The majority of offset projects under the UN's Clean Development Mechanism (CDM) do not provide real and measurable emissions reductions, according to a study for the European Commission.
The CDM enables developed countries to buy credits from renewable energy and energy efficiency projects in less economically developed regions to help meet their emission reduction commitments under the Kyoto protocol.
Although the CDM is due to end in 2020, similar offset mechanisms have been proposed under the climate change deal agreed last year in Paris and the International Civil Aviation Organization’s scheme to reduce emissions from aviation.
A key requirement of the CDM is that emissions reductions are ‘additional’, in other words, they would not have happened in the absence of the mechanism. The commission asked academics at the Öko-Institut in Germany and the York-based Stockholm Environment Institute to assess the extent to which projects meet this objective and whether carbon reductions are real and measurable.
The study found that 85% of the projects analysed were unlikely to have met the test of being additional, with just 2% highly likely to have achieved emissions cuts that would not have occurred without the CDM.
According to the academics, most energy-related projects, such as wind, hydro, waste-heat recovery and efficient lighting were unlikely to be additional. For example, incandescent light bulbs were already being phased out in many countries, they pointed out.
By contrast, projects restricting methane emissions from landfill or coal mines were highly likely to be additional, while biomass projects had a medium likelihood of being additional, depending on local conditions.
The academics found that the CDM had provided many benefits, including: bringing innovative technologies and financial transfers to developing countries; helping to identify untapped mitigation opportunities; and creating knowledge, institutions and infrastructure to facilitate further action on climate change.
However, they concluded that the future role of crediting mechanisms should be reviewed. Recommendations in the report include:
- Potential buyers of credits should limit purchases to either existing projects, where greenhouse-gas abatement is at risk of stopping or those that have a high likelihood of ensuring environmental integrity.
- Climate mitigation efforts should focus on carbon pricing mechanisms that do not rely extensively on credits, and do not serve to offset other emissions.
- Offsets should be limited to project types that have a high chance of being additional.
Overall, emissions reductions using credits should play a time-limited and niche role in which additionality can be relatively guaranteed, and where the mechanism serves as a stepping-stone to other, more effective policies.
Campaign group T&E said that the findings of the study question the decision to rely almost exclusively on offsetting to meet the aviation sector’s climate target after 2020.
