Clean energy investment in developing countries must do better
Brussels, Belgium – One out of five emission reductions credits sold under the Kyoto Protocol’s Clean Development Mechanism (CDM) lack environmental integrity, according to WWF.
Created by the Kyoto Protocol, the CDM allows industrialized countries to partly meet their own greenhouse gas reduction targets by financing emission reducing projects in developing countries. These projects must be additional to emission reduction schemes that would have taken place in the absence of the mechanism.
WWF’s new report — Is the CDM fulfilling its environmental and sustainable development objectives? — suggests that 20% of emission reductions certified under the initiative may have happened even without CDM financing. Furthermore, the report shows that the overall contribution of the CDM to sustainable development, strongly required by Kyoto rules, is worryingly low.
Based on the report, WWF proposes a series of improvements that the Executive Board should implement to strengthen the credibility of the CDM. These include strengthening the project methodologies, and increasing the controls and transparency of the verifying organizations.
Governments at the upcoming climate change talks in Bali need to step up improvements to the Kyoto Protocol’s most important emission reduction scheme. WWF acknowledges that the Executive Board has recently taken steps to improve the CDM. Further improvements are necessary and practicable.
“The CDM is a new and very important tool and needs to be fine-tuned to reach its purpose,” says Dr Stephan Singer, Head of WWF’s European Climate and Energy Policy Unit.
“The UN must ensure that CDM projects protect the environment by being truly ‘additional’. Governments at the upcoming UNFCCC Bali climate talks must make sure that the CDM fulfils its potential and remains a central mechanism in the international climate framework beyond 2012.”
Since the launch of the European Emissions Trading Scheme (ETS) in 2005, the EU has become the largest carbon market in the world. But access to excessively large volumes of carbon credits in phase II of the EU ETS (2008-2012) means that emissions from sectors taking part in the scheme could actually increase by 145 million tonnes of CO2 over the levels in 2005/06 – equivalent to the annual emissions from approximately 30 coal-fired power stations.
“As the largest buyer the EU needs to ensure the CDM delivers real climate and sustainable development benefits,” adds Singer.
“At the same time, deep domestic reductions in the EU are crucial to realizing a low-carbon economy that keeps warming below the dangerous level of 2°C. CDM credits need to be additional to, and not be used instead of domestic action.”
WWF believes that in order to ensure that CDM energy projects are truly additional, have real sustainable development benefits, and put the world on a path towards a low-carbon economy the use of CDM energy project credits within the EU ETS should be limited to those certified by the Gold Standard. This is the only carbon offset standard supported by over 45 NGOs worldwide.
For further information:
Claudia Delpero, WWF European Policy Office
Tel: +32 497 406381
Martin Hiller, WWF International
Tel: +41 22 364 9019
E-mail: email email@example.com