CARBONBALANCE

HOW Clean is CDM

2010-08-23T16:28:00.000-04:00

UN board could rein in $2.7 billion carbon market

UNITED NATIONS An obscure U.N. board that oversees a $2.7 billion market intended to cut heat-trapping gases has agreed to take steps that could lead to it eventually reining in what European and U.S. environmentalists are calling a huge scam.

At a meeting this week that ended Friday, the executive board of the U.N.'s Clean Development Mechanism said that five chemical plants in China would no longer qualify for funding as so-called carbon offset credits until the environmentalists' claims can be further investigated.

The "CDM" credits have been widely used in the carbon trading markets of the European Union, Japan and other nations that signed onto the 1997 Kyoto Protocol requiring mandatory cuts in greenhouse gases.

Rather than cut their own carbon emissions, industrialized nations can buy the credits which then pay developing countries to cut their greenhouse gases instead.

But environmentalists say rich nations could be wasting billions of dollars on what some are calling "perverse financial incentives," because some of the largest projects funded by the U.N.-managed CDM are a golden goose for chemical makers without making meaningful cuts in emissions.

The CDM executive board, based in Bonn, Germany, has asked for a decades' worth of data on the gases from those five plants in China to study whether the system was manipulated.

The controversy revolves around the apparent conflict between the Kyoto climate treaty and another U.N. treaty, the 1987 Montreal Protocol for repairing the Earth's fragile ozone layer.

The money from the CDM-authorized fund goes to pay the carbon offset credits claimed by more than 20 chemical makers mostly in China and India, but also in nations such as South Korea, Argentina and Mexico.

The chemical makers are paid as much as $100,000 or more for every ton they destroy of a potent greenhouse gas, HFC-23. The price for destroying it is based on its being 11,700 times more powerful as a climate-warming gas than carbon dioxide.

But that gas is a byproduct of an ozone-friendly refrigerant, HCFC-22, which those chemical makers also are paid to produce under the U.N.'s ozone treaty. Environmentalists say there is so much money in getting rid of HFC-23 that the chemical makers are overproducing HCFC-22 to have more of the byproduct to destroy.

"The evidence is overwhelming that manufacturers are creating excess HFC-23 simply to destroy it and earn carbon credits," said Mark Roberts of the Environmental Investigation Agency, a research and advocacy group. "This is the biggest environmental scandal in history and makes an absolute mockery of international efforts to combat climate change.

HCFC-22 is widely used in hair sprays, air conditioners and some refrigerators because it less damaging to the seasonal ozone hole over Antarctica than previous coolants. It has been promoted under the ozone treaty, often considered one of the world's most successful environmental treaties, as a replacement for chloroflourocarbons, or CFCs.

Rich countries accused of carbon 'cheating'

2010-06-10T18:06:00.002-04:00

Some rich countries are seeking new rules under the UN climate convention that campaigners say would allow them to gain credit for "business as usual".

This is all related to

land-use change, which can either release or absorb carbon, depending mainly on whether forests are planted or chopped down.

India forms new climate change body

2010-02-05T10:21:00.000-05:00

Interesting news leading up to the weekend. What is the implication for future global climate talks?

...the Indian government will established a separate National Institute of Himalayan Glaciology to monitor the effects of climate change on the world’s ‘third ice cap’, and an ‘Indian IPCC’ to use ‘climate science’ to assess the impact of global warming throughout the country.

Florida's Clean Energy and Ocean Energy Technology

2010-01-29T10:40:00.000-05:00

The Case for OTEC in Florida

Ocean Thermal Energy Conversion (OTEC):Energy from the Ocean

2010-01-29T10:33:00.000-05:00

This is worth exploring especially in small islands...More of a discussion to follow

Enivronmental Investment in North Africa

2010-01-24T14:34:00.001-05:00

Just in case some of you missed the the news last December as we got caught up in the Copenhagen Conference.

The World Bank announced $5.5 billion dollars of investment money for North African solar power projects. Initial investments will be $750 million dollars from the Clean Technology Fund with the rest on the way from other sources. Planned to be completed by 2015, the project would span five countries and triple world wide concentrated solar power capacity....By 2020, the North African project should total 900 MW in capacity.

The UNFCC Position on Copenhagen

2010-01-22T11:31:00.003-05:00

As I continue to update and build on the current theme " After Copenhagen What Next?". Here is the first official UNFCC Post-Copenhagen response.

After Copenhahen What Next

2010-01-19T19:52:00.005-05:00

What is on the agenda following what many define as the Copenhagen fiasco? My aim over the next few days is series of post to address this issue.
Here is a lively CNN Debate to open up the discussion.

HERE COMES THE US

2009-11-23T19:52:00.000-05:00

WASHINGTON, Nov 23 (Reuters) - The United States will propose an emissions reduction target at a U.N. climate change summit in Copenhagen, a senior administration official said on Monday.

The official also said the White House would decide in the coming days when and whether President Barack Obama would attend the December meeting.

He added the emissions cut proposal would be consistent with the legislative process in the U.S. Congress.

Several heads of state and government have agreed to attend the meeting but Obama has not yet confirmed his attendance.

Climate Policy : The Caribbean Perspective

2009-07-01T13:46:00.004-04:00

This post marks the initial entry in a new series of postings on the climate policy discourse in the English Caribbean. These are the unedited main points; remarks made by Ambassador K. G. A. Hill at the 2009 Fourth Conference on the Environment by Jamaican Institute of Environmental Professionals.

Climate change policies are but extensions of those already being formulated and implemented for sustainable development. Governments in the Caribbean ought not to lose sight of this as they organise their institutional arrangements and in deploying resources. The social, environmental, and economic policies have not resulted in the “growth” and socio-economic transformation necessary to increase public welfare. There is no “cushion” of surplus capital in the challenging period of a warming earth.
Even as the Caribbean governments and their citizens prepare at the national and regional levels, the negotiating process picks up speed at the international.
In the Caribbean the debate should be no less vigorous, with attention to understanding and responding to alternative proposals for an equitable and efficient set of greenhouse gas emission regulating mechanisms. The relative merits of a carbon tax or the cap-and-trade schemes should be a priority.
The regions response to climate changes will be an important factor in determining the allocation of capital and the distributional effects.
A regional climate change policy is a regional energy security policy, a land use policy, a food security policy and ultimately a policy for stability and decency.
It will be up to Caribbean scientists to refine the scenarios, improve their data collection, and sharpen their empirical observation tools as the only basis for sound national and regional policies.
The programmes should be done in the framework of the existing institutional bilateral frameworks, and considerably scaled up to the levels of head of state and governments.
The CARICOM/CARIFORUM (Caribbean I) arrangements require considerable retooling. The organisations are constrained in terms of their limited capabilities and inadequate level of funding. Organisational restructuring, the bane of current economic growth and development models continue.
The effectiveness of the ACS relative to the call on the region’s resources may need to be considered in light of the focus that must be given to climate change activities.
Starting in the national jurisdiction, the central political role of foreign ministry must be redefined to ensure that the global and all-encompassing nature of climate change is coordinated and integrated in all policies and programmes and at all levels of the political structures. At the same time the technical capabilities of the relevant line Ministries Departments and Agencies will require additional resources.
The universities, other tertiary bodies, the professional and research bodies, the business sector, the trades unions (by sector and specialisation), NGOs and the Press and audio-visual media especially radio are all important to build awareness, and prepare for the transitional process already underway on the path to low carbon energy use.
Similarly, the Latin American System (SELA), which groups the Americas, excepting Canada and the United States and other non-independent territories together in regional and international policy issues, but with no discernable focus on climate change.

Trade-Off and Choices in Environmetal Policy For India

2009-07-01T13:24:00.005-04:00

India has laid down the marker: Reuters is reporting :

India will not sign up to targets to reduce its greenhouse gas emissions but will instead focus on fighting poverty and boosting economic growth, the environment minister said on Tuesday.

India is one of the world’s biggest emitters alongside China, the US and Russia, and the second most populous nation. But India’s per capita emissions lag far behind rich countries and it feels the developed world should take the lead on tackling climate change.

“India cannot and will not take emission reduction targets because poverty eradication and social and economic development are first and over-riding priorities,” a statement on behalf of environment minister Jairam Ramesh said.

A legally binding emission reduction target endangers India’s energy conservation, food security and transport, he said.

India has laid out its stance ahead of the negotiation of a climate treaty in Copenhagen in December that will replace the expiring Kyoto pact.

Developing nations say rich countries should cut emissions by at least 40% below 1990 levels by 2020. Developed nations say that target is out of reach when they are trying to stimulate recession-hit economies.

Climate Bill Debate ; The Rational Perspective

2009-07-01T12:56:00.003-04:00

Just do It: As THOMAS L. FRIEDMAN puts it

... for all its flaws, this bill is the first comprehensive attempt by America to mitigate climate change by putting a price on carbon emissions. Rejecting this bill would have been read in the world as America voting against the reality and urgency of climate change and would have undermined clean energy initiatives everywhere.More important, my gut tells me that if the U.S. government puts a price on carbon, even a weak one, it will usher in a new mind-set among consumers, investors, farmers, innovators and entrepreneurs that in time will make a big difference...

The AP's H. JOSEF HEBERT makes a strong case that :
Such a law would impact how much people pay to heat, cool and light their homes (it would cost more); what automobiles they buy and drive (smaller, fuel efficient and hybrid electric); and where they will work (more "green" jobs, meaning more environmentally friendly ones).

Another WSJ report

2009-07-01T12:45:00.001-04:00

Coming from the Right:

Climate Bill and Public Debate in the US

2009-07-01T12:40:00.004-04:00

Here is a quick view from the republican leaning WSJ, essentially parroting the conservative concern over comprehensive environmental policy.

Game On : U.S. House passes landmark climate change bill

2009-07-01T12:02:00.003-04:00

What a difference a year makes. The most positive sign in decades of a change in environmental policy in the US. Clear example of the dramatic effect of democratic politics on policy and a clear victory for President Obama.

Oakland, Calif.-based nonprofit Green For All, which was a driving force in securing green job training funds in the American Recovery and Reinvestment Act, called the bill a significant step forward in creating a more equitable and secure country. The bill includes a $860 million allocation to the Green Jobs Act.
“This legislation will not only position America at the forefront of the clean-energy economy but will also create jobs and opportunities for communities that are too often at the margins - and the smokestack end - of our current economy,” Green For All CEO Phaedra Ellis-Lamkins said in a statement.
The U.S. House of Representatives narrowly passed a sweeping climate change bill today that will significantly change the way Americans use and produce energy.

Selling Credits For Carbon As Profitable As Converting Rain Forests Into Plantations

2009-06-05T09:55:00.000-04:00

BANGKOK – Selling credits for the billions of tons of carbon that are locked in Indonesia's tropical rain forests could be as profitable as converting these areas into palm oil plantations, a study released Friday found.

The study, in the current issue of the peer-reviewed journal Conservation Letters, also found that conserving the 3.3 million hectares (8.2 million acres) that are slated to become plantations on Kalimantan, on the island of Borneo, would boost the region's biodiversity. The 800 proposed plantations that were studied contain 40 of the region's 46 threatened mammals including orangutans and pygmy elephants, the study found.

"Our study clearly demonstrates that payments made to reduce carbon emissions from forests could also be an efficient and effective way to protect biodiversity," said Oscar Venter, a conservation biologist at the University of Queensland in Australia and the study's lead author. "We now need to see policy discussions catch up with science because at the moment the potential co-benefits of linking forest protection to biodiversity are not getting the attention they deserve."

Under an international climate change agreement which would replace the Kyoto Protocol in 2012, governments are expected to create a framework allowing countries to get compensated for protecting their forests.

Among the scenarios being considered are providing countries with direct financial assistance for reducing their emissions from forests or allowing them to gain credits, which they could sell on an international carbon market to companies that have exceeded their allotted carbon cap.

Under the latter scenario, the study concluded that conserving forests would be more profitable than clearing them for palm oil if the credits could be sold for $10 to $33 per ton. Currently, the rate per ton is around $20, the study said.

A carbon trading market - or "cap-and-trade" system - works much like any commodities market except that traders make their fees selling a ton of carbon dioxide instead of corn or copper. At this point, the carbon dioxide traded for the most part comes from industrial sources.

Countries that agree to reduction targets are given permits for an amount of allowable carbon dioxide emissions which are passed onto businesses. Companies can choose to cut their emissions by retrofitting a factory and selling their permits for a profit - or continuing to pollute and buying additional units of carbon dioxide on the open market.

The World Bank's Timothy Brown, a natural resources management specialist in Indonesia, said the calculations seemed reasonable based on the expectation of growth within the carbon markets over the next 10 to 20 years.

But he said there still remains many questions about setting up the system known to avert deforestation and convincing local governments and companies to abandon the much greater certainty of gaining profits from palm oil for the much less certain prospect of earning money trading carbon credits.

"It's not only that the carbon markets are uncertain but the guy trying to access the carbon market is uncertain how to do it," Brown said. "He knows where to go to sell his oil palm. He knows these people. With the carbon market, who does he call? It's not a smooth and frictionless market."

Palm oil can be found in half of supermarket products from cosmetics to ice cream, according to the industry, and demand has risen sharply in China, India and the United States. The industry is also expected to grow as countries mandate the use of biofuels as part of a cleaner energy mix.

But as its profile has risen so has the controversy surrounding the methods used to farm palm oil. Plantation companies in Indonesia and Malaysia - which together produce 87 percent of all palm oil - have come under fire for leading to deforestation that contributes to the demise of animals like orangutans and Sumatran elephants.

Indonesia, where already 15.1 million acres are covered by plantations, has aggressive expansion plans.

Frances Seymour, director general of the Center for International Forestry Research in Indonesia which also took part in the study, said the new data should help make the case that forest have to be part of the solution to reducing greenhouse gas emissions.

"Ultimately, our goal is to help fashion an agreement that will allow tropical forests to become a part of a more comprehensive climate agreement - one that will reduce emissions, as well as produce co-benefits," she said in a statement.

Other groups that took part in the study included The Nature Conservancy, the Great Ape Trust and the Consultative Group on International Agriculture Research.

Voluntary Carbon Markets Nearly Doubled in 2008, Reaching 123.4MtCO2e

2009-05-29T15:42:00.004-04:00

The latest report on the Voluntary Carbon Market is out with some encouraging conclusions and findings. This report provides invaluable information on developments in the Carbon Market outside the various sanctioned and regulated carbon markets.
Some key findings:

Over the past several years, these markets have not only become an opportunity for citizen consumer action, but also an alternative source of carbon finance and an incubator for carbon market innovation
The formation of coalitions to encourage self-regulation; and increased market transparency.
The voluntary carbon markets, like any other commodity market, were not immune to the over-arching forces of the economy and regulatory developments.
In 2008 the CCX overtook the OTC market in terms of tracked volume, it also overtook the OTC market in terms of growth. CCX trades tripled in 2008 (202%), whereas the OTC market grew by 26%—a clear break from the trend in 2007, when the OTC market tripled, while the CCX only doubled.
The voluntary carbon markets were estimated to be valued at US$705 million2 in 2008, more than twice their value in 2007 ($335 million).
The average price of a voluntary carbon credit transacted on the OTC market was $7.34/tCO2e in 2008, up 22% from $6.10/tCO2e in 2007 and up 79% from $4.10/tCO2e in 2006. This compares to an average price of $4.43/tCO2e on the CCX. The OTC market transacted an estimated $396.7 million (56% of the total market), whereas the CCX market transacted an estimated $306.7 million (44%).

The entire report could be read here:

China and US Emissions Talk

2009-05-19T06:18:00.004-04:00

How can we interpret the news that the US and China have been discussing emissions reductions over secret meeting for a few months now.
As the Guardian has been reporting:

A high-powered group of senior Republicans and Democrats led two missions to China in the final months of the Bush administration for secret backchannel negotiations aimed at securing a deal on joint US-Chinese action on climate change, the Guardian has learned.
The initiative, involving John Holdren, now the White House science adviser, and others who went on to positions in Barack Obama's administration, produced a draft agreement in March, barely two months after the Democrat assumed the presidency...The two sides began discussing ways to break through the impasse, including the possibility that China would agree to voluntary – but verifiable – reductions of greenhouse gas emissions. China has rejected the possibility of cuts as it sees that as a risk to its continued economic growth, deemed essential to lift millions out of poverty and advance national status...
memorandum of understanding between the two countries on joint action on climate change.

Chandler said he and Holdren drew up a three-point memo which envisaged:

•Using existing technologies to produce a 20% cut in carbon emissions by 2010.

• Co-operating on new technology including carbon capture and storage and fuel efficiency for cars.

• The US and China signing up to a global climate change deal in Copenhagen.

Progress on US Cap and Trade

2009-05-13T02:12:00.003-04:00

Waxman, Markey Announce Breakthrough on Climate Change Bill:

Democrats on the House Energy and Commerce Committee have reached a deal on the most contentious aspects of cap-and-trade legislation for carbon emissions and plan to unveil the bill on Thursday, Chairman Henry Waxman (D-Calif.) said Tuesday night.
“We have resolved a good number of the issues,” Waxman said after a meeting with committee Democrats, adding that the bill remains on track to clear his panel next week. Opening statements are planned for Thursday with a marathon markup beginning on Monday.

Guyana Presents its case at carbon finance summit

2009-05-09T23:33:00.003-04:00

As one of the leading members of Caricom and the one with arguably the most diversified resource base it is encouraging to highligght the position Guyana has taken and expressed on the issue of deforestation , climate change and carbon Finance.

Head of State Bharrat Jagdeo delivered the feature address at the Forest Carbon Finance Summit 2009 where he highlighted Guyana’s position on avoided deforestation. Avoided Deforestation is now touted as a concept where countries are paid to prevent deforestation that would otherwise occur.
He said that country can play a critical part in helping to outline a successor Agreement to the Kyoto Protocol in time for the December 2009 Copenhagen Climate Conference.
While acknowledging that developed countries need to have strong political will and dedication to addressing the climate issue, the Guyanese leader also pointed out the responsibility of developing countries as part of the solution, using forests as a cost effective abatement solution.

Australian cap-and-trade plan Delayed

2009-05-07T14:21:00.002-04:00

Australian Prime Minister Kevin Rudd's announcement that the country’s cap-and-trade program will to be delayed a year and will not roll out until July 2011 comes as no surprise to those who have been following the debate down-under.
I Rudd's words "I believe (this) is the most sensible, rational, balanced response to a fundamental change in economic circumstances." Are the adverse economic condition solely be be blamed or has conservative politics won the debate?

Solar Power Plant goes Hybrid

2009-05-03T12:40:00.002-04:00

Continuing on the topic of Alternative Energy and the potential of Solar Energy. An earlier Reuters report of an Israeli company wanting to prove it doesn't need constant sunshine for a solar power plant to make non-stop electricity to power off-grid communities.

The Green Business of Pig Waste!!

2009-05-03T12:32:00.001-04:00

Continuing on the subject of Pig Waste it appears that Pig farmers in Sweden are trialing a new network to sell the combustible gasses emitted by their fertilizer, raising cash and helping the environment according to a Reuters report:

The Green Business of Pig Waste!!

2009-05-03T11:56:00.005-04:00

We have yet to reach the limits of the ways and things to recycle. Pig waste has lots of potential. Half of what pigs consume is returned as waste which consist of among other things a host of toxic substances: ammonia, methane, hydrogen sulfide, carbon monoxide, cyanide, phosphorous, nitrates. Not surpising then that we are slowly but surely finding ways to use this waste in beneficial ways:

Here is a typical flow chart for extracting the benefits from Pig Waste !

CDM Projects by Scope (Industry)

2009-05-02T16:00:00.005-04:00

An analysis of the scope (sectoral) distribution of registered CDM projects tells a fascinating story. As of 2009 almost 60% of these projects were in energy related industries. Less than one half of 1% was is Forestation related projects. One reason for the sectoral bias is the relative role of the energy sector in carbon emissions and by extension its resulting demand for carbon credits.
From the perspective of charting a course forward for the CDM, the present sectoral distribution provides strong evidence in support of the need for more Forestation delated CDM projects.

REGIONAL DISTRIBUTION OF REGISTERED CDM PROJECTS

2009-04-30T23:58:00.002-04:00

An examination of the regional distribution of the regional distribution of registered CDM projects tells a fascinating story. As of 2009 there are 1584 registered projects under the CDM distributed over fifty-five (55) countries. Less than two percent (2%) of these projects are in Africa. Twenty six percent (26%) are in Latin America and the Caribbean. Asia and the Pacific host almost three quarters (71%) of registered CDM projects. On the evidence it appears that the global distribution of clean technology investments under the CDM follows the same broad pattern of Foreign Direct Investments.

Analysing CDM : Project Size

2009-04-27T23:40:00.006-04:00

I will be starting a series of post of the CDM: what has been achieved over the past decade. The aim is to provide some analysis of the effectiveness and efficiency of CDM in light of the flood of recent criticisms.
The first post examines the scale distribution of CDM registered projects: Suffice to state that it is not as biased one would expect. Based on the most recent data from the UNFCC more than 43% of the projects registered under CDM are in fact small scale projects. In effect only about 57% of the 1534 projects under the CDM Scheme are large scale projects. Does this bode well for small developing states?

Carbon Tax Not Cap and Trade Says FEDEX

2009-04-23T18:21:00.005-04:00

The battle-lines are being drawn and the contours of policy debate sharpens as the Obama administration continues to signal its intention to institute some form of Carbon emission control measure in the USA.
FedEx Chief Executive Officer Fred Smith adds his opinion on the matter. Smith who is part of the Energy Security Leadership Council: a group of military and business leaders and has been outspoken on energy issues advocates a straight carbon tax.

Fred Smith said he is in favor of a carbon tax, but that he does not agree with the Obama Administration’s proposal for a cap-and-trade system for carbon emissions.

HAPPY EARTH DAY !!!

2009-04-22T13:54:00.001-04:00

IMAGINE THE BEAUTY, TAKE IN THE SCENERY, BREATH AND APPRECIATE LIFE

HOT LATEST NEWS !!! HONOR FOR ISLAND NATIONS

2009-04-21T18:22:00.000-04:00

Island Nations Honored for Taking Stand on Climate Under Ozone Treaty

Environmental News Network (ENN) will be reporting that:
Mauritius and the Federated States of Micronesia (FSM) will be honored today; Tuesday, April 21st 2009, with a Climate Protection Award from the U.S. Environmental Protection Agency for their outstanding contribution to climate protection under the Montreal Protocol ozone treaty.

KYOTO PROTOCOL OR A GLOBAL CARBON TAX?

2009-04-20T14:02:00.007-04:00

Professor William Nordhaus' presentation to the Copenhagen Climate Change Congress Plenary Session, 11 March 2009 continues to reverberate. His first strike is against the present Kyoto Regime; as he puts it “the world should dump the “inefficient and ineffective” Kyoto protocol and replace it with a global carbon tax...”
The central premise of his proposal stems from the question of "how the goals of climate policy can be effectively and efficiently implemented on the national and sub-national scale"?
To this end he suggests that "We need to move the burden of taxation away from labour to resources — and tax not just on carbon but other resources such as water to tackle the far wider environmental and resource problems we face.”
Given how difficult it maybe to scrap the Kyoto Regime given the political economy considerations, I think that the measures worth exploring as suggested by Professor Nordhaus include :

• Modifying the Kyoto Protocol to include tax-type models.
• Broadening the Kyoto treaty to allow countries to fulfill their treaty obligations if they have a domestic regime with a minimum carbon price attached to all emissions.

The full text of the presentation is here.
The audio file can be downloaded here. Professor Nordhaus’ presentation is from minute 23:43 – 42:12

UK Budget to include £500m Spending on Reducing Carbon Emissions

2009-04-20T13:21:00.003-04:00

Reports from the Guardian:

Alistair Darling will use this week's budget to announce an extra £500m of government spending on reducing carbon emissions, including a pledge of £40m to top up and keep open a grants programme for renewable-energy technologies.

Several companies and campaign groups are planning to deliver a petition to Downing Street today demanding that the government put greater support for renewable energy in place. Britain is the second-worst performer in the European Union in terms of the amount of energy coming from renewables, and is a long way behind Germany, Denmark, Spain and Portugal.

Interesting Fact of the Month

2009-04-20T13:14:00.004-04:00

UK Government buildings emit more CO2 than all of Kenya

Public buildings in England and Wales are pumping out 11m tonnes of carbon dioxide a year, more than Kenya's entire carbon footprint. (The Guardian)

Kenya and the Forest :

2009-04-19T23:50:00.001-04:00

Kenya signs its first REDD deal to conserve forests:
Mongabay.com is reporting that Kenya has signed its first carbon deal to reduce emissions from deforestation and degradation (REDD).
Kenya has signed its first carbon deal to reduce emissions from deforestation and degradation (REDD).

San Francisco-based Wildlife Works Carbon and Kenya Forest Service (KFS) announced a plan to protect the 80,000-acre Rukinga forest reserve in southeastern Kenya. The project will be funded by sales of carbon credits in the voluntary carbon market. The credits will be certified under the Voluntary Carbon Standard (VCS).

Ensuring Developing countries’ participation in the global carbon market

2009-04-19T23:30:00.001-04:00

Financing the move to low-carbon economic development remains a crucial part of any discussion of Carbon Finance. An interesting paper by Wagner, Keohane, Petsonk, and Wang provides a valuable framework to address that issue. To them, financing the transition to low-carbon economic development must be the focus of any framework to encourage developing countries’ participation in the global carbon market... the essence of Clean Investment Budgets (CIBs).
Their framework includes the proposal that emerging economies could adopt binding limits on greenhouse gas emissions, set above current levels but within economic and environmental constraints. Such a step would enable these nations to access carbon finance immediately and far more efficiently than existing and proposed mechanisms.

Today's Food for Thought :Global Warming Study: Nations Need to Cut Emissions by 70 Percent

2009-04-17T13:12:00.003-04:00

The threat of global warming can be significantly lessened if nations cut emissions of heat-trapping greenhouse gases by 70 percent this century, according to a new study by the National Center for Atmospheric Research (NCAR)

EU and the CDM : Is CDM under Threat ?

2009-04-17T12:42:00.004-04:00

How much should made of the recurring EU attempts to refine the parameters of the CDM? Following earlier proposal by the EU Commission that the CDM should be limited to LDCs, a Carbon Finance is reporting the EU is ready to close its doors to credits from such programmes – threatening global emissions trading...
This follows from a position paper issued by the International Emission Trading Association (Ieta) where in The EU is proposing to phase out "one of the main private finance success stories of the Kyoto protocol" .

The more things change the more they do remain the same: The EU as a major stakeholder has every right to shape the nature of any global carbon finance regime, but this is not a carte-blanche for unilateral re-modification of the most successful element of the Kyoto Agreement. The EU can not be allowed to limit the beneficiaries of the CDM for their own gains.

Technology Transfer and CDM Projects

2009-04-11T23:26:00.003-04:00

How much of the $95 billion on clean technology transfer to developing countries from richer nations from The UN’s Clean Development Mechanism (CDM) stands to produce has actually occured? Are these CDM projects and by extension the "distribution of clean or low-emissions technology evenly spread around the developing world?"
The study, “Analysis of Technology Transfer in CDM Projects,” provides some initial answers:

Roughly 36% of the projects accounting for 59% of the annual emission reductions claim to involve technology transfer.
Technology transfer is more common for larger projects and projects with foreign participants.
Technology transfer is very heterogeneous across project types and usually involves both knowledge and equipment.
The technology originates mostly from Japan, Germany, the USA, France, and Great Britain.
Unilateral and small-scale projects involve less technology transfer, possibly due to their smaller size: Unilateral project constitutes 39% of all projects.

These are some of the interesting conclusions. See the above link for the complete report.

Prediction: $1 Trillion U.S. Carbon Market By 2020

2009-04-09T14:59:00.003-04:00

How big will a US Carbon Market be? Well New Carbon Finance research economists have taken the first crack at the estimation. According to their initial prediction;
The U.S. will be home to a $1 trillion carbon emission market by 2020 if federal and state policymakers continue on their current path towards a cap-and-trade program that is confined to domestic trading only...
The researchers predict that in 12 years a carbon-constrained U.S. economy that includes a cap-and-trade system allowing only domestic trades will produce:

The reproduced chart says a thousand words !!

Are present Cabon Permit prices too Low?

2009-04-09T14:48:00.002-04:00

This seems to be the main point from a UK government-sponsored study to be released later this year as Reported by the Times Green Digest.
The study recommends that the price of European carbon permits should be at least 85 GBP (pounds), about eight times the present price, if they are to meet their goal of getting polluters to cut emissions. Presently carbon permits under Europe’s Emissions Trading Scheme (ETS) are trading at about 11 pounds per ton.

Carbon credits from forest conservation would crash carbon market, says Greenpeace

2009-04-08T13:49:00.006-04:00

Forestry related projects promoting afforestation and or reforestation are central to the CDM. Not surprising a number of these projects have been approved and are under consideration from Asia to South America. Its importance was underlined when the Precious Woods project in Brazil secured Latin America’s largest issue of carbon credits under Kyoto’s Clean Development Mechanism (CDM).: 512,000 CERs.
Greenpeace is sounding the alarm warning that the :

Inclusion of forest conservation in a market-based mechanism for reducing greenhouse gas emissions would crash carbon prices by swamping the market with cheap credits...low carbon prices would "derail global efforts to tackle global warming" and cause "developing countries losing out on billions of dollars a year for investment in clean energy technologies".

To that effect Greenpeace is, proposing a hybrid market linked Tropical Deforestation Emission Reduction Mechanism (TDERM) under the UNFCCC and its Kyoto Protocol ...outlined that can effectively incentivise and reward efforts to simultaneously meet the twin goals of:
• Reducing emissions from deforestation in tropical developing countries.
• Protect biological diversity and ecosystem services intrinsic to tropical forests.
Follow the link above for details on their proposal.

Connecting climate change and economic recovery

2009-04-07T22:17:00.003-04:00

I think its worth revisiting a topic I raised earlier : The much discussed trade of between environmental goals and economic growth. As I noted earlier only the skeptics seem to be convinced of this trade of despite mountains of evidence and analysis to the contrary. On that note here is a video from The McKinsey Quarterly of economist Nicholas Stern on the economic downturn and its effect on the climate change agenda.

"Community Cooker" : A practical Measure to reduce carbon Emmissions:

2009-04-06T14:03:00.001-04:00

Kenyan designers have built a cooker that uses trash as fuel to feed the poor, provide hot water and destroy toxic waste, as well as curbing the destruction of woodlands...

While the prototype cooker, in Kibera's Laini Saba village, has been dogged by local squabbles, drought and design problems, it proved the idea worked. A tall chimney carries the once-choking fumes away and initial emissions tests have been favourable, Archer's firm says. Now the Kenyan Red Cross is preparing to install similar cookers in the Dadaab and Kakuma refugee camps near the Somali border, where cholera has already broken out this year, and at least one European aid organisation is looking at wide deployment.

This mirrors the highly successful Carbon Neutral's Fuel-efficient Cooking Stove project in Eritrea which is estimated to save 300,000 tons CO₂e per year.

South Africa sets tariffs to boost renewables investment

2009-04-06T13:56:00.000-04:00

The largest economy in Africa steps up as it stands South Africa is the largest emitter on the African continent, depending on coal for 90 percent of its electricity needs. Despite that fact, moves to diversify to other energy sources have so far stalled due to a lack of policy framework and incentives for investors. In the latest bid to rectify that situation:

South Africa's regulator (NERSA) has approved renewable energy tariffs to boost investment in the sector that would help meet the country's target on alternative energy,...

Small islands urge deep CO2 cuts, fear rising seas

2009-04-06T13:53:00.000-04:00

Finally those most vulnerable to Global Warming are speaking out:

Small island states have sharpened their calls for the rich to make deep cuts in greenhouse gas emissions, saying low-lying atolls risk being washed off the map by rising ocean levels.
An alliance of 43 island states, backed by more than a dozen nations in Africa and Latin America, urged developed countries at U.N. climate talks in Bonn on Thursday to cut greenhouse emissions by "at least 45 percent below 1990 levels by 2020".

Global Updates Asia

2009-04-06T13:30:00.000-04:00

This week I will starting a series of post providing important updates and developments from Carbon Markets outside the EU and developments in the US.

Tokyo bought about 2 million tonnes in the past year of carbon offsets generated by clean energy projects in developing countries, called certified emission reductions (CERs)...

In the two years through March 2008, Tokyo had concluded contracts to buy a total 23.04 million tonnes from abroad, all of which were CERs generated by projects in developing countries under Kyoto's Clean Development Mechanism (CDM).

EU short of CO2 permits in 2008

2009-04-06T12:56:00.004-04:00

Reuters is reporting that it appears that industry data for 2008 carbon dioxide emissions shows a permit shortage in The European Union's Emissions Trading Scheme. In effect there was "undershooting" of carbon permits issued under the EU ETS.

This in effect meant that EU industries emitted allocated quota of permits.

COUNTRY         2008          2008          2007
          EMISSIONS    ALLOCATIONS    EMISSIONS
Austria         32.2          30.2          31.8
Belgium         55.5          55.8          52.8
Bulgaria         N/A           N/A          39.2
Cyprus           N/A           N/A           5.4
Czech Rep.      77.9          85.4          87.8
Germany        472.6         388.8         487.1
Denmark         26.5          24.0          29.4
Estonia         13.5          11.7          15.3
Spain          162.7         151.7         186.6
Finland         36.2          36.5          42.5
France         112.2         129.5         126.6
UK             265.0         214.0         256.6
Greece          69.9          63.7          72.7
Hungary         26.0           N/A          26.8
Ireland         20.4          20.2          21.2
Italy          219.6         197.5         226.4
Liechtenstein    0.02          0.02          N/A
Lithuania        5.2           7.5           6.0
Luxembourg       2.1           2.5           2.6
Latvia           2.3           2.7           2.8
Malta            N/A           N/A           2.0
Netherlands     83.4          76.8          79.9
Poland         187.4           N/A         209.6
Portugal        29.9          30.5          31.2
Romania         40.4          69.7          69.6
Sweden          20.0          20.6          19.0
Slovenia         8.9           8.2           9.0
Slovakia        11.6          32.2          24.5

TOTAL        1,981.4       1,659.1        2,164.7
Sourced Link

International Aspects of a Carbon Cap and Trade Program

2009-04-04T11:14:00.003-04:00

If you want a gist of the the debate in the US please listen to this contribution to the Senate Finance Committee.

Start from 1:56 of the video

Green Carbon Neutral Cities

2009-04-04T09:35:00.006-04:00

In the previous post I made a reference to Mayor Bloomberg's Proposal on using wind energy in New York City. Here are the relevant links.
Audio Link
Text Link (Press Release)

Carbon-Neutral Cities

2009-04-04T09:26:00.003-04:00

Phoenix's Mayor Phil Gordon wants to make his city America's first carbon-neutral city.

Seems like the race is on in the US. This follows on Mayor Bloomberg's proposal at the 2008 National Clean Energy Summit to make New York City a clean-energy powerhouse through off-shore and on-building wind farms.

Low Carbon High Growth in Developing Economies

2009-04-03T20:21:00.004-04:00

Though the skeptic position on the trade-off between environmental policy and economic growth has been largely debunked (see here) and (here) for a start, questions still persist. One strain of the latest version of this debate focuses on the cost to developing countries in terms of lower growth rate.
For those interested in this debate should read The World Bank's "Low Carbon High Growth - Latin American Responses to Climate Change".
A few extracts are worth stating:

Given its past record of low-carbon development, its wealth of natural resources, and its intermediate levels of income—when assessed on a global scale— many Latin American countries are well placed to take a leadership role in the developing world’s response to the climate change challenge. This is not only possible; it is also in Latin America’s best interest.

Beyond adaptation policies, there is a strong case for Latin America to be an active part of a broader effort to mitigate climate change by means of drastically reducing the world’s GHG emissions.

Caribbean nations, for instance, are likely to be hit on multiple fronts, including through more intense natural disasters and the dieback of marine ecosystems. As a result, those nations stand to suffer relatively more, with permanent economic losses reaching by some estimates several percentage points of their GDP.

Food for though ?

IFC Board approves new standards - Implications for Carbon Finance

2009-04-02T22:25:00.001-04:00

The International Finance Corporation (IFC) announced the final approval of its revised social and environmental standards last month, ending a process that has been wracked by controversy. The revised standards are expected to be reflected in changes in coming weeks to the Equator Principles, a voluntary set of project finance guidelines.

The new Performance Standards introduce a number of additional requirements to IFC’s lending criteria. For example, large companies in the developing world applying to the IFC for a loan will now have to report on their greenhouse gas emissions.

Other additions include stronger safeguards on biodiversity protection, the introduction of grievance mechanisms for workers and local communities, new measures on the use of security services, and guarantees for community health and safety.

Carbon Expo

2009-04-02T22:19:00.002-04:00

Carbon TradeEx America 2009 on April 7-8, 2009 at the Washington, DC Convention Center.

Waxman-Markey “Clean Energy and Security Act Of 2009″

2009-04-01T09:35:00.002-04:00

Positive news on the USA front towards Cap and Trade.The discussion draft of The Waxman-Markey - “The American Clean Energy and Security Act of 2009 ” is now public.

The Summary can be found here.
For those interested in a more detailed version click here

Emerging Solar Technologies

2009-03-31T23:35:00.004-04:00

Solar energy is a key component of the Carbon Free Mix.Paul Detering reports that

Technology development in the solar industry continues to accelerate at an unprecedented rate. Over $3 billion was invested in new companies and technologies in 2008 alone, and investments in solar have doubled every year for the last five years.

For developing countries this should serve as good news.

Chinese exports expand - Now Carbon Credits

2009-03-31T23:23:00.003-04:00

Latest report from Carbon Offset daily underlines the significant comparative advantage China has in generating Carbon Credits. They are reporting

The Norwegian Ministry of Finance has signed an agreement to buy carbon credits from Shenhua Group, China’s largest coal miner, under the clean development mechanism (CDM), a statement on the State-owned Assets Supervision and Administration Commission’s website said on Tuesday.
The certified emission reductions (CERs) will be generated from four wind farm projects in Chicheng and Tongliao in Inner Mongolia autonomous region, developed by Guohua Energy Investment Co, a subsidiary of Shenhua Group.

The four projects are expected to generate over 400,000 tons worth of reduction of carbon dioxide emissions every year. The annual revenue is expected to reach 4.8 million euros.

Obama starts climate change forum for big economies

2009-03-31T11:01:00.003-04:00

U.S. President Barack Obama on Saturday invited 16 "major economies" including the European Union and the United Nations to take part in a forum on climate change to facilitate a U.N. pact on global warming

* 16 major economies invited for climate talks in April
* Forum would help advance U.N. talks for a global deal

Finally a president and an administration which means business on the environment.

U.S. asks UN to help cut ship emissions near coasts

2009-03-31T10:59:00.001-04:00

Interesting bit of news.

The United States has asked the United Nation's International Maritime Organization to create a buffer zone around America's coastline to cut pollution from ocean-going ships that harms human health

The Thomson Reuters Carbon Blog is one of the best out there its free with approved registration.

MENA Carbon Forum 2009

2009-03-31T10:44:00.003-04:00

MENA Carbon Forum 2009 (May 6-7; Cairo, Egypt)

The main objective of this Forum is to bring on a unique regional platform, various stakeholders that are active in the carbon market: project owners and developers, CDM governance bodies, financial institutions as well as carbon market buyers and intermediaries and service providers to discuss the latest developments related to carbon market and create ample opportunities for networking and business development.

For those interested in exploring the potential in the Middle East and North Africa

Carbon markets up 84% in 2008

2009-03-31T10:42:00.001-04:00

Carbon markets up 84% in 2008

New Carbon Finance’s latest analysis of 2008 trading activity confirms our Q3 2008 projections with total transactions throughout the year worth $118bn, representing 4bn tonnes of carbon allowances changing hands. In spite of the uncertain economic climate, we expect growth in the global carbon market to continue, reaching $150bn in 2009

The CDM project cycle

2009-03-31T10:25:00.003-04:00

For prospective investor, stake-holders, project developers and managers it is worth keeping in mind that there is a procedure in place to regulate CDM Projects.

The CDM has been designed to incorporate a rigorous project cycle. To develop a CDM project, the following regulatory steps occur in the project cycle:

Design of the CDM project and preparation of necessary project documentation, including the Project Design Document;

Obtain approval from the host country’s Designated National Authority;

Receive validation by the Designated Operational Entity (DOE) and registration of that project with the CDM Executive Board;

Establish monitoring of the project’s emission reductions;

Complete verification and certification of the project’s emission reductions by the DOE;

Receive CERs by the CDM Executive Board.

The devil is always in the details. There are several factors which may affect the lag at each stage of the process.

Types of CDM Projects

2009-03-31T10:19:00.003-04:00

As a general bit of advice it is worth clarify what projects would qualified under CDM. As a basis guideline provided through MDG CarbonFacility:

A CDM project reduces or avoids the emission of greenhouse gases in a developing country. Examples of such projects include:

Renewable energy, such as wind, hydroelectric or solar;

Biomass residues, such as utilizing bagasse for electricity generation in a sugar factory;

Energy efficiency measures, such as the introduction of compact fluorescent light bulbs or more efficient cookstoves; and

Waste management practices, such as capturing methane emissions from wastewater treatment plants

CDM Projects

2009-03-31T10:11:00.003-04:00

CDM is the Clean Development Mechanism (CDM)established under the Kyoto Agreement offering

developing countries the opportunity to use their comparative advantage in emissions reduction: their cost to reduce emissions is generally lower than that of developed countries

I am sure the last part of this statement raises serious issues and echos of the statement made by Larry Summers.

MDG and Carbon Finance

2009-03-31T09:59:00.002-04:00

A good source of information on the institutional support for Carbon Finance within the broad Millennium Development Goals, the MDG CarbonFacility provides that service.

Carbon Market - Carbon Finance - Cap and Trade

2009-03-29T16:57:00.004-04:00

This is blog 1 in my two part response to Alan Bey's request as to what is " Carbon Finance Thing". Part 1 provides a more detailed answer to my earlier entry stating that the carbon Market is by definition the trading in carbon and the permits to emit Green House Gasses (GHG).

The EBRD defines Carbon finance' as the term used for carbon credits to help finance GHG reduction projects. As UNEP points out “emissions reductions can be achieved more quickly, and with less economic dislocation, by harnessing market mechanisms with a skilful blend of policies and measures”. In that respect the objective of carbon finance is to find the lowest cost emissions reduction possibilities.

From this perspective Carbon Finance is the branch of Environmental Finance which studies and analyses the functioning of Carbon Markets: a market for the purchase and sale of emissions credits. Also known as Emissions trading (or emission trading) it is a market based approach used to control pollution through economic incentives for achieving reductions in the emissions of pollutants. It is sometimes called cap and trade. In effect the Carbon Market deals with the trading of credits for carbon dioxide emissions. By definition therefore the Carbon market refers to the buying and selling of emissions permits that have been either distributed by a regulatory organization or created by Green House Gasses (GHG) emission projects.

The source of the emissions permits provide the basis for the two different types of carbon markets operating throughout the world. In addition to the existing “compliance carbon markets” which is associated with countries that have ratified the Kyoto treaty, there is the ´Voluntary carbon market´ operating in countries that have not ratified the Kyoto treaty, such as the U.S. There are significant differences in these markets, both in terms of how they operate and the market prices for carbon credits.

Generally there are two (2) types of carbon transactions in Carbon Market . The first is the Allowance-based transaction: the carbon units traded offer a “right to pollute”, and are created and assigned by regulators under cap-and-trade schemes, such as the EU Emissions Trading Scheme (EU ETS). The second type of carbon transaction is the Project-based transaction. Under this scheme the carbon units are often referred to as offsets or carbon credits, which aim to negate or neutralize greenhouse gas emissions released in one place by avoiding the release of emissions elsewhere. The Kyoto Protocol Clean Development Mechanism (CDM) and Joint Implementation (JI) schemes allow for the development of projects which give rise to carbon credits known as CERs and ERUs respectively.
I am sure there is a lot to digest in this post and I am willing to further expand on a per need basis, and if requested in subsequent posts.

Carbon Finance Terminology

2009-03-29T13:20:00.004-04:00

As promised the second part of my 2 posts in response to Alan Bey's request. The terms used here are borrowed from the World Bank's glossary, which I have referenced as the relevant link. Follow the link for a more complete glossary.

Carbon Finance: Resources provided to projects generating (or expected to generate) greenhouse gas (or carbon) emission reductions in the form of the purchase of such emission reductions.

Certified Emission Reductions (CERs): A unit of greenhouse gas emission reductions issued pursuant to the Clean Development Mechanism of the Kyoto Protocol, and measured in metric tons of carbon dioxide equivalent.

Clean Development Mechanism (CDM): The mechanism provided by Article 12 of the Kyoto Protocol, designed to assist developing countries in achieving sustainable development by permitting industrialized countries to finance projects for reducing greenhouse gas emission in developing countries and receive credit for doing so.

Emission Reductions (ERs): The measurable reduction of release of greenhouse gases into the atmosphere from a specified activity or over a specified area, and a specified period of time.

Emission Reduction Units (ERUs): A unit of emission reductions issued pursuant to Joint Implementation. This unit is equal to one metric ton of carbon dioxide equivalent.

Emission Reductions Purchase Agreement (ERPA): Agreement which governs the purchase and sale of emission reductions.

EU ETS: the European Union emissions trading scheme, which began on January 1 2005. Its first phase
ends on December 31 2007; the second runs from 20082012

Kyoto Protocol: Adopted at the Third Conference of the Parties to the United Nations Convention on Climate Change held in Kyoto, Japan in December 1997, the Kyoto Protocol commits industrialized country signatories to reduce their greenhouse gas (or “carbon”) emissions by an average of 5.2% compared with 1990 emissions, in the period 2008-2012.

Project-Based Emission Reductions: Emission reductions that occur from projects pursuant to JI or CDM (as opposed to “emissions trading” or transfer of assigned amount units under Article 17 of the Kyoto Protocol).

Verified Emission Reductions (VERs): A unit of greenhouse gas emission reductions that has been verified by an independent auditor, but that has not yet undergone the procedures and may not yet have met the requirements for verification, certification and issuance of CERs (in the case of the CDM) or ERUs (in the case of JI) under the Kyoto Protocol.

G20 Financial Crisis, Climate Change and Carbon Finance Watch

2009-03-27T13:45:00.007-04:00

Members of the G20 have upped the ante linking the global summit on the present financial crisis to talks on climate change. In effect some members see the issue as an integral rather than a peripheral subject. The implication is clear : as long as the environment remains on the front-burner of international economic considerations it bodes well for carbon finance.

The Carbon Market

2009-03-26T18:13:00.001-04:00

The Carbon Market is generally confused with the Market for Clean Energy. Though the two are complementary, they are two separate market solutions to the global environmental (climate) problems. Whilst the Clean Energy market refers to investments in alternative or renewable energy sources, the carbon Market is by definition the trading in carbon and the permits to emit Green House Gasses (GHG). The Carbon Market is one of the fastest growing markets in the world today. The latest figures from the World Bank show a doubling in size in 2007, growing to US$64 billion. The market has been expanding rapidly since 1997, when the Kyoto Protocol capped emissions of greenhouse gases.

The growth of the Carbon Market has been built on both international and regional agreements. The demand for carbon assets stems from the efforts of nations and industries to meet emission reduction objectives.

Purpose of this Blog

2009-03-26T17:33:00.000-04:00

Welcome to my Blog on Carbon Finance. This is a place to converse, share views and analyze the state of and developments in the Carbon Market. The focus is on issues relevant to the key sources of CMD projects and regulations affecting the market.

Development Watch Recent Events ; The Energy Pact Conference

2009-03-26T17:02:00.000-04:00

I have been following the proceeding of the recent Energy Pact Conference in Geneva organized by The Energy Pact Foundation ( March 16 - 17, 2009).
The interwoven nature of the energy market and the state of the Carbon Market can not be dismissed. A clear reading of the objectives of the Conference which I think is worth stating here gives a good indication of the possibly paths of the ramification.

The Energy Pact Conference has five objectives:

•	To build a common ground for understanding the interrelated energy, environment and development issues, to define a realistic and achievable path for the future.
•	To define an integrated approach that will address current and foreseeable needs and supplies as well as environment and development issues.
•	To discuss the worldwide energy framework in 2030, develop ways to achieve a balanced energy policy on a global scale, and reduce the negative impact of energy production/ consumption on the environment while taking into account development needs of emerging nations.
•	To increase our knowledge of the interactions between energy production and consumption, the environment and economic development.
•	To build a platform for scientific and technological innovation.

http://www.energypact.org/energy_pact_conference/objectives.php

I will be posting the major conclusions of the conference with analysis and implications.

Upcoming Events being followed

2009-03-26T16:50:00.002-04:00

Upcoming Events on the related to Carbon Finance

Sustainable Bioenergy 2009
London,
1 & 2 April

Bioenergy North America 2009
Chicago,
17 April

Carbon Prices Webinar
Online, 20 May

Carbon Finance
North America 2009
New York, 11 & 12 June

EU Emissions
Trading 2009
Brussels,
9 & 10 July

To Behold and Protect

2009-03-16T14:19:00.000-04:00

This is the Natural Tropical Splendor which has inspired my commitment to the environment.
That's what we are fighting for!!!
A picture of the island of my birth St.Lucia !