CDM Project in Egypt Replaces Polluting Taxi Fleet
August 2011: The World Bank has provided an update on the Egypt Vehicle Scrapping and Recycling Programme, the first transport Programme of Activities to be registered under the UNFCCC's Clean Development Mechanism (CDM), and which is now providing funding for the replacement of old polluting taxi vehicles in Cairo.
The CDM programme of activities supports better enforcement of Egypt's Traffic Law 121, which aims to accelerate the rate of fleet replacement, improve air quality, and reduce greenhouse gas (GHG) emissions. The Law provides financial incentives to scrap old cabs and provides them with lower prices and guaranteed financing for the purchase of new vehicles. The incentives include the payment of 5,000 Egyptian Pounds (equivalent to US$900) for a scrapped vehicle, Government-negotiated discounted prices for new vehicles, and loan guarantees backed by the Government. The programme is funded through advanced sale of carbon credits to the World Bank Carbon Finance Unit's Danish Carbon Fund and Tranche 2 of the Spanish Carbon Fund. These early funds have been key in setting up the system, with future carbon revenues expected to expand its reach. [World Bank Press Release]