US Congress's Auditor (Politely) Blasts the CDM

International Rivers' critiques of the Clean Development Mechanism just got some influential support from the Government Accountability Office, the “audit, evaluation and investigative arm of Congress.”

In a detailed report released on November 18 and covered by Reuters yesterday, the GAO concludes that:

“Congress may wish to consider the following lessons from the CDM: (1) that it may be possible to achieve the CDM's sustainable development goals and emissions cuts in developing countries more directly and cost-effectively through a means other than the existing mechanism; (2) that the use of carbon offsets in a cap-and-trade system can undermine the system's integrity, given that it is not possible to ensure that every credit represents a real, measurable, and long-term reduction in emissions; and (3) that while proposed reforms may significantly improve the CDM's effectiveness, carbon offsets involve fundamental tradeoffs and may not be a reliable long-term approach to climate change mitigation.”

While GAO’s auditor/bureaucrat-speak is a little milder than International Rivers’ usual tone, the overall message is exactly what we’ve saying for many years – and what our climate team is saying right now to the UN negotiators currently meeting in Poland.

The GAO report is extremely timely given that Congress is expected to restart discussions on federal climate legislation early next year – and many leading lawmakers strongly support allowing CDM credits into the US to help meet (or, more accurately, cheat) the proposed emissions cap.

The GAO’s findings are also timely given the ongoing negotiations in Poland, where some diplomats - and many hundreds of traders and other corporate lobbyists - are pushing for the CDM to play a major role in whatever global deal succeeds the first phase of Kyoto. And (logically, if not politically, speaking) the report should also influence on-going EU negotiations over how many CDM credits should be allowed to contaminate the post-2012 third phase of the EU’s Emissions Trading System (ETS). (The GAO is highly critical of the failed first phase of the ETS).

As we’ve said before:

“If we want to sustain public support for effective global action on climate change, we cannot risk one of its central planks being a program that is so fundamentally flawed. In the short term the CDM must be radically reformed; in the longer term it must be replaced.”


“Industrialized countries will need to meet their obligations for financial transfers in a way that is independent from and additional to their emission reduction obligations. Several non-offsetting funding mechanisms to help developing countries reduce emissions and adapt to climate change have recently been proposed for the post-2012 regime, including by the G-77, Norway, and Switzerland. Carefully constructed fund-based approaches must replace offsetting in any post- 2012 international agreement that stands a chance of pulling the planet back from climate disaster.”

BTW, Joe Romm just did an another excellent posting on CDM "rip-offsets" on Climate Progress.