Yesterday, ABN interviewed the Chair of the Clean Development Mechanism Executive Board, Martin Hession. The interview included a very interesting question, which is very relevant to REDD and whether REDD is to be financed by carbon trading.
If REDD is to be a carbon trading mechanism, the emissions reduced will not be counted in the country where the reductions take place. Instead they will be sold as carbon credits and used to allow pollution to continue elsewhere. Otherwise, the reductions in emissions will be double counted.
In a country like Indonesia, this has serious implications. In 2009, Indonesia’s president, Susilo Bambang Yudhoyono set a target of 26% emissions reductions against business as usual by 2020. With international support the figure would be 41%.
“This target is entirely achievable because most of our emissions come from forest-related issues, such as forest fires and deforestation,” Yudhoyono said. But if REDD in Indonesia generates carbon credits, these will be sold overseas and will therefore not count towards the Indonesian President’s target.
Here is the question to Martin Hession and his answer (although from his answer, he appears not to have understood the question):
ABN: One of the big concerns raised by big emitters like China and Brazil is that they aren’t able to benefit from CDM projects being hosted in their country as you obviously can’t double count these carbon credits, they are having to sell these carbon credits to EU countries, Annex I countries. What is your view on these concerns?
Martin Hession: Well, I think between the buyer and seller there’s always going to be a mutual benefit. Plainly there is investment from the developed world to China, India and Brazil, so that’s a flow of capital which is useful and obviously the developed countries get the benefit because they reduce the costs of doing their emissions reductions. So I would say it’s kind of a mutual relationship. Obviously those countries can talk about improving that, but under the CDM I think it’s fair. I know that China for instance has managed to capture some of the profits from the projects in a tax, which they dedicate to sustainable development and other countries have different policies on how they use the revenues.
Watch the interview here: