What is the Clean Development Mechanism
Posted by Admin under Clean DevelopmentThe Clean Development Mechanism (CDM) is an arrangement under the Kyoto Protocol allowing industrialized countries with a greenhouse gas reduction commitment (the so-called Annex I countries) to invest in projects in developing countries that reduce emissions as an alternative to more expensive emission reductions in their own countries.
A crucial feature of an approved CDM project is that it has established that the planned reductions would not occur without the additional incentive provided by emission reductions credits that are sold, a concept known as "additionality". These "certified emission reduction" (CER) credits, each equivalent to one tonne of CO2, can be counted by industrialized countries for meeting their Kyoto targets.
The CDM allows emission-reduction (or emission removal) projects in developing countries to earn certified emission reduction (CER) credits, each equivalent to one tonne of CO2. These CERs can be traded and sold, and used by industrialized countries to a meet a part of their emission reduction targets under the Kyoto Protocol.
The CDM allows net global greenhouse gas emissions to be reduced at a lower global cost by financing emission reduction projects in developing countries, where costs are lower than in industrialized countries. In addition, the mechanism stimulates sustainable development and emission reductions, while giving industrialized countries some flexibility in how they meet their emission reduction or limitation targets.
The CDM is supervised by the CDM Executive Board (CDM EB), that resides under the United Nations Framework Convention on Climate Change (UNFCCC).
In theory, the CDM allows for a drastic reduction of carbon reduction costs for the industrialized countries, while achieving the same amount of emission reductions as without the CDM. In practice, however, the emission reductions may be less with CDM than without it and may lead to unsustainable practices.
The Clean Development Mechanism (CDM) is the most important carbon trading system under the Kyoto Protocol and therefore the most important global tool to address climate change and sustainable development. It is intended to bridge the gap between the global development agenda and the global climate agenda. The Clean Development Mechanism (CDM) of the Kyoto Protocol is the first global attempt to address a global environmental public goods problem with a market-based mechanism. T
So, in other words, the CDM has produced a carbon credit market where sellers, located exclusively in developing countries, can generate and certify emissions reductions that can be sold to buyers located in developed countries.
Global warming is one of the most difficult and important challenges facing the international community. To date, the most substantial effort to address this problem is the Kyoto Protocol. Global climate change mitigation policies call for increasing use of biomass fuels as renewable substitutes to fossil energy resources.
Quantified targets for biofuels introduction in to the market exist in the United States, the European Union, and a number of developing countries.
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