Andrew Brandler, chief executive of CLP Holdings, the Hong
Kong-based energy group, has called for the UN’s
Clean Development Mechanism to be fundamentally reformed.
The CDM is designed to encourage low-carbon economic
development in poorer countries by allowing companies in rich
states to gain carbon credits if they sponsor such
These credits, known as Certified Emissions Reductions, are
accepted by the EU Emissions Trading System as equivalent to EU
Allowances. That means companies can use CERs to emit more
carbon than their caps would otherwise allow.
Critics of the scheme say it does not achieve net reductions
in carbon emissions and that the economics of engaging in CDM
projects can be confusing. There is no limit on how many CER
credits can be created, so their value is also
Brandler questioned the validity of the CDM in finding a
price for carbon: "You can’t rely on any pricing
at all coming out of the CDM. It needs to be fundamentally
He also said he was concerned about whether the carbon
market was the best way to deal with more complex technology
such as carbon capture and storage. "To rely on a carbon market
to give pricing signals is completely unrealistic," he
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