Little Brother’s Lessons

Joint Implementation (JI) is the much neglected little brother of the CDM. Yet JI needs careful watching, not just because hundreds of millions of credits have been issued under JI that basically launder hot air and have zero environmental integrity. But also, because JI shows us what we could face with new market mechanisms, if we do not insist on stringent international rules and oversight.

Here in Doha, Parties are discussing how to reform the JI to make it fit for post 2012. ECO welcomes the suggestion of eliminating Track 1, under which host countries can unilaterally approve projects and issue credits without any international oversight. 95% of all JI credits have been issued under track 1, many of them with blatantly no environmental integrity.

Let’s look at Ukraine, the biggest supplier of JI credits with 69 projects registered under track 1. Sixty of these projects were audited by one single auditing company, paid for by the project developer. Normally such an audit takes many months, but some of the projects were miraculously audited in as little as 7 days. That hardly inspires confidence… Many of these projects requested registration only in the last couple of years but receive so called “early credits,” for emission reductions achieved before the Kyoto Protocol started, some receiving credits going as far back as 2002. These projects hardly needed application to JI rules, since they were implemented long before the mechanism started functioning.

This is not to single out Ukraine. It is just to point out what happens when countries can unilaterally issue credits which can then be used for compliance under a global regime. Short-term self-interest trumps long- term climate security. Dear Delegates, please remember this before you enthusiastically endorse an anarchy of approaches and standards under the LCA’s Framework for Various Approaches. The UNFCCC needs to lay out common rules for mechanisms to ensure integrity. We now know from the JI that approval at national level without UNFCCC oversight simply doesn’t deliver.

Unfortunately, the suggested new rules for one unified JI track are insufficient to ensure JI’s climate integrity. Environmental integrity criteria have to be strengthened (i.e. additionality and baseline rules). Non-additional JI projects undermine mitigation goals, especially when they are implemented in countries with a large AAU surplus. Therefore it is vital that only countries that have an ambitious reduction commitment should be able to host JI projects.

The window of opportunity to prevent catastrophic climate change is rapidly closing. We cannot afford any distracting market mechanisms that do not deliver new and additional emission reductions.