New Report On The Clean Development Mechanism Tackles Large-Scale Industrial Projects

(30 October 2002 — New York)  Environmental Defense today issued a report that explores the potential for the Clean Development Mechanism (CDM) to advance the flow of new, clean technologies to developing countries.  The CDM is one of the trading tools available through the Kyoto Protocol, the international treaty to reduce greenhouse gas emissions.

The report, Can the CDM Spur the Diffusion of New Technologies? A Case Study from the Aluminum Sector, walks through a real case study of an aluminum smelter project in South Africa, with data provided by  Aluminium Pechiney.  The reader is guided through various decision points encountered in designing a large-scale project that satisfies three main concerns: promoting sustainable development, implementing state-of-the-art technology that reduces greenhouse gas emissions, and minimizing CDM transaction costs.  Should the decision be taken to build this smelter in South Africa, further study would be required to assess the practical viability of an actual CDM submission.

The report illustrates one method of quantifying emissions reductions from a “business-as-usual” baseline that can add incentives to accelerate the deployment of cutting-edge technologies in the developing world.  The method, known as performance benchmarking, compares a project’s carbon efficiency to that of the existing emissions standards within the industry.

The report can be obtained today at www.environmentaldefense.org, the Environmental Defense web site, and, as of November 1, it will be available at www.pca-online.org, the new web site of the Partnership for Climate Action (PCA).

Environmental Defense and Pechiney are members of the Partnership for Climate Action (PCA), a group of business and environmental leaders dedicated to climate protection.  Other PCA members are Alcan, BP, DuPont, Entergy, Ontario Power Generation, Shell International and Suncor Energy. Environmental Defense and Pechiney consulted with the PCA while writing this paper in order to further the PCA’s goals of employing market-mechanisms to reduce greenhouse gas emissions.