Skip to main content

Finatics Lecture Series - Carbon Markets and Clean Development Mechanism

Speaker Details: Ms. Shivani Datta, Manager, Climate Change & Sustainability Services from Ernst & Young Pvt. Ltd.

Ms. Shivani Datta presided over the talk about CARBON MARKETS and CDM among an eager and enthusiastic student crowd. She started off her talk by reiterating the present Global concern about over-consumption of resources, contribution by industry on climate change, how the roadmap was laid particularly in the last two decades to tackle Climate Change internationally through various summits organized by UN starting off with the RIO Earth Summit and birth of UNFCCC in 1992 and how the KYOTO Protocol got its acceptance worldwide in 1997 till the end of its first commitment period in 2012. The green house gases and its global warming potential over the last century was also enumerated thereby giving a brief summary of the articles to be followed and the roles of both the developed and developing countries according to Kyoto Protocol. This is where the speaker started highlighting what CDM is, its features, specificity and the challenges faced by it.
Clean Development Mechanism which is one of the mechanisms under the Kyoto Protocol allows a country with an emission reduction commitment and to implement an emission reduction project in developing countries. Such projects allow a company to earn Certified Emission Reduction (CER) credits which is saleable in future thereby meeting the Kyoto targets.
The twin purposes of CDM are
1. To assist developing country parties in achieving sustainable development.
2. To assist developed country parties in achieving compliance with part of their quantified emission limitation and reduction commitments under Article 3.
The features of CDM were broadly CERs, Market driven, Eligibility timeline, sustainable development and GHG reduction. Another concept of Additionality was introduced which is a fundamental issue in the carbon offset market. In order to determine additionality a project should have been started after January 2000 with due consideration of CDM at the start of the project. Several questions were raised doubting whether ‘financial additionality’ exists, how it would benefit other projects and how it would help in alleviating the barriers.



The various steps involved in Additionality are
 Identification of alternatives to the project activity
 Investment analysis
 Barriers analysis
 Common practice analysis
An investment analysis is basically done considering the factors like project returns with CDM revenue and without CDM revenue, Internal Rate of Return Hurdle rate and the CDM cash flow after which the CDM Project Cycle is implemented. According to IPCC’s 4th assessment report (2007), the Global Sectoral Emissions constitutes for about 45 % by Energy Supply and Industrial emissions. A few generic CDM Possibilities are in Energy Efficient Projects, Infrastructure Projects, Renewable energy & Fuel Switch Projects, Plantation Projects. According to current statistics there are 2950 projects which are registered for CDM implementation till date and more than 5600 projects are in the pipeline.
In the final part of the talk the speaker highlighted about CER Trading and its value accretion curve and finally wound up with the challenges faced by CDM like uncertainty, evolving procedures at each Executive board meeting, stricter validation, and unclear framework after 2012 and the pricing of CER.
Finally the curtains came down with her last words quoted by Mr. Paul Kelly that “Carbon is the currency of a new world order”.

Contributed by:
Arvind Rajendran
PR & Media Cell
MBA 1st Year, IIT Kanpur

Comments

Popular posts from this blog

The Dawn of A New Beginning - MBA Batch 2017-19

“Opportunities multiply as they are seized.” -Sun Tzu




‘I am an IITian’, even after two months here at IIT Kanpur this one line still fills our heart with excitement. Each one among the 54 students here who have started the journey into the MBA programme of IIT Kanpur, batch of 2017-19, feels that pride and with that equally realizes the responsibility it carries.
We started our journey here on 20th July. Meeting our batch mates for the first time still feels thrilling. Though we knew each other through the whatsapp/facebook group that was created by our seniors to make our registration process as smooth as possible. We were given several assignments before the registration to give us an inkling of the idea of how life at IIT Kanpur is going to be. Assignments were planned in a way such that we get a hands-on experience on case studies, presentations, group activities and article reading. We began burning the midnight oil as a precursor to actually doing it, and how! These assignments u…

Tips from Top - "Various dimensions of leadership." Mr Amit Kasliwal, India Head - Corporate Sales, Ford India.

Leadership is one of the most desired traits for success in life and MBA students at IIT Kanpur were fortunate to get a fresh perspective on the topic from the top echelon of corporate world, when Mr Amit Kasliwal, India head of corporate sales at Ford India visited the campus to interact with the students.

Sir described leadership as the zeal to identify and solve problems. Citing an example, sir said that India has a myriad of problems and out of those; transportation was one of the major issues. Ford is dedicated to solve this problem. Talking specifically about the corporate sales department, he told that by selling cars to taxi operators, they created entrepreneurs, thereby solving the problem of job creation at that level.   
Further describing leadership, sir claimed that a leader must have a long term view, and should be enthusiastic about other’s agenda, thereby creating opportunities and ‘win-win’ situations. According to sir, and rightly so, sustainable leadership can be …

International Exposure: Japan, Utkarsh Maurya, MBA 2nd Year

JENESYS 2016 from 27th Feb to 7 March 2017. About JENESYS 2016 The Ministry of Foreign Affairs of Japan promotes people-to-people exchanges between Japan and the various nations of the Asia-Pacific, North America, Europe, Latin America, and the Caribbean regions. The Asian and Oceanian regional component of this exchange program is called “JENESYS 2016”- Japan-East Asia Network of Exchange for Students and Youths. Around 250 students and working professionals were invited for the 7th batch of JENESYS 2016 (Theme: Economics) from 12 countries: India, Indonesia, Cambodia, Philippines, Singapore, Timor-Leste, Thailand, Laos, Malaysia, Myanmar, Brunei and Vietnam. The objective is to promote mutual trust and understanding among the people of Japan and participating countries, and regions, to build a basis for future friendship and cooperation. The Indian Delegation 23 youths were selected from India; out of them 15 were students and the rest were working professionals. From IIT Kanpur, 3 stud…