Introduction of Clean Development Mechanism (CDM)

Kyoto Protocol

The Kyoto Protocol is an international agreement linked to the United Nations Framework Convention on Climate Change (UNFCCC). The major feature of the Kyoto Protocol is that it sets binding targets for 37 industrialized countries and the European community for reducing greenhouse gas (GHG) emissions. These amount to an average of five per cent against 1990 levels over the five-year period 2008-2012.

The Kyoto Protocol was adopted in Kyoto, Japan, on 11 December 1997 and entered into force on 16 February 2005. 184 Parties of the Convention have ratified its Protocol to date. The detailed rules for the implementation of the Protocol were adopted at COP 7 in Marrakesh in 2001, and are called the "Marrakesh Accords."

Source: IGES

Clean Development Mechanism (CDM) is a mechanism that is based on the provision of Article12 of the Kyoto Protocol. It is a scheme for greenhouse gas (GHG) emission reduction through cooperation between developed countries (Annex I Parties to the United Nations Framework Convention on Climate Change (UNFCCC)), which are committed to certain GHG emission reduction targets under the Kyoto Protocol, and developing countries (non-Annex I Parties), which do not have any commitments to reduce GHG emissions. The purpose of CDM is to assist to accomplish the GHG reduction targets of developed countries under the Kyoto Protocol, as well as to contribute to sustainable development of non-Annex I Parties (host countries). Under the CDM, Annex I Parties (investing countries) implement projects (e.g. projects of landfill gas (methane) recovery with power generation) resulting in reduction of greenhouse gas emissions within the territories of non-Annex I Parties. Annex I Parties are able to acquire all or parts of the credits (certified emission reductions (CERs)) which result from the projects. Non-Annex I Parties will benefit from the CDM projects.

Source: IGES

CDM Objectives

  • Assist Annex I countries achieved emission targets
  • Contribute to sustainable development in host countries
  • The CDM will issue CERs before the 1st commitment period

CDM Principles

  • Voluntary: accepted by the host country
  • Additionality: not business as usual, different from the baseline scenario
  • Sustainable development (SD): in accordance to the host country's policy on SD
  • Validated, verified, and certified by Designated Operational Entity (DOE)
  • Registered and Certified Emission Reductions (CERs) Issuance : by UNFCCC CDM Executive Board

CDM Project Cycle

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