Carbon Credit Watch

Costly Kyoto: a money racket not a green scheme?

(October 4, 2011) In the lead-up to global climate talks in South Africa next month, this National Post editorial turns a harsh light on the Kyoto climate-change treaty and, in particular, the United Nations’ carbon emissions-trading scheme. Taking into account recent revelations by WikiLeaks and a human rights investigation in Honduras, the Post concludes: “all that happens in most of these carbon-trading arrangements is a transfer of cash. No emissions are reduced. The UN signs off on energy projects, whether or not they result in emission savings, just so carbon traders and [developing nation governments] may cash in.”

UN’s do-nothing green scheme

National Post editorial

Kyoto has cost the world’s governments and companies at least $150-billion in research, subsidies, compliance costs and lost economic activity. Yet there is no proof it has saved even a tonne of carbon emissions.

With the Kyoto climate-change treaty set to run out next year, environmentalists and the United Nations are desperate to find a successor deal at next month’s climate summit in Durban, South Africa. But their efforts have suffered two major setbacks in the past week. First, the Internet whistleblower WikiLeaks revealed documents showing that many UN-approved development programs are shams, the UN’s emissions trading scheme has failed to reduce carbon emissions and UN officials are aware of all of this, but have refused to admit it. Then on the weekend, both the European Parliament and the Inter-American Commission on Human Rights announced they would be investigating claims that a UN-approved biofuels company in Honduras has been linked to the murder of 23 farmers who objected to having their land seized to make way for palm oil plantations.

One of the keys to implementing the Kyoto climate-change treaty has been the UN’s Clean Development Mechanism (CDM). The CDM arranges for governments and companies in the industrialized world to fund “green” projects in the developing world, or to provide developing countries with clean technology. In return, the developed nation’s government or corporation receives a carbon offset – a credit for preventing emissions in the developing world – that it can use to offset its own domestic carbon emissions.

More than three-quarters of the CDM projects that have been certified since 2005 are in China and India. But WikiLeaks now shows that most of the 720 projects in India should never have been approved in the first place because there was never any chance of them achieving the emission reductions their operators insisted were likely. And rather than having claims verified by an independent evaluator in advance, the Indian CDM office simply “took the project developer at his word.”

“What has leaked just confirms our view that in its present form the CDM is basically a farce,” says Eva Filzmoser, program director of CDM Watch, a Brussels-based organization. The millions of tonnes of reductions in greenhouse-gas emissions claimed by the UN and by CDM compliance officers have never materialized and the debacle calls into question both the feasibility of a worldwide carbon-trading market and the environmental benefits of one.

Good heavens. Who ever could have foreseen the UN using sleight-of-hand to justify the continuation of a prominent program? [Editor’s Note. Refer UN blasted over Iraq oil-for-food scheme].

The assassination of many as two dozen Honduran peasants between January 2010 and this past spring is not the UN’s fault directly. But the deaths may highlight the international body’s zeal to create an international carbon trading system. The CDM board approved the palm oil biofuels project in July, despite protests from 77 rights organizations and NGOs over the parent company, Grupo Dinant, and its human-rights record concerning land disputes in the Aguan Valley. Rights groups accuse Dinant of conspiring with the Honduran government to terrorize peasants into leaving their farms to make way for large-scale palm oil production.

The CDM board went ahead with Dinant’s certification, even though the company’s European partner, EDF Trading, withdrew from the project. EDF was to buy the carbon credits created by the Honduran project and sell them to European companies that were exceeding their emission targets. But EDF grew concerned about Dinant’s methods and withdrew from their contract.

All of this reinforces the suspicions of many that the UN’s entire stance on climate change is less about the environment and more a wealth-transfer scheme that takes money from rich countries and gives it to governments and businesspeople in poor ones: The WikiLeaks revelations show is that all that happens in most of these carbon-trading arrangements is a transfer of cash. No emissions are reduced. The UN signs off on energy projects, whether or not they result in emission savings, just so carbon traders and develop-nation government may cash in.

The Honduran case also shows how ruthless some of the state and industrial actors may have become in seeking a piece of this UN-approved pie.

The alleged violence is obviously inexcusable in any circumstance. But it may have been possible to overlook some of the financial shenanigans if CDM projects were leading to real environmental improvements. But it is hard to believe any of the UN’s claims about CDM because it is, too often, both the advocate and the judge.

Kyoto has cost the world’s governments and companies at least $150-billion in research, subsidies, compliance costs and lost economic activity. Yet there is no proof it has saved even a tonne of carbon emissions. As delegates gather in South Africa next month, they should be looking for practical, less-expensive ways of reducing emissions, not grand elaborate schemes that are prone to fraud and unlikely to make a dent in carbon dioxide levels.

Read the original publication of this editorial here [PDF here].

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