Expanded Clean Development Mechanism program to benefit Africa

The poorest nations in Africa are likely to benefit from a broadening of the United Nations’ Clean Development Mechanism (CDM) program to promote non-polluting energies, such as hydropower, in the developing world.

Chairman Hans Juergen Stehr of the CDM Executive Board, said May 8 that new rules are expected to be approved in June that should make it easier to initiate renewable energy projects that might have been considered uneconomic or hampered by red tape.

“There is a huge potential if it’s developed right,” Stehr said during 166-nation talks in Bonn about ways to fight global warming. “It will increase the possibilities and the potential for small-scale projects.”

The CDM allows rich nations to invest in renewable energy projects in developing nations and then claim credits back home for the greenhouse gas emissions they avoid. The CDM has advanced 655 projects ranging from hydroelectric projects in Honduras to wind farms in Morocco.

Stehr declined to estimate how much the rule change would add to the multi-billion-dollar CDM. Some experts estimate the CDM, part of the U.N.’s Kyoto Protocol for slowing global warming, could channel US$100 billion into developing nations.

Africa wins fewer CDM investments than other regions

Stehr said the rule changes would make the CDM more relevant to the poorest nations, such as in Africa, which has won fewer CDM investments than other parts of the developing world. (HNN 2/2/07)

Under the new guidelines, a city in the developing world might shift to install energy saving light bulbs in one district, and then expand to ever more neighborhoods to help cut use of fossil fuels, Stehr said. Until now, such a project would have been limited to the original district and could be too small to attract investment.

Or, Stehr said, a group of villages could attract funding for a shift to renewable energies. The new rules would make it economic for a few villages to start off and then widen the project to scores of others.

“If you add up and have 100, these very small, isolated activities become valid also as a CDM project,” he said.

CDM emissions credits can be traded — CDM projects in the pipeline have the potential to prevent emissions of 1.9 billion tons of greenhouse gases, Stehr said.

“That’s US$19 billion if the credits are worth US$10 per ton,” he said.

Stehr said the CDM was continuing to expand even though governments have not agreed how to extend the Kyoto agreement, whose first period runs to 2012. The Bonn talks are part of a long-term hunt for a new deal to replace and widen Kyoto.

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