Will the Clean Development Mechanism Mobilize Anticipated Levels of Mitigation?

24 Pages Posted: 20 Apr 2016

See all articles by Shaikh M. Rahman

Shaikh M. Rahman

affiliation not provided to SSRN

Ariel Dinar

World Bank - Agriculture and Rural Development Department

Donald F. Larson

Institute for the Theory and Practice of International Relations

Date Written: March 1, 2010

Abstract

Under the Kyoto Protocol, developed countries can only tap mitigation opportunities in developing countries by investing in projects under the Clean Development Mechanism. Yet Clean Development Mechanism investments have so far failed to reach many of the high-potential sectors identified by the Intergovernmental Panel on Climate Change. This raises doubts about whether the Clean Development Mechanism can generate an adequate supply of credits from the limited areas where it has proved successful. This paper examines the current trajectory of mitigation projects entering the Clean Development Mechanism pipeline and projects it forward under the assumption that the diffusion of the Clean Development Mechanism will follow a path similar to other innovations. Projections are then compared with pre-Clean Development Mechanism predictions of the mechanism?s potential market size to discern whether limits on the types of projects entering the pipeline have limited the expected supply of certified emission reductions. Parameter tests suggest that this is not the case and that currently identified Clean Development Mechanism investments will generate offsets in excess of early model predictions. In particular, under favorable circumstances, the mechanism is on track to deliver an average annual flow of roughly 700 million certified emission reductions by the close of 2012 and nearly to 1,100 million certified emission reductions by 2020.

Keywords: Climate Change Mitigation and Green House Gases, Climate Change Economics, ICT Policy and Strategies, Energy Production and Transportation, Carbon Policy and Trading

Suggested Citation

Rahman, Shaikh M. and Dinar, Ariel and Larson, Donald F., Will the Clean Development Mechanism Mobilize Anticipated Levels of Mitigation? (March 1, 2010). World Bank Policy Research Working Paper No. 5239. Available at SSRN: https://ssrn.com/abstract=1574736

Shaikh M. Rahman

affiliation not provided to SSRN

No Address Available

Ariel Dinar (Contact Author)

World Bank - Agriculture and Rural Development Department ( email )

1818 H Street, N.W.
Washington, DC 20433
United States
202-473-0434 (Phone)

Donald F. Larson

Institute for the Theory and Practice of International Relations ( email )

P.O. Box 8795
Williamsburg, VA 23185
United States

HOME PAGE: http://https://sites.google.com/site/decrgdonaldflarson/

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