel to assess the following issues:

Coverage of the CDM-NM sections as outlined in the applicable guidelines.

The language is sufficiently transparent, precise and unambiguous to undertake a full assessment

The proposed methodology reflects methodology-specific information and not project-specific information.

The baseline methodology is internally consistent i.e., the applicability conditions, project boundary, baseline emissions estimation procedure, project emission estimation procedure, leakage, and monitoring section are consistent with each other.

The baseline scenario identification has a clear and concise presentation of methodological steps to identify baseline scenario and description of baseline scenario to which the methodology is applicable.

The additionality section has clear and concise presentation of methodological steps to assess additionality and relationships between them.

The emission reductions calculation section has relevant formula provided and all variables used adequately explained.

The baseline methodology is internally consistent with the monitoring methodology, which is clearly documented in accordance with applicable guidelines.

If it is a resubmitted C case, all the issues raised in the previous recommendations are addressed or are sufficiently/ properly explained.

No other issue was identified that leads to a 2-rating (EB 32, Annex 16).

Version 4 of F-CDM-NMas is contained in EB 32 Annex 16. This version replaces Version 3 contained in EB 21 Annex 3.

Step 2(a): Voluntary pre-assessment by the DOE/AE

A DOE/AE may carry out a voluntary pre-assessment in which case the grading by the Meth Panel (Step 2(b)) is not required:

A DOE/AE may voluntarily undertake a pre-assessment of a newly proposed methodology before submitting it. If a voluntary pre-assessment has been undertaken, no pre-assessment by the Meth Panel, as referred in paragraph 7 above, is needed. The submitted methodology may be in such case be considered as received once the secretariat has confirmed that the "CDM: Proposed new methodology form" has been duly filled by the DOE, documentation provided by the DOE is complete and the deposit of the stipulated submission fee has been received by the secretariat (EB 37, Annex 1, paragraph 8).

Step 2(b): Grading by a member of the Meth Panel

If no voluntary pre-assessment is undertaken, the proposed methodology will be forwarded to one member of the Meth Panel for grading:

This member is to assess the quality of the submission and grade it as being 1 and 2 in accordance with the criteria for pre-assessment as contained in the current version of the "CDM: Proposed new methodology assessment form" (F-CDM-NMas). If the member grades the documentation as being 2, the documentation is to be sent back to the project participants who may resubmit it as a proposed new methodology, along with a fee of USD 1000 as per paragraph 6, taking into account the comments in the assessment form (F-CDMNMas). If the grade is 1, the documentation shall be considered as received by the Board and be forwarded by the secretariat for consideration of the Board and the Meth Panel (EB 37, Annex 1, paragraph 7).

This means that where a proposed methodology is preliminarily rejected, project participants will need to pay the USD 1000 fee a second time in order to resubmit it. The grading is to use the same criteria set out in F-CDM-NMas.

Step 3: Public comment

While the preliminary assessment and grading is taking place, the secretariat will make the proposed methodology publicly available and invite the public to make submissions on it using the Proposed new methodology - public comment form (F-CDM-NMpu):

At the same time... the secretariat shall make the proposed new methodology publicly available on the UNFCCC CDM web site and invite public inputs for a period of 15 working days.

Public inputs on a proposed new methodology shall be made using the current version of the "Proposed new methodology - public comment form" (F-CDM-NMpu) (EB 37, Annex 1, paragraph 9).

The CDM: Proposed new methodology - public comment form (F-CDM-NMpu) is contained in EB 25 Annex 14 Version 5 (replacing Version 3 in EB 10 Annex 4). The current public comment form requires the following information from a person or organisation commenting on the proposed new methodology:

Name of person / organization responsible for completing and submitting this form

Contact information (address, phone, e-mail ...)

Related F-CDM-NM document ID number (EB 25, Annex 14).

Comments should be based on assessment of the CDM-NM and its application in sections A to C of the draft CDM-PDD:

Based on an assessment of the CDM-NM and its application in sections A to C of the draft CDMPDD, provide your comments to the proposed new methodology. Please indicate the sections or issues to which your comments refer (EB 25, Annex 14).

Comments received are forwarded to the Meth Panel for consideration:

Comments shall be forwarded to the Meth Panel at the moment of receipt and made available to the public at the end of the 15 working day period (EB 37, Annex 1, paragraph 9).

Step 4: Desk review by experts

Two experts are selected from a roster of experts to review the validity of the proposed new methodology and provide feedback that will be considered by the Meth Panel in the preparation of its recommendation to the Executive Board:

The Chair and the Vice-Chair of the Meth Panel, with the assistance of the secretariat and in consultation with the four selected Meth Panel members, shall, no later than seven working days after the receipt of the proposed new methodology, select two experts from a roster of experts (lead and second reviewers) who are to undertake a desk review to appraise the validity of the proposed new methodology. The lead reviewer is to be paid a three (3) days fee and the second reviewer a two (2) days fee for the first 100 pages of the proposed new methodology (CDM-NM) and for each additional 30 pages, or part thereof, a (1) one day fee. The two reviewers should provide inputs independently (EB 37, Annex 1).

Each desk reviewer is to prepare a recommendation for the Meth Panel within 10 days of receiving a proposed methodology:

Each desk reviewer shall prepare, under the guidance of the Chair of the Meth Panel and in accordance with the provisions of the CDM modalities and procedures, his/her recommendation to the Meth Panel. He/she shall forward it, wherever possible, within 10 working days after having received a proposed methodology using the respective current version of the forms "CDM: Proposed new methodology - lead expert desk review form"(F-CDM-NMex_3d) and "CDM: Proposed new methodology - second expert desk review form"(F-CDM-NMex_2d) (EB 37, Annex 1).

The current versions of the desk review forms are found in EB 25 Annex 11, 12 replacing the earlier versions in EB 21 Annex 4 and 5. The review forms are used by methodology lead experts providing desk review for a proposed new methodology.

Forms are called 3d and 2d because this decision says that the lead reviewer should spend 3 days preparing his or her report, and other reviewer 2 days:

In order to make more efficient use of expertise, to select one lead reviewer from among the two desk reviewers selected to consider each case; the lead reviewer is to be paid 3 days fee and the second reviewer a 2 days fee. The two reviewers should provide inputs independently. The modalities of work between the lead reviewer and the second reviewer shall be further developed at the twentieth meeting of the Board (EB 19, Agenda sub-item 3(b)(f)).

F-CDM-NMex_3d and F-CDM-NMex_2d

The lead review form (F-CDM-NMex_3d) and second review form (F-CDM-NMex_2d) require a general evaluation of the proposed new methodology, setting out any changes (major and minor) needed to improve the methodology (EB 25, Annexes 11 and 12).

F-CDM-NMex_3d then requires a summary of the project, setting out:

The purpose of the methodology;
Short statements on how the proposed methodology: chooses the baseline scenario, demonstrates additionality, calculates baseline emissions, calculates project emissions, calculates leakage, calculates and monitors emission reductions;
The relationship between the proposed methodology and any approved or pending methodologies - for example:
- Does the proposed methodology draw on or extend an existing methodology?
- Could an existing methodology be used to calculate emission reductions from the proposed project activity, removing the need to approve a new methodology? (adapted from EB 25, Annex 11)

This information is not required from the second reviewer.

Both F-CDM-NMex_3d and F-CDM-NMex_2d then require the reviewer to evaluate the appropriateness and adequacy of the following elements of the proposed methodology, and if required, suggest changes. These elements are also indicated on CDM-NM itself (EB 32 Annex 17).

The applicability conditions of the methodology;
The definition of the project boundary, in terms of gases and sources, as well as the physical delineation;
The methodological basis for determining the baseline scenario and assessing additionality;
The methodological basis for calculating baseline emissions and emission reductions;
How the methodology addresses any potential leakage from the project activity;
Any implicit and explicit key assumptions and rationale for the methodology;
For all data and parameters, how data sources or default values are used and how the data or measurements are obtained (e.g. official statistics, expert judgment);
Measurement procedures for all key data and parameters;
The consistency of the methodology with the principles of transparency and conservativeness;
The internal consistency of the methodology;
The proposed changes required for the implementation of the methodology in the second and third crediting periods;
The baseline approach selected; and
The fit between the proposed methodology and the referred proposed project activity (adapted from EB 25, Annexes 11 and 12).

Step 5: Assessment and recommendation by the Meth Panel

In parallel to the expert desk review process, four members of the Meth Panel are selected to assess the draft pre-assessment report prepared by the secretariat:

Upon receipt of a proposed new methodology, four members of the Meth Panel, one as lead who will be responsible for presenting the case at the meetings, shall be selected on a rotational basis in alphabetical order to independently review the draft recommendation prepared by the secretariat... The four selected panel members shall be paid a fee for one (1) working day for the review of the draft recommendations as prepared by the secretariat (EB 37, Annex 1, paragraph 14).

The secretariat then compiles the inputs from these Meth Panel members, the appointed experts and the members of the public, and forwards these to the full Meth Panel. The secretariat may also request any further information that is required from project participants:

The secretariat shall be responsible for compiling different inputs, including those from other members of the Panel, public inputs and desk reviewers, and prepare, draft recommendations for consideration by the Meth Panel. The secretariat may seek guidance of the Chair of the panel, as required. The secretariat may request the project participants, copying the selected members and the DOE, to make available additional technical information necessary to further clarify or assist in analysing the proposed new methodology with a deadline for responding (EB 37, Annex 1, paragraph 14).

The Meth Panel prepares a summary recommendation using the Proposed new methodology - Meth Panel summary recommendation to the Executive Board form (F-CDM-NMSUMmp) and a full recommendation using Proposed new methodology - Meth Panel recommendation to the Executive Board form (F-CDM-NMmp). These are based on the draft pre-assessment and must take into account the inputs compiled by the secretariat:

The Meth Panel, taking into consideration public comments and the recommendations by the desk reviewers, shall prepare its preliminary recommendation regarding the approval of the proposed new methodology to the Executive Board using the current versions of the form "CDM: Proposed New Methodology - Panel recommendation summary to the Executive Board" (F-CDM-NMSUMmp) based on the draft prepared by the secretariat and independently reviewed by the four selected members of the Meth Panel. The recommendations used for consultations with project participants shall be documented in the latest version of the "CDM: Proposed New Methodology (CDM-NM)" form (EB 37, Annex 1, paragraph 17).

As noted above, the current version of the procedures does not refer to CDM-NMmp, and requires the Meth Panel to prepare only a summary recommendation using CDM-NMSUMmp.

However, the current version of CDM-NMSUMmp states that it is to be used in conjunction with CDM-NMmp, and CDM-NMmp is still available on the ‘Forms' section of the CDM website, indicating that it is still used by the Meth Panel to make recommendations to the Executive Board.

In order to prepare the draft recommendation, the Meth Panel must have access to a proposed methodology ten weeks before its next meeting:

A proposed new methodology shall be available to the Meth Panel at least ten weeks prior to its next meeting. The secretariat shall make public, through the UNFCCC CDM web site, the date of a meeting and the corresponding deadline at least ten weeks prior to the meeting (EB 37, Annex 1, Part III, paragraph 10).

CDM-NMSUMmp (EB 20, Annex 5)

The summary recommendation form requires the Meth Panel to reach an overall recommendation of either ‘A', ‘B' or ‘C', where:

‘A' means approve this proposed methodology with minor changes;
‘B' means reconsider this proposed methodology, subject to required changes; and
‘C' means not approve the proposed methodology.

The recommendation forms are only forwarded to the Executive Board once the methodology has received an ‘A' or ‘C' classification. If a ‘B' classification is awarded, the preliminary recommendation is sent to the proponents and further information is requested:

The Meth Panel shall, through the secretariat, copying the DOE, forward its preliminary recommendation to project participants.

Within a timeframe stipulated by the Chair of the Meth Panel (but not exceeding 4 weeks), after the receipt of the preliminary recommendation of the Meth Panel by the project participants the project participants may submit (copying the DOE), clarifications to the Meth Panel, through the secretariat, on technical issues concerning the proposed new methodology raised in the preliminary recommendation by the Meth Panel. Technical clarifications provided by the project participants shall include the revisions, in the form for baseline and monitoring methodologies (CDM-NM) in a highlighted form (EB 37, Annex 1, paragraph 17).

Project participants shall make required changes to the proposed new methodology and send it back to the Meth Panel. The proposed new methodology will be reconsidered by the Meth Panel if changes required are made by the project participants. The Executive Board will only consider this proposed new methodology after the revised proposed methodology has been reconsidered by the Meth Panel (EB 25, Annex 13).

In addition to these recommendations, the following elements must be evaluated and reported on:

The purpose of the methodology.
Suggested applicability of methodology
How the proposed methodology chooses the baseline scenario, demonstrates additionality, calculates baseline emissions, calculates project emissions, calculates leakage, calculates emission reductions
Suggested "recommendation level" for the baseline and monitoring methodologies (A, B or C)
- Major reasons for B/C choice from the proposed baseline methodology
Any major issues arising from the assessment of the proposed monitoring methodology (if different to those already raised above)
Any other issues arising (e.g. cross-cutting, general or precedent setting issues raised by the proposed new baseline or monitoring methodology)

CDM-NMmp (EB 25, Annex 13)

The full recommendation form requires:

An overall recommendation of either ‘A', ‘B' or ‘C'; and
A detailed evaluation of the proposed new methodology, using the same criteria as are set out in F-CDM-NMex_3d (EB 25, Annex 11).

If clarifications are requested from project proponents and received, the Meth Panel considers these clarifications and prepares a final recommendation to the Executive Board. Both the summary recommendation and the full recommendation are then forwarded to Board members via the secretariat:

If project participants provide clarifications related to the preliminary recommendation by the Meth Panel, the Meth Panel shall consider these clarifications at its next meeting and prepare its final recommendation to the Executive Board. The final recommendation shall be forwarded to the Executive Board and made publicly available (EB 37, Annex 1, paragraph 17(d)).

If clarifications are not received within three (3) months, the proposal for a new methodology will be considered to have been withdrawn:

If project participants do not provide clarification related to preliminary recommendation by the Meth Panel within the timeframe of three (3) months, the case will be considered as withdrawn (EB 37, Annex 1, paragraph 17(e)).

Where possible the Meth Panel shall make a recommendation to the Executive Board on the approval of the proposed methodology at its next meeting:

Whenever a proposed new methodology is submitted to the Meth Panel in accordance with paragraph 10 and 11 above, it shall analyze it and, if possible at its next meeting, make a recommendation regarding the approval of the proposed new methodology to the Executive Board (EB 37, Annex 1, Part III, paragraph 13).

However, some submissions may be postponed by the Chair of the Meth Panel if there are more than ten proposed new methodologies:

In case more than ten (10) proposed new methodologies are submitted by the deadline for submissions of proposed new methodologies, the Chair of the Meth Panel shall ascertain how many proposals shall be analyzed at the next meeting of the Meth Panel and decide to postpone the analysis of some submissions to the subsequent meeting of the Meth Panel. Submissions received and confirmed to be completed by the secretariat shall be treated on a "first come first served" basis (EB 37, Annex 1, Part III, paragraph 11).

The Board may decide to change a deadline for submissions of proposed new methodologies taking into account the workload of the Meth Panel (EB 32, Annex 13, Part III, paragraph 12).

Step 6: Approval by the Executive Board

At its next meeting, the Executive Board will either approve or not approve the proposed methodology:

The Executive Board shall consider a proposed new methodology at the next meeting following the receipt of the final recommendation regarding the approval ("A" case) or non-approval ("C" case) of the proposed new methodology by the Meth Panel (EB 37, Annex 1, paragraph 18).

Once it has been approved, the methodology is made publicly available and validation of the project activity may continue:

Once approved by the Executive Board, it shall make the approved methodology publicly available and the designated operational entity may proceed with the validation of the project activity and submit the project design document (CDM-PDD) for registration (EB 37, Annex 1, paragraph 3).

Relationship between the submission and consideration of new methodologies and DOE accreditation

At EB 7, the Executive Board clarified the relationship between the process of accreditation and designation of DOEs and the approval of new methodologies. The graph describes this relationship (EB 7, Annex 1). It describes steps in the process, including timelines, for submitting and approving a new methodology (baseline and/or monitoring). The graph highlights in particular that

the witnessing of an applicant entity for validation shall take place simultaneously with the validation of an approved methodology and subsequent registration of the proposed CDM project activity.
shows that the role of the DOE/AE at validation of a proposed methodology is limited to checking whether the documentation is complete.
two scenarios may arise after approval of a new methodology:
1. The proposed methodology was accepted without modification. Validation can proceed immediately if all information required for validation is available;
2. The proposed methodology was modified. Validation only proceeds once project participants have adjusted their documentation (dotted line).