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Sri Lanka

Bamboo Processing

Aim of the project

The project aims to develop a bamboo supply chain and product industry in Sri Lanka, leading to reduced global environmental impact from GHG emissions and a sustainable industry base.

Project Duration: 7 years (Indicative period: end 2011-end 2018)

Funds

GEF funds reserved for this project amount to USD 2.69 million.
The indicative co-financing from Sri Lankan government amounts to USD 19 million and private sector USD 2.4 million, making the total project size approximately USD 24 million.

List of Co-Financers:
Name of co-financer (source)    Classification
Mahaweli Authority of Sri Lanka    Nat'l Gov't
Ministry of Industry and Commerce    Nat'l Gov't
Forest Department of Sri Lanka    Nat'l Gov't
UNIDO    Multilateral agency
Touchwood Investments PLC    Private sector
Bamboo Resources Development (Pvt) Ltd    Private sector

Brief Outline

This project will focus on addressing barriers and developing the production of sustainable bamboo for use in the production of energy, building materials, and food production in Sri Lanka. It will involve a comprehensive framework to address the policy framework, the technology transfer and capacity buildings needs for increased supply, and ensuring sustained demand of these materials.
The project aims to bring about the transfer and diffusion of new technologies related to the processing of bamboo and potentially other biomass sources. This will lay the ground for a new industrial sub-sector in Sri Lanka and promote bamboo and biomass plantations as sources of feedstock for this sector. The GHG emission reductions linked to this are fully consistent with the goals of the Climate Change Focal Area.

Some of the products (pellets) will promote biomass as a source of renewable energy. During project preparation, close attention has been paid to ensure that the biomass supplies will not threaten indigenous biodiversity or contribute to further land deterioration or water misallocation – but exactly the opposite. The project impact is expected to include a positive effect on land which has already been deteriorated or is at risk of deterioration. This issue will continue to be closely tracked within project implementation.

Risks

Risks can be a result of many reasons including: environmental (including climate change related), technical, economic, policy, the market, and finance. In this project, no environmental/climate change risks have been identified. Few technical, economic & regulatory barriers have been identified, which, however are moderate in nature.

GEF support (along with co-financing) is expected to remove many of the existing barriers and reduce the impact of others.

The Project will include the following components which address the barriers to bamboo production in a systematic way:
•    Component 1: Policy framework
•    Component 2: Bamboo Tissue Production
•    Component 3. Plantation establishment
•    Component 4. Plantation operation
•    Component 5. Bamboo processing equipment

Expected outcomes

The goal of this project is to develop an internationally competitive industry. The GEF funding will serve to provide Technical Assistance and some investment input to develop and stimulate this industry. As a result of stimulating this industry, a number of positive outcomes are expected for the global environment.

•    Energy for power, it is expected that 25% of the biomass produced and harvested within the project would be used to replace existing non-sustainable fuel sources for power production – including fuel oil and non-sustainable biomass. The total estimated power from renewable sources would be 113,800 MWh per year. In total, the direct emissions reductions from this project resulting from displacing unsustainable fuels for power production are expected to be 76,530 tonnes CO2eq per year, or 765,300 tonnes CO2eq over a 10 year period.

•    Energy for cooking, it is expected that 25% of the biomass produced and harvested within the project would be used to replace non-sustainable biomass from disappearing forests. The total estimated energy from renewable sources would be 198,000 MWh. In total, the emissions reductions from this project resulting from displacing unsustainable fuels for cooking are expected to be 80,320 tonnes CO2eq per year, or 803,200 tonnes CO2eq over a 10 year period.

•    Materials use, it is expected that the use of bamboo (and potentially wood materials) which are sustainably grown will result in a carbon pool – thus taking out CO2eq and depositing it into the materials such as flooring material. The CO2eq removed from the standing stocks would then be replaced by new bamboo growth. In total, the net CO2eq emissions reductions are expected to be 87,520 tonnes per year or 875,200 tonnes GHG over a 10 year period.

In total, the direct emissions reductions from the project are expected to be 244,370 tonnes CO2eq per year with renewable energy generated equivalent to 311,800 MWh per year.

Indirect emissions reductions are estimated to be:

•    Bottom-up indirect emissions reductions are estimated to be 7,331,100 tonnes CO2eq.
•    Top-down indirect emissions reductions are estimated to be 8,429,880 tonnes CO2eq.

* Technologies will include: New species of bamboo grown, floor material production using bamboo, edible bamboo shoots production, and biomass pellet production.