Problems With Clean Development

Kyoto Credits System Aids The Rich, Some Say ... Such complaints are being increasingly heard from environmentalists and even some business leaders around the world, said Ben Pearson, director of Clean Development Mechanism Watch, an Australia-based environmental group that monitors Kyoto's impact -- and the criticism could be the unkindest cut of all for the treaty, which took effect on Feb 16. In what advocates call an innovative market-based strategy, the treaty allows rich nations to avoid making some of their mandated reductions in greenhouse gas emissions by buying "credits" from nations that pollute less, or by investing in sustainable development projects, which is how the Durban dumpsite [which will remain open as a CDM project] is classified. The theory is that such investments will allow rich countries to lower the global burden of emissions and simultaneously spur transfer of clean technology to poorer nations. But activists such as [Sajida] Khan and Winfried Overbeek, who is fighting a Kyoto-inspired project in Brazil, say that the world cannot barter its way out of global warming, and that there is no way to achieve a stable climate unless people in wealthy countries use fewer resources and energy -- in other words, lower consumption.

This article blurs the line between the two different flexibility mechanisms in the Kyoto Protocol. Under Kyoto, "Annex I countries" -- the developed world -- has emissions caps, while the rest of the world does not. With the emissions trading mechanism, an Annex I country can avoid making domestic emissions by buying credits from other Annex I countries. This I see no problem with, since greenhouse gasses have the same impact regardless of where they're emitted.

What the article is really criticizing is the clean development mechanism (CDM), under which an Annex I country gets credit for paying for an emissions-reducing project in a non-Annex I country. On the one hand, an emissions reduction is still an emissions reduction, although the accounting is trickier since non-Annex I countries have no caps, so it's harder to say what their emissions would be in the absence of a CDM project.

There are two major arguments against the CDM. The first is raised by the article, although not articulated very well. There's a long history of criticism of development projects. Typically they're projects that involve huge capital investments, since those are easiest for foreign donors to do. They get dumped on local people without their consent, designed by foreign experts who don't understand the local situation. The technocratic rationale behind CDM -- helping non-Annex I countries leapfrog "dirty" technology -- and the ease of accounting for the contribution of a big project mean that CDM projects will likely include many of the worst kind of development projects. For example, big dams are widely recognized as one of the most socially and ecologically destructive development projects, but they produce "clean" hydropower. In sum, CDM is bad because it provides a new impetus for the kind of development projects that activists have opposed all along.

The second argument, not raised in this article, is based on the fact that non-Annex I countries will eventually have to rein in their own emissions. Under the CDM, Annex I countries are buying up all the easy emissions reductions in non-Annex I countries. Thus, when those countries go to make their own reductions, they'll be stuck with the harder ones. It's unlikely that governments would be thinking of this long-term consequence, however, since the CDM cash is right here right now, and many of these countries desperately need cash. The problem with this argument, though, is that non-Annex I countries will (assuming there's some measure of justice in the negotiations) not be asked to make a certain amount of reduction -- "cut X tons of carbon" -- regardless of their pre-existing condition. They'll be asked to reduce to a certain target. So a CDM project would just put them closer to that target, and they'd get it for free instead of for cheap. In either case they'd have to make the same amount of hard reductions. Meanwhile Annex I countries who made heavy use of the CDM in the first round would be socked with another high reductions target, since with their higher per-capita emissions (maintained by using CDM), they'd still have more ability to make reductions.