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August 23, 2010The United Nations Clean Development Mechanism(CDM) has faced a huge amount of criticism on the way it works.This mechanism which was established under the Kyoto Protocol gives Billions of Dollars to Projects in Developing Countries which reduce the emission of Carbon Dioxide.The complicated process which involves a ton of regulations and approvals is prone to gaming by market participants who are well connected.This have given rise to mom and pop carbon consultancies in India which alongwith China accounts for a majority of these projects.Note the CDM mechanism allows the trading of CERs which recently saw a huge fraud by investment banks in Europe.This had led to calls of this expensive and wasteful scheme to be shut down.The CDM panel has responded by cracking down on new projects emanating from India and China.The Panel rejected CER requests from a new supercritical coal power plant in India besides summarily rejecting Carbon Credits from around 70 Wind Farms in China
Now the UN Panel cracks down on the biggest beneficiaries the Hydrofluoro Carbon Plants
HFC Plants account for a large share of the CER issued by the UN Panel.These Gases which are used in Refrigeration Industry are potent cause of Global Warming as their ozone destruction power is multiple times that of Carbon Dioxide.Like other Projects,HFC plants in China have come under the United Nations Axe.The United Nations is reviewing the Carbon Credit Requests from 5 plants in China and their is a high probability of cancellation of these requests.NGOs and activists have alleged that these HFC plants emit more GreenHouse Gases (GHGs) than is required in the normal function of the plants.This leads to increased revenue from neutralizing these gases defeating the entire purpose of the CDM scheme.Carbon Trading has repeatedly been proved to be an inefficient and ineffective scheme,but its popularity continues to increase around the world.The Scheme is suitable for niche purposes and is totally inadequate as a holistic response to the problem of Climate Change
U.N. panel to review CER request from 5th HFC plant – Reuters
A United Nations panel will review a carbon offset request from a fifth greenhouse gas destroying plant, the UN said on Friday, a sign that all similar projects approved under a Kyoto Protocol carbon finance scheme will be scrutinized.
The UN’s climate arm said on its website it would review a request for offsets, called Certified Emissions Reductions (CERs), from the Zhejiang Juhua project in China, which makes money by destroying a potent greenhouse gas called HFC-23.
The project was approved under Kyoto’s $2.7 billion Clean Development Mechanism (CDM), which helps fund cuts in carbon emissions in emerging economies.
It is the fifth HFC-23 project this week to have its CER issuance request face an additional review by the CDM’s executive board. It had requested 1.44 million CERs for abatement activities between September and November 2009.