The Federal Environment Ministry, with the financial support of the World Bank (WB), has initiated the Clean Development Mechanism (CDM) for the 'Shaheed Benazir Bhutto CNG Bus Project,' The News has learnt.

A consultant firm, Winrock International (WI), has been hired to train personnel as well as to develop project idea notes (PINs) and project design documents (PDDs) for the CNG Bus Project, sources within the City District Government Karachi (CDGK) informed The News, adding that the consultant has now approached the Karachi Mass Transit Cell (KMTC) to obtain the required information.

"The CDM allows emission-reduction (or emission removal) projects in developing countries to earn certified emission reduction (CER) credits, each equivalent to one tonne of carbon dioxide. These CERs can be traded and sold, and used by industrialized countries to a meet a part of their emission reduction targets under the Kyoto Protocol," explained a statement on the United Nations Framework Convention on Climate Change (UNFCCC) website.

"The mechanism stimulates sustainable development and emission reductions, while giving industrialized countries some flexibility in how they meet their emission reduction limitation targets. The projects must qualify through a rigorous and public registration and issuance process designed to ensure real, measurable and verifiable emission reductions that are additional to what would have occurred without the project. The mechanism is overseen by the CDM Executive Board, answerable ultimately to the countries that have ratified the Kyoto Protocol," the statement continued.

Sources explained that the CDM is required to be initiated before the kick-off of the project, and again, after the completion of the project so as to compare and analyse the environmental impact before and after the completion of the project.

This study would also explore the possibilities of significant financial assistance from international donor agencies, subject to the submission or fulfilment of the required standing formalities and preparation of the documents, sources maintained.

The Shaheed Benazir Bhutto CNG Bus Project is expected to be launched by end-June this year, provided that all milestones regarding project implementation timeline are achieved on time, sources added.

It is pertinent to mention here that with successful implementation of the project in Karachi, the model would be replicated in nine other major cities of the country, including Rawalpindi/Islamabad, Lahore, Faisalabad, Gujranwala, Peshawar, Quetta, Hyderabad and Sukkur.

Sources said that the scope of the CDM would be extended to these cities as and when the CNG Bust Project is implemented.

Moreover, sources said, with the passage of time, if the Bus Rapid Transit System (BRTS) project is implemented in Karachi with the support of Asian Development Bank (ADB), a CDM study will also look into the BRTS as well.

Sources maintained that the WB has already given the required funding for the study to the consultant, and added that the KMTC has also furnished the required information to the consultant under the intimation of the environment ministry.

According to some documents, copies of which are available with The News, the consultant has sent 15 queries to the KMTC, including the number of buses, plying start date, size of engine, expected kilometres plied per year for every bus, expected number of years the buses will be plied by the government, current diesel consumption in km/litre per bus, capital expenditure, expected fuel expenses per bus per year, any admin charges per year etc.

Sources said that in Karachi, the diesel consumption of an old bus is 2 km/litre, whereas a new bus consumes a litre of diesel for every 4.8 kilometre drive. The environment ministry has already released Rs300 million to the State Bank of Pakistan (SBP) for the implementation of the pilot project.

As per the plan, the federal government would provide Rs2.5 billion as subsidy and upfront grant for bringing 4000 CNG dedicated buses over the time period of five years for Karachi. The federal government will contribute a total of Rs677,181 as subsidy over five years toward the cost of the one bus. As per modalities, Rs300,000 will be provided as upfront grant as part of down payment and Rs377,181 as interest subsidy payable in five years.