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

256 development dialogue september 2006 – carbon tradingsources, and they don’t help societies organise themselves in ways thatrequire less coal, oil or gas. Third, by ensuring that the market forcredits from carbon projects is dominated by large industrial firms,they make it that much more difficult for renewable energy or efficiencyprojects to get a foothold.Don’t such projects also provide perverse incentives for governments not to doanything about pollution except through the carbon market? If I were a governmenttrying to help the industries in my country get masses of carbon creditsfrom destroying a few HFCs, I would hesitate to pass laws to clean up HFCs.Such laws wouldn’t make industry any money. In fact, they would cost industry.Instead, why not just allow the pollution to go on until someone comesalong off ering money if it is cleaned up? 69That’s a question that’s understandably going through the minds ofgovernment officials in many Southern countries (as well as of those ofcorporate executives in the North). As a result, it’s not clear whetherthe CDM market is actually a force for less pollution or not.Another danger is that HFC projects could undermine the 1987 Montreal Protocol on Substances that Deplete the Ozone Layer. Whilethis Protocol mandates phasing out of HFCs in Southern countriesby 2010, the CDM has now provided a perverse incentive to hikeproduction of HFCs in order to cash in as much as possible on creditsales. Although the CDM board has raised the issue with governments,no decision has been made to limit the number of HFC creditsor bar new plants from entering the CDM market.But at least HFC projects don’t do any harm to local people, right?That’s a matter of opinion. If the industry getting the credits is hurtinglocal people, local people may well disagree with the project. NearGujarat, at Fluorochemicals Limited, proprietor of one of India’s firstprojects to be registered with the CDM, villagers complain of air pollution’seffects on their crops, especially during the rainy season, and believethe plant’s ‘solar oxidation pond’ adds to local water pollution. 72Villagers near another factory hoping to benefit from CDM credits,Rajasthan’s SRF Fluorochemicals, believe that their aquifers are beingdepleted and their groundwater polluted, leading to allergies,rashes, crop failure, and a lack of safe drinking water.What about other industrial projects?One of the industries that is benefiting most from the CDM is thenotoriously dirty sponge iron sector.