‘Nicaragua will sell carbon credits’

Nicaragua will join other Central American countries in selling carbon credits. In 2012, small hydroelectric projects, those which produce less than 15 megawatts of electricity, will sell carbon credits to the German company Mabanaft. The sales will be registered through the United Nations as part of the Kyoto Agreement to reduce greenhouse gases. In addition to the Central American countries, Chile and Colombia also sell credits.

Carbon credit sales allow countries to sell some of the rights to produce greenhouse gas they are allowed under the Kyoto Agreement to other countries that are producing more than permitted. By producing energy from renewable sources like water, wind and biofuel, Nicaragua is polluting less than it is allowed under Kyoto and thus can sell the excess. Authorities believe that, once all the qualifying projects are registered, the carbon credits will bring in between US$286,000 and US$430,000. At the moment, ten small hydroelectric plants in the Departments of Matagalpa and Rivas are affiliated with the programme.

El Nuevo Diario, Aug. 4
Taken from the Nicaragua News Bulletin
9 August 2011

An inconvenient truth: climate change and indigenous people

In November 2009, Survival International released a report entitled ‘The most inconvenient truth of all: climate change and indigenous people’.[i] The report sets out four key mitigation measures that threaten tribal people:

Agrifuels[ii]: promoted as an alternative, ‘green’ source of energy to fossil fuels, much of the land allocated to grow them is the ancestral land of tribal people. If agrifuels expansion continues as planned, millions of indigenous people worldwide stand to lose their land and livelihoods.

Hydro-electric power: A new boom in dam construction in the name of combating climate change is driving thousands of tribal people from their homes.

Forest conservation: [See Chapter 6]

Carbon offsetting: Tribal peoples’ forests now have a monetary value in the booming ‘carbon credits’ market. Indigenous people say this will lead to forced evictions and the ‘theft of our land’.

[i] Survival International (2009) ‘The most inconvenient truth of all: climate change and indigenous people’, Survival International: London. (November)
[ii] Also referred to as biofuels.

Carbon blood money in Honduras

By Rosie Wong | First published in Foreign Policy in Focus | 9th March 2012
Reproduced here by kind permission of Rosie Wong

With its muddy roads, humble huts, and constant military patrols, Bajo Aguán, Honduras feels a long way away from the slick polish of the recurring UN climate negotiations in the world’s capital cities. Yet the bloody struggle going on there strikes at the heart of global climate politics, illustrating how market schemes designed to “offset” carbon emissions play out when they encounter the complicated reality on the ground.

Small farmers in this region have increasingly fallen under the thumb of large landholders like palm oil magnate Miguel Facussé[1], who has been accused by human rights groups of responsibility for the murder of numerous campesinos in Bajo Aguán since the 2009 coup. Yet Facussé’s company has been approved to receive international funds for carbon mitigation under the UN’s Clean Development Mechanism (CDM).
The contrast between the promise of “clean development” and this violent reality has made Bajo Aguán the subject of growing international attention — and a lightning rod for criticism of the CDM.

The Coup and Its Aftermath [2]

In June 2009, a military coup in Honduras deposed the government of Manuel Zelaya, stymieing the government’s progressive social reforms and experiments with participatory democracy. “It was not only to expel President Zelaya,” says Juan Almendares, a prominent Honduran environmental and humanitarian advocate[3]. The coup happened “because the powerful people in Honduras were acting in response to the peoples’ struggles in Honduras.”

The result has been social decay and political repression. The homicide rate in Honduras has skyrocketed under the Porfirio Lobo regime, registering as the world’s highest in 2010. Human rights groups highlight the ongoing political assassinations of regime opponents. In this small country of 8 million people, 17 journalists have been killed since the coup. LGBTI organisers, indigenous rights activists, unionists, teachers, youth organisers, women’s advocates, and opposition politicians have also received death threats or been killed. Those responsible are rarely punished by the justice system, which instead devotes its energies to prosecuting social and human rights activists. Protests are often met with teargas canisters and live ammunition.

The coup has also proved a setback for campesino activists seeking to halt the encroachment of large landowners on their farms.

The Struggle for Land in Bajo Aguán

Highly unequal land distribution has long been an issue in Honduras, and genuine land reform has been evasive. However, partial agrarian reform in 1961 made the rainforests of Bajo Aguán available for cooperatives of farmers who migrated there from other parts of the country. Clearing the forests to make the land suitable for farming was extremely difficult work, but the farmers’ perseverance turned it into one of the most desirable and fertile agricultural lands in the country.

However, under pressure from international financial institutions, Honduras’s government passed the Law of Agricultural Modernization in 1994, allowing large producers to extend their territories beyond the maximum legal property limits. As a result, large landowners began to buy up the land of small farmers, effectively reversing whatever limited land reform had been achieved. The human costs were immense. According to Juan Chinchilla of the Unified Campesino Movement of Aguán (MUCA), “it forced masses of farmers to migrate to the cities and to the U.S. under terrible conditions.”

An older movement, the MCA (Campesino Movement of Aguán), has organised several dramatic acts of resistance to this dislocation. In May 2000, the collective orchestrated a remarkable mass occupation of a former U.S. military base on a large tract of arable land controlled by agro-industrialists. Coordinating with landless farmers from all over the country, the MCA organised 50 trucks and, early one morning, entered the former base and tore down its fences. This occupation continues today, despite threats and persecution.

In 2008, MUCA occupied one of Miguel Facussé’s palm oil processing plants and subsequently entered into negotiations with then-President Zelaya to have occupied lands legally transferred to small farmers. When the coup occurred and jeopardized these hard-won gains, landless farmers mobilized against it, with MUCA officials travelling to the Nicaraguan border to meet Zelaya on his second attempt to return to Honduras. It was there that MUCA decided to organise a mass land occupation starting on December 9, 2009.

But despite this resistance, aggressive landholders buoyed by the coup have continued their onslaught against the farmers of Bajo Aguán. According to the Inter-American Commission of Human Rights, 42 farmers were assassinated between September 2009 and October 2011 in Honduras. More recent reports have the numbers in the 50s by 2011. In one surprisingly brazen incident in November 2010, after five farmers were killed in El Tumbador, Facussé gave a press statement acknowledging that it was his hired security guards who were responsible.

A community member from the Marañones settlement in Bajo Aguán described an eviction of small farmers from the Guanchía cooperative on 8 January 2010, carried out by a contingent of 500 police and soldiers with teargas and guns: “It was a violent eviction where they had nothing legal to show us; the first greetings they gave us were the weapons. They began to shoot at us, to capture and beat our compañeros. There were captured children, nine of them…compañeras were raped…our homes were destroyed, our food – they took part of it and destroyed the other parts.”

Almost every farmer I interviewed said that it was unsafe to leave their settlements. The countryside is dotted with military checkpoints, and farmers have been killed travelling to or from their settlements. “The way we see it, it has become a crime to be a farmer here,” Heriberto Rodríguez of MUCA explained. There have been at least four military operations in the area since 2010.

Palm Oil and Power

Bajo Aguán’s small farmers are already under siege. But carbon trading with the global North could help to fuel this aggression even further under the Clean Development Mechanism (CDM). Set up under the current UN climate treaty, the CDM is supposed to encourage “clean” technology in the South and to provide Northern actors with the most efficient (i.e., cheapest) way to reduce global pollution. The basic equation is simple: a project in the global South that ostensibly reduces carbon emissions generates carbon credits. These credits can then be bought and sold by companies in the global North, who can use them to meet government requirements to reduce pollution without actually reducing emissions in their factories or power plants.

Dinant, Facusse´s palm oil company, has set up one of these projects. In the past, the company’s palm oil mill pumped its waste into large open pits, a process that produces large quantities of methane. Dinant’s project involves capturing this greenhouse gas and using it to power the mill. The project’s blueprint claims that it will reduce pollution in two ways: first, by not letting the methane from open pits escape straight into the atmosphere, and second, by preventing pollution from burning the fossil fuels that were formerly used to power the mill.

Dinant’s approval is obviously problematic for a number of reasons.

First, with the expanding palm oil industry contributing to massive deforestation in sensitive tropical regions, it’s ironic that Dinant would be rewarded for environmentally sound practices. Moreover, its CDM approval essentially endorses a business model of producing palm oil for export—instead of food for local consumption—in a country where one in four children suffers chronic malnutrition. As Heriberto Rodríguez argued, “We don’t need palm oil here. We need what we can eat.”

Finally, if Wikileaks cables detailing some of Facussé’s more unsavoury dealings—including but not limited to his potential links to drug traffickers (to say nothing of his documented violence against local farmers)—are any indication, Facussé’s misdeeds are no secret to the North. And yet one CDM board member told a journalist that “we are not investigators of crimes” and that there is “not much scope” to reject the project under CDM rules.

As rights groups have brought these problems to light, northern companies associated with the project have pulled out one by one, including a consultant that contributed to the project application, the German government bank that had agreed to give a loan to Dinant, and the French electricity company that had agreed to buy the credits. This has left Miguel Facussé and Dinant out on a limb. However, the struggle to stop European carbon market money from flowing to Bajo Aguán is not finished: the CDM board has re-approved the project, and the British government has not withdrawn its support, which means that new buyers could still appear.

Not for Sale

At an international human rights conference in February, MUCA signed an agreement with the Lobo regime that included a financing plan for the farmers to pay the large landholders for occupied land. But critics say that even if the government can be trusted (itself a questionable proposition), the crucial issues of assassinations and impunity were ignored. Facussé´s company is now accusing farmers of new “invasions.”

Needless to say, the situation in Bajo Aguán continues to be incredibly dangerous. Local rights groups have called for a Permanent Human Rights Observatory to witness, document, and discourage the ongoing violence against farmers in the region.

Although growing international condemnation has made it more difficult for Dinant to access carbon market money, the project remains officially sanctioned, and loans from international development banks have not been cancelled. Heriberto Rodríguez, speaking from his roadside hut in an Aguán settlement, had no doubt about the impact of this international support: “Whoever gives the finance to these companies also becomes complicit in all these deaths. If they cut these funds, the landholders will feel somewhat pressured to change their methods.”

MUCA spokesperson Vitalino Alvarez rejects the idea of carbon trading projects altogether. “To get into these deals is like having [our land] mortgaged,” he said. “So to this we say no; this oxygen, we don’t sell it to anybody.”

[1] For more on Miguel Facussé, see Chapter 2 of both the book and the website of ‘The Violence of Development’.
[2] For more on the 2009 coup d’état in Honduras, see Chapter 9 of both the book and the website of ‘The Violence of Development’.
[3] See interview with Juan Almendares in the Interview section of this website.

The Durban Disaster, by the Global Justice Ecology Project (GJEP)

COP 17, December 2011
Global Justice Ecology Project [i] at the UN Climate talks in Durban, South Africa
From Anne Petermann, Executive Director of GJEP

Our entire GJEP team went to the UN Climate Conference this month to strengthen and empower the climate justice movement by lifting up the voices of communities being directly impacted by climate change, the fossil fuels industry or false solutions to climate change (like industrial-scale biofuels or forest carbon offsets schemes).

Ricardo Navarro, of Friends of the Earth El Salvador Addresses GJEP Press Conference. Photo: Ben Powless

Ricardo Navarro, of Friends of the Earth El Salvador Addresses GJEP Press Conference. Photo: Ben Powless

As part of this effort, we sent reporters a list of climate justice experts and front line community representatives that were in Durban and available for interviews. Journalists gave us very positive feedback about this and appreciated our making it easy for them to include climate justice perspectives in their reporting.

We also sent out more than a dozen press releases and helped organise press conferences to highlight the climate justice point of view regarding important issues being negotiated.

We supported the climate justice messages of Indigenous Environmental Network, La Via Campesina, Global Forest Coalition, Grassroots Global Justice Alliance, the Global Alliance for Incinerator Alternatives including the wastepickers delegation they brought to Durban, and Climate Justice Now!

March in Durban. Photo: Langelle/GJEP

March in Durban. Photo: Langelle/GJEP

GJEP Direct Action for Climate Justice

By the end of the climate conference, it was evident that the agreements reached were going to be a disaster for the diverse ecosystems and millions of people already suffering from the impacts of climate chaos. So we took action. On the final day of the Climate Conference, two of our youth delegates and I occupied the halls of the convention centre with hundreds of youth activists from around the world. We staged a sit-in, were arrested, “de-badged” and ejected from the conference grounds.

GJEP is removed by UN security during sit-in occupation. Photo: Ben Powless

GJEP is removed by UN security during sit-in occupation.
Photo: Ben Powless

“I took this action today because I believe this process is corrupt, this process is bankrupt, and this process is controlled by the One percent. If meaningful action on climate change is to happen, it will need to happen from the bottom up. The action I took today was to remind us all of the power of taking action into our own hands. With the failure of states to provide human leadership, and the corporate capture of the United Nations process, direct action by the ninety-nine percent is the only avenue we have left.”

Global Justice Ecology Project is one of the very few organisations inside the UN Climate process to take direct action against the corporate takeover of the UN climate talks.

Thank you for your support.


Anne Petermann

Executive Director

[i] Global Justice Ecology Project explores and exposes the intertwined root causes of social injustice, ecological destruction and economic domination with the aim of building bridges between social justice, environmental justice and ecological justice groups to strengthen their collective efforts. Within this framework, our programmes focus on Indigenous Peoples’ rights, protection of native forests and climate justice. We use the issue of climate change to demonstrate these interconnections. Global Justice Ecology Project is the North American Focal Point of the Global Forest Coalition.

Doha Disappointment

By Stephen Leahy | International environmental journalist | DOHA, Qatar | Dec 10 2012

The United Nations climate talks in Doha went a full extra 24 hours and ended without increased cuts in fossil fuel emissions and without financial commitments between 2013 and 2015. “This is an incredibly weak deal,” said Samantha Smith representing the Climate Action Network, a coalition of more than 700 civil society organisations. “Governments came here with no mandate for action,” Smith said in a press scrum moments after the meeting known as COP 18 ended and the 195 parties to the U.N. Framework Convention on Climate Change (UNFCCC) approved a complex package called “The Doha Climate Gateway”.

The Doha Gateway creates a second phase of the Kyoto Protocol to cut fossil fuel emissions by industrialised nations from 2013 to 2020 but does not set new targets. There is also no financial support to help poor countries adapt to impacts of climate change – only agreement for more meetings in 2013. Talks will also begin next year to create a “mechanism” to assess damages and costs for countries suffering losses from climate change.

Finally, the Doha Climate Gateway has an agreed outline for two years of negotiations on a new global climate treaty that would go into legal force in 2020.

“It is impossible to get everyone here to smile …. I too am disappointed,” said Qatar’s Abdullah bin Hamad Al-Attiyah, the COP18 president. Al-Attiyah told Tierramérica * he was surprised countries wanted to make so many changes throughout the two weeks and right up to the final hours. However, this is a “historic” agreement, Al-Attiyah insisted.

Doha will do nothing to cut emissions that are taking the world to four degrees and more of warming. It offers little in terms of finance to help poor countries cope with climate change, Smith said. Smith singled out the US and Canada for blocking progress on key issues. Canada was one of the worst, she said. While profiting from its massive oil sands operations, it was “super-obstructive on finance”.

Industrialised countries promised to put 100 billion dollars a year into a Green Climate Fund by 2020. To bridge the gap till then, developing nations asked for 60 billion dollars in total by 2015. Britain, Germany and a few other countries promised to contribute six billion dollars but this is not binding. Under the Doha Climate Gateway, countries agreed to further talks on finance in 2013.

The loss and damage debate was among the most intense during closed meetings, featuring the US pitted against island states like the Philippines that are badly impacted by stronger cyclones and sea level rise. The US delegates blocked all references that implied compensation or liability, openly admitting they feared a political backlash at home, according to an anonymous source.

“Loss and damage is a huge issue for Central America. We are highly vulnerable to the impacts of climate change,” said Mónica López Baltodano, of the Centro Humboldt Nicaragua, an environmental NGO. “Honduras and Nicaragua are the number one and number three most vulnerable countries in the world according to the Climate Risk Index,” Baltodano told Tierramérica here in Doha.

The Germanwatch Global Climate Risk Index was released here a few days ago. It said those two countries have been the most affected in terms of lost lives and damages over the past 20 years. In 2011, Thailand, Cambodia, Pakistan and El Salvador were the worst affected by extreme weather events.

In 2010, at COP 16 in Cancun, there was agreement to find ways to assess and reduce losses and damages from impacts of climate change, including extreme weather events and slow onset events like sea level rise, ocean acidification, loss of biodiversity and desertification. Developing countries wanted a new institution and framework to deal with loss and damage, but the US was opposed to any new institution. The compromise is for a “new mechanism” to be created in 2013.

A new second phase of the Kyoto Protocol will run from 2013 to 2020. Getting this second phase or commitment is considered very important by developing countries because it has hard-won legal terms that commit countries to making cuts as well as methods for measuring and verifying emission levels. However, only the European Union, Australia and a few other countries are involved, representing just 12 percent of global emissions. The US has never participated, while Canada and Japan have opted out of the second phase.

None of those in the second Kyoto phase increased their emission cuts pledges. They did agree to a mandatory review of their reduction targets in 2014. Rich countries outside of Kyoto promised to make comparable cuts but offered nothing new here in Doha. “The COP process is very disappointing,” said Baltodano, who has attended two previous ones. “It’s very clear that countries’ economic interests dominate the negotiations.”

Countries are mainly influenced by the corporate sector and civil society has very little interaction or influence there, she said. “There is a huge space we don’t reach.”

The Doha outcome puts the world on track for three, four or even five degrees of warming, said the delegate from the South Pacific island nation of Nauru who represents the Alliance of Small Island States in the final plenary. “We’re not talking about how comfortable your people (in the developed world) may live but whether our people live,” the delegate said. “The lives of our people are on the line here.”

* This story was originally published by Latin American newspapers that are part of the Tierramérica network. Tierramérica is a specialised news service produced by IPS with the backing of the United Nations Development Programme, United Nations Environment Programme and the World Bank.

ENCA was grateful to Stephen Leahy for his permission to reproduce his article in ENCA Newsletter 57 (January 2013). The original article can be found at: www.ipsnews.net/2012/12/doha-climate-summit-ends-with-no-new-co2-cuts-or-funding/

Stephen is a professional member of the International Federation of Journalists and the Society of Environmental Journalists and a Fellow of the International League of Conservation Writers.

Blue Carbon

Grettel Navas of the Fundación Neotropica* in Costa Rica introduces the notion of Blue Carbon.
Article reproduced by kind permission of Fundación Neotropica.

Carbon capture. Greenhouse gas emissions. Compensation. Climate change. These and other concepts are repeatedly used in academic discussions, in expert forums and press articles around the world. But they are also used in everyday conversations about the state of our planet and its future.

Only recently, however, has the concept of Blue Carbon been introduced in official discussions on climate change. It was the Prime Minister of Papua New Guinea who, based on a global study carried out on the carbon fixation of marine and coastal ecosystems, presented this concept to the international community at the United Nations.

Parallel with the concept of Green Carbon (stored in the forest and the ground), Blue Carbon can be defined as that stored by different marine and coastal ecosystems ̶ for example, plankton, bacteria, seaweed, marshland plants, mangrove swamps and other wetlands. It has been found that these contain five times more carbon than tropical forests and are therefore hugely relevant to the fight against climate change. In Costa Rica, for example, in light of the government’s commitments to achieve carbon neutrality by 2021, attention is refocusing on these mistreated and forgotten ecosystems as an intelligent strategy.

Mangroves in the Golfo Dulce

Mangroves in the Golfo Dulce

Whilst it is true that marine and coastal ecosystems make up only 0.05% of living biomass, they store an important quantity of carbon in the earth since they are the most intense carbon sink on the planet. Historically the coastal ecosystems have been undervalued and unjustly called ‘swamps’ or ‘unhealthy marshes’. This has given the green light to their systematic destruction. Unlike the capture and storage of carbon in the earth (where it can be locked away for decades or centuries), carbon storage in the ocean can last for thousands of years.

This much has been confirmed in a United Nations Environmental Programme report: “of all the green carbon captured annually in the earth ̶ that is carbon captured for the process of photosynthesis ̶ about 55 per cent is captured by marine ecosystems” (Falkowski et al, 2004; Arrigo, 2005; González et al, 2008; Bowler, 2009; Simon et al, 2009).

The idea behind seeing blue carbon separately and giving it a different name is that it is able to highlight the importance of coastal and marine ecosystems, because in many international forums on carbon and climate summits, the role of the oceans has often been minimised or unnoticed. In rescuing its role in climate change we can carry out conservation projects of wetlands, protection of the oceans and protection of different ecosystems.

From 2009 the Costa Rican Fundación Neotropica, aware of the importance of these resources, has continually worked on programmes of community conservation of mangrove swamps. In addition to raising people’s awareness of the importance of the mangrove swamps bordering the Golfo Dulce, the Mangle-Benín project resulted in the strengthening of these areas with the planting of around 100,000 mangrove plants and established environmental clubs with primary school students. The project had strong local support through local organisations and schools, achieving a community-wide management of mangrove areas.

Moreover, with the project ECOTICOS, the ecological economics of the Térraba-Sierpe National Wetlands for the community, Costa Rica and the world were assessed. This wetlands area houses the largest area of mangroves of its kind in the American hemisphere, which even by conservative estimates, produces environmental benefits to the value of $10,000 per hectare p.a..

Another important initiative has been the Wetlands Life for All campaign held in conjunction with other organisations and institutions such as Apreflofas, the School of Biology at the University of Costa Rica and student associations at the major state universities. Through this campaign they look to achieve a greater awareness of the importance of these coastal ecosystems, the benefits that they provide and the need for their effective conservation.

In Costa Rica, despite all its important conservation initiatives, a significant number of mangrove areas are not designated as Protected Wilderness Area having only the general declaration that the law affords to wetlands. This creates a great deal of uncertainty on the future of their management and conservation. These ecosystems are fragile and under constant threat by pressure from production activities, sedimentation and climate change, amongst other factors. This is true in the case of the mangrove areas of Golfo Dulce for example.

“From the incorporation of Costa Rica as a member of the Ramsar Convention on Wetlands in 1991, a movement for the conservation and rational use of this type of ecosystems was begun. In addition to serving as a source of income from their diverse products and benefits, they also serve as a habitat for rich biodiversity.” (Source: EARTH)

In the fight to counteract climate change, the application of the concept of Blue Carbon and the conservation of coastal and marine ecosystems becomes an urgent action, both beneficial and vital, being an extremely important link for all sectors of society: environmental organisations, social movements, government institutions, academics, private companies and concerned individuals, all committed to conservation.

* Fundación Neotrópica promotes the coordination and auto-management for the conservation and for a just and equitable distribution of the benefits generated by natural resources. The organisation’s website is at: www.neotropica.org

Carbon trading: discredited strategy

Increasing allegations of corruption and profiteering are raising serious questions about the UN-run carbon trading mechanism aimed at cutting pollution and rewarding clean technologies, writes Patrick McCully, executive director of US thinktank International Rivers in The Guardian, Wednesday 21 May 2008

The world’s biggest carbon offset market, the Kyoto Protocol’s clean development mechanism (CDM), is run by the UN, administered by the World Bank, and is intended to reduce emissions by rewarding developing countries that invest in clean technologies. In fact, evidence is accumulating that it is increasing greenhouse gas emissions behind the guise of promoting sustainable development. The misguided mechanism is handing out billions of dollars to chemical, coal and oil corporations and the developers of destructive dams – in many cases for projects they would have built anyway.

According to David Victor, a leading carbon trading analyst at Stanford University in the US, as many as two-thirds of the supposed “emission reduction” credits being produced by the CDM from projects in developing countries are not backed by real reductions in pollution. Those pollution cuts that have been generated by the CDM, he argues, have often been achieved at a stunningly high cost: billions of pounds could have been saved by cutting the emissions through international funds, rather than through the CDM’s supposedly efficient market mechanism.

And when a CDM credit does represent an “emission reduction”, there is no global benefit because offsetting is a “zero sum” game. If a Chinese mine cuts its methane emissions under the CDM, there will be no global climate benefit because the polluter that buys the offset avoids the obligation to reduce its own emissions.

A CDM credit is known as a certified emission reduction (CER), and is supposed to represent one tonne of carbon dioxide not emitted to the atmosphere. Industrialised countries’ governments buy the CERs and use them to prove to the UN that they have met their obligations under Kyoto to “reduce” their emissions. Companies can also buy CERs to comply with national-level legislation or with the EU’s emissions trading scheme. Analysts estimate that two-thirds of the emission reduction obligations of the key developed countries that ratified Kyoto may be met through buying offsets rather than by decarbonising their economies.

Almost all the demand for CERs has so far come from Europe and Japan. In the next few years, Australia and Canada could become significant CER buyers. In the longer term, the US could become the largest single market for CDM offsets under legislation being debated. The climate plan by Republican presidential hopeful John McCain would allow supposed emission reductions in the US to be met through domestic and CDM offsets.

Around 2bn CERs are expected to be generated by the end of this phase of Kyoto in 2012. At their current price, project developers will sell around £18bn-worth of CDM credits over the next five years. The CDM approved its 1,000th project on April 15. More than twice as many are making their way through the approvals process.

Marginal improvement

Any type of technology other than nuclear power can apply for credits. Even new coal plants, if these can be shown to be even a marginal improvement upon existing plants, can receive offset income. A massive 4,000MW coal plant on the coast of Gujarat, India, is expected soon to apply for CERs. The plant will spew into the atmosphere 26m tonnes of CO2 per year for at least 25 years. It will be India’s third – and the world’s 16th – largest source of CO2 emissions.

Many observers had hoped that the CDM would promote renewables and energy efficiency. Yet if all projects now in the pipeline generated the CERs they are claiming up to 2012, non-hydro renewables would attract only 16% of CDM funds, and demand-side energy efficiency projects just 1%. Only 16 solar power projects – less than 0.5% of the project pipeline – have applied for CDM approval.

For a project to be eligible to sell offsets, it is supposed to prove that it is “additional”. “Additionality” is key to the design of the CDM. If projects would happen anyway, regardless of CDM benefits, then their offsets would not represent any reduction in emissions.

But judging additionality has turned out to be unknowable and unworkable. It can never be definitively proved that if a developer or factory owner did not get offset income they would not build their project or switch to a cleaner fuel supply- and would not do so over the decade for which projects can sell offsets.

The documents written by carbon consultants to justify why their clients’ projects should be approved for CDM offsets contain enough lies to make a sub-prime mortgage pusher blush. One commonly used “scam” is to make a proposed project look like an economic loser on its own, but a profitable earner once offset income is factored in. Examples include the Indian wind developers who failed to tell the CDM about the lucrative tax credits their projects were earning.

Off-the-record, industry insiders will admit that deceitful claims in CDM applications are standard practice. The carbon trading industry lobby group, the International Emissions Trading Association (IETA), has stated that proving the intent of developers applying for the CDM “is an almost impossible task”. Industry representatives have complained that “good storytellers” can get a project approved, “while bad storytellers may fail even if the project is really additional”.

One glaring signal that many of the projects being approved by the CDM’s executive board are non-additional is that almost three-quarters of projects were already complete at the time of approval. It would seem clear that a project that is already built cannot need extra income in order to be built.

Michael Wara, a law professor and carbon trade analyst from Stanford University, and Victor show in a recent paper that “essentially all” new hydro, wind and natural gas fired projects being built in China are now applying for CDM offsets. If the developers are being truthful that their projects are additional, this implies that without the CDM virtually no hydro, wind or gas projects would be under construction in China. Given the boom in construction of power projects in China, the fact that it is government policy to promote these project types, and the fact that thousands of hydro projects have been built in China without any help from the CDM, this is simply not credible.

Additionality also creates perverse incentives for developing country governments not to bring in, or enforce, climate-friendly legislation. Why should a government voluntarily act to cap methane from its landfills or encourage energy efficiency if in doing so it makes these activities “business-as-usual”, and so not additional and not eligible for CDM income?

Waste gases

The project type slated to generate the most CERs is the destruction of a gas called trifluoromethane, or HFC-23, one of the most potent greenhouse gases, and a waste product from the manufacture of a refrigerant gas. Every molecule of HFC-23 causes 11,700 times more global warming than that of CO2. Because of this massive “global warming potential”, chemical companies can earn almost twice as much from selling CERs as from selling refrigerant gases. This has spurred concern that refrigerant producers may be increasing their output solely so that they can produce, and then destroy, more waste gases.

A rapidly growing industry of carbon brokers and consultants is lobbying for the CDM to be expanded and its rules to be weakened further. If we want to sustain public support for effective global action on climate change, we cannot risk one of its central planks being a programme that is so fundamentally flawed. In the short term, the CDM must be radically reformed. In the long term it must be replaced.

At the time when this article was written, Patrick McCully was executive director of International Rivers, a US thinktank, internationalrivers.org He is now (2014) executive director of Black Rock Solar, a company that promotes environmental stewardship, economic development and energy independence by providing not-for-profit entities, tribes and underserved communities with access to clean energy, education, and job training.

Article reproduced here by kind permission of Patrick McCully.

Carbon neutrality in Costa Rica by 2021?

Costa Rica News – reporting by Marcelo Teixeira (Reuters); editing by Dan Grebler (Reuters); first paragraph added by Dan Stevens; updates provided by Martin Mowforth.

Most of us living in Costa Rica realised that the goal of Costa Rica obtaining carbon neutrality by the year 2021 was a goal that was not going to be attained. The general idea of promoting businesses to be environmentally friendly and offset their carbon credits is a good one, but the overall goal of carbon neutrality in Costa Rica was a long way off. Luis Guillermo Solis who was elected President earlier this year sees the need to adjust this goal.

In April, Costa Rica’s PAC (Citizens’ Action Party), won a four-year presidential term, and dropped the country’s commitment to carbon neutrality by 2021. “We don’t think it would be possible to reach carbon neutrality by 2021, because the most important tasks to reduce emissions in the country are yet to be done,” Patricia Madrigal, the Citizens’ Action Party environmental adviser, told Reuters in March.

She said changes in the transport and energy sectors, to increase fuel efficiency and renewables production, are necessary because the nation lacks the means to reduce carbon dioxide emissions in key sectors by the target date. Madrigal said the PAC has no intention of abandoning the carbon neutrality goal, nor other climate policies, but believes a more realistic year to reach the target would be around 2025 if reforms are carried out as planned.

Costa Rica announced in 2009 the intention to become the world’s first carbon neutral country by 2021. The decision and policies adopted to reach the target were praised by environmental groups and multilateral organisations dealing with climate change. The Central American country has managed a successful reforestation plan using a system that pays landowners for protecting forests, funded by a carbon tax on fossil fuels. It increased forest cover from around 20 percent of the total area in the 1980s to about 50 percent currently, although ENCA’s Martin Mowforth questions how much of this increased proportion was achieved through the creation of monoculture plantation forests which are not good for biodiversity.

The restoration of forest cover is generating carbon credits, which Costa Rica intends to use to offset part of its emissions. The government also convinced several companies to neutralise emissions. It set a voluntary carbon market and a bank to assist businesses to buy offsets.

There was no mention, however, of carbon neutrality in a document released by the group with environmental guidelines for a PAC government. The previous government of Laura Chinchilla recognised the 2021 commitment as challenging, but believed it to be a mistake to postpone it. “We knew since the beginning it would be difficult, but it is something possible to be done,” said William Alpizar, the country’s climate head.

According to Alpizar, it was easier to reduce emissions in agriculture and forestry, but much more complex to do it in the transport area, which accounts for almost 70 percent of all emissions related to energy use. He said the country would need to reduce around 5 million metric tons of CO2e (carbon dioxide equivalent) by 2021 to be carbon neutral. Only a couple of other countries have pledged to neutralise emissions, but have set very distant target dates.