20/05/2016
The Clean Development Mechanism (CDM) is one of the flexible mechanisms of the Kyoto Protocol that can be deployed in the global effort to reduce the concentration of greenhouse gas emissions in the atmosphere. The CDM is designed to stimulate clean development in developing countries with support from industrialised countries. The CDM is based around the idea that projects which reduce greenhouse gas emissions below the level that would have occurred without the project, earn Certified Emissions Reductions (carbon credits) for every tonne of CO2-equivalent reduced. These credits represent commodities that can be traded or sold.
From the start in 2006, the CDM has been subject to a lot of criticism. Examples are that companies first start generating greenhouse gas emissions in order to subsequently implement a project that reduces these emissions again and being rewarded for doing this through the CDM. In addition, the monetary value of a carbon credit determines the appetite of investors to invest in CDM projects; due to over-allocation of emissions-allowances to industrialised countries, the value of the credits collapsed and with it the incentive for companies to invest in CDM-projects. Other points of discussion involved phenomena such as “double-counting” and “additionality”. However, I do not wish to elaborate on these technical terms. I’d rather stress my point that it is clear that the CDM has been exposed to numerous criticism from stakeholders, politicians, climate activists, etc. from all over the world.
What I liked though and wanted to share is that Ms Figueres, Executive Secretary of the United Nations Framework Convention on Climate Change, on the eve of the Bonn Climate Change Conference – May 2016, stated that it is due to the experience gained through the CDM and inherently the carbon markets, that we are in the position to do something to keep the rise of the average global temperature below 2º.
Experience gained with the Kyoto Protocol’s Clean Development Mechanism (CDM) will be critical to the success of the new universal climate change agreement adopted with much excitement in Paris last year, said the United Nations’ top climate change official, Christiana Figueres.
