An article on environmental management perspective
I remember many years ago receiving a call from a BBC journalist asking which villages in India they should visit to see the impacts of climate change. This was in the early 1990s. I was puzzled and asked, "Is climate change here?" Finally, the television crew decided to shoot urban fires in Delhi and drought in Rajasthan to show their viewers how India was reeling under the impact of changing climate due to increased greenhouse gas emissions.
I wonder what I'd say if I got a similar call today. Would I point to recent cloudbursts and cyclonic events, which have more or less drowned several major metropolitan cities in the country? Would I point to the obvious variations and extreme weather events - from heatwaves to freak snow episodes - to say that our climate has changed? Clearly, the answer isn't simple. It is true that every Indian city that has drowned under the weight of its rain has suffered because of the progressive mismanagement at the hands of its city managers. It is also true that the intensity of floods and drought has increased because we have made the poor even more vulnerable to weather events - either by destroying the wetlands that absorbed the water or by simply ruining the land economies of people, which would sustain them in times of stress.
It is also true that our weather is changing. In other words, we have a double-whammy - already stressed regions and people who will be further hit. It is imperative that we reduce our vulnerabilities by doing 'good' development - investing in the natural resource base of people to mitigate against drought and floods. Simultaneously, it is also imperative that we reduce global emissions so that the threat of climate change is contained.
It is for this reason that the world governments party to the convention on climate change came up with the Clean Development Mechanism (CDM). The idea was simple: the industrialized North had to reduce its emissions, partly because its emissions were already leading to the threats of climate change and partly to provide economic and ecological space for the South to increase its emissions. Two facts were clear: one, the North could not substantially reduce its emissions as it could not de-link from the fossil fuel economy that drives growth. Two, the South did not have to make the mistakes of the emission-flatulent parts of the world. It could re-engineer its growth trajectory so that it would be more efficient or less dependent on fossil fuels. It was this reasoning that led to CDM - so that the North could pay for the cleaner development in the South and get credits in its carbon balance sheet. It was meant to be a win-win situation.
This was not to be. In our study of the working of CDM (see 'Newest, Biggest Deal', Down To Earth, November 15, 2005), we find that it has become a market mechanism simply - an agreement between private parties looking to make a fast buck. It is, as we show, not just the complicated development mechanism but also the corrupt development mechanism, which is leading to poor quality projects.
It is important to consider why this is so. It would be easy for commentators in the developed world to blame these transgressions - corruption or poor project design - on the governments and industries of the South. But the answer is not so simple.
The fact is that rich governments have worked overtime on the design of CDM so that it is what it is today. For instance, the rules and procedures that have been developed for CDM are extremely convoluted and cumbersome, leading to ineffective projects at the country level. Take the criterion for "additionality" - what can be done without a CDM project - which is leading to creative carbon accounting and poor quality projects. In fact, the current rules create perverse incentives for governments to do little to combat climate change.
These over-developed criteria are purportedly the response of rich governments and their NGOs to protect against "business-as-usual" dirty projects, which they believe Southern governments would want to push through in the garb of CDM. They don't trust the poor country governments. The result is bad rules made for bad projects.
The second problem concerns high transaction costs (and procedures) - due to the compulsory involvement of private auditors and their procedures, which in turn negates the involvement of the community and small projects in CDM. This was done by rich governments and their NGOs to protect against the lack of credible procedures in the South. But look at the end result. The procedure stipulates that the project proponent hires the consultant to do the project design and then hires the authorized validator to certify the project, based on the consultant's report. In other words, the entire process is regulated by mutual self-interest. It is no wonder that Down To Earth indicted two internationally acclaimed auditors - namely, PricewaterhouseCoopers and Ernst & Young - for fraudulent project design documents.
I could go on. But the moot point is that the design of CDM is flawed. It keeps prices low; it forces the South to discount its advantage in reducing emissions. It does little to combat climate change. If the threat of climate change is real, then the answers to it must also get real. CDM is a halfway house because it does not build a global climate regime based on entitlements for all. But it can deliver the building blocks of a cleaner tomorrow. For this, we must do things differently. Much more differently.
- Sunita Narain
Thanks,
umalme
I remember many years ago receiving a call from a BBC journalist asking which villages in India they should visit to see the impacts of climate change. This was in the early 1990s. I was puzzled and asked, "Is climate change here?" Finally, the television crew decided to shoot urban fires in Delhi and drought in Rajasthan to show their viewers how India was reeling under the impact of changing climate due to increased greenhouse gas emissions.
I wonder what I'd say if I got a similar call today. Would I point to recent cloudbursts and cyclonic events, which have more or less drowned several major metropolitan cities in the country? Would I point to the obvious variations and extreme weather events - from heatwaves to freak snow episodes - to say that our climate has changed? Clearly, the answer isn't simple. It is true that every Indian city that has drowned under the weight of its rain has suffered because of the progressive mismanagement at the hands of its city managers. It is also true that the intensity of floods and drought has increased because we have made the poor even more vulnerable to weather events - either by destroying the wetlands that absorbed the water or by simply ruining the land economies of people, which would sustain them in times of stress.
It is also true that our weather is changing. In other words, we have a double-whammy - already stressed regions and people who will be further hit. It is imperative that we reduce our vulnerabilities by doing 'good' development - investing in the natural resource base of people to mitigate against drought and floods. Simultaneously, it is also imperative that we reduce global emissions so that the threat of climate change is contained.
It is for this reason that the world governments party to the convention on climate change came up with the Clean Development Mechanism (CDM). The idea was simple: the industrialized North had to reduce its emissions, partly because its emissions were already leading to the threats of climate change and partly to provide economic and ecological space for the South to increase its emissions. Two facts were clear: one, the North could not substantially reduce its emissions as it could not de-link from the fossil fuel economy that drives growth. Two, the South did not have to make the mistakes of the emission-flatulent parts of the world. It could re-engineer its growth trajectory so that it would be more efficient or less dependent on fossil fuels. It was this reasoning that led to CDM - so that the North could pay for the cleaner development in the South and get credits in its carbon balance sheet. It was meant to be a win-win situation.
This was not to be. In our study of the working of CDM (see 'Newest, Biggest Deal', Down To Earth, November 15, 2005), we find that it has become a market mechanism simply - an agreement between private parties looking to make a fast buck. It is, as we show, not just the complicated development mechanism but also the corrupt development mechanism, which is leading to poor quality projects.
It is important to consider why this is so. It would be easy for commentators in the developed world to blame these transgressions - corruption or poor project design - on the governments and industries of the South. But the answer is not so simple.
The fact is that rich governments have worked overtime on the design of CDM so that it is what it is today. For instance, the rules and procedures that have been developed for CDM are extremely convoluted and cumbersome, leading to ineffective projects at the country level. Take the criterion for "additionality" - what can be done without a CDM project - which is leading to creative carbon accounting and poor quality projects. In fact, the current rules create perverse incentives for governments to do little to combat climate change.
These over-developed criteria are purportedly the response of rich governments and their NGOs to protect against "business-as-usual" dirty projects, which they believe Southern governments would want to push through in the garb of CDM. They don't trust the poor country governments. The result is bad rules made for bad projects.
The second problem concerns high transaction costs (and procedures) - due to the compulsory involvement of private auditors and their procedures, which in turn negates the involvement of the community and small projects in CDM. This was done by rich governments and their NGOs to protect against the lack of credible procedures in the South. But look at the end result. The procedure stipulates that the project proponent hires the consultant to do the project design and then hires the authorized validator to certify the project, based on the consultant's report. In other words, the entire process is regulated by mutual self-interest. It is no wonder that Down To Earth indicted two internationally acclaimed auditors - namely, PricewaterhouseCoopers and Ernst & Young - for fraudulent project design documents.
I could go on. But the moot point is that the design of CDM is flawed. It keeps prices low; it forces the South to discount its advantage in reducing emissions. It does little to combat climate change. If the threat of climate change is real, then the answers to it must also get real. CDM is a halfway house because it does not build a global climate regime based on entitlements for all. But it can deliver the building blocks of a cleaner tomorrow. For this, we must do things differently. Much more differently.
- Sunita Narain
Thanks,
umalme