Clean Development Mechanism

One of three mechanisms under the Kyoto Protocol, the Clean Development Mechanism (CDM) allows developing countries who have signed onto the UNFCCC Kyoto Protocol to pursue projects to reduce GHG emissions and earn certified emission reduction credits, which can then be sold to developed countries with obligations under the Kyoto Protocol.1 The other two mechanisms are Joint Implementation, which allows developed countries to carry out greenhouse gas reducing projects in developing countries, and Emissions Trading, which allows countries with carbon credits to spare to sell them to countries needing to meet a target.2

Vietnam leads the pack in the LMC with 301 CDM projects – OR As of February 2017, the Institute for Global Environmental Strategies (IGES) indicates that there are 618 CDM projects in various states of completion in the LMC countries. Cambodia hosted 11; Laos hosted 29, co-hosted 5 with Thailand, and co-hosted 1 with Vietnam; Myanmar hosted 1, Thailand hosted 270; and Vietnam 301.)

The CDM is meant to help developing countries to meet their targets under the Kyoto Protocol, but not all observers agree that the projects are in fact sustainable or environmentally friendly. One strong critique is that large hydropower projects can qualify for credits, which are projects that typically emit a significant amount of GHGs, cause irreversible damage, and displace many communities3 Hydropower projects now count for over a quarter of all applied-for projects, making them the second most common project (wind being first).4 All LMC have hydropower projects in the CDM pipelines, with major projects planned or operational on the mainstream of the Mekong River in Lao, Thailand, Vietnam and Cambodia. Other potential projects include low-carbon transport with a policy study underway in Thailand5; urban, such as methane recovery in Vietnam; 6 and agriculture and natural resources such as biogas projects in Thailand.7

References

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