The Clean Development Mechanism is when a project undertaken in a developing country generates reductions in greenhouse gas emissions, contributes to the host country’s sustainable development, and accrues emission reduction credits.
Such projects can earn saleable certified emission reduction credits, each equivalent to one tonne of CO2, which can be counted towards meeting Kyoto targets. These Certified Emission Reductions (CERs) can be used to contribute to the emission reduction commitments of industrialised countries. Article 12 of the Kyoto Protocol defines the CDM.
The mechanism is seen by many as a trailblazer. It is the first global, environmental investment and credit scheme of its kind, providing a standardized emissions offset instrument.
A CDM project activity might involve, for example, a rural electrification project using solar panels or the installation of more energy-efficient boilers.
The mechanism stimulates sustainable development and emission reductions, while giving industrialized countries some flexibility in how they meet their emission reduction or limitation targets.
Operational since the beginning of 2006, the mechanism has already registered more than 1,650 projects and is anticipated to produce CERs amounting to more than 2.9 billion tonnes of CO2 equivalent in the first commitment period of the Kyoto Protocol, 2008–2012.
The chart shows the emission reductions (CER's) expected from CDM projects by country in which the emissions were reduced. (Image from the Wikimedia Commons)
More information about the CDM: http://cdm.unfccc.int
Carbon Expert are among the leading brokers in emissions spot trading within the voluntary carbon credit market.
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