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The Kyoto Protocol includes three so-called ‘flexible mechanisms’, instruments which allow governments in industrialised countries to achieve parts of their emission reduction commitments under the Kyoto Protocol through projects abroad rather than through action or policy changes at home. What follows is a brief description of the three mechanisms; there are several excellent reports providing a detailed critique of the structural as well as philosophical flaws of this market-based approach. For further information on this subject, please check the climate change publications page.

1. Emission Trading
The emission trading system will allow industrialised countries to buy and sell emission credits. Countries that keep emissions below their agreed target will be able to sell the excess emissions to countries that find it more difficult or more expensive to meet their own targets. One of the main concerns is that the Kyoto targets of some countries are so low that they can be met with minimal effort. These countries could then sell large quantities of emission credits (known as ‘hot air’), thus taking off the pressure from those governments for whom buying credits is more convenient than putting in place policies and measures that lead to true and lasting emission cuts. The true cost of such foregone emission cuts will be borne by the atmosphere and future generations faced with the full impacts of climate change.

2. Joint Implementation
This mechanism will allow industrialised countries to gain credits for financing emission reduction projects in other industrialised countries with Kyoto targets. Carbon sink projects are also eligible for crediting under the Joint Implementation scheme and the definitions for such carbon sink projects make no distinction between forests and tree plantations thus providing no safeguards that carbon sink projects will contribute to restoring natural forest ecosystems.

3. Clean Development Mechanism (CDM)
This mechanism will allow industrialised countries to gain credits for financing emission reduction projects in countries without Kyoto targets. The CDM was added at a late stage of the negotiations that culminated in the Kyoto Protocol. The CDM goes back to a Brazilian proposal to create a "Clean Development Fund" as part of the Kyoto Protocol. This proposal, supported by G-77/China, was based upon penalizing those industrialised countries not complying with the emission targets set in the Kyoto Protocol. The resources of the fund were to be made available to non-industrialised countries for use in climate change mitigation projects (90%) and projects to help countries fight the consequences of climate change such as floods, droughts – the so-called adaptation projects. Industrialised countries opposed the idea and the Clean Development Mechanism was created as a compromise. Unlike the fund, the mechanism is not linked to industrialised countries’ compliance with their emission targets; rather, it aims to achieve climate change mitigation through a market-based approach: industrialised countries receive emission rights in exchange for financing emission abatement project in the South.

CDM concerns
Of these three, the CDM is of greatest concern to Fern because for every tonne of carbon captured through a CDM project, an additional tonne of carbon from fossil fuel burning can be released in industrialised countries. Given that CDM projects will be located in countries that are not subject to emission targets, any CDM project increases the overall allowance of greenhouse gas emissions in industrialised countries while there is no guarantee that overall emissions in the CDM host country would be permanently reduced through the project. This has become of particular concern since governments decided at COP6bis in Bonn in July 2001 that carbon sink activities were eligible as a project category in the CDM. These sink projects will only ensure temporary storage while justifying additional, permanent carbon emissions from fossil fuels in an industrialised country party to the Kyoto Protocol. Eventually, the carbon stored through terrestrial sinks – trees, other plants, soil (i.e. part of the 'active carbon pool') – will be released again into the atmosphere, thus adding to the already released carbon emission from fossil fuels the sink was meant to permanently offset.

A detailed critique of the potential consequences of Northern companies controlling land use in the South to offset greenhouse gas emissions in the North can be found in Democracy or Carbocrazy? Intellectual corruption and the future of the climate debate, a Cornerhouse Briefing by Larry Lohmann (available at: http://cornerhouse.icaap.org).