Registered Clean Development Mechanism Projects Research Articles

Exploring the scientific literature on clean development mechanisms: A bibliometric analysis

The Clean Development Mechanism (CDM) was established under Article 12 of the Kyoto Protocol to assist developed countries in reducing greenhouse gas (GHG) emissions by transferring technologies to developing countries and creating a carbon credit market. Despite playing a crucial role in reducing GHG emissions, the CDM faced market uncertainties, inadequate targets for GHG reduction among signatory countries, political and institutional obstacles that led to a decline in CDM projects after 2012. Currently, China, India, and Brazil have the highest percentage of registered CDM projects. The literature presents both evidence in favor of and against CDM projects. To evaluate the evolution and updates in the literature, a bibliometric analysis of 810 articles published between 1998 and 2021 was conducted. The USA had the highest number of published articles, followed by Germany and China, with Energy Policy and Climate Policy as the main journals for disseminating the topic. The study identified four main research axes that expanded into seven thematic groups. Additionally, the evolution of four lines of interest was evident over time, starting with the greenhouse effect and Kyoto Protocol, followed by economic and business aspects, sustainable development and energy policy, and finally, technological transfer and innovation.

Valuing investments in the Global Carbon Market Mechanism as compound real options: Lessons from the Clean Development Mechanism

AbstractThe Global Carbon Market Mechanism (GCMM) aims to incentivize national or sub‐national actors to invest in climate mitigation projects at the same time as limiting the global costs of tackling global warming. Using the worked example of the Clean Development Mechanism (CDM), this article shows that the exact valuation of a mitigation project requires the application of compound real options techniques, as it is able to account for the multi‐staged nature of a project cycle, as well as the two basic sources of uncertainty (the probability of not moving successfully to the next stage of the cycle, technical risk, and the uncertainty related to future emission reduction credit prices, market risk). Using parameters from the global database of registered CDM projects, this article illustrates that longer than projected lead times, higher than projected transaction costs, and higher than projected rates of failure lowered the value of investing in CDM projects considerably, alongside offset prices and their variability. Regulators of and participants within the patchwork of existing emission trading schemes and market mechanisms, including the GCMM (Article 6.4 of the Paris Agreement), could benefit through wider appreciation of the benefits of this valuation method.

Electricity supply trend and operating statuses of coal-fired power plants in North Korea using the facility-specific data produced by North Korea: characterization and recommendations

Reliable energy-related data from NK are needed in order to understand the status and management of air quality in NK. However, data from the North Korean government are limited. Nevertheless, in order to understand the electricity supply and operating statuses of coal-fired power plants in NK, we used the facility-specific data presented in the Project Design Documents of the registered Clean Development Mechanism projects hosted by NK to calculate several indicators that reflect the operating status of coal-fired power plants. The average daily operating time was short, between 4 and 20 h; the power generation efficiency was low, at about 23%; and the emission performance value of carbon dioxide was poor, at about 1500 gCO2/kWh. We also found that the electricity outputs presented in other studies were substantially lower than those reported for the coal-fired power plants in the second National Communication on Climate Change. The best way to provide financial and technical support to NK might be through international programs, such as a new technology transfer mechanism controlled by the Climate Technology Centre and Network in post-2020 climate regime.

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.

Emission sources and mitigation of fluorinated Non‐CO2 greenhouse gas in registered CDM projects

AbstractTypical non‐CO2 greenhouse gases in clean development mechanism (CDM) projects include methane (CH4), nitrous oxide (N2O), and fluorinated gases (F‐gases). The use of F‐gases, such as hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), and sulfur hexafluoride (SF6), has increased sharply in the semiconductor and electronics manufacturing industries. The global warming potential of F‐gases is very high, ranging from 140 to 23 900. Therefore, there has been considerable interest in the reduction of F‐gas emissions. This paper examines the emission sources, methodology, and reduction technologies of F‐gases, using the project design documents of CDM projects registered in the United Nations Framework Convention on Climate Change (UNFCCC). In comparison to other non‐CO2 gases, CDM projects have significantly reduced annual F‐gas emissions. CDM projects achieved reductions of HFCs using thermal oxidation technology, mostly involving the chlorodifluoromethane (HCFC‐22) production process; conversely, PFC reductions targeted the aluminum smelting process to reduce the anode effect. The extent of SF6 reduction in CDM projects was relatively high in the liquid crystal display (LCD) manufacturing process using thermal and catalytic oxidation, although SF6 recovery technology was much more effective in terms of capital and annual costs. Overall, large amounts of F‐gases could be alleviated using thermal or catalytic oxidation. However, the economical reduction of F‐gas emissions would be possible using recovery technology. © 2017 Society of Chemical Industry and John Wiley & Sons, Ltd.

Improving the attractiveness of CDM projects through allowing and incorporating options

The paper puts forward a proposal that, within Clean Development Mechanism (CDM) projects, investors be allowed to benefit from options; this will require a CDM rule change. Through the presence of options, the downside risk resulting from low carbon prices and/or low achieved emission reductions on projects can be limited, while any upside resulting from high carbon prices and/or high achieved emission reductions can be taken advantage of. It is demonstrated that the presence of options improves the financial attractiveness of CDM projects, and this is at no detriment to any stakeholder. The flow-on from the proposal is that more CDM projects should be realisable if options are available, and this in turn will lead to reduced global emissions and improved sustainability. The proposal is supported by the necessary theory and is demonstrated on two registered CDM projects, one on hydropower and one on wind power.

Review on Clean Development Mechanism (CDM) implementation in Malaysia

Abstract Clean Development Mechanism (CDM) appears to be a catalyst to reduce the cost of renewable energy projects in Malaysia. Carbon credit gained from developed countries enhances financial states of the nation and potentially pushes forward renewable energy industries. Most of the registered CDM projects are related to renewable energy, which recorded 69% out of total projects. This paper adopted to-date data from GreenTech Malaysia in order to present the CDM projects in energy sector. Institutional framework has been discussed to demonstrate the registration in CDM cycle. Although the extent of CDM's successfulness is controversial, the number of registered CDM projects in energy sector is in rising trend and helps in large amount of emission reductions in Malaysia particularly through biomass and biogas projects. CDM should encourage more new renewable technology including wind energy and tidal energy in Malaysia.

What is the carbon emission factor for the South African electricity grid?

One of the most important parameters for developing Clean Development Mechanism (CDM) project proposals in the electricity sector (both supply and efficiency) is the standard electricity ‘grid emission factor’, which represents the carbon dioxide related to a megawatt hour of electricity supplied or saved on the grid. While there are detailed guidelines from the CDM Executive Board on how to calculate this emission factor, the values used in registered CDM projects in South Africa vary widely, both due to changes in the rules over time and also to misapplication of the rules. This paper shows how the application of the latest guidelines gives a ‘combined margin emission factor’ for South Africa of 0.957 tCO2/MWh in 2009/2010. The variation in emission factors in the literature, as well as the importance of reducing the transaction costs for South African project developers, points to the need for an official published grid emission factor from the CDM host country authority in South Africa, the Designated National Authority (DNA), within the Department of Energy.

Technology Transfer Under the Clean Development Mechanism: An Empirical Study of 1000 CDM Projects

Against the backdrop of the enhanced importance of technology transfer in the context of the ongoing climate change negotiations, the potential of the Clean Development Mechanism (CDM) as a vehicle for technology transfer has been underscored. This study undertakes an empirical exploration of the extent to which the CDM is contributing to technology transfer and what is the nature of that technology transfer. While most of the multi-country studies on technology transfer under the CDM base their analysis on explicit claims on technology transfer made in the CDM Project Design Documents, this study enumerates technology transfer on the basis of an operational definition, which has been arrived at in light of the evolutionary theories of economic growth, and applies this definition to a dataset of the first 1000 registered CDM projects. Besides, this study undertakes a richer and more in-depth scrutiny of the various kinds of foreign involvement, explores the extent of interlocking of the various roles played by these foreign entities, and also considers their potential influence on technology transfer.

The Drivers and Outcomes of the Clean Development Mechanism in China

ABSTRACTThe Clean Development Mechanism (CDM) is a flexible market mechanism intended to reduce greenhouse emissions and promote sustainable development. China hosts a third of all registered CDM projects, and generates two‐thirds of all certified emissions reductions. Understanding the political economy of the CDM in China is therefore of critical importance in determining whether the CDM is an effective instrument to promote sustainable development and mitigate climate change. This paper discusses the nature and dynamics of CDM project development in China by analysing the 579 registered CDM projects operating in China as of 1 July 2009. The predominant activities are hydroelectric and wind power projects, with foreign involvement largely by European firms specializing in emerging carbon markets. The sustainability outcomes of projects in China are primarily economic, with environmental benefits largely restricted to cleaner production. The results suggest that the CDM is largely being employed as an ancillary device to attract foreign investment and further China's existing development agenda. We argue that the these results indicate the need for further reform of the CDM to achieve desired outcomes, and that China's approach to the design of integrated policy portfolios might be an example of how to achieve this. Copyright © 2011 John Wiley & Sons, Ltd and ERP Environment.

Why Are There So Few Carbon Offset Projects in Pacific Island Countries?

This article examines reasons for the lack of Clean Development Mechanism (CDM) projects registered in Pacific Island Countries (only two of the 1699 projects registered as of 1 July 2009 were located in such countries) and assesses the potential for new project development in the region. Two groupings of CDM projects are analyzed. First, features of the eight CDM projects located in Small Island Developing States and Territories that were registered as of 1 July 2009 are examined to identify what factors have characterized successfully registered CDM projects. (No new projects have been registered in SIDS since this date, although there are more projects currently being validated.) Second, the 122 agricultural-based CDM projects registered as of 1 July 2009 are analyzed to consider how agricultural and bioenergy projects – which seem the most suitable form of CDM projects for the Pacific Islands region – can be best developed in the region. Analysis reveals that agricultural CDM projects that generate electricity have strong potential for development in the Pacific Islands. Policy options to support electricity generation projects are discussed, including the establishment of a regional CDM body, the possibility of Pacific Island countries engaging in unilateral CDM projects, and the role that ‘regional economic leaders’ such as Australia could play to assist project implementation.

The role of offsets in a post-Kyoto climate agreement: The power sector in China

This paper considers how an offset scheme specific to the electricity generation sector could incentivize emissions cuts while avoiding the problems encountered by the Clean Development Mechanism (CDM). It proposes an approach to project evaluation based on measures of additionality, economic viability and contribution to sustainable development specific to this sector and re-evaluates 460 registered CDM projects in China that generate electricity using wind, natural gas or small hydro. It concludes that many small hydro schemes would be viable without the CDM subsidy. Although these projects have zero emissions from operations, offsets issued to projects that are viable without subsidy permit increased emissions in developed countries and lead to a net increase in global emissions. To provide some indication of the sustainable development benefits that CDM projects bring to their host countries, the paper includes estimates of the projects’ benefit to public health due to the reduced use of coal for generation. The paper provides insights into the economics of projects and their value to host countries that are missed by the official CDM methodologies. It contributes to the debate over the design of sector-specific offset schemes that may be part of a new global agreement on combating climate change.

Measuring Emissions Against an Alternative Future: Fundamental Flaws in the Structure of the Kyoto Protocol’s Clean Development Mechanism

Proposals for reforming the Clean Development Mechanism (CDM) range in scope, from making the CDM’s rules stricter and/or more objective, to a more fundamental shift away from project-based offsetting. Interviews conducted in India during 2004-2009 on how the CDM is working in practice in India’s electricity sector, an analysis of the project documents from 70 registered CDM projects in India and China, and analysis of the UNEP Risoe CDM project database together indicate fundamental limitations to improving the outcomes of the CDM within its basic structure as a project-base offsetting mechanism. I find: (1) The majority of CDM projects are “non-additional” (would have gone ahead regardless of support from the CDM) and therefore do not represent real emissions reductions; (2) Due to the subjectivity inherent in project development decisions, a reasonably accurate filter for non-additional projects is infeasible; (3) The need to test project additionality, which is inherently difficult and inaccurate, adds uncertainty and time to the CDM application process, compromising its effectiveness in supporting truly additional projects; (4) Beyond the problems with additionality testing, the fundamental structure of the CDM leads to the over-generation of credits and limits its ability to reduce emissions; (5) Taking a step back, the large-scale use of carbon credits generated in developing countries by industrialized countries to meet their emissions targets hinders global efforts to mitigate climate change over the next decades. Both the large-scale use of offsetting to meet industrialized country targets and the continuation of project-based offsetting risk undermining the ability of global climate change agreements to control greenhouse gas emissions.

An analysis of the relationship between the additionality of CDM projects and their contribution to sustainable development

The Clean Development Mechanism (CDM) allows industrialised countries to use credits from greenhouse gas abatement projects in developing countries in order to fulfil their own emission reduction commitments. There has been mounting evidence that the CDM’s ability to fulfil its goals as stipulated by the Kyoto Protocol—contributing to the sustainable development of the host countries and delivering real, measurable and additional emission reductions—is less than satisfactory. In this article, an evaluation is made of CDM projects’ likelihood of being additional by assessing the impact Certified Emission Reductions have on the Internal Rate of Return of the individual projects. In addition, the projects’ sustainable development benefits are assessed by using a multi-criteria analysis. In a final step, the relationship between the projects’ additionality and sustainability contribution is assessed and a trade-off between these two CDM goals is established, revealing a potential inherent conflict in how the current mechanism works. The analysis is based on a systematic evaluation of 40 registered CDM projects in India.

Assessing the additionality of CDM projects: practical experiences and lessons learned

The Clean Development Mechanism (CDM) under the Kyoto Protocol allows industrialized countries to use credits from greenhouse gas (GHG) abatement projects in developing countries. A key requirement of the CDM is that the emission reductions be real, measurable and additional. This article evaluates how the additionality of CDM projects has been assessed in practice. The analysis is mainly based on a systematic evaluation of 93 registered CDM projects and comes to the conclusion that the current tools for demonstrating additionality are in need of substantial improvement. In particular, the application of the barrier analysis is highly subjective and difficult to validate in an objective and transparent manner. Key assumptions regarding additionality are often not substantiated with credible, documented evidence. In a considerable number of cases it is questionable whether the emission reductions are actually additional. Based on these findings, practical recommendations for improving the assessment of additionality are provided.