Joint implementation (JI) is one of three flexibility mechanisms set out in the Kyoto Protocol to help countries with binding greenhouse gas emissions targets (the Annex I countries) meet their treaty obligations. [1] Under Article 6, any Annex I country can invest in a project to reduce greenhouse gas emissions in any other Annex I country (referred to as a "Joint Implementation Project") as an alternative to reducing emissions domestically. In this way countries can lower the costs of complying with their Kyoto targets by investing in projects where reducing emissions may be cheaper and applying the resulting Emission Reduction Units (ERUs) towards their commitment goal.
A JI project might involve, for example, replacing a coal-fired power plant with a more efficient combined heat and power plant. Most JI projects are expected to take place in the economies in transition (the EIT Parties) noted in Annex B of the Kyoto Protocol. [2] Currently Russia and Ukraine are slated to host the greatest number of JI projects. [3]
Unlike the case of the Clean Development Mechanism, the JI has caused less concern of spurious emission reductions, as the JI project, in contrast to the CDM project, takes place in a country which has a commitment to reduce emissions under the Kyoto Protocol.
The process of receiving credit for JI projects is somewhat complex. Emission reduction projects are awarded credits called Emission Reduction Units (ERUs), which represents an emission reduction equivalent to one tonne of CO2 equivalent. The ERUs come from the host country's pool of assigned emissions credits, known as Assigned Amount Units, or AAUs. Each Annex I party has a predetermined amount of AAUs, calculated on the basis of its 1990 greenhouse gas emission levels. [4] By requiring JI credits to come from a host country's pool of AAUs, the Kyoto Protocol ensures that the total amount of emissions credits among Annex I parties does not change for the duration of the Kyoto Protocol's first commitment period. [5]
The formal crediting period for JI was aligned with the first commitment period of the Kyoto Protocol, and did not start until January 2008 (Carbon Trust, 2009, p. 20). [6] In November 2008, only 22 JI projects had been officially approved and registered. By 2012, it is expected that the total number of ERUs generated by JI will be around 300 million. This estimate is based on values taken from project plans, and makes no adjustment to account for delivery in practice.
Russia accounts for about two-thirds of these projected savings, with the remainder divided up roughly equally between Ukraine and the EU's New Member States. Emission savings include cuts in methane, HFC, and N2O emissions.
In December 2012, ERU prices crashed to a low of 15c before recovering to 23c after news that EU’s Climate Change Committee was to vote on a ban of ERUs from countries that have not signed up to a second commitment period under the Kyoto Protocol. [7] In January 2013, Bloomberg reported that Emission Reduction Unit prices declined 89 percent in the 2012 year. [8]
The Third Period ( Phase three ) of the EU - Ts is expected to start by the end of 2012 The future of the JI is expected to be decided by the committee of the UNFFCC.
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The Kyoto Protocol is an international treaty which extends the 1992 United Nations Framework Convention on Climate Change (UNFCCC) that commits state parties to reduce greenhouse gas emissions, based on the scientific consensus that (part one) global warming is occurring and (part two) that human-made CO2 emissions are driving it. The Kyoto Protocol was adopted in Kyoto, Japan, on 11 December 1997 and entered into force on 16 February 2005. There are currently 192 parties (Canada withdrew from the protocol, effective December 2012) to the Protocol.
Emissions trading is a market-based approach to controlling pollution by providing economic incentives for reducing the emissions of pollutants.
Environmental finance is a field within finance that employs market-based environmental policy instruments to improve the ecological impact of investment strategies. The primary objective of environmental finance is to regress the negative impacts of climate change through pricing and trading schemes. The field of environmental finance was established in response to the poor management of economic crises by government bodies globally. Environmental finance aims to reallocate a businesses resources to improve the sustainability of investments whilst also retaining profit margins.
A carbon credit is a generic term for any tradable certificate or permit representing the right to emit one tonne of carbon dioxide or the equivalent amount of a different greenhouse gas (tCO2e).
The Clean Development Mechanism (CDM) is one of the Flexible Mechanisms defined in the Kyoto Protocol that provides for emissions reduction projects which generate Certified Emission Reduction units (CERs) which may be traded in emissions trading schemes. The market crashed in 2012 when the value of credits collapsed and thousands of projects were left with unclaimed credits. The struggle about what to do with the old credits sank the 2019 COP 25 in Madrid.
The European Union Emissions Trading System (EU ETS), was the first large greenhouse gas emissions trading scheme in the world, and remains the biggest. It was launched in 2005 to fight global warming and is a major pillar of EU energy policy. As of 2013, the EU ETS covers more than 11,000 factories, power stations, and other installations with a net heat excess of 20 MW in 31 countries—all 27 EU member states plus Iceland, Norway, Liechtenstein and United Kingdom. In 2008, the installations regulated by the EU ETS were collectively responsible for close to half of the EU's anthropogenic emissions of CO2 and 40% of its total greenhouse gas emissions. By 2020 the EU hopes to cut greenhouse gas emissions by 20% compared with 1990 and to increase energy efficiency by 20%. A 2020 study estimated that the EU ETS had reduced CO2 emissions by more than 1 billion tons between 2008 and 2016 or 3.8% of total EU-wide emissions.
The emission reduction unit (ERU) is an emissions unit issued under a Joint Implementation project in terms of the Kyoto Protocol. An ERU represents a reduction of greenhouse gases under the Joint Implementation mechanism, where it represents one tonne of CO
2 equivalent reduced.
Flexible mechanisms, also sometimes known as Flexibility Mechanisms or Kyoto Mechanisms, refers to Emissions Trading, the Clean Development Mechanism and Joint Implementation. These are mechanisms defined under the Kyoto Protocol intended to lower the overall costs of achieving its emissions targets. These mechanisms enable Parties to achieve emission reductions or to remove carbon from the atmosphere cost-effectively in other countries. While the cost of limiting emissions varies considerably from region to region, the benefit for the atmosphere is in principle the same, wherever the action is taken.
Carbon finance is a branch of environmental finance that covers financial tools such as carbon emission trading to reduce the impact of greenhouse gases (GHG) on the environment by giving carbon emissions a price.
Greenhouse gas inventories are emission inventories of greenhouse gas emissions that are developed for a variety of reasons. Scientists use inventories of natural and anthropogenic (human-caused) emissions as tools when developing atmospheric models. Policy makers use inventories to develop strategies and policies for emissions reductions and to track the progress of those policies. Regulatory agencies and corporations also rely on inventories to establish compliance records with allowable emission rates. Businesses, the public, and other interest groups use inventories to better understand the sources and trends in emissions.
A carbon price — the method widely agreed to be the most efficient way for nations to reduce global warming emissions — is a cost applied to carbon pollution to encourage polluters to reduce the amount of greenhouse gases they emit into the atmosphere: it usually takes the form either of a carbon tax or a requirement to purchase permits to emit, generally known as carbon emissions trading, but also called "allowances".
"Supplementarity", also referred to as "the supplementary principle", is one of the main principles of the Kyoto Protocol. The concept is that internal abatement of emissions should take precedence before external participation in flexible mechanisms. These mechanisms include emissions trading, Clean Development Mechanism (CDM), and Joint Implementation (JI).
Certified Emission Reductions (CERs) are a type of emissions unit issued by the Clean Development Mechanism (CDM) Executive Board for emission reductions achieved by CDM projects and verified by a DOE under the rules of the Kyoto Protocol.
An Assigned Amount Unit (AAU) is a tradable 'Kyoto unit' or 'carbon credit' representing an allowance to emit greenhouse gases comprising one metric tonne of carbon dioxide equivalents calculated using their Global Warming Potential. Assigned Amount Units are issued up to the level of initial "assigned amount" of an Annex 1 Party to the Kyoto Protocol.
The Intergovernmental Panel on Climate Change (IPCC) with the United Nations Framework Convention on Climate Change (UNFCCC) use tens of acronyms and initialisms in documents relating to climate change policy.
Hot air in economics refers to the Assigned Amount Units (AAU) credits given for the reduction of Green House Gas (GHG) emissions among the former Soviet Bloc countries since 1990.
This article is about the Kyoto Protocol and government action in relation to that treaty.
A Removal Unit (RMU) is a tradable carbon credit or 'Kyoto unit' representing an allowance to emit one metric tonne of greenhouse gases absorbed by a removal or Carbon sink activity in an Annex I country.
The United Nations Climate Change Conferences are yearly conferences held in the framework of the United Nations Framework Convention on Climate Change (UNFCCC). They serve as the formal meeting of the UNFCCC Parties to assess progress in dealing with climate change, and beginning in the mid-1990s, to negotiate the Kyoto Protocol to establish legally binding obligations for developed countries to reduce their greenhouse gas emissions. From 2005 the Conferences have also served as the "Conference of the Parties Serving as the Meeting of Parties to the Kyoto Protocol" (CMP); also parties to the Convention that are not parties to the Protocol can participate in Protocol-related meetings as observers. From 2011 the meetings have also been used to negotiate the Paris Agreement as part of the Durban platform activities until its conclusion in 2015, which created a general path towards climate action.
