Outsourcing Emissions: Clean Development Mechanism (CDM) as Ecological Modernisation - Implementing Environmental and Resource Management - page 267

the targets transterritorially, primarily to attain these targets 'cost-effectively'. As
an effect, it is mainly through these mechanisms that the climate change regime
operationalises the functional requirements of mitigation in a major way. These
mechanisms constitute what has been referred to as the carbon market
(MacKenzie 2008) and has evolved to be the key tool for reducing emissions
worldwide with transactions worth 30 billion USD in 2006.
These instruments, called the Flexible Mechanisms, aim at reducing GHG
emissions and are defined on the basis of the geographical location of the parties.
Through these instruments the parties engage in collaborative actions resulting in
emission reduction as defined by the scientific and policy norms of the Protocol.
By fusing the scientific understanding that the GHG emissions, or the reduction of
emissions anywhere on earth, affect the atmosphere uniformly with the economic
rationale of differential operational costs across the different parts of the globe, the
climate change regime constructed a tradable commodity in emission reductions
so that the different actors in the regime could transact particular values of emis-
sion 'currencies' across the market. These units, over the 2008-2012-commitment
period, expressed as levels of allowed emissions, or 'assigned amounts' are calcu-
lated in terms of tonnes of CO 2 -equivalent emissions.
Among the flexible mechanisms, the Emissions Trading (ET) is an instrument,
used between the parties with commitments to accepted targets, for limiting emis-
sions over the said commitment period. Through ET, the Protocol permits those
countries with emission units to spare to sell this excess capacity to countries that
have exceeded their targets. The Joint Implementation (JI) is a project-based
mechanism directly linked to the carbon market that enables industrialized coun-
tries to carry out joint implementation projects with other developed countries.
The JI is based on discrete emission reduction units that could be credited to an
investor country for reduction projects realised in a host country based on actual,
project-based avoidance, reduction, or sequestration of GHGs. Third among the
flexible mechanisms - the CDM - forms a transterritorial instrument between the
developed and the developing countries. Like JI, CDM is a project-based mecha-
nism and involves investment in projects that reduce emissions in developing
countries. The CDM is intended to make the GHG abatement process economi-
cally more feasible for developed countries, while simultaneously assisting devel-
oping countries to set a sustainable development trajectory through investments
and technology transfer. With the emission targets for the first commitment period
(2008-2012) set and different institutional and operational mechanisms in place,
large number of CDM projects 4 have already begun to generate Certified Emission
Reductions (CERs) - the exchange unit of CDM projects as per the Protocol - and
CERs are being transferred across the territories.

4

As of on December 12, 2008, there are 1261 registered CDM projects across the different
developing countries. Among them, India has the largest number with 375 projects, fol-
lowed by China and Brazil with 323 and 146 projects respectively. Among the investor
parties, UK and Northern Ireland invested in 475 projects followed by Switzerland with
350 projects. Scale wise, the large projects are only marginally higher (with 54.64%)
than the smaller projects though the CER potential is far higher with the large projects.