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Pilot Auction Facility for Methane and Climate Change Mitigation (PAF)

The Pilot Auction Facility (PAF) is an innovative climate finance mechanism designed to stimulate private investment in projects that reduce greenhouse gas emissions. The PAF consists of two key elements: the first, a tradable put option for emission reductions, provides option holders with the right but not the obligation to sell future emission reductions to the PAF at a predetermined price. The second element, an auction platform, provides a transparent means for allocating and determining the value of the options. The competitive nature of the auction reveals the minimum price required by the private sector to make emission reduction investments.

Support provider

Germany, Sweden, Switzerland (through a joint contribution of the State Secretariat of Economic Affairs (SECO) and the Climate Cent Foundation), and the United States.

Purpose of support

Project and program implementation

Eligible countries and regions

All developing countries are eligible.

Eligibility criteria

A detailed description of the eligibility criteria and auction rules visit the PAF Website. The PAF can modify the eligibility criteria but it often takes into consideration the following factors: Emission Reductions Eligibility, Eligible Methodologies, Ineligible Methodologies (Adipic Acid), Eligible Countries, Eligible Generation / Issuance Period, Sub-Auctions &Abatement Project’s Operational Status before the Auction Date, Environmental, Health & Safety and Social Criteria (EHS), and Integrity Criteria.

Financial instruments

Equity

Steps to access

Email PAF_Secretariat@worldbank.org with an email containing this disclaimer to obtain the third auction Application Package.

Climate objective

Mitigation

Sectors and themes

Forestry and Land-Use, Waste management

Type of support provider

Multilateral

Type of recipient

Private sector

Fund size

USD 100 million

Co-financing required

Application timeframe

Annual auctions

Trustee or administrator

World Bank

Contact information

http://www.pilotauctionfacility.org/

paf_secretariat@worldbank.org

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Pilot Auction Facility for Methane and Climate Change Mitigation (PAF)