Tuesday, August 05, 2008

CDM for Large Power Generation Projects?

In India Together in July, 2008, Mr. Shripad Dharmadhikary reports, "most hydro power projects don't need the Clean Development Mechanism (CDM) credits to be built. But a gross mockery is being made of the basic principles and understanding of the Kyoto Protocol, with no real cuts in emissions."

This article summarizes the CDM mechanism and its application in India, focusing on the hydro power projects, and questions the logic behind awarding large sums of carbon finance to projects that are already under construction or completed construction. And why hydro, which is already carbon neutral, when compared to the thermal power plants coming into production?

Do large power generation projects need carbon finance support for completion? Is this in violation of additionality clause, that CDM will support those projects, which otherwise would not come into being. The amount of finances involved in the power plant construction and O&M, in some cases, the CDM accounts for peanuts. Then, why the fancy for CDM in every project?

There is also an approved methodology for new thermal power plants (ACM0013) - "Consolidated baseline and monitoring methodology for new grid connected fossil fuel fired power plants using a less GHG intensive technology".

When a new power plant is commissioned, isn't it logical to use the best technology that pollutes less - locally and globally? Then why introduce a methodology for new plants as an incentive. There are other approved methodologies for existing power plants, which result in increasing the efficiency of the boilers by co-generation, replacement with better boilers, saving heat losses, or even adding incinerators (for waste, etc). These seem OK.

The author quotes, "As a result of such distortions, a mechanism that is in any case fundamentally flawed is being further discredited with blatant misuse and abuse." and "The person who anyway always walked, is asking to be paid saying he walked behind the bus and saved money"

Also see

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