The Clean Development Mechanism (CDM) is supposed to catalyze climate-friendly projects in low-income countries by allowing developers to generate revenue by selling “carbon credits” or “offsets.” The offset buyers – industrialized country companies and governments – use the credits to show compliance with Kyoto Protocol-mandated emissions reductions. Because of the CDM’s structural flaws and cheating by project developers, billions of dollars worth of credits are being sold by projects that never needed assistance from the CDM to be built. In the short-term the CDM must be radically improved; beyond 2012 its goal of providing finance for clean development in developing countries should be met through fund-based rather than offsets-based approaches.
Download the factsheet to learn more about the various problems with the CDM, the types of projects in the CDM pipeline, and key examples of problematic CDM dam projects.