Environmental Science and Pollution Research

, Volume 23, Issue 1, pp 504–513

Is a Clean Development Mechanism project economically justified? Case study of an International Carbon Sequestration Project in Iran

Research Article

Abstract

The present study evaluates a carbon sequestration project for the three plant species in arid and semiarid regions of Iran. Results show that Haloxylon performed appropriately in the carbon sequestration process during the 6 years of the International Carbon Sequestration Project (ICSP). In addition to a high degree of carbon dioxide sequestration, Haloxylon shows high compatibility with severe environmental conditions and low maintenance costs. Financial and economic analysis demonstrated that the ICSP was justified from an economic perspective. The financial assessment showed that net present value (NPV) (US$1,098,022.70), internal rate of return (IRR) (21.53 %), and payback period (6 years) were in an acceptable range. The results of the economic analysis suggested an NPV of US$4,407,805.15 and an IRR of 50.63 %. Therefore, results of this study suggest that there are sufficient incentives for investors to participate in such kind of Clean Development Mechanism (CDM) projects.

Keywords

Clean Development Mechanism Carbon sequestration NPV Iran 

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Copyright information

© Springer-Verlag Berlin Heidelberg 2015

Authors and Affiliations

  • Salih Katircioglu
    • 1
  • Sara Dalir
    • 2
  • Hossein G. Olya
    • 3
  1. 1.Department of Banking and FinanceEastern Mediterranean UniversityFamagustaTurkey
  2. 2.Allameh Tabatabai UniversityTehranIran
  3. 3.Faculty of TourismEastern Mediterranean UniversityFamagustaTurkey

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