New Market Mechanisms: Prerequisites for Implementation

The Durban climate conference decided to establish a new market-based mechanism (NMM) that is to cover broad segments of countries’ economies. This article aims to explore the essential prerequisites for the implementation of an NMM. In addition to a theoretical discussion it considers the cases of China and Mexico. The article finds that the challenges in establishing market mechanisms that cover a broad segment of the economy are formidable and most developing countries have serious capacity constraints. Lead times can be expected to be at least 3–5 years. To move the process forward, it may be useful to consider promoting pilot activities similar to the Activities Implemented Jointly pilot phase that preceded the introduction of the flexible Kyoto mechanisms and the demonstration activities for Reducing Emissions from Avoided Deforestation and Forest Degradation.

The European Union (EU) is advocating strongly for the introduction of new market-based mechanisms (NMM) that should cover whole sectors or “broad segments of the economy”. The Durban climate conference decided to establish such a new mechanism, with the details to be decided at the subsequent conference in Qatar. However, little progress was made over the course of 2012, so the conference in Qatar adopted a new mandate for the elaboration of implementation details by the end of 2013.
The question is, however, which developing countries would actually be able to implement such new mechanisms, a task that would pose substantial challenges in terms of data gathering, setting appropriate sectoral targets and measuring, reporting and verifying emissions and reductions. This paper therefore aims to explore the essential prerequisites for the implementation of new market mechanisms.
As a basis for the analysis, the first chapter will briefly introduce the different types of NMM recently discussed. It will focus on differing design features and notable differences. The second chapter will outline and categorize preconditions to be met nationally in order to implement an NMM. As a tentative third step, the NMM readiness of Mexico and China, two of the countries most often cited in relation to NMM, will be analysed along the factors identified. A conclusion sums up the findings of the previous chapters and considers current and future needs and challenges in New Market Mechanisms.



Copyright: © Lexxion Verlagsgesellschaft mbH
Quelle: Issue 4/2012 (Dezember 2012)
Seiten: 12
Preis inkl. MwSt.: € 41,65
Autor: Wolfgang Sterk
Florian Mersmann

Artikel weiterleiten In den Warenkorb legen Artikel kommentieren


Diese Fachartikel könnten Sie auch interessieren:

Market-based Instruments for Greenhouse Gas Mitigation in Brazil: Experiences and Prospects
© Lexxion Verlagsgesellschaft mbH (12/2012)
Brazil has become an increasingly important participant in the discussion about climate change, combining an active role in climate diplomacy with credible domestic policy efforts. Market-based instruments have featured prominently in its domestic policy landscape, with carbon markets envisioned both at the federal and regional level. Aside from successful participation in the Clean Development Mechanism (CDM) and some progress in the creation of voluntary offset markets, however, the pathway towards a domestic carbon market has so far been fraught by delays and ongoing uncertainty. Still, Brazil can build on proven institutional structures, quantified emissions limitation targets, and new rules on the collection of emissions data and sectoral mitigation plans to establish robust market-based instruments. A carbon market can help leverage its vast mitigation potential to abate greenhouse gas emissions at sufficient scale while limiting the cost of compliance for domestic entities. Given its unique emissions profile, however, Brazil should not focus on becoming a net seller of carbon credits or allowances to foreign entities, but should instead harness the opportunity to create an ambitious, welldesigned market and thereby become a leader on climate change mitigation in Latin America.

A Green Emerging Market: India’s Experiments with Market Based Mechanisms for Climate Mitigation
© Lexxion Verlagsgesellschaft mbH (12/2012)
India is the fourth largest emitter of greenhouse gases in the world. After Copenhagen in 2009, India announced that it will be working to reduce voluntarily the carbon intensity of its emissions by 20–25 % against 2005 levels by the year 2020, while maintaining a growth rate of 8 %. In 2011–2012, it introduced a number of innovative initiatives to help reach that goal. This paper will discuss three of these measures. Two of these schemes are market based initiatives in the field of energy: the first is called “Perform, Achieve and Trade” and is aimed at improved energy efficiency; the second scheme promotes increased use of renewable sources of energy through trade in renewable energy certificates. The third scheme is a pilot market based emissions trading mechanism that seeks to reduce the levels of particulate matter emissions in three leading industrial states in India.

Emissions Trading around the World: Dynamic Progress in Developed and Developing Countries
© Lexxion Verlagsgesellschaft mbH (12/2012)
Drawing on a series of forthcoming case studies developed under a joint project of the Environmental Defense Fund (EDF) and the International Emissions Trading Association (IETA), this article conveys the dynamic bottom-up progress on emissions trading systems (ETS) around the world. The case studies will provide an easily accessible tool that facilitates the analysis of ETS based on examples from existing and developing policies. Each of the 18 case studies provides an overview of the history on climate action within the specified jurisdiction, highlights ongoing challenges and unique features, and describes key ETS elements. The jurisdictions of focus lie within both developed and developing parts of the world, and the set of case studies encompasses multinational-, national-, regional-, state/provincial-, and city-scale jurisdictions. This article summarizes the key design features and differentiating aspects of ETS development in each jurisdiction. While designs vary, each ETS described ultimately belongs to the same category of quantity-based market mechanism.

Financing Renewable Energy Projects in Asia: Barriers and Solutions
© Lexxion Verlagsgesellschaft mbH (7/2010)
With abundant supplies of a range of renewable energy resources, world-leading technology developers and manufacturers and an increasingly favourable regulatory climate in many jurisdictions, Asia has become a focal point for new renewable energy developments and investments.

Transitioning from the CDM to a Clean Development Fund
© Lexxion Verlagsgesellschaft mbH (4/2009)
Parties to the UNFCCC must work at Copenhagen toward establishing sound institutions and instruments that will serve as the foundation of international climate cooperation over the coming decades. One of the major tasks will be to assess the performance to date of the Clean Development Mechanism (CDM). The CDM is an emissions trading offset system that allows developed countries to meet their Kyoto targets by investing in emissions reduction projects in developing countries, where greenhouse gas (GHG) abatement is expected to be cheaper than it is in developed countries.

Name:

Passwort:

 Angemeldet bleiben

Passwort vergessen?

Der ASK Wissenspool
 
Mit Klick auf die jüngste Ausgabe des Content -Partners zeigt sich das gesamte Angebot des Partners
 

Selbst Partner werden?
 
Dann interessiert Sie sicher das ASK win - win Prinzip:
 
ASK stellt kostenlos die Abwicklungs- und Marketingplattform - die Partner stellen den Content.
 
Umsätze werden im Verhältnis 30 zu 70 (70% für den Content Partner) geteilt.
 

Neu in ASK? Dann gleich registrieren und Vorteile nutzen...