The CDM inherits the UN’s suffocating bureaucracy, so smaller projects struggle to gain approval. But more important than what it keeps out is what it lets in. The criterion of “additionality” is supposed to rule out projects that would not be undertaken without CDM payments. Not only is this counterfactual approach utterly unverifiable; it is also an ideal target for gaming.
And then it suggests an approach based on a stabilisation target, a safe global emissions budget, and binding targets for all allocated on the basis of ultimate convergence to equal per capita entitlements as what we should be doing instead (ditto):
…the solution to the CDM’s problems is more carbon trading, not less. It matters little for the climate where or what activities greenhouse gas emissions come from. But it matters enormously for the cost of cutting them. That is why the best solution is a global emissions cap and tradeable national quotas (ultimately based on equal per capita amounts) coupled with a scientific mechanism for measuring national emissions.
Bravo, FT. Expect my subscription renewal forthwith.