The Quest for Innovation and Sustainability
Edited by Wilfred Dolfsma, Geert Duysters and Ionara Costa
Chapter 8: Beyond the Emission Market: Kyoto and the Internationalization of Firms from the Waste Industry
Asel Doranova, Geert-Jan Eenhoorn and Ionara Costa INTRODUCTION The Kyoto Protocol is generally recognized for its paramount aim to reduce the global level of greenhouse gas (GHG) emissions and for the global emission market it has created. The market-based approach is a key aspect of the Protocol and follows recent trends from the environmental policy domain to engage the private sector in the achievement of public goals. The Kyoto’s emission market is pivoted on the splitting of the signatory countries into two groups: developing countries with no emission limits; and developed countries, the so-called Annex I countries with bound targets to reduce their GHG emissions. Within the latter, the national emission-reducing targets are allocated to local entities, business firms mainly, according to the level of GHG emissions their activities generate. Three flexibility mechanisms put the Kyoto emission market into motion: the Clean Development Mechanism (CDM), the Joint Implementation (JI), and the Emissions Trading. Together these marketbased mechanisms allow flexibility to countries and business firms in meeting their reduction targets, based on credits of GHG emission reduction ‒ the Certified Emission Reduction (CER). CERs can be generated by CDM and JI projects hosted by respectively developing and transition economies and be used to offset an actor’s own emission liabilities, or negotiated in the global emissions market. In principle, CDM and JI projects have to involve the deployment of technologies leading to the reduction or avoidance of GHG emissions in the host country. Business firms often based on developed economies own the bulk...
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