Guidebook for formulating JCM

projects utilizing the JCM
Financing ProgrammePreface
Japan established the Joint Crediting Mechanism (JCM) to promote greenhouse gas (GHG) emission reductions and removals by mitigation actions in developing countries, achieved through the
diffusion of low carbon or decarbonizing technologies, products, systems, services, and infrastructure, and to use them as appropriately quantified contributions to achieve Japan's own emission
reduction targets. As of January 2021, Japan had initiated JCM projects in 17 partner countries(Mongolia, Bangladesh, Ethiopia, Kenya, Maldives, Viet Nam, Lao PDR, Indonesia, Costa Rica,
Palau, Cambodia, Mexico, Saudi Arabia, Chile, Myanmar, Thailand and Philippines). In order tosupport the implementation of candidate JCM projects, the Ministry of the Environment, Japan(hereinafter referred to as “MOEJ”) has been implementing JCM Model Projects (hereinafterreferred to as “model projects”), some of which are in collaboration with projects supported by
the Japan International Cooperation Agency (JICA) and government-affiliated financial institutions. Model projects are intended to utilize financial support to implement projects that will
reduce GHG emissions by utilizing leading low carbon or decarbonizing technologies in developing countries, and in return, to acquire JCM credits for achievement of Japan’s GHG emission
reduction target. Moreover, in accordance with Japan’s Overseas Development Strategy (Environment) adopted by the Cabinet Office in June 2018, the aim of JCM model projects is also tocontribute to global GHG emission reductions through the diffusion of leading low carbon or
decarbonizing technologies.
This Guidebook was prepared to inform project participants in partner countries of key points toconsider when making an application to the JCM Financing Programme.

Table of Contents
Chapter 1 Outline of Joint Crediting Mechanism andJCM Financing Programme...............................................................................1
1.1 Joint Crediting Mechanism (JCM) ............................................................................. 2
1.2 JCM Financing Programme....................................................................................... 3
1.2.1 Outline .......................................................................................................... 3
1.2.2 Eligible projects and costs .............................................................................. 4
1.2.3 Timeframe for model projects ........................................................................ 5
1.2.4 Amounts of financing support ....................................................................... 7
1.3 Registration as a JCM project ................................................................................... 8

Chapter 2 Important aspects to consider in utilizing
JCM Financing Programme.............................................................................11
2.1 Overview of JCM Financing Programme ................................................................. 12
2.2 Composition of International Consortium ............................................................... 12
2.3 Eligible projects ...................................................................................................... 13
2.4 Eligible costs ........................................................................................................... 13
2.5 Payment of funds ................................................................................................... 13
2.6 Property/asset management and obligation to return funds ................................... 13
2.7 Reference scenarios for emission reduction calculations ......................................... 14
2.8 Documentation required ....................................................................................... 14
2.9 Key points to note .................................................................................................. 17

Chapter 1
Outline of Joint Crediting Mechanismand JCM Financing Programme1Chapter 1

Outline of Joint Crediting Mechanism and JCM Financing Programme

1.1 Joint Crediting Mechanism (JCM)
The aim of the Joint Crediting Mechanism (JCM) is to facilitate the diffusion of leading low carbon
or decarbonizing technologies, products, systems, services, and infrastructure, the implementation of mitigation actions, and contributions to sustainable development in developing countries.
Contributions to GHG emission reductions or removals are evaluated appropriately and quantitatively, and they are used to help achieve Japan’s emission reduction targets.
The JCM contributes to the ultimate objective of the UNFCCC by facilitating global actions for
GHG emission reductions or removals.
The JCM is an emerging project-based bilateral offset crediting mechanism initiated by the Government of Japan to facilitate the diffusion of leading low carbon technologies for mitigating GHG
emissions in host countries.

Source: https://www.carbon-markets.go.jp/eng/jcm/index.html

Japan has held consultations for the JCM with developing countries since 2011 and has established the JCM with Mongolia, Bangladesh, Ethiopia, Kenya, the Maldives, Viet Nam, Lao PDR,
Indonesia, Costa Rica, Palau, Cambodia, Mexico, Saudi Arabia, Chile, Myanmar, Thailand and thePhilippines.
(1) The JCM starts its operation as a non‐tradable credit type mechanism.
(2) Based on implementation status of the JCM, both governments continue consultation for thetransition to a tradable credit type mechanism and reach a conclusion at the earliest possibletime.
(3) The JCM aims for concrete contributions to assisting adaptation efforts of developing countries after the JCM is converted to a tradable credit type mechanism.

2

1.2 JCM Financing Programme
1.2.1 Outline
MOEJ launched the Financing Programme for JCM Model Projects to support the implementationof candidate JCM projects.
Its purpose is to provide financial support for projects that aim to reduce GHG emissions by utilizing leading low carbon or decarbonizing technologies in developing countries, and in return generate JCM credits to help Japan achieve its GHG emission reduction target. Moreover, based on
the Overseas Development Strategy (Environment) adopted by Japanese Cabinet Office in June
2018, JCM model projects aim to contribute to global GHG emission reductions through the diffusion of leading low carbon or decarbonizing technologies.

Government ofJapan
Finance part of aninvestment cost

Includes collaboration withprojects supported by JICA
and other governmentalaffiliatedfinancial institute.

Conduct MRV and expected
to deliver at least half of JCM
credits issued(less than half)International consortiums(which include Japanese entities)

Scope of the financing: facilities, equipment, vehicles, etc. which reduce CO2 fromfossil fuel combustion as well as construction cost for installing those facilities, etc.
Eligible Projects : starting installation after the adoption of the financing andfinishing installation within three years.
Source: http://gec.jp/jcm/kobo/mp/r02/20190819_JCM_goj_eng.pdf

The Government of Japan will finance a portion (up to half) of investment costs of model projects
implemented by an International Consortium that will consist of a Japanese entity (as the representative participant) and one or more local in-country partner entities.

3Chapter 1

Outline of Joint Crediting Mechanism and JCM Financing Programme

1.2.2 Eligible projects and costs
To be eligible, a proposed model project must satisfy all of the following criteria.
(a)The project will reduce energy-related CO2 emissions by using leading low carbon or
decarbonizing technologies in a developing country with which Japan has signed or has
been in discussions to sign a bilateral JCM document, and is expected to contribute toachieving Japan’s GHG emission reduction target through the JCM.
(b) The project will contribute to sustainable development in the partner country, and theinstallation and operation of facilities/equipment under the project will comply with therelevant laws and regulations of the partner country, as well as international practices
and guidelines regarding environmental protection.
(c) The reduction of GHG emissions achieved by the project can be quantitatively calculated
and verified.
(d) Facilities/equipment installed by the project do not receive any other subsidy from theGovernment of Japan.
(Source: Guidelines for Submitting Proposals, 2020, GEC)

The following costs are eligible to be covered for model projects. The financial support is provided
only for costs that can be verified as having been spent for the implementation of eligible projects.

(a)
(b)
(c)
(d)
(e)
(f)
(g)

Cost of main construction/installation work
Cost of ancillary work
Cost of machinery and parts
Cost of surveying and testing
Cost of facilities/equipment (including monitoring equipment)
Cost of administrative work; andOther necessary costs approved by the JCM Administration Entity(Source: Guidelines for Submitting Proposals, 2020, GEC)

1.2.3 Timeframe for model projects
1) Implementation period
The implementation period of any model project (i.e., the period for installation of facilities andcompleting all payments) shall be three years or less. Procurement orders dated prior to or after
this period will not be covered. The following figures provide examples of scheduling for a model
project.

4

Example of a 1-year project
Stage

Item

Apr

May JunJulFirst year
Aug Sep Oct Nov Dec Jan

Feb

Mar AprMay JunJul

Second year
Aug Sep Oct Nov Dec Jan

Feb

Mar AprMay JunJul

Third year
Aug Sep Oct Nov Dec Jan

Feb

Mar

Jul

First year
Aug Sep Oct Nov Dec Jan

Feb

Mar AprMay JunJul

Second year
Aug Sep Oct Nov Dec Jan

Feb

Mar AprMay JunJul

Third year
Aug Sep Oct Nov Dec Jan

Feb

Mar

Jul

First year
Aug Sep Oct Nov Dec Jan

Feb

Mar AprMay JunJul

Second year
Aug Sep Oct Nov Dec Jan

Feb

Mar AprMay JunJul

Third year
Aug Sep Oct Nov Dec Jan

Feb

Mar

Call for proposals
From proposal
Proposal review and preliminary
submission to Contract
selection of model projects
of Financing issuancePreparation and review of application
documents, and Contract of Financing
issuedProject implementation

Project implementaton (e.g. installing
facilities/equipment etc.)

Submission of midterm report
Midterm inspection

Midterm inspection by JCM
Administration Entity (document review
and on-site inspection, etc. if necessary)
Submission of final report fromJapanese representative participants

Final inspection

Inspection by JCM Administration
Entity (document review and on-site
inspection, etc. if necessary)

Disbursement of financial support to Japanese representative
participants

Example of a 2-year project
Stage

Item

Apr

May JunCall for proposals
From proposal
Proposal review and preliminary
submission to Contract
selection of model projects
of Financing issuancePreparation and review of application
documents, and Contract of Financing
issuedProject implementation

Project implementaton (e.g. installing
facilities/equipment etc.)

Submission of midterm report
Midterm inspection

Midterm inspection by JCM
Administration Entity (document review
and on-site inspection, etc. if necessary)
Submission of final report fromJapanese representative participants

Final inspection

Inspection by JCM Administration
Entity (document review and on-site
inspection, etc. if necessary)

Disbursement of financial support to Japanese representative
participants

Example of a 3-year project
Stage

Item

Apr

May JunCall for proposals
From proposal
Proposal review and preliminary
submission to Contract
selection of model projects
of Financing issuancePreparation and review of application
documents, and Contract of Financing
issuedProject implementation

Project implementaton (e.g. installing
facilities/equipment etc.)

Submission of midterm report
Midterm inspection

Midterm inspection by JCM
Administration Entity (document review
and on-site inspection, etc. if necessary)
Submission of final report fromJapanese representative participants

Final inspection

Inspection by JCM Administration
Entity (document review and on-site
inspection, etc. if necessary)

Disbursement of financial support to Japanese representative
participants

5Chapter 1

Outline of Joint Crediting Mechanism and JCM Financing Programme2) Procedure after announcement of selection
Inquiries are to be submitted to the JCM Administration Entity, which administers the JCM Financing Programme. The JCM Administration Entity will evaluate each application and issue a response
based on its evaluation. Participant(s) in projects that have been selected as model projects shallsubmit full application documents for a Contract of Financing between the JCM Administration
Entity and the participant(s). The JCM Administration Entity will review the submitted documents(technical documentation, project budget, and supporting documentation, etc.), and if all is inorder, conclude a Contract of Financing with the participant(s). A model project can only start
after this agreement has been signed. Reports to be submitted and reviewed are as follows:(a) Implementation reports: Due at end of each Japanese fiscal year(b) Completion reports: A completion report is required within 30 days of the completion ofeach model project. All payments by project participants to other entities in line withrespective contracts shall be completed prior to submission of the completion report.
(Source: Guidelines for Submitting Proposals, 2020, GEC)

3) After implementation period
The JCM Administration Entity will issue payments of financial support to participants in responseto requests for subsidy as submitted by a participant, after on-site visits conducted to review thesubmitted requests.
Participants shall prepare a property ledger documenting the value of the property acquired
through the model project in order to properly manage such property, and report its status to
MOEJ on an annual basis. After a model project has been completed, participants shall conduct
monitoring to quantify GHG emission reductions achieved by the facilities.

Source: Presentation by GEC entitled “Financing Programme for JCM Model Projects
and JCM Global Match” in Mexico JCM webinar, January 19, 2021.
http://gec.jp/jcm/jp/event/2020Mexico/S2-2-1_GEC.pdf

6

1.2.4 Amount of financing support
Total JCM Financing
Programme budget(FY2020)

9 billion yen (approx. 82 million USD) (FY2020 portion a 3-years budget for 2020,
2021, 2022)

Scope of financing

Facilities, equipment, vehicles, etc., that will reduce CO2 emissions from fossil fuelcombustion, as well as construction costs for installing those facilities, etc.

Eligible projects

Projects that will start installation after signing of a Contract of Financing andcomplete the installation within 3 years.

Suggested size ofindividual model projects

Under 2 billion yen (approx. 18.2 million USD) in financial support under thisprogramme

Minimum size of a model
project
Maximum financial
supportCost-effectiveness offinancial support

To be calculated by multiplying the aggregate amount of eligible costs by thepercentage listed below.
Number of project(s) already selected ineach partner country that use a similar
technology

Financial support percent of investment
cost (to be determined by the JCM
Administration Entity)

None (0)Up to 50%

Up to 3 (1-3)

Up to 40%

More than 3 (>3)

Up to 30%

The amount of financial support is calculated by multiplying the cost-effectiveness offinancial support times emission reductions of GHG and legal durable years (alsoreferred to as statutory service life).
Cost-effectiveness of GHG emission reductions is expected to be JPY 4,000/tCO2-e(approx. 36 USD/tCO2-e) or lower.
If 5 or more projects using a similar technology are proposed in a partner country(e.g., solar power in Mongolia, Palau, and the Philippines, and hydropower in Indonesia), cost-effectiveness is expected to be JPY 3,000/tCO2-e (approx. 27 USD/tCO2-e)or lower.
If 10 or more projects using a similar technology are proposed in a partner country(e.g., solar power in Thailand), cost-effectiveness is expected to be JPY 2,500/tCO2-e(approx. 22 USD/tCO2-e) or lower.

(Source: Presentation by GEC entitled “Financing Programme for JCM Model Projects and JCM Global Match” in Mexico JCM
webinar, January 19, 2021, http://gec.jp/jcm/jp/event/2020Mexico/S2-2-1_GEC.pdf)
Source: Presentation by GEC entitled “Financing Programme for JCM Model Projects and JCM Global Match” in Mexico JCM
webinar, January 19, 2021.
http://gec.jp/jcm/jp/event/2020Mexico/S2-2-1_GEC.pdf

7Chapter 1

Outline of Joint Crediting Mechanism and JCM Financing Programme

1.3 Registration as a JCM project1.3.1 Flow for Registration of a JCM Project
In principle, JCM Model Projects are to be registered as JCM projects within one year after completion. To be registered as a JCM Model Project, the measurement/reporting/verification (MRV)
methodology being applied to the proposed JCM project must be approved by a Joint Committeeof Japan and the partner country. The representative participant prepares a draft PDD consistingof a Project Design Document (PDD) and monitoring plan based on an approved MRV methodology, and submits it to the JCM Secretariat and Third Party Entity (TPE), together with a Modalities
of Communication (MoC) statement signed by the project participants. The draft PDD is posted
by the JCM Secretariat for public comment, and at the same time validation is conducted by the
TPE. The representative participant addresses public comments and after receiving a report fromthe TPE that the draft PDD is reasonable 妥当, submits to the Secretariat the reasonability-confirmed PDD and monitoring plan, MoC, JCM Project Registration Request Form, and TPE report.
Next, the Joint Committee decides whether or not to register the proposed JCM project.

Implementation period
Stage

Item

Last year

First year

MRV period(MRV shall be conducted until the end of legal durable years of the facilities/equipment)
Last year of legal durable
Second year
Third year
years (statutory servicelife)

One year after MRV
periodInstallation, inspection etc.

Project implementation

Commercial operation start

Completion of project implementation

Registration completed within a year after project completion

Registation as JCM project

MRV (Monitoring,
Reporting andVerification)

Issuance of JCM Credits

Monitoring and Reporting

Monitoring& Reporting conducted during legal durable years of facilities/equipmentJCM

Verification by TPE (Third Party Entity)

JCM credits
issuedJCM credits
issuedCompletion of JCM project

Approval of MRV Methodology
The MRV methodology consists of a methodology that outlines the calculation method for GHG
emission reductions and a spreadsheet (monitoring plan and monitoring report) for monitoring inaccordance with the methodology. If a MRV methodology already approved by the Joint Committee is applied to the proposed project, the steps for approval of the methodology can be omitted
省略 and work to create the PDD and monitoring plan can begin immediately. On the other hand,
if no approved MRV methodology is applicable, an MRV methodology applicable to the proposed
project must be developed. The consortium will cooperate in the development of the MRV methodology by the representative participant (submission of required documentation such as target
equipment and energy consumption, etc.).

8

From PDD and monitoring plan preparation to JCM Project Registration Request Form
The representative participant prepares a PDD and monitoring plan for the content of the
proposed JCM project. The consortium cooperates with this (submission of requested documentation, etc.) The main structure of a PDD is shown below.
Main structure of a Project Design Document (PDD)
Item

Content

A. Project description

A.1. Title of the JCM project
A.2. General description of project and applied technologies and/or measures
A.3. Location of project, including coordinates
A.4. Name(s) of project participant(s)A.5. Duration
A.6. Contribution from Japan

B. Application of an
approved
methodology(ies)B.1. Selection of methodology(ies)B.2. Explanation of how the project meets eligibility criteria of the approved
methodology

C. Calculation of emission
reductions

C.1. All emission sources and their associated greenhouse gas emissions relevant to
the JCM project
C.2. Figure of all emission sources and monitoring points relevant to the JCM project
C.3. Estimated emission reductions each year

D. Environmental impact
assessment
E. Local stakeholder
consultation

E.1. Solicitation of comments from local stakeholders
E.2. Summary of comments received and their consideration

After the PDD and monitoring plan as well as MoC statement have been prepared, the processproceeds to validation by public comment and TPE. The TPE is selected by a program of the Ministry of the Environment, Japan, and the costs for the TPE to implement the validation are borne by
the Ministry program. After receiving a report from the TPE that the draft PDD is reasonable, therepresentative participant submits a JCM Project Registration Request Form to the JCM Secretariat.

1.3.2 Monitoring
Monitoring of the facilities/equipment installed by the JCM Model Project must start after trial
operation is completed and regular operation begins. Monitoring shall be done for the period
stated in the PDD, i.e., until the end of the statutory service life. The monitoring results are to berecorded in the monitoring report spreadsheet included in the MRV methodology. Based on themonitoring report, it is possible to apply for the issuance of credits equivalent to the amount of
CO2 emissions reduced during the relevant period.

9Chapter 1

Outline of Joint Crediting Mechanism and JCM Financing Programme

1.3.3 Issuance of JCM credits
The representative participant prepares a monitoring report, submits it to TPE, and after receivinga verification from the TPE for the amount of CO2 emission reductions, submits a JCM Credit
Issuance Request Form to the Joint Committee. In principle, JCM credit issuance covers the period
from the start of operation of the facilities/equipment to the expiration of the statutory service life.
However, it is limited to the period of validity of the JCM bilateral document.
In principle, the initial request for credit issuance should be made within one year after being
registered as a JCM project, and thereafter, a combined request can be made for multiple years.
However, if the legal durable years (statutory service life) expire less than one year before the endof 2031 or after 2031, a Credit Issuance Request Form must be submitted before the end of 2031
for any emission reductions earned between 2021 and 2030.
More than 50% of the credits will be allocated to the Government of Japan, and after confirming
the intent of the partner country government to acquire and allocate the credits, any remainder
will be acquired by the representative participant and the partner participant. However, somepartner countries may have their own rules in place.
From the preparation of the monitoring report for the initial request for credit issuance, and dealing with the verification by the TPE, to the Credit Issuance Request Form, it is possible to receive
support from consultants contracted by the Ministry of the Environment of Japan to support the
representative participant. The TPE for the initial verification is selected by a MOEJ program, andthe costs for the TPE to implement the verification are borne by the MOEJ program. In principle,
the members of the International Consortium will bear the costs of the second and subsequentverifications.
The representative participant and the partner participant can inform MOEJ of their desire for
credit allocation before submitting the Credit Issuance Request Form. The request for credit
issuance is to be made after there has been a confirmation of the distribution of credits between
governments and between the representative participant and partner participant.
If the partner participant is to possess credits, those credits can be used in credit mechanisms ineither country. Details need to be confirmed with the JCM committees of each country.

Note
For the preparation of monitoring reports, verification by a TPE, and requests for credit
issuance as required for the initial verification, support can be obtained from a consultant
contracted under a program of MOEJ.
The verification fee paid to the TPE for the first verification will be covered by the MOEJ
program.
The representative participant and the partner participant are to provide data and information on the JCM project to the supporting consultant and TPE, and cooperate to ensure thatcredit issuance is completed without delay.

10Chapter 2
Important aspects to consider inutilizing JCM Financing Programme

11Chapter 2

Important aspects to consider in utilizing JCM Financing Programme

Outline of this chapter
This chapter covers the most important aspects that partner participants should keep in mind
when considering using the JCM Financing Programme There are many important points for partner participants to consider in addition to what is provided in this Guidebook, so interested parties
are encouraged to inquire with the JCM funding agency or consulting firms that specialize in theJCM. A list of contacts is provided at the end of this guideline document.

2.1 Overview of JCM Financing Programme(1) As a general guide, the amount of financing available per project is 2 billion yen or less.
(2) The 17 countries that have signed a bilateral JCM document are given priority in the JCM
Financing Programme JCM. It is not possible to include multiple countries in one application.
(3) If the one consortium installs facilities/equipment in multiple locations, it may be possible toinclude them in one application.
(4) In principle, projects must be completed within 3 years from project start (occurrence, i.e.,ordering of construction costs or equipment costs) to the completion of facilities/equipment
installation and start of operation.
(5) It is mandatory to form an International Consortium with a Japanese company registered inJapan, as the representative participant. The formation of the International Consortium
makes it possible to apply to the JCM Financing Programme.

2.2 Composition of International Consortium(1) The International Consortium must consist of a Japanese company registered in Japan as therepresentative participant, and partner participant registered as a corporation in the partnercountry.
(2) A central government agency in the partner country cannot be the partner participant. However, state-owned enterprises and local governments are able to be partner participants.
(3) There is no problem if the partner participant has a capital relationship with the Japanesecompany.

2.3 Eligible projects(1) To become a JCM Model Project, a project must be able to reduce energy-derived CO2 emissions, and it must be possible to determine the amount of reduction. Therefore, financing is
not available for a project that only mainly reduces GHG emissions other than energy-derived
CO2 (e.g., semi-aerobic landfills).

12

(2) The introduction of a system that indirectly contributes to the reduction of energy-derived
CO2 emissions, such as an energy management system (EMS), will only be eligible if it isdetermined that quantitative measurement, reporting, and verification (MRV) of the amountof energy-derived CO2 emission reduction is possible.
(3) It is assumed that the technology being used in the project is already commercialized, as notechnology is eligible if it is still at the development stage.
(4) The facilities/equipment to be introduced do not have to be manufactured in Japan. If thetechnology is a leading low carbon or decarbonizing technology it will be considered.

2.4 Eligible costs(1) Only facilities/equipment ordered after an approval decision on JCM financing are eligible.
Costs of facilities/equipment ordered before the financing decision are not eligible.
(2) Costs related to operation and maintenance are not eligible. In principle, costs for structural
work and building construction, etc., are not eligible, even if the equipment is to be installedindoors.

2.5 Payment of funds(1) The financing will be provided after the installation of the facilities/equipment has been completed, the start of operations confirmed, and all the required documentation has been
submitted. Normally, the financing will be transferred to the representative participant's
account within 2 to 3 months after it has been confirmed that the required documentation
has been submitted.
(2) Based on a request from a project participant, an approximate payment can be made up to
an amount determined for each year.

2.6 Property/asset management and obligation to return
funds(1) MRV must be conducted for installed facilities/equipment for the period of the (Japanese)
legal durable years (statutory service life) of the facilities/equipment.
(2) During the statutory service life, if the project will not be continued due to circumstances
attributable to the financing recipient (e.g., the plant closes and the equipment stops operating, or the JCM program financed equipment is sold to a company outside the International
Consortium), the project participant has the obligation to return the funds to the Government of Japan.

13Chapter 2

Important aspects to consider in utilizing JCM Financing Programme(3) The handling of any equipment that has exceeded its statutory service life can be determinedat the discretion of the project participant.

2.7 Reference scenarios for emission reduction
calculations(1) Reference scenarios for the calculation of emission reductions are to assume the use of “excellent technologies that are normally introduced locally at the present time,” and not “technology that is normally introduced locally at present time” (i.e., business as usual, or BaU).
(2) Even if it is difficult to establish a reference scenario due to a small number of types of highly
specialized equipment, it is necessary to do so by investigating competing technologies.

2.8 Documentation required to prepare an application to
be a JCM Model Project
When considering an application to be a JCM Model Project, it is necessary to discuss matters witha Japanese representative participant and a consultant who will provide assistance for the application. The discussions are likely to progress more smoothly if a prospective applicant prepares thefollowing information and documentation prior to these discussions.

14Required information/documents
Date:
Name and position of the person completing the application:
I. Basic information of partner company
1.

Company name2.

Registered address3.

Website address

4.

Name of President/CEO

5.

Main business activity

6.

Overview of financial status E.g., Financial
statements including capital and capital
structure, balance sheet, profit and loss
statement, and cash flow

7.

Phone number

8.

FAX number

9.

Email address

10. Name of project site
11. Address of project site
• Please attach company brochure (if available).
• Please attach company annual reports for most recent three years.
II. Necessary information about the Project1.

Name of project2.

Project outline/plan including background,objectives and goals

3.

Number of project sites

4.

Address of each project site

5.

Maps of each project sites (URL)

6.

Planned size (capacity) and numbers of
installing facilities/ equipment and expected
costs

7.

Current energy (electricity, fuel) consumption
within the project boundary

8.

Planned energy (electricity, fuel) consumption
within the project boundary

9.

Explanation on financial plan including
financial resources to complete the project

10. Drawings/diagrams of equipment/system to
be installed (if already available)

15

Chapter 2

Important aspects to consider in utilizing JCM Financing Programme

11. Specifications/explanation sheet (brochure) of
main equipment to be installed
12. Detailed information of project cost
- Total cost of project- Breakdown of project cost (if available)- Quotations (cost estimates) from suppliers/
installers
13. Estimated annual maintenance costs
14. Detailed information on expected timeline ofprocurement/installation
15. Regulatory approvals necessary for installation/
operation (power generation, grid connection,
PPA, EIA, design approval, etc.)
16. Current progress on preparations for the project
17. Photos of project site (URL)
18. Any previous experience in dealing withJapanese companies
III. Other information to attach to application
19. Company articles of incorporation
20. Financial statements including capital andcapital structure, balance sheet, profit andloss statement, and cash flow for three mostrecent years
21. Information/evidence on sources of financing
to complete the project
22. Corporate documentation indicating decision
to implement JCM Financing Programme(e.g., board resolution, minutes of board
meeting, etc.)
23. Signed document (MOU) with Japanese entity
as the consortium representative16

2.9 Key points to note when preparing an application to
be a JCM Model Project
No

Item

Description

Key points

Examples1

Selection ofrepresentative
participant• The representative• When preparing an
participant must be aapplication to be a JCM
company registered as a
Model Project, identify arepresentative participant for business in Japan. No
application to be a JCM
the International
Model Project can be madeConsortium, which is an
without a representative
important requirement.
participant.

2

Calculations of
CO2 emission
reductions thatwill be realized
by the project,
and amount offinancingneeded• Independently estimate theCO2 emission reductions
due to the project. The
amount of JCM financing isestimated based on the
independent estimate.

3• Give consideration so that
Selection ofqualified projects application is suitable to be
JCM Model Project.
to be JCM
Model Projects• Consider projects that could
involve collaboration with aJapanese company
developing business in Latin
America.
• Register with JCM Global
Match. 1• Contact a consulting
company doing researchcommissioned by MOEJ andobtain support in efforts to
identify a representative
participant in Japan.

• For the estimation of the• The estimates should be
financing amount, emission
conservative and based on
reductions are to beefficiency ratings from
calculated conservatively
specifications of thebased on the emission
proposed
reduction calculation
facilities/equipment, andformulas published by theemission reduction
JCM Administration Entity.
calculation formulas• For the CO2 emission factor
specified by the JCMof electric power, value
Administration Entity.
published by the JCM• If revised downward, theAdministration Entity are toamount of JCM financing
be used.
and project feasibility will
• Numbers are required forchange, which will have
which basis can be shown
impacts on the project plan.
from the EPC, etc. The
calculation is to be donewith consideration ofvarious types of systemlosses.
• The installation offacilities/equipment must
be able to reduceenergy-derived CO2
emissions, and it must be
possible to determine theamount of reduction.
• The project should be on ascale within the limits of
JCM Model Project
financing (maximum 2
billion yen, preferred
minimum 50 million yen).

• Examples envisioned
include projects that help
reduce consumption offossil-fuel-derived electricity(renewable energy, energy
saving) and fossil fuels.
• Potentially large public
infrastructure-related
projects in electric power
and water supply, etc., areworth considering as
candidates for JCM Model
Projects.

1 https://gec.force.com/JCMGlobalMatch/

17

Chapter 2

Important aspects to consider in utilizing JCM Financing Programme

No

Item

Description

Key points

Examples4

Obtaining
permits andapprovals• There are risks thatprocedures required for
grid-connected PV andpower generation projects
could change.

• Before applying, it is• At the time of theimportant to carefully
application, the degree ofdetermine the prospects ofcertainty of the proposal
obtaining permits andwill be reviewed based on
approvals.
the prospect of obtaining
project approvals and gridconnection permits within 3months of the application.
• If the permits and approvals
cannot be obtained, theproject cannot be
implemented.
• In that case, the project
becomes ineligible for JCM
financing.

5

Projectmanagement• Transport the project
facilities/equipment andstore on site.

• No compensation iscovered by the JCM
Financing Programme forany increase in the cost ofwork due to transportdelays, theft, anddeterioration of public
security.

6

Budget control
andmanagement• The budget implementation • Expenditures exceeding the • Clearly explain andplan is to follow thebudget (in yen) in thecoordinate with the EPC so
Japanese fiscal year (April totarget fiscal year are notthat work can be performed
March each year).
covered by JCM Financing
within the budget for each
Programme.
Japanese fiscal year.

• Take steps to prevent delays
and theft during transportof project
facilities/equipment.

FY2020 JCM Financing Programme
List of Grid CO2 Emission Factors (tCO2/MWh)
Renewable Energy(solar, wind, hydropower etc.)

Energy Efficiency
Country

All project

Other thansubstitution
to selfconsumption

Substitution toself-consumption
DieselAll project

Natural gas

Costa Rica

-

0.1

0.8

México

-

0.528

0.8

Costa Rica

-

0.611

0.8

0.46

-

0.255

0.533

-

-

0.434

0.533

-

-

Chile, factor de emisión de CO2 de la red
Red

Energía renovable(solar, eólica, hidroeléctrica, etc.)
Caso 1*

Caso 2**Sistema Eléctrico Nacional (SEN)

0.404

0.404

Aysen (SEA)

0.176

0.176

Magallanes (SEM)

0.361

0.361

* Sustituir sólo la red eléctrica** Sustituir ambas, la red eléctrica y la energía para el autoconsumo

16

Other than
Substitution
substitution
to selfto selfconsumption
consumption

Véase elcuadrosiguiente

0.533