Challenge: The “CDM Integrity Study” CLIMA.B.3/ETU/2010/0020r was contracted by the European Commission Directorate-General for Climate Action ("DG CLIMA"). Four of the most experienced organisations in the environment and carbon offsetting field were selected to work on this report, CO2logic, SEI CEPS and AEA. The report which was published on the European Commission website examined the World’s largest carbon offsetting mechanism and its success and failures since it was launched a decade ago.
The European Union set up the largest carbon reduction and offsetting system in the world and has relied heavily on the United Nations CO2 (UNFCCC CDM) offsetting mechanisms. Thus the EU is in a unique position to influence the direction of the CDM and the development of alternative or complementary mechanisms.
Teamwork: This in-depth assessment involved four consultancy bureaus, a dozen consultants as well as the DG CLIMA team. Working as a group which including sharing documents, knowledge, verifying each other’s work as well as working hard and long hours under pressure to ensure the highest quality report was given on time to the EC was a crucial part of the success of this study.
Results: The European Union set up the largest carbon reduction and offsetting system in the world and has relied heavily on the United Nations CO2 offsetting mechanisms. Today the EU is in a unique position to influence the direction of the CDM carbon offsetting scheme and the development of alternative or complementary mechanisms. The Clean Development Mechanism (CDM) is currently at a crossroads. As the main instrument for generating greenhouse gas offset credits under the Kyoto Protocol, the CDM was designed to meet two primary objectives: to help developing countries achieve sustainable development; and to help developed countries meet their Kyoto Protocol targets. As the first commitment period of the Kyoto Protocol is set to expire at the end of 2012, there remains uncertainty about the future of the CDM. At the same time, the EU plan to allow continued, though restricted, use of CDM credits post-2012 within the EU ETS, and potentially other emissions trading systems may adopt a similar approach (Australia etc).
The study carried out by CO2logic and the other partners analysed the pros and cons of the current system and the experience gained so far. Using the teams intricate knowledge as well as through interviews with other sector specialists the report went on to propose the necessary reforms.
The report for the European Commission and was published by Jos Delbeke, Director General. DG Climate Action with the following words:
“The Commission today published the results of a study assessing the merits and shortcomings of the current Clean Development Mechanism, which allows companies and industrialised countries to offset emissions by investing in emission reduction projects in developing countries. This study also explores options for UN or EU action to further improve the mechanism.”
Contribution to sustainable development:
For this report CO2logic was specifically in charge of the Briefing papers on Sustainable Development and Additionality. They can be found at the following link