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CDM
Clean Development Mechanism
(and trading of CERs)
SESSION 5
United Nations Environment Program
Division of Technology Industry and Economy
OUTLINE
2/ Basics
> What are the key concepts ?
4/ Statistics
> Where are we now with the CDM and how are emission
reduction credits traded on the markets?
OVERVIEW
OVERVIEW
OVERVIEW
OVERVIEW
Developing
Countries
CDM
Annex 1 countries
EU 25
Canada
Japan
Other OECD
JI
Central and
Eastern Europe
OVERVIEW
BASICS
2. Verification / Certification
of emission reductions
Emissions baseline
ADDITIONAL
EMISSION
REDUCTIONS
Emissions after the project
Years
Project implementation
ACME Session 5 Clean Development Mechanism - 8 / 39
BASICS
BASICS
CDM requirements
BASICS
Renewable energy
Waste management
Power sector
> Induction of new technologies which are
efficient (thermal)
> Reduction in technical T&D losses
Fuel switching
ORGANISATION
CDM project cycle
ORGANISATION
ORGANISATION
Content of the PDD
ORGANISATION
New
methodology
(to be submitted
to UNFCCC
secretariat)
ORGANISATION
ORGANISATION
ORGANISATION
Crediting period:
> Usually starting the later of CDM registration, and start of project operation.
> Fixed crediting period of up to 10 years. OR
> Renewable crediting periods of up to 7 years (maximum 3 x 7 years).
ORGANISATION
ORGANISATION
Validation
ORGANISATION
Registration
ORGANISATION
Last steps
ORGANISATION
ORGANISATION
STEP 0 Preliminary screening based on the starting date of the project activity
Start date of claiming credits for project should precede date of registration
CDM consideration proved = PASS
STEP 1 - Identification of alternatives consistent with current laws and regulations
If proposed CDM project is the only alternative left, the project is non-additional
An optional flow
chart, adopted by the
executive board in
October 2004,
applicable to any type
of project for the
demonstrate of
additionality.
PROJECT ACTIVITY
IS ADDITIONAL
ORGANISATION
STATISTICS
STATISTICS
End of 2004
End of 2005
STATISTICS
STATISTICS
STATISTICS
STATISTICS
OPPORTUNITIES
Who is buying CER?
Buyers based in Europe (41% in 2004, 56% in 2005) and Japan (36%
versus 38%) dominate the market for project-based transactions.
January 2004 to December 2004
Overall volume: 110,0 million tCO2e
OPPORTUNITIES
Location of projects
OPPORTUNITIES
What is being sold ?
OPPORTUNITIES
OPPORTUNITIES
Carbon funds
available through
Prices of CERs
What determines
prices of CERs ?
OPPORTUNITIES
CONCLUSION
Next steps
CDM is real
> 225 projects registered and 60 methodologies approved;
> In 2005 CDM projects transactions worth 1,9 billion.
CONCLUSION
End of session 5