Absolute or relative baselines for JI/CDM projects in the energy sector?

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Absolute or relative baselines for JI/CDM projects in the energy sector?

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  • Research Article
  • Cite Count Icon 8
  • 10.1023/a:1022854701442
RESIDE0NTIAL SOLAR WATER HEATING AS A POTENTIAL CLEAN DEVELOPMENT MECHANISM PROJECT: A SOUTH AFRICAN CASE STUDY
  • Jan 1, 2002
  • Mitigation and Adaptation Strategies for Global Change
  • Randall Spalding-Fecher + 2 more

A community-based Clean Development Mechanism (CDM) project – asolar water heating project in a low-income community in South Africa –is analysed to illustrate the methodological and policy challenges that faceimplementation of the Kyoto Protocol to the United Nations FrameworkConvention on Climate Change. We evaluate four baseline options, andthree potential CDM interventions. The emissions reductions range from –670 to +5 929 Mg CO2 per year, with all option but oneshowing positive emission reductions. Using metered solar water heatingwith liquefied petroleum gas back-up as the CDM intervention, and electricstorage geysers as the baseline, the annual emissions reductions are 5686 Mg CO2. The cost-effectiveness from the national perspective,which is the incremental life cycle costs divided by the lifetime emissionsreductions, is –$18 per Mg CO2 From the perspective of theCDM investor, however, the cost-effectiveness is $5.2 per mgCO2, assuming that the investor receives all of the carbon credits forproviding the incremental capital investment. From our analysis, weconclude that using the current technology (kerosene stoves) as a baselineis probably not appropriate because it does not reflect likely future trendsand also penalises the community for their poverty and current lack ofinfrastructure. We also highlight the importance of credit sharing, and howit affects the cost-effectiveness of the project from the CDM investor'sperspective. The lessons from this analysis are important for the currentinternational policy debate on how to preferentially treat small-scale CDMprojects.

  • Research Article
  • 10.1016/j.clipol.2003.09.007
Hitting emissions targets with (statistical) confidence in multi-instrument Emissions Trading Schemes
  • Nov 19, 2003
  • Climate Policy
  • David Shipworth

Hitting emissions targets with (statistical) confidence in multi-instrument Emissions Trading Schemes

  • Open Access Icon
  • Research Article
  • Cite Count Icon 3
  • 10.2139/ssrn.880384
Should Developing Countries Participate in the Clean Development Mechanism under the Kyoto Protocol? The Low-Hanging Fruits and Baseline Issues
  • Feb 6, 2006
  • SSRN Electronic Journal
  • M Germain + 2 more

Should Developing Countries Participate in the Clean Development Mechanism under the Kyoto Protocol? The Low-Hanging Fruits and Baseline Issues

  • Preprint Article
  • Cite Count Icon 10
  • 10.7892/boris.90367
The environmental integrity of the CDM - a legal analysis of its institutional and procedural shortcomings.
  • Nov 1, 2009
  • Joëlle De Sépibus

There is growing concern that a significant proportion of Clean Development Mechanism (CDM) credits (CERs) do not reflect real emission reductions and that the mechanism is inadequate to assist developing countries in their transition towards a low-carbon economy. Hence, any decision to maintain the CDM in its current form within a post-2012 climate agreement has to be considered with great care. This study examines, in particular, how the baseline and the additionality requirements have been interpreted and sheds some light on the verification process and the oversight by the Executive Body (EB). Finally, it shows that the CDM is inadequate to foster significant policy reforms, which are a prerequisite for any meaningful change in the emission trends of developing countries.

  • Research Article
  • 10.1504/ijgenvi.2019.10023929
The CDM low-hanging fruits problem under ex-ante and ex-post baselines
  • Jan 1, 2019
  • International Journal of Global Environmental Issues
  • Etidel Labidi + 1 more

The Kyoto Protocol set up the so-called 'clean development mechanism' (CDM) to help industrialised countries to meet their emission targets. This is made possible through allowing the use of emission credits generated by emission reduction projects undertaken in developing countries. Two important issues surround the implementation of CDM: the 'low-hanging fruits' (LHF) and the alternative baseline types. To examine the interactions between these issues, we have modelled the behaviour of a monopolistic firm with the possibility of participating in CDM projects. Under an ex-ante baseline, the CDM project increases marginal cost during the first period. Consequently, the output produced by the firm decreases and emissions are reduced. In our study, the LHF problem occurs if the firm does not take into account the future emission reduction or limitation commitments and the irreversibility aspect of abatement measures. Therefore, the increase in the myopic marginal cost is higher than predicted. Under an ex-post baseline, the CDM project decreases marginal cost, increasing the firm's output level. The low-hanging fruits problem takes place if the marginal cost in the myopic behaviour decreases more than predicted. In our study, the extent of the LHF problem increases under a permits' endowment effect but decreases under the irreversibility effect.

  • Preprint Article
  • Cite Count Icon 1
  • 10.22004/ag.econ.22229
Nonpoint Source and Carbon Sequestration Credit Trading: What Can the Two Learn from Each Other?
  • Jan 1, 2003
  • 2003 Annual meeting, July 27-30, Montreal, Canada
  • Kurt Stephenson + 1 more

Emission trading programs have been discussed with respect to achieving water quality objectives and future caps on carbon emissions. A significant part of this literature explores the institutional and technical design issues associated with trades involving nonpoint effluent sources and carbon sequestration. This paper explores conceptual linkages between the nonpoint and carbon sequestration programs and identifies potential areas where cross fertilization can benefit research and policy design of trading programs for environmental protection.

  • Research Article
  • Cite Count Icon 93
  • 10.1561/101.00000035
Transaction Costs and Environmental Policy: An Assessment Framework and Literature Review
  • Apr 14, 2011
  • International Review of Environmental and Resource Economics
  • Kerry Krutilla

This article develops a framework for environmental policy analysis based on an encompassing assessment of transaction costs. This approach emphasizes the ex ante costs of establishing environmental entitlements, and the ex post costs of administrating, monitoring, and enforcing them. The framework is used to organize a literature review which addresses policy design and instrument choice, as well as optimal environmental policy-making and benefit-cost analysis. The review also considers the empirical literature on transaction costs associated with environmental policy-making, and current practices to record some categories of transaction costs in regulatory impact assessments. The article concludes with a discussion of the implications for environmental policy analysis.

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  • 10.3763/cpol.2002.0203
Absolute or relative baselines for JI/CDM projects in the energy sector?
  • Jan 1, 2002
  • Climate Policy
  • Harri Laurikka

Absolute or relative baselines for JI/CDM projects in the energy sector?

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Major US electric utility climate pledges have the potential to collectively reduce power sector emissions by one-third
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Major US electric utility climate pledges have the potential to collectively reduce power sector emissions by one-third

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Evaluation of metrics and baselines for tracking greenhouse gas emissions trends: Recommendations for the California climate action registry
  • Jun 1, 2003
  • Lynn Price + 2 more

Executive Summary: The California Climate Action Registry, which was initially established in 2000 and began operation in Fall 2002, is a voluntary registry for recording annual greenhouse gas (GHG) emissions. The purpose of the Registry is to assist California businesses and organizations in their efforts to inventory and document emissions in order to establish a baseline and to document early actions to increase energy efficiency and decrease GHG emissions. The State of California has committed to use its ''best efforts'' to ensure that entities that establish GHG emissions baselines and register their emissions will receive ''appropriate consideration under any future international, federal, or state regulatory scheme relating to greenhouse gas emissions.'' Reporting of GHG emissions involves documentation of both ''direct'' emissions from sources that are under the entity's control and indirect emissions controlled by others. Electricity generated by an off-site power source is consider ed to be an indirect GHG emission and is required to be included in the entity's report. Registry participants include businesses, non-profit organizations, municipalities, state agencies, and other entities. Participants are required to register the GHG emissions of all operations in California, and are encouraged to report nationwide. For the first three years of participation, the Registry only requires the reporting of carbon dioxide (CO2) emissions, although participants are encouraged to report the remaining five Kyoto Protocol GHGs (CH4, N2O, HFCs, PFCs, and SF6). After three years, reporting of all six Kyoto GHG emissions is required. The enabling legislation for the Registry (SB 527) requires total GHG emissions to be registered and requires reporting of ''industry-specific metrics'' once such metrics have been adopted by the Registry. The Ernest Orlando Lawrence Berkeley National Laboratory (Berkeley Lab) was asked to provide technical assistance to the California Energy Commission (Energy Commission) related to the Registry in three areas: (1) assessing the availability and usefulness of industry-specific metrics, (2) evaluating various methods for establishing baselines for calculating GHG emissions reductions related to specific actions taken by Registry participants, and (3) establishing methods for calculating electricity CO2 emission factors. The third area of research was completed in 2002 and is documented in Estimating Carbon Dioxide Emissions Factors for the California Electric Power Sector (Marnay et al., 2002). This report documents our findings related to the first areas of research. For the first area of research, the overall objective was to evaluate the metrics, such as emissions per economic unit or emissions per unit of production that can be used to report GHG emissions trends for potential Registry participants. This research began with an effort to identify methodologies, benchmarking programs, inventories, protocols, and registries that u se industry-specific metrics to track trends in energy use or GHG emissions in order to determine what types of metrics have already been developed. The next step in developing industry-specific metrics was to assess the availability of data needed to determine metric development priorities. Berkeley Lab also determined the relative importance of different potential Registry participant categories in order to asses s the availability of sectoral or industry-specific metrics and then identified industry-specific metrics in use around the world. While a plethora of metrics was identified, no one metric that adequately tracks trends in GHG emissions while maintaining confidentiality of data was identified. As a result of this review, Berkeley Lab recommends the development of a GHG intensity index as a new metric for reporting and tracking GHG emissions trends.Such an index could provide an industry-specific metric for reporting and tracking GHG emissions trends to accurately reflect year to year changes while protecting proprietary data. This GHG intensity index changes while protecting proprietary data. This GHG intensity index would provide Registry participants with a means for demonstrating improvements in their energy and GHG emissions per unit of production without divulging specific values. For the second research area, Berkeley Lab evaluated various methods used to calculate baselines for documentation of energy consumption or GHG emissions reductions, noting those that use industry-specific metrics. Accounting for actions to reduce GHGs can be done on a project-by-project basis or on an entity basis. Establishing project-related baselines for mitigation efforts has been widely discussed in the context of two of the so-called ''flexible mechanisms'' of the Kyoto Protocol to the United Nations Framework Convention on Climate Change (Kyoto Protocol) Joint Implementation (JI) and the Clean Development Mechanism (CDM).

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  • 10.5339/qfarc.2016.eepp1669
On the Development of a Stochastic Model to Mitigate Greenhouse Gas Emissions in Building and Transportation Sectors
  • Jan 1, 2016
  • Somayeh Asadi + 1 more

Energy-related activities are a major contributor of greenhouse gas (GHG) emissions. A growing body of knowledge clearly depicts the links between human activities and climate change. Over the last century the burning of fossil fuels such as coal and oil and other human activities has released carbon dioxide (CO2) emissions and other heat-trapping GHG emissions into the atmosphere and thus increased the concentration of atmospheric CO2 emissions. The main human activities that emit CO2 emissions are (1) the combustion of fossil fuels to generate electricity, accounting for about 37% of total U.S. CO2 emissions and 31% of total U.S. GHG emissions in 2013, (2) the combustion of fossil fuels such as gasoline and diesel to transport people and goods, accounting for about 31% of total U.S. CO2 emissions and 26% of total U.S. GHG emissions in 2013, and (3) industrial processes such as the production and consumption of minerals and chemicals, accounting for about 15% of total U.S. CO2 emissions and 12% of total ...

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  • Cite Count Icon 3
  • 10.1260/0958305011500887
JI and CDM: Lessons from Pilot Project Assessment
  • Nov 1, 2001
  • Energy & Environment
  • Katie Begg + 1 more

This paper discusses two important issues concerning the use of Joint Implementation (JI) and the Clean Development Mechanism (CDM) under the Kyoto Protocol: — uncertainty in estimates of reductions in greenhouse gas (GHG) emissions; and — contribution to and assessment of sustainable development. The analysis is based on assessments of several operational projects which reduce GHG emissions in countries in transition and developing countries. The projects are concentrated in the energy sector. When considering uncertainty in the estimates of GHG emissions reduction from JI/CDM projects, there are two main issues: construction of the baseline and accuracy of monitoring. Analysis across a range of project types led to estimates of baseline uncertainty which vary from 25% to 60%. Recommendations are made for measures to manage the uncertainty. In terms of contribution to sustainable development, the paper reports analysis of the case study projects in this context and makes recommendations for project aspects which are positive in this respect.

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Environmental innovations hold promise for cutting greenhouse gas (GHG) emissions, but most technology investments are made in large technologically leading countries. Thus, emission reductions in small open economies, such as the Nordic countries, depend on not only domestic technological development, but also technology spillovers from foreign countries. The present study analysed how the development of climate change technologies affected the Nordic countries' GHG emissions from the industrial and energy sectors during a particular time frame. Consequently, while controlling for economic growth and population, domestic and foreign technological development's effects on industrial and energy sector GHG emissions were examined from the 1990–2019 period. The results revealed that both domestically developed environmental technologies and technology spillovers from foreign economies mitigated GHG emissions from these nations' energy and industrial sectors, thereby providing an efficient pathway to achieving sectoral environmental sustainability. In particular, domestic environmental technologies were found to be more efficient in driving environmental sustainability in the industrial sector, whereas impacts from domestic and foreign technological development did not differ significantly in the energy sector. Furthermore, given that economic growth plays a vital role in GHG emissions, environmental Kuznets curve (EKC; inverted U-shaped and U-shaped) relationships have been observed in the energy and industrial sectors, respectively. This suggests that the examined countries' industrial sectors have more environmental quality hurdles to overcome.

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The Kyoto Protocol of the United Nations Framework Convention on Climate Change (UNFCCC) has introduced the Clean Development Mechanism (CDM) as a scheme for greenhouse gas (GHG) emission reduction through cooperation between Annex 1 Parties (investing countries), which are committed to certain GHG emission reduction targets under the Kyoto Protocol, and non‐Annex 1 Parties (host countries), which do not have any commitments to reduce GHG emissions. The eligibility of forestry projects under the CDM is limited to afforestation/reforestation (A/R) projects. A/R CDM allows Certified Emissions Reduction Units (CERs) to be purchased through carbon sequestration by afforestation or reforestation projects in developing countries. A total of 17 methodologies have been approved by the Executive Board of the UNFCCC. Out of these, 11 approved methodologies are for large‐scale A/R CDM project activities and 6 are for small‐scale A/R CDM project activities. This study identifies some potential land use changes for the development of new and approved methodologies of A/R CDM project activities. These suggested land use changes with high potential are pasture lands, landfills, mountainous areas, and mined lands. The suggested future land uses in A/R CDM project activities are due to their good potential in sequestering carbon, success in the establishment of plantation, and unavailability of the approved methodologies of A/R CDM project activities that are applicable to these suggested land uses. A total of 8 project design documents (PDD) of A/R CDM project activities have been accepted by the Executive Board and registered under the Kyoto Protocol of the UNFCCC. Some of the problems with A/R CDM project activities include the planting of large scale monoculture plantations, the planting of exotic species, and impact on the hydrology of the project areas. Future directions of A/R CDM project activities are here suggested, which are implementing mixed species in a plantation, using native species during reforestation activities, and counting the soil organic carbon pools among the carbon pools measured for carbon sequestration.

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Greenhouse gas (GHG) emissions from post-consumer waste and wastewater are a small contributor (about 3%) to total global anthropogenic GHG emissions. Emissions for 2004-2005 totalled 1.4 Gt CO2-eq year(-1) relative to total emissions from all sectors of 49 Gt CO2-eq year(-1) [including carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), and F-gases normalized according to their 100-year global warming potentials (GWP)]. The CH4 from landfills and wastewater collectively accounted for about 90% of waste sector emissions, or about 18% of global anthropogenic methane emissions (which were about 14% of the global total in 2004). Wastewater N2O and CO2 from the incineration of waste containing fossil carbon (plastics; synthetic textiles) are minor sources. Due to the wide range of mature technologies that can mitigate GHG emissions from waste and provide public health, environmental protection, and sustainable development co-benefits, existing waste management practices can provide effective mitigation of GHG emissions from this sector. Current mitigation technologies include landfill gas recovery, improved landfill practices, and engineered wastewater management. In addition, significant GHG generation is avoided through controlled composting, state-of-the-art incineration, and expanded sanitation coverage. Reduced waste generation and the exploitation of energy from waste (landfill gas, incineration, anaerobic digester biogas) produce an indirect reduction of GHG emissions through the conservation of raw materials, improved energy and resource efficiency, and fossil fuel avoidance. Flexible strategies and financial incentives can expand waste management options to achieve GHG mitigation goals; local technology decisions are influenced by a variety of factors such as waste quantity and characteristics, cost and financing issues, infrastructure requirements including available land area, collection and transport considerations, and regulatory constraints. Existing studies on mitigation potentials and costs for the waste sector tend to focus on landfill CH4 as the baseline. The commercial recovery of landfill CH4 as a source of renewable energy has been practised at full scale since 1975 and currently exceeds 105 Mt CO2-eq year(-1). Although landfill CH4 emissions from developed countries have been largely stabilized, emissions from developing countries are increasing as more controlled (anaerobic) landfilling practices are implemented; these emissions could be reduced by accelerating the introduction of engineered gas recovery, increasing rates of waste minimization and recycling, and implementing alternative waste management strategies provided they are affordable, effective, and sustainable. Aided by Kyoto mechanisms such as the Clean Development Mechanism (CDM) and Joint Implementation (JI), the total global economic mitigation potential for reducing waste sector emissions in 2030 is estimated to be > 1000 Mt CO2-eq (or 70% of estimated emissions) at costs below 100 US$ t(-1) CO2-eq year(-1). An estimated 20-30% of projected emissions for 2030 can be reduced at negative cost and 30-50% at costs < 20 US$ t(-) CO2-eq year(-1). As landfills produce CH4 for several decades, incineration and composting are complementary mitigation measures to landfill gas recovery in the short- to medium-term--at the present time, there are > 130 Mt waste year(-1) incinerated at more than 600 plants. Current uncertainties with respect to emissions and mitigation potentials could be reduced by more consistent national definitions, coordinated international data collection, standardized data analysis, field validation of models, and consistent application of life-cycle assessment tools inclusive of fossil fuel offsets.

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There’s a market growing in the United States, but unlike markets that trade in tangible commodities, this one trades in the absence of something no one wants: greenhouse gases in the atmosphere. Hundreds of companies make it possible for individuals, organizations, businesses, and even events such as rock music festivals to proclaim themselves carbon-neutral by paying someone else to reduce their emissions. Worried about your carbon footprint? No problem. For fees of US$2–50 per ton of “avoided emissions,” an offset provider will funnel your money into an activity or technology that keeps greenhouse gases out of the atmosphere. The question is, are offset buyers really getting what they paid for?

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Potential of GHG emission reduction from agriculture sector
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Land use change activities, use of fertilisers, and open field burning of agricultural waste are the major sources of greenhouse gas (GHG) emissions in the agriculture sector. Clean development mechanism (CDM) of Kyoto Protocol provides various GHG mitigation options that reduce energy needs, recycle the generated waste and enable the use of alternate energy sources. CDM promotes projects that use renewable energy sources with clean technology leading to less dependency on conventional energy sources, ultimately reducing GHG emissions. A total of 167 CDM projects of the agriculture sector were studied across 19 countries regarding their emission reduction and methodologies used. Expected carbon emission reduction from the above 167 projects was about 10,083,912 metric ton of CO2 equivalent (MtCO2e), out of which actual emission reduction achieved till October 2012 was 4,989,448 MtCO2e per annum. This paper presents for the first time an overview of the contribution of CDM towards GHG mitigation in the agriculture sector.

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