Policy Instruments and Market Mechanisms
Chapter 1: Protection of the atmosphere – CDM and REDD+
Agenda 21 did not specifically refer to climate change, other than to acknowledge ‘the 1992 United Nations Framework Convention on Climate Change and other international, including regional, instruments’ (UN 1993: 76). While the need for a convention to address climate change was acknowledged at Rio, the UNFCCC was negotiated largely outside UNCED. The primary objective of UNFCCC is to ‘prevent dangerous anthropogenic interference with the climate system’ (UNFCCC 1992: 9). It entered into force in 1994, and was principally determined by the need to develop a technical solution to climate change, as well as the market ideology of neo-liberalism, which led to the creation of the ‘flexible mechanisms’ of the 1997 KP: the CDM, joint implementation (JI) and International Emissions Trading (IET). The first (and only) supra-national emissions trading scheme (ETS) was established in 2005. The first phase of the ETS until 2007 was based on reducing emissions through a focus on internal EU sources in the power and heat sectors, oil refineries, etc. Starting in 2008, ETS participants were also able to purchase carbon credits from JI and CDM projects (Bäckstrand and Lövbrand 2007: 130). This linkage allowed for the ‘offsetting’ of emissions via the creation of investment projects in developing countries, which could then sell their ‘carbon credits’ into the compliance-based market established under KP, and be bought by greenhouse gas (GHG) emitting industries within the EU (Cadman 2013b: 1–2).