A United Nations carbon market that allowed excess production of emission credits is probably undermining European Union efforts to curb greenhouse gases, according to the Stockholm Environment Institute.
About 75 percent of the emission-reduction credits issued under the UN’s Joint Implementation program through March have questionable environmental value, said Anja Kollmuss, co-author of the institute’s study. Ukraine and Russia produced 90 percent of the tradable JI credits, which are provided to companies and countries when they invest in carbon-cutting projects elsewhere.
The use of JI to offset emissions may have enabled global greenhouse gas output to be about 600 million metric tons higher than if countries met their targets domestically, the institute said. JI credits used in the EU’s carbon market may have weakened the bloc’s emissions reduction target by about 400 million tons of carbon dioxide equivalent.
“Countries need to have strict targets if they want to participate in international carbon trading,” Kollmuss said by phone Aug. 19. “Otherwise there is little incentive to ensure quality.”
Four Russian plants produced more waste-industrial gas after becoming eligible to claim credits for eliminating it, according to an article on the study published Monday in the journal Nature Climate Change. Waste production at one of the Russian factories jumped to 17 percent of chemical output from 2 percent historically, according to the study.
“The research is saddling the failures of the EU ETS onto someone else,” Oleg Shamanov, Russia’s climate negotiator, said by phone on Aug. 21. Russia’s credits were processed and verified according to the program’s rules, he said.
About 97 percent of JI credits are approved by nations, rather than a UN supervisory committee.
“This study focuses on that part of JI that is not subject to international oversight, but is instead left up to the individual countries to administer and ensure integrity,” Konrad Raeschke-Kessler, vice-chairman of the Joint Implementation Supervisory Committee, said in an e-mailed statement Monday. The JISC, an international body that oversees projects registered under a separate track of JI, has recommended that the mechanism be run under a single track with international oversight, he said.
The study’s findings show that tougher rules are needed if the UN and countries allow such crediting and trading under a post-2020 climate agreement being negotiated through December, Kollmuss said. About 872 million emission credits have been issued under JI. One credit offsets a ton of carbon-dioxide equivalent.
“If there is no political will to do it better, we will end up with credits that don’t reflect actual emission reductions,” Kollmuss said.
A glut of EU carbon allowances has driven their price down about 63 percent since the end of 2007 on the ICE Futures Europe exchange in London. UN JI credits for delivery in December 2014 traded at 3 euro cents a ton on ICE when the contract expired, compared with a record 8.09 euros in November 2011.