Outcomes of CDM Executive Board Meeting

Last week the Clean Development Mechanism (CDM) Executive Board (EB) met in Bonn. A number of interesting decisions were taken that I highlight below.

  1. The EB is continuing its crackdown of shoddy work of designated operational entities (DOEs). TUEV SUED was immediately suspended. The accreditation panel found that TUEV SUED had continued to give positive validations for projects which were flagged over corrections. This was despite the fact that TUEV SUED had concerns about additionality. The other reason given for the suspension was due to the lack of technical experience of TUEV SUED employees. TUEV SUED has six months to correct its failures. Korea Energy Management Corporation (KEMCO) also received a partial suspension.

  2. The EB has asked for public comments by 23 April 2010 on an appeals procedure for stakeholders of CDM projects. International Rivers plans to take advantage of this opportunity with our partners.

  3. The EB issued rules for assessing how changes in tariffs affect the internal rate of return for projects. In December, a number of wind projects in China were rejected because of concerns that the tariffs were lowered to make the projects seem less economically viable (i.e. so that they would seem additional). In a positive development, six hydro projects were placed under review, asking the DOE to reassess changes in tariffs. It is clear that hydro projects are not additional, so the wind ruling should also apply to hydro.