Clean Development Mechanism Implementation Research Articles

Environmental co-benefits of climate mitigation: Evidence from clean development mechanism projects in China

The carbon reduction effects of climate mitigation have received much attention, but less attention has been paid to the co-benefits of climate mitigation such as such as air pollution reduction and related health impacts. This oversight may have led to an underestimation of the broader welfare effects of climate mitigation and thus hindering its progress in implementation. This paper investigates the co-benefits of climate mitigation through focusing on the pollution reduction effects of the implementation of the clean development mechanism (CDM), which is an important climate mitigation mechanism to enhance north-south climate cooperation. Using a unique firm-level dataset with data on China's CDM projects from 1998 to 2012, we show that the CDM implementation reduced sulfur dioxide emissions. Mechanism analyses show that the CDM implementation alleviated firms' financing constraints and promoted fossil energy savings, thereby reducing emissions of air pollutants that usually coexist with greenhouse gases in burning fossil fuels. We also find that the CDM didn't bring about the expected technological progress. These results highlight environmental co-benefits of climate mitigation and provide important implications for international climate cooperation

Exploring the impact of environmental, social, and governance on clean development mechanism implementation through an institutional approach.

The study hypothesizes that the environmental, social, and governance (ESG) of the host country have a significant effect on clean development mechanism (CDM) implementation. As CDM incorporates sustainable development as one of the objectives for the green transition, many countries endeavor to adopt and implement CDM as their cleaner production method. Based on the institutional theory, the study aims to investigate the mechanism by which the institutional process of each ESG pillar makes an opportunity for a host country and to see how such country-specific factors influence the implementation of CDM projects. A county-year unbalanced sample drawn from World Bank and multinational CDM project data was analyzed using panel logistic and Poisson regression. Panel regression results show that high-energy intensity and low renewable electricity output as an environmental pillar positively affect CDM implementation. Unemployment and undernourishment as a social pillar positively affect CDM whereas low government effectiveness and the high rule of law positively affect CDM. In the results of zero-inflated Poisson regression, the direction of government effectiveness was upturned. The findings have broadened and deepened the ESG pillar based on the institutional theory and emphasized sustainable development rather than economic outputs.

Clean development mechanism implementation: External and organizational factors drives expected business benefits

AbstractThis study aims to deal with the challenge of rationalizing and testing the interrelationships assumptions of external and organizational factors in the case of clean development mechanism implementation. Prior studies are lacking to introduce the expected business benefits as a mediator between external factors and clean development mechanism implementation. The moderating effect of environmental resources was rationalized and evaluated. The data were collected from 130 ISO 14001 certified manufacturing firms and analyzed using the partial least squares technique. The results revealed that expected business benefits mediate the impacts of all considered external factors and cause an insignificant direct association between market pressure and mechanism implementation. Organizational resources moderate positively the impact of competitor pressure on mechanism implementation. The findings extend the literature by illustrating the dependency of external factors and organizational factors and challenging the results of the studies, which have been driven by independence assumption. The findings are enabling policy‐makers and managers to effectively modify the strategies for enhancing the extent of mechanism implementation.

A critical analysis of CDM implementation in landfills in Rio de Janeiro after 2012: reflections on its socio-environmental contribution capacity in the Brazilian solid waste treatment sector

ABSTRACT The paper reports a study of Clean Development Mechanism implementation in landfills in Rio de Janeiro, Brazil. CDM is supposed to promote sustainable development through projects of GHG emission reductions. This analysis focuses on the power relationships behind the socio-political process of adopting the mechanism in landfills where emissions have been reduced by the breakdown of biodegradable waste. Sociological concepts such as ‘ecological practices’; ‘market’ and ‘environmental justice’ were used for the analysis. CDM’s neoliberal traits combined with local economic interests that shape the waste management domain in Rio can affect the mechanism’s capacity to promote local social-environmental progress.

CDM implementation towards reduction of fugitive greenhouse gas emissions

Clean Development Mechanism (CDM) is the market-based mechanism introduced to reduce greenhouse gas emissions (GHGs) during various activities. Enormous literature has been available on the GHG mitigation activities in energy, transport, agriculture, construction, waste handling activities, afforestation and reforestation sectors using CDM. However, no single study has been carried out for reduction of fugitive emissions or leakages which releases during the industrial activities. Therefore, this paper presents a critical assessment of CDM projects implemented to reduce fugitive emissions during industrial activities. Out of entire 7749 registered CDM projects (in all sectors of CDM), only 154 (1.98%) fugitive emission reduction projects were implemented up to 2016. These 154 projects contribute up to 147,563,247 MTCO2e (8.87%) estimated emission reduction out of total 1,663,533,108 MTCO2e estimated emission reduction in all sectors of CDM ( https://cdm.unfccc.int/about/index.html ). Out of these 154 registered fugitive projects, 125 projects were assessed for fuel emissions, 19 for halocarbons (HCF) emissions and 10 for sulphur hexafluoride (SF6) emissions. The details of the projects were gathered from Project Design Document (PDDs) of United Nations Framework Convention on Climate Change (UNFCCC) project cycle search and further verified by monitoring the reports of each project. These projects were studied to examine estimated emission reductions with special emphasis on the achieved emission reductions in terms of Certified Emissions Reduction (CERs) to calculate financial benefits. Available CDM methodologies to reduce fugitive emissions were also studied. Further, the distribution of these projects across India was mapped using Arc-GIS. Findings show India is second most country after China in registration of CDM projects. Westerns and northern part of India covers maximum CDM activities. Amongst various methodologies, abatement of methane from coalmines (ACM0008), approved methods decomposition of fluoroform (HFC-23) and point of use abatement device to reduce SF6 emissions (AM0078) were used extensively for reduction of fuel, HFC and fluoride gas emissions. 260,064,195 MTCO2e of CERs (14.5%), i.e. emission reduction was achieved from these projects till 2016 ( https://cdm.unfccc.int/about/index.html ). Therefore, some key challenges or barriers are discussed for development and disclosure of carbon strategies to get transparency in entire CER trading processes.

Determinants and outcome of a Clean Development Mechanism in Malaysia

The Clean Development Mechanism (CDM) enables transferring technology from developed countries to developing countries, such as Malaysia, and simultaneously promotes sustainable growth. Although this has been proven, the contribution of Malaysian companies in CDM projects is low. Therefore, this study has been aimed at investigating the determinants of CDM adoption and its impact on companies' performances. Data were gathered by surveying 91 companies in the energy, agriculture, and forestry sectors in Malaysia implementing CDM projects. The data were analysed using the partial least squares technique. The results show that environmental regulations, competitiveness, and financial benefits have a positive impact on CDM implementation. Additionally, this study reported a significant positive effect of CDM implementation on economic performance. This paper extends the knowledge on the determinants and financial outcome of CDM implementation. The information given in this research might be beneficial for policy makers and managers in modifying tactics and strategies towards successful promotion of the CDM in developing countries.

Certified emission reduction opportunities in the rural domestic energy sector: An economic analysis

ABSTRACTSince the Kyoto Protocol agreement, clean development mechanism (CDM) for techno-economic viable project implementations has garnered large emphasis in terms of certified emission reduction, particularly among developing nations. This paper attempts to assess the economic impact of CDM implementation toward sustainable development and the CO2 emission particularly in rural domestic energy sector. A detailed survey was undertaken in the state of Kerala, located in southern part of India, to map the rural domestic energy consumption pattern. Multiple-regression analysis of the data collected reveals the interrelationships of the various parameters that influence domestic energy consumption. The interrelationships between the different parameters were modeled as a linear programming model that optimizes the contribution of individual energy resources on end applications. The results were used to estimate the feasible extent of CO2 emission reduction through use of various energy resources, vis-à-vis their economic viability through cost effectiveness.

Verification of outcomes from carbon market under the clean development mechanism (CDM) projects in landfills

This paper addresses the issue of verifying the outcomes of using the Clean Development Mechanism – CDM – in landfills. Our research focuses on the São Paulo Metropolitan Area and outlines six CDM projects: Bandeirantes, São João, Caieiras, Itapevi, Pedreira, and Lara. Twenty-three indicators are proposed, organized into two dimensions: social and environmental. The process of constructing indicators was participatory. The Delphi technique was then applied leading to its validation by experts. The dimensions were subdivided into five topics: participation, emphasizing the participation of associations and cooperatives surrounding landfills; the interface between agents involved, each with different interests; benefits, focusing on the implementation of CDM in the solid waste sector (especially waste pickers' cooperatives and technology transfer); environmental quality monitoring, highlighting the issue of odor; and gas emissions monitoring related to the efficiency of the biogas capture system. The aforementioned results corroborate the importance of the indicators developed based on interdisciplinary and multi-agent approaches which take into account the different stakeholders.

Experience with linking greenhouse gas emissions trading systems

Two emissions trading systems (ETS) are linked if a participant in one system can use an allowance or a credit issued by either system for compliance. Linking ETS offers a number of potential benefits including, lower overall compliance cost, price protection, greater liquidity in the allowance market, and reduced emissions leakage. It is useful to distinguish: (a) A unilateral link—one ETS accepts the allowances of another ETS for compliance purposes, but not vice versa. Any link to an offset system, such as the Clean Development Mechanism (CDM), is a unilateral link for the ETS that accepts those credits. (b) A bilateral link—each ETS accepts the allowances of the other ETS for compliance purposes. Another way to implement a bilateral link is to adopt a common compliance instrument. The European Union ETS (EU ETS) has a single compliance instrument—the EU allowance—that is used in all 31 participating countries. Several national and subnational jurisdictions have established an ETS for one or more greenhouse gases (GHGs). Some of these ETS also issue offset credits for GHG emission reductions achieved by specified sources. In addition, the international CDM and Joint Implementation (JI) mechanisms issue offset credits for GHG emission reductions. Most ETS have established unilateral links, mainly to the CDM and JI, but also to other ETS. Apart from the systems that are part of the EU ETS and Regional Greenhouse Gas Initiative (RGGI) only one bilateral link, between the California and Quebec ETS, has been established. This study summarizes the experience with linking GHG ETS. WIREs Energy Environ 2016, 5:246–260. doi: 10.1002/wene.191This article is categorized under: Energy and Climate > Economics and Policy Energy and Climate > Systems and Infrastructure Energy Policy and Planning > Climate and Environment

Teoria de opções reais: avaliação econômico-financeira de projetos na indústria cerâmica

O presente estudo teve como objetivo avaliar economicamente a implantação do Mecanismo de Desenvolvimento Limpo na substituição de biomassa não renovável por biomassa renovável no processo produtivo de uma empresa de cerâmica vermelha. A avaliação pretendeu demonstrar o valor da flexibilidade gerencial de Diferimento conforme adaptações realizadas na metodologia proposta por Copeland & Antikarov (2001), a qual adiciona à avaliação tradicional de fluxo de caixa descontado a Opção Real – OR. Essa determinação seguiu um roteiro de etapas essenciais para a análise das variáveis que compreendem o modelo e que possibilitou a ordenação dos resultados quanto aos valores da OR considerada e do valor presente incluindo a flexibilidade gerencial. Finalmente, como resultado deste estudo concluiu-se que a Teoria de Opções Reais por meio da Opção de Diferimento ou Adiamento contribuiu com informações que auxiliaram nas decisões gerenciais de investimento em projetos quando comparados à metodologia tradicional de avaliação visto que são consideradas incertezas inerentes ao projeto, tal como o ambiente real.

Applicability of clean development mechanism to the Hong Kong building sector

Under the Kyoto Protocol's Clean Development Mechanism (CDM), countries worldwide co-operate on encountering climate change by emissions trading, which enables a win–win situation by effectively “regenerating” a cleaner environment in developing countries, whilst efforts in developed countries may still not meet their committed targets of carbon reduction. According to the CDM rules, energy efficiency improvement projects in the building sector are valid for emissions trading. Although the potential saving of energy is significant, there is only a limited number of building projects being registered as CDM projects. This paper explores the applicability of CDM in the building sector by reviewing the implementation of CDM and its advantages and disadvantages. Hong Kong was selected for an in-depth study due to its eligibility for CDM and yet non-starter status. According to a questionnaire survey supplemented by interviews with the stakeholders in this study, major hindrances such as the lack of financial incentive, inadequate knowledge about emissions trading and insufficient governmental support were found in potential CDM projects in the building sector. It is recommended that an inter-city emissions trading market covering mainland China and Hong Kong, and suitable emission reduction targets should be established and led by the government at the initial stage. By setting up an emission exchange centre, local emissions trading activities could be facilitated and job opportunities could be created. In addition to conducting emissions trading, Hong Kong may also contribute to emissions trading in the region by making use of its highly skilled professional services and efficient business environment. This study paves the way for a densely built city such as Hong Kong to benefit environmentally and economically from a cleaner region in its vicinity.

The implementation of clean development mechanism (CDM) in the construction and built environment industry

Greenhouse gas emissions due to human activities are the main contributors to global climate change, a problem that should not be ignored. Through the clean development mechanism (CDM) introduced under the Kyoto Protocol, developing countries are able to earn certified emission reduction (CER) credits through a myriad of emission reduction projects. This study aims to explore the potential of implementing CDM projects in the construction and built environment (C&BE) industry, which has been criticized for not only consuming an enormous amount of resources, but also for contributing to adverse environmental health. In this research, we limit the boundary of the C&BE industry to include the planning, procurement, construction, occupation and refurbishment/demolition phases of a project's life cycle. Surveys and in-depth follow-up interviews with experts have generated useful insights pertaining to CDM potential and its adaptation into the C&BE industry. From this foundation, this paper evaluates the current obstacles to CDM and presents feasible suggestions to increase CDM projects related to the C&BE industry.

Success Factors for Clean Development Mechanism Implementation in Malaysia

The Clean Development Mechanism (CDM), established under the Kyoto Protocol, is one of the market-based mechanisms developed to assist industrialized countries mitigate greenhouse gas (GHG) emissions, achieve emission reduction targets, and at the same time promote sustainable development in developing countries. The CDM, which provides flexibility and costeffectiveness in meeting GHG emission reduction targets, has captured interest globally. CDM implementation is expected to generate benefits, give developing countries a sense of ownership, and share the global load in tackling global warming and climate change. However, CDM <br />implementation faces several complications. The successful participation of developing countries in emission reduction projects presents ongoing challenges, which inhibit their drive towards sustainable development goals. Through a comprehensive review of the literature and theoretical analysis, several factors have been identified as significant to successful CDM implementation in Malaysia. These success factors, which include regulation and a legal framework, competitive advantage, green supply chain, ethical values, financial benefits, and technology transfer, are presented and the importance of each factor is discussed.

Entrepreneurship and the carbon market: opportunities and challenges for South African entrepreneurs

The Kyoto Protocol and its implementation brought forward issues of climate change and its mitigation strategy by national measures through the creation of market mechanisms in carbon trading. The trading of emission certificates has become an important trade commodity worldwide, and its markets have diversified. While this opportunity has created new markets for entrepreneurs and actors that range from farmers to brokers, unequal involvement in most developing countries is noted. This has been mostly observed in those countries where entrepreneurship is often regarded as the cornerstone of economic growth and social improvement. South Africa has spearheaded other African countries in its implementation of Clean Development Mechanism (CDM) projects leading to carbon trading. Based on our research on South African entrepreneurship and its involvement in the carbon market, we conclude that albeit a number of opportunities, the biggest challenge for entrepreneurial participation in the carbon market remains in the nature and processes of CDM project implementation, the lack of a clear supportive system, limited access to financing and--more importantly--general ignorance of the trading opportunities by entrepreneurs. The complex nature of CDM projects themselves limits participation due to lack of the necessary skills on the national level leading to uneven distribution of CDM projects on provincial levels in South Africa. Recommendations are provided to overcome the obstacles and to promote entrepreneurial activity in the carbon market.

Understanding CDM potential in the Mediterranean basin: A country assessment of Egypt and Morocco

Abstract The Mediterranean basin countries on the one hand are considered a climate change vulnerability “hotspot”, while on the other they obtain a substantial potential for the implementation of clean development mechanism (CDM) projects and especially for North Africa region. Abatement of greenhouse gas emissions can mainly be achieved through utilizing renewable energy sources in the region, implementing energy efficiency measures and substituting oil with natural gas in energy generation. However, with few exceptions, the majority of these countries have a limited track record in the CDM pipeline. The aim of this paper is to investigate possibilities for CDM projects and indentify the main challenges for the promotion of CDM activities in the Mediterranean region. In this respect, an assessment of the current state of related institutional and policy setting, CDM potential and barriers related to the implementation of a CDM project in two representative case study countries of the Mediterranean basin, namely Egypt and Morocco was elaborated. The analysis indicated that the overall CDM potential in Egypt and Morocco are almost equal and both countries demonstrate the same tendencies, the key problem, however, remains on how to deal with the political instability and regulatory barriers the region face.

Post-2012 CDM multi-criteria analysis of industries in six Asian countries: Iranian case study

The prospects of the Clean Development Mechanism (CDM) and for carbon income, up to and beyond 2012, in the industrial sectors of Iran and five other Asian countries are investigated. The attractiveness and suitability of each host country, the status of their industrial sectors (based on four post-2012 scenarios), and the post-2012 potential of the CDM (or similar carbon projects) in these sectors are all examined. A multi-criteria analysis of Iran, Saudi Arabia, the UAE, Qatar, China, and India, based on seven sets of criteria (institutional, regulatory, economic, political, social, CDM experience, and energy production/consumption), is conducted, and the post-2012 potential carbon incomes of each country – based on CO2e emissions of industrial processes – are calculated. Finally, the Iranian industrial sector and the impact of deregulation of energy prices are examined. The post-2012 potential savings in the Iranian industrial sector are calculated based on energy savings, carbon income, and environmental savings. The results indicate that there is strong demand for investment and new technology in this sector to combat several-fold energy price increases. Moreover, high-priced carbon credits could play a meaningful role in post-2012 energy policies in this sector. Policy relevance This research is the first study to quantify the carbon market potentials in the industrial sectors of the selected Organization of the Petroleum Exporting Countries (OPEC) members. The Kyoto Protocol is considered by most OPEC countries to be a mixed bag of threats and opportunities and they have shown ambivalence towards it, mainly due to the threat a reduction of fossil fuel consumption poses to their economies. On the other hand, energy efficiency is a desirable goal for their industrial sectors. Iran, as an OPEC member country with vast energy resources, has mostly ignored the CDM during the first commitment period of the Kyoto Protocol and has performed poorly on CDM implementation. However, the current deregulation of energy prices in Iran, with profound cuts in energy subsidies, would definitely alter the perspective of its industrial decision makers on the post-2012 carbon potentials.

Economic Impact of CDM Implementation through Alternate Energy Resource Substitution

Since the Kyoto protocol agreement, Clean Development Mechanism (CDM) hasgarnered large emphasis in terms of certified emission reductions (CER) not only amidst the globalcarbon market but also in India. This paper attempts to assess the impact of CDM towardssustainable development particularly in rural domestic utility sector that mainly includes lightingand cooking applications, with electricity as the source of energy. A detailed survey has undertakenin the state of Kerala, in southern part of India to study the rural domestic energy consumptionpattern. The data collected was analyzed that throws insight into the interrelationships of thevarious parameters that influence domestic utility sector pertaining to energy consumption byusing electricity as the source of energy. The interrelationships between the different parameterswere modeled that optimizes the contribution of electricity on domestic utility sector. The resultswere used to estimate the feasible extent of CO2 emission reduction through use of electricity as theenergy resources, vis-à-vis its economic viability through cost effectiveness. The analysis alsoprovides a platform for implementing CDM projects in the sector and related prospects withrespects to the Indian scenario.

Certified emissions reductions and CDM limits: revenue and distributional aspects

The EU allows those installations that are subject to emissions trading to use a limited volume of certified emissions reductions (CERs), generated through the Clean Development Mechanism (CDM), to cover their own GHG emissions. These CERs can be used in addition to the EU allowances (EUAs), which were primarily allocated free to installations in Phase II of the EU Emissions Trading Scheme (EU ETS) from 2008 to 2012. For the year 2008, the CER limits, which are differentiated by EU Member State, created substantial arbitrage rents (due to the CER-EUA spread) of approximately EU€250 million. Different options for the allocation of this rent are discussed and it is found that, according to economic theory, making the right to use CERs tradable or the regulator pre-committing to buying CERs at the level of the relevant limit reduces the inefficiencies connected to the current regulation. Furthermore, auctioning these CER usage rights shifts the rents created through the CER-EUA spread to the Member State itself. The improved design and implementation of CDM limits justifies EU policy makers intervening to correct previously competition-distorting choices.

Achieving Certified Emission Reduction in Rural Domestic Energy Sector Through Alternative Fuel Replacement

Since the Kyoto protocol agreement, clean development mechanism (CDM) has garnered large emphasis in terms of Certified Emission Reduction (CER) not only amidst the global carbon market but also in India. This paper attempts to assess the economic as well as environmental impact of CDM implementation towards sustainable development and the CO 2 emission by replacing fossil fuels with alternative fuels like biogas and biomass particularly in rural domestic energy sector based on Intergovernmental Panel on Climatic Change (IPCC) guidelines. A detailed survey was undertaken in the state of Kerala, in southern part of India to map the rural domestic energy consumption pattern. The data collected was analyzed that throws insight into the interrelationships of the various parameters that influence domestic energy consumption. The interrelationships between the different parameters were modeled that optimizes the contribution of individual energy resources on end applications. The results were used to estimate the feasible extent of CO 2 emission reduction through replacement of various conventional energy resources with alternative energy sources, vis-a-vis their economic viability through cost effectiveness. The analysis also provides a platform for implementing CDM projects in the sector and related prospects with respects to the Indian scenario.

Benefits of clean development mechanism application on the life cycle assessment perspective: A case study in the palm oil industry

This study performed an assessment on the beneficial of the Clean Development Mechanism (CDM) application on waste treatment system in a local palm oil industry in Malaysia. Life cycle assessment (LCA) was conducted to assess the environmental impacts of the greenhouse gas (GHG) reduction from the CDM application. Calculations on the emission reduction used the methodology based on AM002 (Avoided Wastewater and On-site Energy Use Emissions in the Industrial Sector) Version 4 published by United Nations Framework Convention on Climate Change (UNFCC). The results from the studies showed that the introduction of CDM in the palm oil mill through conversion of the captured biogas from palm oil mill effluent (POME) treatment into power generation were able to reduce approximate 0.12 tonnes CO2 equivalent concentration (tCO2e) emission and 30 kW·hr power generation per 1 tonne of fresh fruit bunch processed. Thus, the application of CDM methodology on palm oil mill wastewater treatment was able to reduce up to 1/4 of the overall environment impact generated in palm oil mill. Implications The Clean Development Mechanism (CDM) is an arrangement under the Article 12 of the Kyoto Protocol Kyoto Protocol to support developing countries in greenhouse gas (GHG) reduction. Since CDM indicators only focus on GHG emissions reduction, the life cycle assessment (LCA) methodology could be used to provide additional assessment on the environmental impact of the CDM implementation. This study utilized the GHG emission reduction indicators obtained from CDM methodology for calculating the environmental impacts based on various environmental consequences and evaluation.