Egypt: Vehicle Scrapping and Recycling Program
Context
The Egyptian mass transport fleet—taxis, microbuses, trailer trucks, and buses—is aging, emits large amounts of greenhouse gas (GHG), and prone to frequent breakdowns. The bustling capital, Cairo, is the source of 40 percent of the country’s GHG transport emissions, exposing residents to as much as 20 times the acceptable level of air pollution daily.
To accelerate the rate of fleet replacement and reduce air pollution, the Government of Egypt adopted a new traffic law mandating that fee-based transport vehicles over 20 years old would no longer be eligible for new operating licenses or license renewals. Because the law did not specify how the non-eligible vehicles should be disposed of, owners could sell them in regions where the law did not apply, convert them for private use, or dismantle them and sell the engines for use in other cars. Without a national scrapping and recycling program, the law was not having the intended effect.
Program Overview
The Carbon Partnership Facility is using results-based climate finance to help the Ministry of Finance (MoF)replace the mass transport fleet. The program offers financial incentives to owners of taxis that voluntarily surrender their vehicle for material scrapping and recycling. The recycling and scrapping program ensures that old vehicles are permanently taken off the roads and components such as tires, oils, and batteries are disposed of and recycled in an environmentally safe manner. The taxi owners can use the financial incentive toward the purchase of a new vehicle from participating dealers. More than half of the new vehicles purchased under the program run on Compressed Natural Gas, which is a type of environment-friendly fuel that generates minimal GHG emissions.
Results
This Clean Development Mechanism (CDM) program in the transport sector was the first of its kind in the world. Between 2013 and 2018, more than 40,000 taxis—83 percent of Cairo’s taxi fleet—have replaced aging taxis, some of which were over 50 years old. The new vehicles have reduced GHG emissions by approximately 334,000 tons of CO2.
The program is an example of how the sale of certified emission reductions can help accelerate the success of government programs, successfully reducing GHG emissions from transport, improving air quality, and creating safer road conditions. The program has also sparked interest from countries in Sub-Saharan Africa that would like to replicate the program.
Program Documents
Relevant program documents can be found here.