Carbon credits are a big swindle

 

http://vorige.nrc.nl/international/article2416330.ece/Carbon_credits_are_a_big_swindle

By Mirjam de Rijk

The Kyoto protocol allows rich countries to meet their greenhouse gas reduction commitments by investing in projects abroad. But research shows that many of these projects would have happened anyway.

In the run-up to the Copenhagen climate change summit the European Union likes to portray itself as the world climate leader by pointing to its commitment to reduce its CO2 output by 30 percent – if only the other countries would show the same ambition. What European leaders fail to mention is that two-thirds of the EU's carbon dioxide reduction is accounted for by carbon credits: investments in projects in the developing world that count towards a rich country's own greenhouse gas reduction commitment. And many of those carbon credits don't lead to any CO2 reduction at all.

The Kyoto protocol set up a system of trading in carbon credits called the Clean Development Mechanism (CDM). In return for investing in clean technology in poor countries a rich countries are granted 'certified emissions reductions' or carbon credits. For instance, investing in a CO2 reducing project in Mexico gives the Netherlands the right to emit more CO2 at home. The logic behind carbon credits is that it doesn't matter where on the planet CO2 emission is reduced so long as it is reduced. So why not do it where it can be done cheaper?

In practice, however, carbon credits have become a big swindle. CDM has resulted in little to no reduction in CO2 emissions. The credits are used mainly to pour money into energy projects that would have been carried out regardless of Western funding. Less than 10 percent of CDM projects are even directed at saving energy.

Plants that would have been built anyway

Take the Allain Duhanyan hydroelectric power station in India, for example. It has sold 75 million dollars worth of carbon credits, even though it was clear before the project began that it would be an economically very profitable project. In other words: the power station would have been built with or without carbon credits. This means that by buying carbon credits Western countries are financing theoretical CO2 emissions reductions that never take place in reality. Billions of consumer's and taxpayer's euros are thus channelled to project developers and a growing army of carbon credit traders.

Stanford University in the US estimated that a third to two-thirds of all carbon credits do not result in actual emissions reductions. A study by the German Öko institute confirmed these findings. A survey of CDM participants showed that 71 percent agreed with the statement that many CDM projects would have been carried out with or without carbon credits.

More than half of all CDM projects are in 'poor' China. Even new coal-fired power plants in China and India are allowed to sell carbon credits because they are supposedly more energy-efficient than the existing coal-fired power plants.

An example of this is the Reliance Power Group in India. It wants to build a new 4,000 megawatt coal-fired power plant, whose CO2 yearly emissions will be the equivalent of a year's worth of traffic pollution in a country like the Netherlands.

Europe has to do nothing until 2020

The importance of carbon credits to the negotiations in Copenhagen cannot be underestimated. They allow the EU countries to pat themselves on the back for committing to a 30 percent carbon dioxide reduction. What the European leaders never mention is that EU member countries have agreed among themselves that two-thirds of this reduction will be achieved by buying carbon credits in CDM projects in the developing world.

So Europe is really committing to only a 10 percent reduction by 2020 as compared to 1990. Statistics released by the European Commission's environmental agency this week show the EU countries are already at that level. so all they have to do is maintain current emission levels. The bottom line is that carbon credits are allowing Europe to do nothing about a fundamental transition to CO2-poor economy until 2020.

If we want real climate change it is crucial for the European economy to change drastically both by saving energy and by generating renewable energy in substantial quantities in Europe itself. What is Europe's promise in Copenhagen to reduce greenhouse gases by 30 percent really worth if it plans to achieve that promise by buying up fake credits abroad, while refusing to take politically challenging climate measures at home?