Russia Committed To Emission Reducing Treaty But Used Deceptive Practices To Increase Them

Lack of oversight meant some Russian projects either didn’t decrease emissions or were already planned. CREDIT: AP PHOTO/IVAN SEKRETAREV
Lack of oversight meant some Russian projects either didn’t decrease emissions or were already planned. CREDIT: AP PHOTO/IVAN SEKRETAREV

A plan to decrease greenhouse gas emissions backfired after what some say was “criminal” activity in Russia and Ukraine flooded the carbon credit market, resulting in 600 million metric tons of emissions.

A new study, published Monday in Nature, found that 80 percent of the projects certified under the United Nations Framework Convention on Climate Change’s Joint Implementation (JI) scheme, part of the Kyoto Protocol, did not actually reduce emissions. Projects in many cases would have happened anyway — with or without Kyoto — and some were even fake, Vladyslav Zhezherin, one of the report’s authors, told the Guardian.

The Kyoto Protocol was signed in 1997 and committed countries to emissions cuts. Under the program, countries that are party to the protocol can issue emissions reduction credits for projects that reduce carbon emissions or increase carbon sinks “additional to what would otherwise have occurred.”

In one example, operators of three chemical plants actually increased waste gas emissions, only to turn around and earn credits by reducing them again. “If you produced more greenhouse gases only to destroy them and generate more carbon credits, you would essentially be damaging the climate for profit,” said Lambert Schneider, a co-author of the study, which was put out by the Stockholm Environment Institute (SEI), an international nonprofit research organization.


But the system was broken from the beginning, said Anja Kollmuss, an author of the study and an an associate at SEI. In simple terms, countries set emissions targets and then certified credits from projects — like wind farms or reforesting — that reduced emissions. The countries could buy the credits themselves (retire them) or they could be sold them to other countries or companies that needed to meet reduction goals.

But there were two big problems with the system, Kollmuss said. For one, there was no international oversight for certifying projects. Second, and perhaps more importantly, Russia and Ukraine had overall emissions targets that were greater than their emissions — resulting in billions of excess, valueless credits.

“They received literally billions of spare Kyoto Protocol allowances,” Kollmuss told ThinkProgress. The excess allowances led to projects being certified that would have happened anyway — such as projects that were started in 2002 and certified in 2012, Kollmuss said. “Not all the projects were bad, just the overwhelming majority of them,” she said.

As with any market, when supply overwhelms demand, prices collapse. Suddenly, credits went from €13 (about $14.80) to less than €.5 (about 57 cents), which hurt projects that had been financed on the assumption that the market would hold.

The study’s authors hope the analysis will help inform negotiators during the UNFCC conference in Paris in December.

Carbon credit markets can work, Kollmuss said. (In fact, nine New England and Mid-Atlantic states have an emissions credit program that has reduced emissions and lowered electricity bills.)


“Do we know how to design a market so it has integrity? Yes, we do,” Kollmuss said. But it comes down to political willingness, and will only work if all party countries have ambitious targets; the targets are calculated in multi-year terms; there are clear accounting rules; and there is international oversight, she said.

“What we know of this future climate treaty if it is passed in Paris, it is much more of a bottom-up treaty. Countries can decide themselves what they are going to do and how they are going to do it,” Kollmuss said.