CLEAN DEVELOPMENT MECHANISM

WHAT IS CLEAN DEVELOPMENT MECHANISM ?

The Clean Development Mechanism (CDM) is a carbon offset scheme established under the Kyoto Protocol, which is part of the United Nations Framework Convention on Climate Change (UNFCCC). Its primary goal is to help industrialized (Annex I) countries meet their legally binding greenhouse gas (GHG) emission reduction targets by allowing them to invest in emission-reducing projects in developing (non-Annex I) countries.

The Clean Development Mechanism (CDM) enables projects in developing nations that reduce or remove emissions to generate Certified Emission Reduction (CER) credits, each equivalent to one tonne of CO2. These CERs can be traded and sold, and used by developed countries to meet a part of their emission reduction targets under the Kyoto Protocol.

The projects must qualify through a rigorous and public registration and issuance process designed to ensure real, quantifiable, and verifiable emission reductions that are additional to what would have occurred without the project. The CDM Executive Board, which is ultimately accountable to the countries that have adopted the Kyoto Protocol, supervises this mechanism.

KEY REASONS FOR CLEAN DEVELOPMENT MECHANISM

• Greenhouse Gas Reduction: CDM initiatives worldwide emissions of greenhouse gases, playing a vital role in addressing climate change.
• Advancing Sustainable Growth: Projects promote renewable energy, boost energy efficiency, and improved air quality, while also supporting economic growth and social welfare in host countries.
• Technology Transfer: CDM facilitates the transfer of advanced environmental technologies and expertise from developed to developing nations, accelerating global adoption of cleaner solutions.
• Cost-Effective Compliance: Developed countries can meet part of their emission reduction targets more affordably by purchasing Certified Emission Reductions (CERs) from projects in developing countries.
• Private Sector Engagement: CDM harnesses market forces and encourages private investment in climate-friendly projects, making climate action more dynamic and scalable.
• International Cooperation: The mechanism fosters global collaboration, bridging the gap between developed and developing countries in environmental stewardship.