Download Climate-Change Projects—Selling of Indulgences or High Road?

TÜV SÜD America Inc.
10 Centennial Drive
Peabody, MA 01960
Phone: (978) 573-2500
Fax: (978) 977-0157
E-mail: [email protected]
www.TUVamerica.com
For Immediate Release
Climate-Change Projects—Selling of Indulgences or High Road?
Munich. April 2, 2008. Some 970-plus CDM projects based on the Kyoto Protocol were registered with
the United Nations, and the voluntary carbon market is booming too. Lately, however, emissions trading
has been criticized as the modern version of the buying and selling of indulgences. Yet it is a focal
element of the entire climate-change policy. Prerequisites for the effective use of this instrument are
transparent standards and end-to-end validation and verification. This was the conclusion drawn by a
workshop organized by TÜV SÜD in Munich on April 2, 2008.
Climate change is a fact. The Intergovernmental Panel of Climate Change (IPCC) in Geneva has
developed an array of global warming scenarios. The most "realistic" of these assumes that temperatures
on the earth will have risen between 1.8 and 4 degrees Celsius by the year 2100. By now, most of the
global community has become aware that climate change is believed to be primarily caused by human
activity. The IPCC calculated that the carbon dioxide content of the air has increased by 35 percent since
1750, the start of the industrial revolution, and there is no end to this trend in sight. All the forecasts
assume that global demand for energy, and thus presumably also the emission of greenhouse gases, will
continue to rise.
Kyoto Protocol – a milestone in combating climate change
To stem, or at least slow down, climate change we need to use all the options available to us,’ said
Dr. Peter Langer, CEO of TÜV SÜD Industrie Service GmbH, at the "Climate Change Projects – Selling of
Indulgences or High Road? " workshop in Munich. According to Langer, carbon emissions can be cut
most efficiently by applying simple means such as improving thermal insulation or energy efficiency in
production processes. "On their own, however, these measures will not be sufficient," emphasized
Dr. Langer. "We need to back up our emission-saving efforts by further appropriate action." According to
the physicist, the Kyoto Protocol of the United Nations Framework Convention on Climate Change
(UNFCCC) passed in 1997 is a significant milestone in our fight against climate change and one of the
focal elements of a comprehensive climate-change policy.
CDM projects expected to generate more than 2.7 billion CERs by 2010
The main feature of the Kyoto Protocol to the United Nations Framework Convention on Climate Change
(UNFCCC) is that it sets legally binding limits on greenhouse gas emissions. The developed countries that
ratified the Protocol were assigned emission targets and a corresponding number of allowances (assigned
amount units). On average, the countries are obliged to reduce their emissions 5.2 percent below their
1990 baseline during the first commitment period, 2008 to 2012. A country can do this by:
•
Reducing its own emissions.
•
Trading emission allowances (securing allowances from a country with surplus allowances).
•
Purchasing carbon units created by emission-reduction projects under the clean development
mechanism (CDM) and joint implementation (JI).
The third option, project-based offsets, was included in the Kyoto Protocol to increase the costeffectiveness of reducing emissions and give countries some flexibility in how they meet their emission
reduction commitments. "These so-called flexible mechanisms, CDM and JI, help ensure that the overall
costs of reducing emissions are kept as low as possible," explains Dr. Grant A. Kirkman, Head of the
CDM Methodologies Unit at the UNFCCC secretariat. The CDM covers projects in developing countries
(non-Annex I Parties) and JI covers projects in any country with an emission reduction/limitation
Management Service • Product Service • Industry Service • Automotive
TÜV SÜD America Inc.
10 Centennial Drive
Peabody, MA 01960
Phone: (978) 573-2500
Fax: (978) 977-0157
E-mail: [email protected]
www.TUVamerica.com
commitment under the Kyoto Protocol. Emission reductions claimed under the mechanisms must be real,
measurable,
verifiable, and additional to what would have taken place in the absence of the project. "Apart from
mitigating climate change, the CDM spurs the transfer of technology and assists countries to achieve their
sustainable development objectives," says Kirkman. By mid-March, more than 970 projects had been
registered by the CDM's Executive Board, and approximately another 2,000 were seeking registration.
CDM is expected to generate more than 2.7 billion CERs by the end of the first commitment period of the
Kyoto Protocol in 2012, each equivalent to one ton of carbon dioxide.
Validation and verification guarantee reliable project realization
For instruments such as CDM or JI to function effectively, the individual projects must be comprehensively
validated and verified. "Validation and verification are carried out by organizations which must be
accredited by UNFCCC," explains Werner Betzenbichler, Head of Carbon Management Services at TÜV
SÜD Industrie Service GmbH. In the past seven years, the activities of his team have included validation
of over 800 CDM projects, 220 of which have been registered with the United Nations to date. "To validate
these projects, experts need comprehensive know-how," says the TÜV SÜD expert. "This ranges from
familiarity with the Kyoto Protocol, its rules and processes, to expertise in the individual sectors of Clean
Development Mechanism." TÜV SÜD Industrie Service is the first and only company worldwide to be
accredited by UNFCC for all 15 CDM sectors, enabling its experts to support all CDM projects in
developing countries. The range of projects extends from a reforestation project in China or a photovoltaic
project aimed at providing decentralized electricity to the people in rural Morocco, to projects preventing or
reducing the emission of greenhouse gases with significant "global warming potential" in agricultural or
industrial processes.
Emissions Trading to get investments on track
In addition to the regulated market of the Kyoto Protocol, a voluntary market for climate-change projects
has developed over recent years. "This market is dominated by companies wishing to offset their
emissions in order to render their processes climate-neutral," explains Dr. Jochen Gassner, Director
Climate Neutral at 3C Consulting GmbH, a leading international provider on the voluntary CO2 market. In
contrast to the regulated market of the Kyoto Protocol, no central standards have been defined on the
voluntary market. Instead, various players have developed their own standards, such as the Voluntary
Carbon Standard (VCS) or the Gold Standard. "While several standards of different quality render
orientation on this market more complicated, there is no reason to doubt the fundamental benefits offered
by the market and its projects," says Dr. Gassner. "VER projects, like CDM projects, involve certain risks.
Given this, committing to standardized criteria is important for the carbon offset industry. Today, most
transactions on the voluntary carbon market are realized by a small number of "high-quality suppliers."
"The United Nations estimate that by 2030, approx. $ 210 billion will be needed to keep greenhouse gas
emissions to a reasonable level," added Dr. Gassner. "Emissions trading in the regulated and voluntary
markets will significantly contribute towards paying for these costs and towards getting investments on
track, i.e. focusing them on the continuous improvement of renewable energies and energy efficiency."
Prevention and reduction should take priority over offsetting
Juliette de Grandpré also regards emissions trading as a "focal element of climate change policy." The
Energy and Carbon Market Officer at World Wide Fund for Nature (WWF), Germany, believes this
element will only work if ambitious caps are established for GHG emissions and if sanctions are enforced
whenever these caps are violated. In newly industrialized and developing countries, CDM projects have
also promoted technology transfer, thus resulting in climate protection becoming part of the political
agenda. According to the WWF Officer, however, the Gold Standard should become mandatory for the
Management Service • Product Service • Industry Service • Automotive
TÜV SÜD America Inc.
10 Centennial Drive
Peabody, MA 01960
Phone: (978) 573-2500
Fax: (978) 977-0157
E-mail: [email protected]
www.TUVamerica.com
certification of carbon offset projects. "This standard is the best quality label for offset projects,"
emphasizes de Grandpré, and refers to a current study conducted by the Stockholm Institute of the
Environment and Tricorona on behalf of WWF. "First, it reduces investment risks, and secondly, it
guarantees emissions reductions and compliance with ecological and social accountability standards in
project realization." Two key criteria for the award of certificates as per the Gold Standard are that
projects must strengthen renewable energy or improve energy efficiency, and must contribute to
sustainable development. Juliette de Grandpré also points out that offsetting emissions on the basis of
emissions trading may actually be the last resort on our way to climate-friendly living: "Before we offset
emissions we must definitely prioritize attempts to prevent or reduce them."
For the opportunity to learn more on TÜV’s Carbon Services, TÜV SÜD America Inc., the German
American Chamber of Commerce (GACC) of New York, and the German American Business Council
(GABC) of Boston will also co-sponsor a luncheon and discussion on "Making Carbon an Asset th
Success Factors for Climate Change Strategies & Voluntary Offset Projects" on April 10 at the
Union Club in Boston, MA. Click here for details.
Current press photos from the "Climate-Change Projects – Selling Indulgences or High Road? " workshop
for journalists can be found under www.tuev-sued.de/pressefotos in the "Current Press Photos" main
category. Further information is also available at:
•
•
•
•
www.tuev-sued.de or www.netinform.de/KE
www.unfccc.int
www.3c-company.com/de
www.wwf.de/themen/klimaschutz
Media Relations:
Dr. Thomas Oberst
TÜV SÜD AG
Corporate Communications
INDUSTRY
Westendstr. 199, 80686 Munich
Telephone: +49 (0) 89 / 57 91-23 72
Fax: +49 (0) 89 / 57 91-212
Email: [email protected]
Internet: www.tuev-sued.de
TÜV SÜD is a leading international service organization catering to the business segments INDUSTRY,
MOBILITY and PEOPLE. With over 13,000 employees, it is represented worldwide at more than 600
locations. As partners in our customers' processes, our specialist teams ensure that technology, systems
and know-how are optimized, thus strengthening our customers' global competitiveness.
Management Service • Product Service • Industry Service • Automotive