The Hindu Business Line : India leads in CDM project rejections

New Delhi, Sept. 5 When it comes to carbon trading through the UN’s clean development mechanism (CDM), India does not just lead in the number of projects registered, it also has the maximum number of rejections – i.e., those projects that approached the UNFCCC for registration but were not approved.

UNFCCC, the United Nations Framework Convention on Climate Change, is responsible for processing the CDM proposals under the Kyoto Protocol.

Rejected ones

Out of 26 rejected projects till date, 14 projects are Indian. They are two projects of Bajaj Auto, Radhanagari hydel project, Karnataka-based Sheshadri Iyer mini hydel project, Jaiprakash Associates’s project to increase the additive blend in cement production, Sterlite Industries’s project to generate power from recovered waste heat, Lafarge India’s blended cement project, Vikram Cement’s effort to improve energy efficiency, Gujarat Alkalies and Chemicals Ltd’s fuel switching project, Rajashree Cement and two of Dalmia Sugars.

Even out of the 60 projects for which requests for review are sought by the UN, 19 are Indian.

Projects that are moved with proposals for registration are sent to the ‘request for review’ category when either of the team members working on the proposals wants clarifications on certain aspects of the project.

A project that goes to the ‘request for review’ category either gets a delayed registration, if it addresses all queries of the registration team, or get rejected if it unable to.

additionality criteria

Analysts in the sector point out that most of the rejections are primarily driven by the company’s inability to prove the “additionality criteria” for the project.

In simple terms, the project proponents have to show that they are adopting a greenhouse gas emission reduction technology despite technical, institutional and market acceptability barriers; and possible revenues from carbon credits would make the project financially feasible.

In terms of number of registered CDM projects, India continues to lead, accounting for over 35 per cent of 771 projects, followed by China (14.4 per cent), Brazil (13.6 per cent) and Mexico (11.67 per cent).