A Critical Assessment of the Clean Development Mechanism
Chapter 5: Does the CDM discourage emission reduction targets in advanced developing countries? An analysis of the 'low-hanging fruit' issue
The previous two chapters looked into shortcomings of the CDM that affect its ability to encourage emission reductions in the LDCs, and analysed the potential effects of measures that have been proposed to address these shortcomings. The following two chapters are dedicated to the role of the CDM in those countries in which it has been more successful, that is, the more advanced developing countries. The focus will be on aspects of the CDM that influence its ability to generate positive incentives for generating emission reductions ñ beyond offsetting ñ in these countries. One of the concerns that have surrounded the CDM since its establishment and even until today ñ as can be seen from the quotes above ñ is the fear that engaging in CDM projects would imply selling off developing countriesí cheap emission reduction options (the so-called ëlow-hanging fruití) to industrialized countries, with the result that developing countries would have to invest in more expensive measures to meet their own future reduction targets. While the CDM is a cost-containment mechanism and as such is supposed to target the cheap emission reduction options, the ëlow-hanging fruití focus of the CDM has also been criticized from a developed country perspective, on the grounds that the subsidy granted by the mechanism to very large, low-cost projects is disproportionately large compared to the cost of implementing the emission reductions (Wara, 2008).
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