CDM Projects

CDM Projects

What is the Kyoto Protocol’s Clean Development Mechanism (CDM)?

The United Nations Framework Convention on Climate Change (UNFCCC) is the UN institution in charge of coordinating research and measures taken in relation with climate change, and fixes target emissions (measured as the equivalent in carbon dioxide) that a Party may emit over the commitment period in order to comply with its emissions target, known as a Party’s Assigned Amount. The Kyoto Protocol sketches out “mechanisms” of how industrialized countries can take stronger and more detailed commitments to reduce greenhouse gas emissions (GHG).

Kyoto Protocol:

The Kyoto Procotol proposes three mechanisms: CDM (Clean Development Mechanism), JI (Joint Implementation) and ET (Emission Trading). CDM is between Annex-I country and non-Annex-I country while the other two are between Annex-I countries.
  • The CDM defined in Article 12 provides for Annex I Parties to implement project activities that reduce emissions in non-Annex I Parties, in return for certified emission reductions (CERs).
  • JI under Article 6 of the Kyoto Protocol provides for Annex I Parties to implement projects that reduce emissions, or remove carbon from the atmosphere, in other Annex I Parties, in return for emission reduction units (ERUs)
  • ET as set out in Article 17 of the Kyoto Protocol provides for Annex I Parties to acquire units from other Annex I Parties and use them towards meeting their emissions targets under the Kyoto Protocol.

So the outputs of the three mechanisms are CERs (Certificated Emission Reductions) from CDM, ERUs (Emission Reduction Units) from JI and AAUs (Assigned Amount Units) from ET. They are all representing GHG reductions but playing different roles in emission trading. For example, CERs need to be transferred into ERUs or AAUs when traded between Annex-I countries.

Which Greenhouse Gases are concerned?

The object of the Kyoto Protocol is to reduce emissions of six main greenhouse gases, namely:



Global Warming Potential (GWP)

Carbon dioxide (CO2) Biomass respiration and burning land-use change, energy, transport, industry, etc. 1
Methane (CH4) Energy, landfills, ruminants, waste treatment, rice agriculture, biomass burning, etc. 21
Nitrous oxide  (N20) Transport, industry, livestock and feed, biomass burning, etc. 310
Hydrofluorocarbons (HFCs) Refrigeration and air-conditioning industries, firefighting agent. 140 - 11,700
Perfluorocarbons (PFCs) Electronics industry processes 6,500 - 9,200
Sulphur hexafluoride Dielectric gas for high voltage applications 23,900

The figure in the last column shows that not all GHGs have the same impact on climate change: Global Warming Potential is the ratio of the warming caused by a substance to the warming caused by a similar mass of carbon dioxide. CFC-12, for example, has a GWP of 8,500, while water has a GWP of zero.

Therefore, implementing a project for the destruction of fluorocarbons will have a terrific positive impact on climate change, and considerably contribute to lowering emissions so as to reach targets.

Where are these fluorinated gases found?



Main applications

  • by-product in production of HCFC-22
  • low temperature refrigerant
  • firefighting agent
  • blend component for air conditioning equipment and commercial refrigeration
  • solvent for specialised applications
  • blend component for air conditioning and commercial refrigeration
  • firefighting agent
  • blend component for mobile and stationary air conditioning, and for domestic refrigerators/freezers
  • propellant for extruded polystyrene foams (XPS)
  • blend component for air conditioning equipment and commercial refrigeration
  • propellant for specialised industrial aerosols
  • blowing agent component for extruded polystyrene foams (XPSS)
  • propellant for medical aerosols
  • firefighting agent
  • firefighting agent
  • foam blowing agent for polyurethane (PUR) foams
  • foam blowing agent for polyurethane (PUR) and phenolic foams
  • blend component for solvents

PFC gases and liquids are traditionally used in several electronics industry processes ranging from semiconductor front-end manufacturing, IC-components quality control testing to direct contact dielectric cooling of e.g. power electronics assembly.

Sulphur hexafluoride (SF6) is an excellent dielectric gas for high voltage applications.
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What are the results, and their financial impact?

The diagramme below shows the evolution of emissions without implementing a project (in red). This is increasing because it takes into consideration the hypothesis of production increase. Then in green is the evolution of emissions when a project is implemented. The light green zone shows the volume of emissions that can be traded. It stops in 2012 because the current scheme only is valid until 2012, it will very soon be discussed of how the scheme will evolve after 2012.

This shows the amount that can therefore be gained per year by trading:

Emission credits x GWP x Market price

In private enterprise, emissions trading is very attractive because it does not harm industrial concerns, or require government subsidies. When the price per ton of emissions becomes high enough, well-managed polluting enterprises can make a rational decision to invest in pollution control equipment, and sell part of their emissions licenses.

In some proposed systems, the government grants tax credits to enterprises. However, these are more expensive for governments, and far less popular for that reason.

Emissions trading is attractive to public-interest environmental organizations, because in an open market they can purchase and retire emissions licenses. This permanently reduces the total amount of pollution produced.

The information above is an extract from