UN should ban coal projects from carbon offseting program: CDM Watch

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The United Nations should ban coal-fired power plants from its global carbon offsetting program, the Clean Development Mechanism, at UN climate talks later this month, Brussels-based group CDM Watch said late Thursday.
The group said a number of coal-fired power plants in developing countries that are already registered under the CDM program may receive millions of "artificial" carbon credits from the program because they would have been built anyway.

The CDM program aims to award carbon offset credits to projects that reduce greenhouse gas emissions beyond what would otherwise have occurred, for example wind farms that displace burning of coal for generating power.

The comments follow a recommendation from an influential UN CDM sub-panel Thursday that said the relevant methodology dealing with super-critical coal-fired power plants should be "put on hold" immediately.

That recommendation is likely to be considered by the CDM Executive Board and if adopted could put coal-fired projects under the CDM into doubt.

Super-critical plants burn coal to produce steam at higher temperature and pressure than sub-critical plants, improving thermal efficiency and reducing CO2 emissions compared with less efficient plants.

The UN CDM Methodologies Panel report shows that coal-fired power plants that receive finacing through the CDM "may receive millions of artificial carbon credits under current rules," said CDM Watch.

"CDM Watch and Sierra Club call on the CDM Executive Board to exclude this project type from the CDM at the upcoming climate change conference in Durban," South Africa, it said.

"The study results show unequivocally that coal projects do not belong in the CDM," said Eva Filzmoser of CDM Watch.

"We are now calling on all decision makers to act swiftly and decisively to stop these harmful projects from receiving revenue from the CDM, a mechanism whose aim is to deliver 'clean development,'" she said.

CDM Watch said 45 coal-fired power projects have been approved or are applying for approval under the CDM program, of which 32 are in China and 13 in India.

"Six of these projects are already registered and could generate 89 million carbon credits, worth over Eur600 million [$824 million]," it said.

The CDM Methodologies Panel "again called for the immediate suspension of the coal methodology after it published a report ... that confirms its earlier warnings that under current rules, coal power projects in the CDM are severely over-credited," the group said.

"The CDM Executive Board had ignored the panel's recommendation earlier this summer to suspend the methodology and instead commissioned a new study. The new report more than doubles the Methodologies Panel's prior estimate of the extent of the over-crediting to 51% to 62%," it said.

CO2 CUTS NOT 'ADDITIONAL'

The findings of CDM Watch's report closely match those of a November 3 independent study by the Stockholm Environment Institute that found the coal methodology was "flawed" because, for example, the Indian government had already mandated the use of super-critical coal technology amid persistent coal shortages and rising prices in India.

CDM Watch said both studies show that project developers use "outdated information that conceals the rapid technological shift away from subcritical technology occurring in India and China."

CDM rules state that to qualify under the program and earn credits, emissions reductions must be "additional" to those already taking place.

Aside from questions over the possible over-estimation of emissions reductions achieved by these projects, the SEI study showed "it is highly unlikely that any of the coal power projects are additional due to fuel price pressures and numerous Indian and Chinese government policies that foster or even require super-critical and ultra-super-critical coal design," said CDM Watch.

CDM Watch and US-based environmental group The Sierra Club said the coal methodology should be suspended immediately and that the CDM board should stop registering new coal projects.

They also said that because the methodology revisions recommended by the CDM panel would not be sufficient to address all of the identified flaws, the CDM board "should move to exclude coal projects from the CDM."

The groups also said the EU should ban the use of carbon credits from coal projects from eligibility with the EU Emissions Trading System.

Source- Platts