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BHOLENDRA VARMA
PGDM 3RD TRIMESTER
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Both the buyer and the seller would submit accounts for their
emissions to prove that their allowances were met correctly.
It is also important for any carbon credit (offset) to prove a concept
called additionality. Additionality is a term used by Kyoto's Clean
Development Mechanism to describe the fact that a carbon dioxide
reduction project (carbon project) would not have occurred had it not
been for concern for the mitigation of climate change. More
succinctly, a project that has proven additionality is a beyond-
business-as-usual project.
The Kyoto Protocol, an international agreement between more
than 170 countries, The mechanism adopted was similar to the
successful US Acid Rain Program to reduce some industrial
pollutants.
According the World Resources Institute/World Business Council
for Sustainable Development (WRI/WBCSD) : "GHG emission
trading programs operate by capping the emissions of a fixed
number of individual facilities or sources.
Under these programs, tradable 'offset credits' are issued for
project-based GHG reductions that occur at sources not covered
by the program.
The idea is to achieve a zero net increase in GHG emissions,
because each tone of increased emissions is 'offset' by project-
based GHG reductions.
The difficulty is that many projects that reduce GHG emissions
(relative to historical levels) would happen regardless of the
existence of a GHG program and without any concern for climate
change mitigation.
If a project 'would have happened anyway,' then issuing offset
credits for its GHG reductions will actually allow a positive net
increase in GHG emissions, undermining the emissions target of the
GHG program.
Additionality is thus critical to the success and integrity of GHG
programs that recognize project-based GHG reductions."
5. Carbon credit in India
At last count in March 2006, India had 310 ‘eco-friendly’ projects
awaiting approval by the UN. Once cleared, these projects can fetch
about Rs 29,000 crore in the next seven years. India’s carbon credit
market is growing, as many players (industries) are adopting the Clean
Development Mechanism (CDM), said S K Panigrahi, Director
(Environment and Forest), Planning Commission.
Elaborating on ‘global emission trading’ Panigrahi added, “For
instance, US accounts for 30 per cent of global emissions, while India
makes for three per cent. Now, India can transfer part of its allowed
emissions to developed countries. For this, India must first adopt CDM
and accrue carbon credits. One carbon credit or Certified Emission
Reductions (CERs) is equivalent to one tonne of emission reduced.”
State Minister for Environment and Forest C Chennigappa, “India has
an emerging CDM market and Karnataka is one of the three states to
have registered projects with the host country endorsements.”