Abstract
Justice considerations are now almost inextricably linked to the climate change discourse because of the recognition that global injustice and inequity are evident in the climate change problem, from its causes to its impacts. Consequently, the climate change regime contains a range of provisions, tools and measures to promote justice in the regime. One such tool is the Clean Development Mechanism (CDM), which gives developing countries the opportunity to contribute to climate change mitigation and also provides them with sustainable development benefits. However, the CDM itself is beset with its own justice issues, specifically distributive justice issues. This chapter focuses on the distributive justice issues of the CDM. It defines what distributive justice in the CDM means, examines what it should look like, and identifies the main causes for the lack of distributive justice in the CDM.
Tomilola Eni-ibukun holds a Ph.D. in law from the University of Dundee. She currently works as an independent legal consultant in the field of environmental law. The author is grateful to Elizabeth Kirk of the University of Dundee for reading the draft of this chapter and giving useful advice and comments.
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Notes
- 1.
Equity and justice are used interchangeably in this chapter, as appropriate. The ordinary dictionary meaning of equity includes definitions like “justice according to natural law or right, freedom from bias or favouritism, or something that is equitable”, The Merriam-Webster Dictionary, available at: http://www.merriam-webster.com/ (last accessed on 1 March 2012); “the quality of being fair and impartial” The Concise Oxford English Dictionary, 11th ed. (Oxford: Oxford University Press, 2008); “fairness,” and “justice,” Samantha Hepburn, Principles of Equity and Trusts, 2nd ed. (Sydney/London: Cavendish Publishing Pty Limited, 2001), at 3; and “that which is just or right,” Leslie Curzon, Equity & Trusts, 2nd ed. (London: Cavendish Publishing, 1996), at 1.
- 2.
See generally on the science and effects of climate change, Barrie Pittock, Climate Change: Turning up the Heat (London: Earthscan, 2005); John Houghton, Global Warming: The Complete Briefing, 3rd ed. (Cambridge: Cambridge University Press, 2004); and Mohan Munasinghe and Rob Swart, Primer on Climate Change and Sustainable Development (Cambridge: Cambridge University Press, 2005).
- 3.
Although this is still true, in terms of current emissions, some developing countries have overtaken or are overtaking developed countries and there is therefore a call for such developing countries to undertake appropriate mitigation actions.
- 4.
Samuel Fankhauser et al., “Vulnerability to climate change and reasons for concern: a synthesis”, in James McCarthy et al. (eds), Climate Change 2001: Impacts, Adaptation, and Vulnerability: Contribution of Working Group II to the Third Assessment Report of the Intergovernmental Panel on Climate Change (Cambridge: Cambridge University Press, 2001), at 916.
- 5.
See United Nations Framework Convention on Climate Change, New York, 9 May 1992, in force 21 March 1994, 31 International Legal Materials (1992), 851, para. 22 of the Preamble, which recognises that developing countries need access to resources and that their energy consumption will grow, in order to achieve sustainable social and economic development, albeit taking account of the possibilities for achieving greater energy efficiency and for controlling GHG emissions.
- 6.
See “Our Common Future, Chapter 2: Towards Sustainable Development”, in Our Common Future: Report of the World Commission on Environment and Development, UN Doc A/42/427, 4 August 1987, Annex, para. 1.
- 7.
On climate change and justice generally, see Friedrich Soltau, Fairness in International Climate Change Law and Policy (Cambridge: Cambridge University Press, 2009); and Eric A. Posner and David Weisbach, Climate Change Justice (Princeton: Princeton University Press, 2010).
- 8.
Kyoto Protocol to the United Nations Framework Convention on Climate Change, Kyoto, 11 December 1997, in force 16 February 2005, 37 International Legal Materials (1998), 32.
- 9.
The ultimate objective of the Convention is to stabilise GHG concentrations in the atmosphere at a level that would prevent dangerous human interference with the climate system. See UNFCCC, supra, note 5, Art 2.
- 10.
Kyoto Protocol, supra, note 8, Art. 12.2.
- 11.
Ibid., Art. 3.1 and Annexes A and B. Accordingly, developed countries are required to ensure that their total emissions of certain greenhouse gases (carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons and sulphur hexafluoride) do not exceed their allowed emission levels. The aim is to reduce their overall emissions of these gases by at least 5% below 1990 levels in the first commitment period of the Kyoto Protocol, which runs from 2008 to 2012.
- 12.
Ibid., Arts. 3 and 10.
- 13.
The CDM is a good example of the implementation of the principle of common but differentiated responsibilities, which is one of the justice principles of the climate change regime. On the common but differentiated responsibilities principle in the climate change regime, see UNFCCC, supra, note 5, Arts. 3.1, 3.2 and 4.1.
- 14.
Statistics correct as of 30 January 2012. See CDM, “CDM in Numbers”, available at: http://cdm.unfccc.int/Statistics/index.html (last accessed on 1 March 2012).
- 15.
This refers to those countries that have fulfilled the CDM participation requirements, which are: Kyoto Protocol ratification; designation of a national authority; and confirmation of voluntary participation. See Decision 3/CMP.1, Modalities and procedures for a clean development mechanism as defined in Article 12 of the Kyoto Protocol, FCCC/KP/CMP/2005/8/Add.1, 30 March 2006, Annex, paras. 28–30.
- 16.
All statistics are correct as of 30 January 2012. See CDM, “Registered project activities by host party”, available at: http://cdm.unfccc.int/Statistics/Registration/NumOfRegisteredProjByHostPartiesPieChart.html (last accessed on 1 March 2012).
- 17.
See Decision 17/CP.7, Modalities and procedures for a clean development mechanism as defined in Article 12 of the Kyoto Protocol, FCCC/CP/2001/13/Add.2, 21 January 2002, Preamble, para. 6.
- 18.
Decision 3/CMP.1, supra, note 15, Annex, para. 4(c).
- 19.
See for example Decision 7/CMP.1, Further guidance relating to the clean development mechanism, FCCC/KP/CMP/2005/8/Add.1, 30 March 2006, para. 32; and Decision 2/CMP.5, Further guidance relating to the clean development mechanism, FCCC/KP/CMP/2009/21/Add.1, 30 March 2010, paras. 47–50. For a detailed discussion of the actions that have been taken with the CDM regime to address the problem of inequitable distribution of projects, see Tomilola Akanle, “Distributive Justice in International Law: Can the CDM Achieve an Equitable Geographic Distribution of Projects?”, Ph.D. thesis on file at the University of Dundee, (2011), at 189–238.
- 20.
As of March 2007, the distribution of projects among the top 4 CDM hosts was: India (33%), China (8%), Brazil – (16%) and Mexico – (13%). In January 2008, the distribution was as follows: India: 33%; China: 16%; Brazil: 12% and Mexico: 11%. In July 2010, it was China (40%), India (22%), Brazil (7%) and Mexico (5%). In April 2011, the distribution was: China (44%), India (21%), Brazil (6%) and Mexico (4%) (all statistics obtained by the author from the CDM website at the relevant times). In January 2012, the distribution was: China (47%), India (20%), Brazil (5%) and Mexico (4%). The significance of these statistics is not so much that it is the same four countries that are the top CDM hosts. Much more significant is that although there has been some fluctuation in their percentage shares, they still host by far the majority of all CDM projects – the distribution has not levelled out. These four countries were hosting 70% of the 516 registered CDM projects as of March 2007, 72% of the 850 projects as of January 2008, 75% of the 2,312 registered projects as of August 2010, 76% of the 2,970 registered projects as of April 2011, and 76% of the 3,815 registered projects as of January 2012. The growth in the number of CDM projects has not led to a percentage increase in the number of projects hosted by other countries or a significant increase in the number of countries participating in the CDM. Instead, the status quo has mostly been maintained.
- 21.
In 2001, when establishing the rules to govern the CDM, countries recognised the need to promote equitable distribution of projects. See Decision 17/CP.7, supra, note 16, Preamble, para. 6.
- 22.
“Equitable distribution” is the specific term used within the CDM regime to refer to distributive justice.
- 23.
See generally on egalitarianism, Ronald Dworkin, Sovereign Virtue: Equality in Theory and Practice (Cambridge: Harvard University Press, 2000); and Andrew Mason (ed.), Ideals of Equality (Oxford: Blackwell Publishers, 1998). On utilitarianism, see Jeremy Bentham, An Introduction to the Principles of Morals and Legislation (Kitchener: Batoche Books, 2000) (originally published 1781); and John Stuart Mill, Utilitarianism (London: Electric Book Company, 2001). On the difference principle, see John Rawls, A Theory of Justice (Cambridge: Harvard University Press, 1971); and John Rawls, Political Liberalism, expanded edition (New York: Columbia University Press, 2005).
- 24.
See Felix E. Oppenheim, “Egalitarianism as a descriptive concept”, in Louis P. Pojman and Robert Westmoreland (eds), Equality: Selected Readings (Oxford: Oxford University Press, 1997), at 56; and Mason, Ideals of Equality, supra, note 23, at 3.
- 25.
See James W. Harris, Legal Philosophies, 2nd ed. (London: Butterworths, 1997), at 41.
- 26.
See Howard Davies and David Holdcroft, Jurisprudence: Texts and Commentary, Commentary (London: Butterworths, 1991), at 219.
- 27.
For instance, both utilitarianism and egalitarianism do not require consideration of relevant circumstances.
- 28.
See generally, Akanle, “Distributive Justice in International Law”, supra, note 19, at 131–136.
- 29.
One of the basic rules governing the use of, or access to, shared watercourses is the requirement for equitable and reasonable sharing of the watercourses. See Gabčikovo-Nagymaros Project (Hungary/Slovakia), Judgment, 25 September 1997, ICJ Reports (1997), at 54. See also Convention on the Law of the Non-Navigational Uses of International Watercourses, New York, opened for signature 21 May 1997, not yet in force, 36 International Legal Materials (1997), 703 (Watercourses Convention).
- 30.
The Watercourses Convention does not expressly define “equitable and reasonable” use. Instead, it outlines some of the factors for determining whether a use is equitable and reasonable. According to Article 6, to achieve equitable and reasonable use, account should be taken of all relevant factors and circumstances, some of which are identified in the Article (6).
- 31.
See generally Continental Shelf (Libyan Arab Jamahiriya/Malta), Judgment, 3 June 1985, ICJ Reports (1985), at 39–40; and David Freestone et al. (eds), The Law of the Sea: Progress and Prospects (Oxford: Oxford University Press, 2006), at 150–159.
- 32.
A set or pre-determined outcome under the CDM would be something to the effect that all countries should host the same number of projects, that countries should each host x number of projects, and such like.
- 33.
See the discussion in Sect. 10.2 above.
- 34.
Kyoto Protocol, supra, note 8, Art. 12.
- 35.
For countries’ emissions data, World Resources Institute, “World Resources Institute’s Climate Analysis Indicators Tool (CAIT) Version 7.0.”, 2010, available at: http://cait.wri.org/ (last accessed on 27 January 2012).
- 36.
See CDM, “CDM in Numbers”, available at: http://cdm.unfccc.int/Statistics/index.html (last accessed on 31 January 2012).
- 37.
The estimated demand for CERs has been steadily falling. See Alexandre Kossoy and Philippe Ambrosi, State and Trends of the Carbon Market 2010 (Washington, DC: World Bank, 2010), at 55–59. The bulk of this demand is from the European Union, which accounts for about 70% of demand. See page 55. However, supply too is expected to fall, due, among other things, to the revised EU Emissions Trading Scheme (EU ETS) Directive, which provides that CERs from new projects registered after 2012 will only be accepted into the EU ETS if the projects are in LDCs. See Council Directive 2009/29/EC amending Directive 2003/87/EC so as to improve and extend the greenhouse gas emission allowance trading scheme of the Community, OJ 2009 L 140/63, Article 11a(4), and infra, note 92. It is difficult to estimate with any kind of precision, the demand and supply of CERs in the post-2012 period, as these depend on several factors, such as the emission reduction commitments of developed countries, and rules for the use of CERs to meet these commitments. See generally, World Bank, State and Trends of the Carbon Market 2011 (Washington, DC: World Bank, 2011), at 47–68.
- 38.
World Resources Institute, “World Resources Institute’s Climate Analysis Indicators Tool (CAIT) Version 7.0.”, 2010, available at: http://cait.wri.org/ (last accessed on 27 January 2012).
- 39.
CAIT contains the GHG emissions of most countries and can help with calculating a country’s potential for GHG emission reductions. However, the available data has some shortcomings. The total CO2 emissions data for all countries is available up to 2006. For non-CO2 emissions (such as methane and nitrous oxide), this data is only available up to 2005 and is not available for all countries. In addition, for some countries, their emissions data from land use, land-use change and forestry activities is also not available. However, the CAIT database contains the most up to date and comprehensive information found.
- 40.
See UNDP, “Frequently Asked Questions (FAQs) about the Human Development Index (HDI)”, available at: http://hdr.undp.org/en/statistics/hdi/ (last accessed on 27 January 2012).
- 41.
See Mark McGillivray, “Measuring development? The UNDP’s Human Development Index”, 5 Journal of International Development (1993), 183–192; and Ambuj D. Sagara and Adil Najam, “The Human Development Index: A Critical Review”, 25 Ecological Economics (1998), 249–264.
- 42.
See UNDP, “Human Development Index and Its Components”, 2011, available at: http://hdr.undp.org/en/media/HDR_2011_EN_Table1.pdf (last accessed on 21 January 2012). Although it is possible to use the 2005 HDI data in order to be consistent with countries’ GHG emissions data, the 2011 data is a more accurate measurement of countries’ current development levels than the 2005 data. As the purpose of this section is not to compare countries’ sustainable development potential to their GHG emission reduction potential, but to carry out a comparison among countries, this author determines that it is better in this situation to be accurate.
- 43.
Since 2010, countries are now divided into four roughly equal quartiles, as follows: low, medium, high and very high HDI. In this classification system, the cut-off point for each category does not depend on countries’ HDI values. Rather, countries are simply grouped into roughly equal quartiles, and the cut-off point depends on the number of countries to be included in each quartile, regardless of the HDI values of the countries. The result of this is that two countries with the same HDI value could fall into different categories. For instance, although Tunisia, Jordan and Algeria all have the same HDI value of 0.698, Tunisia is categorised into the high HDI category and Jordan and Algeria into the medium category, essentially because with Tunisia, the number of countries to be included in the high HDI category was completed and so the next countries (starting from Jordan) were classified in the next (medium HDI) category. It is the opinion of this author that the previous classification system (of using absolute values) is a better system, as it will ensure that all countries with the same or similar values fall in the same categories. Consequently, it is this system that this section uses in classifying countries according to their sustainable development potential. See, for instance, the 2007 HDI, in UNDP, “Human Development Report 2009: Summary”, 2009, available at: http://hdr.undp.org/en/media/HDR_2009_EN_Summary.pdf (last accessed on 21 January 2012), at 12.
- 44.
For example, China, Brazil, Indonesia, India, Mexico and the Republic of Korea are the countries with the highest GHG emissions and they are among the countries with the largest number of CDM projects.
- 45.
Such as Iran (seven projects), Nigeria (five projects) and Cambodia (five projects).
- 46.
Such as the Philippines (57 projects) or Malaysia (105 projects).
- 47.
Such as Chile (52 projects).
- 48.
See generally Matthias Busse and Carsten Hefeker, “Political Risk, Institutions and Foreign Direct Investment”, 23 European Journal of Political Economy (2007), 397; and Chantal Dupasquier and Patrick N. Osakwe, “Foreign direct investment in Africa: Performance, challenges, and responsibilities”, 17 J. Asian Economics (2006), 241.
- 49.
For the World Bank good governance indicators, see World Bank, “The Worldwide Governance Indicators (WGI) project”, 2011, available at: http://info.worldbank.org/governance/wgi/index.asp (last accessed on 30 January 2012).
- 50.
These refer to the perception of how much a country’s citizens are able to participate in selecting their government, as well as freedom of expression and association, and a free media. See Daniel Kaufmann, Aart Kraay and Massimo Mastruzzi, “The worldwide governance indicators: methodology and analytical issues”, September 2010, available at: http://siteresources.worldbank.org/INTMACRO/Resources/WPS5430.pdf (last accessed on 6 February 2012), at 4.
- 51.
These countries are performing well for most, though not necessarily all of the statistics. But in comparison to other developing countries, they are performing very well.
- 52.
In absolute values. In the classification in Table 10.1, both have the same ER and SD potential rankings (as these rankings cover a range of absolute values).
- 53.
All governance statistics are for 2010 (the latest available). See World Bank, “Access governance indicators”, 2011, available at: http://info.worldbank.org/governance/wgi/sc_country.asp (last accessed on 6 February 2012). Even computing beyond 2010, the conclusion remains that governance is not the key barrier to equitable distribution. For example, comparing South Africa’s and the Philippines’ governance indicators for 2007, 2008 and 2009, South Africa has consistently ranked higher, but the Philippines is still performing better under the CDM.
- 54.
The CDM modalities and procedures are provided by the Conference of the Parties serving as the Meeting of the Parties to the Kyoto Protocol (COP/MOP) and the CDM Executive Board. These include the modalities and procedures for undertaking activities such as those relating to selecting the project methodologies, preparing the necessary project documentation such as the project design documents, and registering the project activities. See “Rules and References”, available at: http://cdm.unfccc.int/Reference/index.html (last accessed on 27 February 2012).
- 55.
See Ann E. Prouty, “The Clean Development Mechanism and its Implications for Climate Justice”, 34 Columbia Journal of Environmental Law (2009), 513, at 523; Sanja Lutzeyer, “Climate trading: the clean development mechanism and Africa”, 12 Stellenbosch Economic Working Papers (2008), 1, at 27; and Emily Boyd et al., “The clean development mechanism: an assessment of current practice and future approaches for policy”, 2007, available at: http://www.tyndall.ac.uk/sites/default/files/wp114.pdf (last accessed on 15 January 2012), at 23.
- 56.
See the discussion of the unilateral CDM structure as a barrier to equitable distribution, in Sect. 10.5.5 below.
- 57.
Most of these countries fall in the medium ER potential category and others fall in the low potential category. For example, Angola (no project), Zambia (one project), Tanzania (one project), and Nigeria (five projects), all have medium ER potential and very high SD potential. See the classification of countries according to their emission reduction in Table 10.1 above.
- 58.
See UNEP and Ecosecurities, Guidebook to Financing CDM Projects (Roskilde: UNEP, 2007), at 3 and 7.
- 59.
Kyoto Protocol, supra, note 8, Art. 12.8 provides that a share of the proceeds of CDM projects should be used to cover administrative expenses, as well as to assist in meeting the cost of adaptation in developing countries. The share of proceeds to support adaptation in developing countries is 2% of CERs issued. See Decision 17/CP.7, supra, note 17, para. 15(a). The share of proceeds to cover administrative expenses, including the registration fee, is US$0.10 per CER issued for the first 15,000 tonnes of CO2 equivalent and US$0.20 per CER issued for any amount in excess of 15,000 tonnes. See Decision 7/CMP.1, supra, note 19, para. 37.
- 60.
See, UNEP and Ecosecurities, Guidebook to Financing CDM Projects, supra, note 58, at 56.
- 61.
See the discussion on unilateral CDM projects below.
- 62.
See, for example, Jane Ellis and Sami Kamel, “Overcoming Barriers to Clean Development Mechanism Projects”, May 2007, available at; http://www.oecd.org/dataoecd/51/14/38684304.pdf (last accessed on 12 February 2012), at 32–33, where the authors state that transactions costs are a barrier faced by many project developers, especially for small-scale projects, and in poor developing countries.
- 63.
See note 57 above for examples of such countries.
- 64.
See generally for the financing requirements of CDM projects, UNEP and Ecosecurities, Guidebook to Financing CDM Projects, supra, note 58.
- 65.
Lia C. Sieghart, “Unilateral clean development mechanism – an approach for a least developed country? The case of Yemen”, 12 Environmental Science and Policy (2009), 198, at 201.
- 66.
Here, the developing country would for example benefit from the use of renewable energy, capacity building, technology transfer and other sustainable development benefits arising from the project.
- 67.
See Gregor Pfeifer and Geoff Stiles, “Carbon finance in Africa – a policy paper for the Africa Partnership Forum”, 2008, available at: http://www.africapartnershipforum.org/dataoecd/40/15/41646964.pdf (last accessed on 16 February 2012), at 17; Axel Michaelowa, “Unilateral CDM – can developing countries finance generation of greenhouse gas emission credits on their own?”, 7 International Environmental Agreements: Politics, Law and Economics (2007), 17, at 17; and Sieghart, “Unilateral clean development mechanism”, supra, note 67, at 202.
- 68.
See the discussion of transaction costs in Sect. 10.5.2.1 above.
- 69.
See World Bank, “Minimum Project Requirements”, available at: http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/ENVIRONMENT/EXTCARBONFINANCE/0,,contentMDK:21844766~menuPK:5220728~pagePK:64168445~piPK:64168309~theSitePK:4125853,00.html (last accessed on 16 February 2012).
- 70.
See Alan Silayan, “Equitable distribution of CDM projects among developing countries”, 255 Hamburg Institute of International Economics Report (2005), 1, at 23–24; Prouty, “The Clean Development Mechanism and its Implications for Climate Justice”, supra, note 57, at 523; and Ben Pearson, “Market failure: Why the Clean Development Mechanism Won’t Promote Clean Development”, 15 Journal of Cleaner Production (2007), 247, at 250.
- 71.
See CDM, “Registered project activities by scale”, available at: http://cdm.unfccc.int/Statistics/Registration/RegisteredProjByScalePieChart.html (last accessed on 30 January 2012).
- 72.
If investment comes from developing country entities, the projects are referred to as unilateral, and if from developed country entities, they are either bilateral or multilateral, depending on the number of developed country entities involved in the project.
- 73.
Kyoto Protocol, supra, note 8, Art. 12. See also Prouty, “The Clean Development Mechanism and its Implications for Climate Justice”, supra, note 55, at 522.
- 74.
Such as rules to ensure that projects result in real, measurable, and long-term benefits related to the mitigation of climate change, and that reductions in emissions are additional to any that would occur in the absence of the certified project activity. See Kyoto Protocol, supra, note 8, Art. 12.
- 75.
See Sieghart, “Unilateral clean development mechanism”, supra, note 65, at 199; and Harrie Oppenoorth et al., “The Bali guide on CDM: towards a sustainable CDM”, November 2007, available at: http://www.snm.nl/pdf/klimaattopbali_brochure_bali_guide_def_webversie_copy.pdf (last accessed on 12 January 2012), at 20.
- 76.
According to the CDM rules, the host developing countries are responsible for determining that projects will contribute to their sustainable development. The host country is required to confirm that the CDM project activity assists it in achieving sustainable development. See Decision 3/CMP.1, supra, note 15, para 40(a) of the Annex. Also the host entity usually provides in the project design document, an explanation of the sustainable development contributions of the project. Beyond this, there is no regulation or rule concerning what this means or should constitute. The regulatory tools that have been developed (such as tools for assessing the additionality of the project) are mainly focused on calculating the emission reductions achieved by the project, and not measuring the sustainable development benefits it provides.
- 77.
See Christoph Sutter and Juan Carlos Parreño, “Does the current clean development mechanism (CDM) deliver its sustainable development claim? An analysis of officially registered CDM projects”, 84 Climatic Change (2007), 75, at 89.
- 78.
For example, as of November 2010, Ecosecurities was the largest CDM investor/CER purchaser, with a share of about 12% of all registered CDM projects. See the CDM Pipeline, 1 November 2010. Ecosecurities is however not a compliance buyer, but a CER trader, and is in the business of “sourcing, developing and trading emission reduction credits.” See Ecosecurities, “Who we are”, 2010, available at: http://www.ecosecurities.com/Home/EcoSecurities__the_carbon_market/Who_we_are/default.aspx (last accessed on 1 March 2012). See the CDM Pipeline (available at: www.cdmpipeline.org (last accessed on 1 March 2012)) for an analysis of all CDM projects and the official CDM website (available at: http://www.cdm.unfccc.int (last accessed on 1 March 2012)) for CDM statistics.
- 79.
Because project proponents are not required to disclose their source and style of funding, it is not possible to determine precisely how the market is divided among the various structures available. It is possible that although in some PDDs, it is not stated that the foreign entity is investing directly in the project, or that a contract has been signed for the purchase of CERs, that this is actually the case.
- 80.
See the classification of countries according to their SD potential/human development levels in Table 10.1 above.
- 81.
As noted above, internal barriers such as lack of good governance cannot completely explain the distribution of CDM projects.
- 82.
See CDM, “Regional Distribution – Nairobi Framework”, available at: http://cdm.unfccc.int/Nairobi_Framework/index.html (last accessed on 28 March 2012).
- 83.
See Decision 17/CP.7, supra, note 17, para. 15(b) and Decision 2/CMP.3, Further Guidance Relating to the Clean Development Mechanism, FCCC/KP/CMP/2007/9/Add.1, 14 March 2008, para. 31.
- 84.
See Decision 2/CMP.5, supra, note 19, paras. 49–50; and Decision 3/CMP.6, Further Guidance Relating to the Clean Development Mechanism, FCCC/KP/CMP/2010/12/Add.2, 15 March 2011, para. 64 and Annex III.
- 85.
See Report of the 37th Meeting of the CDM Executive Board, Annex 20, para. 4; and Decision 4/CMP.1, Guidance Relating to the Clean Development Mechanism, FCCC/KP/CMP/2005/8/Add.1, 30 March 2006, Annex II. For a more detailed discussion of these and other initiatives, see Akanle, “Distributive Justice in International Law”, supra, note 19, at pages 189–238.
- 86.
See note 20 above for a history of the distribution of projects, which highlights that the same four countries have consistently been hosting the majority of projects.
- 87.
There is nothing wrong with this. The issue is that those countries that are underperforming should also have the chance to fulfil their CDM potential.
- 88.
See Peter Waring and Tony Edwards, “Socially responsible investment: explaining its uneven development and human resource management consequences”, 16 Corporate Governance: An International Review (2008), 135, at 135.
- 89.
Ibid.
- 90.
Such CERs will be accepted into the EU ETS until 2020 or until these countries have entered into an agreement with the EU for this purpose, whichever is earlier. See Council Directive 2009/29/EC amending Directive 2003/87/EC so as to improve and extend the greenhouse gas emission allowance trading scheme of the Community, OJ 2009 L 140/63, Art. 11a(4).
- 91.
Ibid., Art. 11a(5).
- 92.
That is, where they involve several developed country entities whether acting directly or through a fund, such as the various World Bank carbon funds.
- 93.
Supra, note 11.
- 94.
The GHG emission reduction commitments contained in the Kyoto Protocol (in Annex B) must be achieved by the end of the first commitment period which runs from 2008 to 2012 (Protocol, Art. 3.1). The Protocol does not contain the commitments for subsequent periods, but provides in Art. 3.9 that consideration of these commitments shall be initiated by 2005. During the 11th Conference of the Parties (COP 11) in December 2005, the Ad Hoc Working Group on Further Commitments for Annex I Parties under the Kyoto Protocol (AWG-KP) was established. Its aim is to determine what commitments developed countries will take on post-2012, and how they will meet those commitments. See Decision 1/CMP.1, Consideration of Commitments for Subsequent Periods for Parties Included in Annex I to the Convention under Article 3, paragraph 9, of the Kyoto Protocol, FCCC/KP/CMP/2005/8/Add.1, 30 March 2006, paras. 2–3. Countries decided to conclude this work and forward their conclusions to COP/MOP 5 in December 2009. See Report of the Ad Hoc Working Group on Further Commitments for Annex I Parties under the Kyoto Protocol on its Resumed Fourth Session, FCCC/KP/AWG/2007/5, 5 February 2008, para. 22(c).
- 95.
See Decision 1/CMP.7, Outcome of the Work of the Ad Hoc Working Group on Further Commitments for Annex I Parties under the Kyoto Protocol at its Sixteenth Session, FCCC/KP/CMP/2011/10/Add.1, 15 March 2012, paras. 1–2.
- 96.
See Decision 3/CMP.7, Emissions Trading and the Project-Based Mechanisms, FCCC/KP/CMP/2011/10/Add.1, 15 March 2012, para. 1. See also CDM, “Frequently Asked Questions”, available at: http://cdm.unfccc.int/faq/index.html (last accessed on 26 March 2012).
- 97.
It will also accept CERs from CDM projects implemented in non-LDC countries with which it enters into an agreement for this purpose. See supra, note 90.
- 98.
See World Bank, “World Bank ups funding for post-2012 credits”, 13 January 2011, available at: http://wbcarbonfinance.org/docs/World_Bank_ups_funding_for_post-2012_credits.pdf (last accessed on 28 March 2012); and World Bank, “Umbrella Carbon Facility T2”, available at: http://wbcarbonfinance.org/Router.cfm?Page=UCFT2&ItemID=53224&FID=53224 (last accessed on 28 March 2012).
- 99.
Although the CDM market will continue to operate, it is still uncertain just how much demand there will be for CERs. See the discussion at supra, note 37.
- 100.
See Decision 2/CP.17, Outcome of the work of the Ad Hoc Working Group on Long-term Cooperative Action under the Convention, FCCC/CP/2011/9/Add.1, 15 March 2012, para. 83 and Preamble to Part E, para. 4. This new mechanism may be created under the Convention. It is however more likely to be created under the new international agreement which countries are currently negotiating, which is intended to come into effect and be implemented from 2020. See Decision 1/CP.17, Establishment of an Ad Hoc Working Group on the Durban Platform for Enhanced Action, FCCC/CP/2011/9/Add.1, 15 March 2012, para. 4.
Countries have requested the Ad Hoc Working Group on Long-term Cooperative Action under the Convention to conduct a work programme to elaborate modalities and procedures for the new mechanism, with a view to recommending a decision to COP 18. Parties and admitted observer organisations have been invited to submit their views on possible modalities and procedures, including their positive and negative experiences with existing approaches and mechanisms, as well as lessons learned. See Decision 2/CP.17, para. 85. This would provide a good opportunity for countries to ensure that the lessons from the operation of the CDM are taken into account when designing the new mechanism.
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For some of these criticisms, see Charlotte Streck, “Expectations and Reality of the Clean Development Mechanism: A Climate Finance Instrument between Accusation and Aspirations”, in Richard Stewart, Benedict Kingsbury and Bryce Rudy (eds), Climate Finance: Regulatory and Funding Strategies for Climate Change and Global Development (New York: New York University Press, 2009), 67, at 67–75; and Pearson, “Market Failure: Why the Clean Development Mechanism Won’t Promote Clean Development”, supra, note 70, at 249.
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As noted above, there are several criticisms of the CDM, and there is a lot of literature on how the CDM should be reformed in the post-2012 period. The suggestions contained in such literature could also be useful in the design of a new market mechanism. See for instance, Emily Boyd et al., “Reforming the CDM for Sustainable Development: Lessons Learned and Policy Futures”, 12 Environmental Science and Policy (2009), 820.
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Such as requiring investors to invest directly in certain countries, or requiring them to take countries’ sustainable development potential into consideration. See the recommendations in Sect. 10.7.
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Eni-ibukun, T. (2013). Climate Justice: The Clean Development Mechanism as a Case Study. In: Hollo, E., Kulovesi, K., Mehling, M. (eds) Climate Change and the Law. Ius Gentium: Comparative Perspectives on Law and Justice, vol 21. Springer, Dordrecht. https://doi.org/10.1007/978-94-007-5440-9_10
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