A Critical Conversation on Climate Change ... - Green Choices

166 development dialogue september 2006 – carbon tradingA side issue?OK, I can see that off sets don’t work. But surely off set credits are only a minorpart of carbon trading – so minor that we can perhaps just ignore them?It’s not so easy. Some countries have contemplated using carbon creditsbought from abroad to cover as much as half their (already minimal)emissions reduction obligations under the Kyoto Protocol. Countriessuch as Japan, Canada, Spain, The Netherlands, the UK, France, Swedenand Italy are expected to be among the biggest buyers.In October 2005, one London financial consultant went so far asto proclaim that the EU carbon market was ‘betting the house onCDM/JI credits.’ So keen is Japan on gaining access to foreign carboncredits, meanwhile, that it is giving Japanese companies 50 percent of start-up investment costs for CDM projects, as well as 50 percent of validation and legal documentation costs, together with othersubsidies for feasibility studies and design documents. A World Bankofficial has claimed that Northern countries as a whole will need tofind between 750 and 2,200 CDM projects in the next few years, oron the order of 1.4 billion tonnes of credits. Only 265 projects hadbeen officially registered by August 2006, accounting for only about84 million credits, and Northern governments and corporations alikeare desperately pushing for more to be produced.The fact that offset credits form a large part of the carbon market’svolume makes them central to carbon trading’s overall problems.Carbon credits contaminate any trading system they are used in byadding another layer of unverifiability to the hybrid commodity beingtrafficked.‘It is widely recognisedthat…[the end-of-pipedevelopments that sofar constitute the bulkof CDM projects] haveno direct developmentbenefi ts.’Holm Olsen, UnitedNations EnvironmentProgrammeAll right, maybe credits from carbon projects are important in the market. Butat least you have to admit that carbon sink projects, which surely have the mosttechnical problems of all, are only a trivial part of the market. After all, theyconstitute less than 10 per cent of the credits from CDM projects. So perhapswe can aff ord to be relaxed about the fact that they aren’t doing any verifi ablegood for the climate.Carbon sinks credits may be a small part of the market. But, as can beseen in the case studies of the next chapter, they have a disproportionateeffect on land and people’s use of it. Remember how manytrees and how much territory is needed in order supposedly to ‘offset’a minimal amount of emissions. With sinks, it doesn’t take manycredits to damage people’s lives.Which perhaps makes this a good time to turn to the topic of the particularproperty rights confl icts associated with carbon saving projects.