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Why CDM is important |
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CDM is important from an environmental, business
and a national point of view.
From a national
point of view CDM holds the potential to lead to
significant investment, job creation and poverty alleviation
in the developing countries, all of this in a way that assists
these countries in achieving sustainable development. It is
thus important for developing countries to set up effective
structures to facilitate and regulate CDM in their countries
in order to ensure that they get a fair share of the global
investment that takes place under the CDM while at the same
time meeting the demands of sustainable development. The order
of investment that might occur can be illustrated by two
estimates: the first is that the three flexibility mechanisms
under the Kyoto Protocol, of which CDM is one, could be worth
as much as $ 20 billion per annum by 2020. The second is that
the CDM can cause $ 24 – 37 billion to flow to developing
countries by 2012.
From a business point of
view CDM represents new opportunities for entrepreneurs in
the developed world and a potential method to add an
additional revenue stream to projects that will improve their
viability and overcome potential barriers to market entry. By
way of example, if a utility decides to retro-fit a coal-fired
power station in order to make it more efficient, there is
immediately the possibility that a CDM project may be done and
that the resultant Certified Emissions Reductions may be sold
in order to subsidize or even pay for the retro-fit procedure.
CDM thus represents potential value to businesses as diverse
as (amongst others) utilities, forestry companies, renewable
energy producers, energy efficiency proponents, landfill
operators, construction companies, mines, project financiers,
petro-chemical companies and indeed any substantial users of
energy.
To environmental NGO’s like entities
aiming to combat desertification or deforestation, CDM might
be a way to finance their activities and advance their aims.
For more information return to the menu at the top of
the page.
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