2. EQUITY IN THE KYOTO PROTOCOL
2.3 The Clean Development Mechanism
118 states from these responsibilities, an analysis of these responsibilities does not offer much in understanding how equity is conceived in the differentiation of rights between developed and developing states.
The analysis of equity in this section will, therefore, focus on the CDM, a mechanism created under the Protocol to ensure that developed state parties meet their emission reduction targets while enhancing developmental capacity in developing states. Established under article 12 of the Kyoto Protocol, CDM gives room for developed and developing states to collaborate on an emission reduction project. An examination of the CDM, therefore, offers an opportunity to understand the Protocol’s approach to equity.
119 providing the funds.21 The amount of emission reduction achieved by such project in the developing state is credited to the developed state sponsoring such project.
This creates a system that facilitates a no-cost or low-cost transfer of finance and technology from industrialized states to developing states.22 In doing this, the mechanism creates a win- win situation where both developed and developing states benefit from such projects. Climate change action is achieved while bringing some development into the host state of such projects.
To be eligible for a CDM project, both the donor and the host states must have ratified the Kyoto Protocol.23 Additionally, the host state must establish a Designated National Authority that evaluates the project’s consistency with the national sustainable development goals and objectives.24 The project will be overseen by an executive board and must conform to the rules and guidelines set by the Conference of the Parties.25 The project in question must result in emission reductions, which are an addition to reductions that would have taken place without the project.26 The mechanism has been defined as ‘innovative’ in its attempt to curb the reduction in emissions globally.27
2.3.1 Africa and the CDM
Having examined the main aim of the CDM, this section analyses how the CDM affects African states and the extent to which it caters for the concern around capacity and responsibility for climate change and what that reveals about the conception of equity in the Kyoto Protocol.
The CDM is a market-based mechanism for emissions trading.28 This implies that the distribution of projects is determined by the size and functionality of a state’s market and its potential for profits.29 This distribution has been to the advantage of states with a good
21 Article 12(2) of the Kyoto Protocol; Nordic Council of Ministers, Joint Implementation as a Measure to Curb Climate Change: Nordic Perspective and Priorities (1995) 8; Ewah Eleri ‘Africa and climate change’ SAEEP Working Paper No. 6 11.
22 Ruth Gordon ‘Climate change and the poorest nations: Further reflections on global inequality’ (2007) 78 University of Colorado Law Review 1611.
23 Rule 31 of the Modalities and Procedures for a Clean Development Mechanism as Defined in Article 12 of the Kyoto Protocol Decision 17/CP.7 FCCC/CP/2001/13/Add.2 (hereinafter Modalities and Procedures for CDM).
24 Rule 29 of the Modalities and Procedures for CDM.
25 Article 12(4) of the Kyoto Protocol.
26 Article 12(5)(c) of the Kyoto Protocol; Rule 30(d) of the Modalities and Procedures for CDM.
27 Charlotte Streck ‘New partnerships in global environmental policy: The Clean Development Mechanism’
(2004) 13(3) Journal of Environment and Development 296.
28 Agarwal (n17 above) 381.
29 Gordon (n22 above) 1609; Lira Benites-Lazaro & Celio Andrade ‘Clean Development Mechanism: Key lessons and challenges in mitigating climate change in mitigating climate change and achieving sustainable development’
in Reference Module in Earth Systems and Environmental Sciences (2019).
120 investment climate and strong institutions capable of supporting joint implementation efforts.30 Developing states with functional economies are disproportionately favoured as sites of CDM projects without regard to other factors such as geographic spread or economic and developmental needs. Unfortunately, most African states lack these features. Projects assigned under the scheme, thus, went to stronger developing states, very few of which were African.31 Furthermore, since African states are only liable for a negligible percentage of global greenhouse gas emissions, it follows that the region presents very few opportunities for emission reduction. This is because, for a CMD project to earn the donor state carbon emission credits, the project must achieve reductions below a certain baseline.32 Since there are few high- emitting industrial activities in the African region, the emission reduced by a project in an average African state may not be enough to meet the baseline.33 States with high volumes of industrial activities, such as China or Brazil, are more ‘lucrative’ since they will earn a donor state more carbon emission reduction credits. This arrangement deprives poorer developing states of the opportunity to benefit from the much-needed low-cost access to sustainable technology, which the CDM provides.
2.3.2 Equity in the Kyoto Protocol
Flowing from the above, it is evident that the Kyoto Protocol, through the CDM, addresses the seeming clash between climate change action and the need for development by creating a mechanism where developed states support developing ones with financial and technology support through the establishment of climate-friendly projects within developing states. On the one hand, this solves the need of developing states for finance and technology while on the other hand, it creates climate credits for developed states and contributes towards their emission reduction targets. This approach emulates distributive justice principles where rights and responsibilities are distributed in line with the different needs and capabilities of the parties.
A project under the CDM is targeted not only to enhance emission reduction, but also to provide a much-needed developmental project to the recipient developing state. While the developed state sponsoring the project takes the climate credits on such project, the host state benefits
30 Martina Jung ‘Host Country Attractiveness for CDM Non-Sink Projects’ (2005) HWWA Discussion Paper No.
312, 4.
31 Gordon (n22 above) 1614.
32 Ibid.
33 Jung (n30 above) 4.
121 from the developmental advantage and the technological transfer provided by such projects.
This way, both sets of objectives are achieved without necessarily jeopardizing one for the other.
The Kyoto Protocol also presents a clear case of restorative justice. It’s unilateral approach to the distribution of climate change responsibilities effectively ensures that only developed states bear the financial and technological cost for addressing climate change. It takes action completely off the hands of developing states and rests them solely with developed states. Even among developed parties, the quantified emission reduction responsibility of each developed state party is matched with its historical emissions.34
As discussed in chapter two, restorative justice emphasises the need for a solution-seeking process that is deliberative and focused on the victim.35 The Kyoto Protocol follows this principle by ensuring that the resolution of the climate change problem does not neglect developing states that are the most at risk from the impacts of climate change. Instead, it ensures that the solutions to climate change are infused with developmental advantages which will benefit these developing states.
The fact that the CDM requires that each host state must have a Designated National Authority, which analyses the consistency of each proposed project with the national sustainable development objectives, ensures that the CDM projects are not mere dumping grounds for outdated technology. Each CDM project is expected to be a result of a deliberative process between the Designated National Authority and the developed state sponsoring the project.
This process helps to ensure that these projects are consistent with each host state’s developmental and environmental objectives while achieving the global climate change ambition.
In conclusion, the Kyoto Protocol, through the CDM, applies both a distributive and a restorative justice conception of equity. It ensures that the differing needs and capabilities of each state party dictates the extent of their rights and responsibilities. It also ensures that the responsibility for climate change action is placed primarily at the feet of those who are historically accountable for climate change. In doing this, the Protocol merges climate change
34 Article 3 and annex B of the Kyoto Protocol.
35 See section 3.3.1 of chapter two.
122 action and the need for development together by ensuring that climate change action also caters for some of the developmental needs of the host states.