I say, it’s lucky people who want to save the planet do it for the love of it:
National Post: The Kyoto Protocol’s Clean Development Mechanism (CDM) has helped funnel almost $400-billion into emission-cutting projects in developing countries by allowing investors to earn carbon credits they can sell to companies and governments of richer nations that use them to meet emission targets.
I imagine they love $400 billion too.
This was just one branch of the great green-industrial-machine. (And yet skeptics are winning, she says wickedly, with hardly any money).
But those halcyon days are gone for the CDM — what was $30 per ton, is now 30c.
From 2003, developers flocked to register projects such as destroying heat-trapping waste gasses at Chinese chemical plants or installing hydroelectric power stations in Brazil, and made huge profits by selling the resulting carbon credits for up to $30.40 a tonne in 2008.
But interest has waned while countries wrangled over setting new emission goals under the United Nation’s Framework Convention on Climate Change (UNFCCC), hammering credit prices down to unprofitable levels below $0.30.
There’s a tiny $200 million or so left ticking over in the accounts:
The latest UN financial statements show the CDM has operating cash of $148-million, on top of a separate reserve of $45-million, meaning the system’s administrators could continue at current levels almost until the end of the decade.
At its peak the UN CDM Fund employed 160 people to register and issue credits.
The CDM raises funds by charging fees to developers for registering projects and issuing credits, a relatively unique mechanism that helped it grow from a handful of staff in 2003 to more than 160 in 2013 as the number of projects mounted.
It’s all come undone so quickly.
In true bureaucratic style now that projects have fallen by 90%, staff numbers have slipped from 160 to 150.
Its accounts show almost half of the current annual budget of $32.9-million is to pay staff, which still number around 150 despite a massive drop-off in new projects seeking registration.
Previously it took 1.6 full time employees to approve and register one project per month. Now with productivity improvements each case only needs a full time staff of … 50.
UN data shows just three projects a month were registered on average this year, against 268 a month at the peak of activity in 2012. This means a staff of 10-20 people would be sufficient, said Axel Michaelowa, a University of Zurich climate policy academic and founding partner of consultancy Perspectives.
Hmm Jo thinks, but since CDM’s were by definition, pointless (because they didn’t change the weather), there is no net productivity difference whether they occur or not. Hence the total productivity of the CDM Fund has not changed. But it’s more efficient now that it has ten less staff.Make no mistake — the money has left the room.
But the climate puddle will drip on nicely anyhow:
Developed countries have agreed to mobilise $100 billion a year by 2020 to poorer nations, but the Green Climate Fund launched to help meet that goal had received donations of just $34 million by the end of 2013.
(Those dregs would fund skeptics to 2050.)
There is a still a long way to go. The promise of a $100-billion-dollar-cash-cow with no connection to reality is a Phantom Vested Interest just the same. It still has pulling power. The question is not so much whether we need to stop the UN CDM fund, but what we do with the entire UN.
Full story National Post.