Unambitious climate targets ‘preventing investment’ in clean energy projects
More than 80% of the biggest project developers in the global emissions reduction industry cite the lack of global ambition on climate change mitigation as the biggest barrier to their continued development of clean energy and emissions reduction projects.
The results come from a survey, conducted by industry group the Project Developer Forum (PD Forum) and completed by 17 of its members, to gauge the views of its members on issues such as the low carbon price and the resulting decrease in investment in renewable energy and green technologies under the UN’s Clean Development Mechanism (CDM).
Almost half of all respondents said they owned or managed emissions reduction projects that had stalled due to the low carbon price, resulting in the release of millions of tons of CO2 back into the atmosphere. One respondent estimated this figure to be 6 million tonnes of CO2 equivalent.
Just over half the respondents (53%) ranked problems with the CDM as the lowest barrier to their company’s involvement, indicating that the initial problems experienced by the UN’s carbon market mechanism, which was created to stimulate cost-effective investment in clean energy projects across the developing world, have largely been overcome.
When asked if they thought backloading, a proposed stopgap plan to prop up the market by temporarily withdrawing 900 million allowances, would solve the problem of low carbon prices, 71% disagreed, saying it was just a temporary measure and that further reforms or market interventions were needed.
With a major European Parliament vote on backloading scheduled for Tuesday, industry participants are following events closely as a vote in favour of the plan is likely to give a short-term uplift to carbon prices and reaffirm political commitment to emissions trading.
Chairman of the PD Forum, Gareth Phillips, said; “The results of this survey send a strong signal to leaders across the globe that they must act quickly and decisively to help shore up the price of carbon emissions and safeguard future investment in clean energy.
“Over the past 14 years, the CDM has driven billions of dollars of investment into low carbon and renewable energy projects across the developing world, making a major contribution to sustainable development. All this is now under threat as a result of insufficient mitigation ambition amongst nations.”