The Kyoto Protocol: an international agreement linked to the United Nations Framework Convention on

Climate Change.
Feature:
Major feature is it sets binding targets for 37 industrialized countries and the European community for
reducing greenhouse gas (GHG) emissions. This amount to an average of five per cent against 1990
levels over the five-year period 2008-2012.
The major distinction between the Protocol and the Convention is that while the Convention
encouraged industrialised countries to stabilize GHG emissions, the Protocol commits them to do so.
(Protocol enforce industrialized countries to stabilize emissions).
Recognizing that developed countries are principally responsible for the current high levels of
GHG emissions in the atmosphere as a result of more than 150 years of industrial activity, the
Protocol places a heavier burden on developed nations under the principle of “common but
differentiated responsibilities.”
The Kyoto Protocol was adopted in Kyoto, Japan, on 11 December 1997 and entered into force on
16 February 2005. The detailed rules for the implementation of the Protocol were adopted at COP
7 in Marrakesh in 2001, and are called the “Marrakesh Accords.”
The Kyoto mechanisms
Under the Treaty, countries must meet their targets primarily through national measures. However, the
Kyoto Protocol offers them an additional means of meeting their targets by way of three market-
based mechanisms.
The Kyoto mechanisms are:
 Emissions trading – known as “the carbon market" 
 Clean development mechanism (CDM)
 Joint implementation (JI).
The mechanisms help stimulate green investment and help Parties meet their emission targets in a cost-
effective way.
Monitoring emission targets
Under the Protocol, countries’ actual emissions have to be monitored and precise records have to be
kept of the trades carried out.
Registry systems track and record transactions by Parties under the mechanisms. The UN Climate
Change Secretariat, based in Bonn, Germany, keeps an international transaction log to verify that
transactions are consistent with the rules of the Protocol.
Reporting is done by Parties by way of submitting annual emission inventories and national reports
under the Protocol at regular intervals.
A compliance system ensures that Parties are meeting their commitments and helps them to meet their
commitments if they have problems doing so.
Adaptation
The Kyoto Protocol, like the Convention, is also designed to assist countries in adapting to the adverse
effects of climate change. It facilitates the development and deployment of techniques that can help
increase resilience to the impacts of climate change.
 The Adaptation Fund was established to finance adaptation projects and programmes in developing
countries that are Parties to the Kyoto Protocol. The Fund is financed mainly with a share of proceeds
from CDM project activities.
The road ahead
The Kyoto Protocol is generally seen as an important first step towards a truly global emission reduction
regime that will stabilize GHG emissions, and provides the essential architecture for any future
international agreement on climate change.
By the end of the first commitment period of the Kyoto Protocol in 2012, a new international framework
needs to have been negotiated and ratified that can deliver the stringent emission reductions
the Intergovernmental Panel on Climate Change (IPCC) has clearly indicated are needed.

Status of Ratification of the Kyoto Protocol

Currently, there are 192 Parties (191 States and 1 regional economic integration organization) to the
Kyoto Protocol to the UNFCCC. The total percentage of Annex I Parties emissions is 63.7%.

Amendment to Annex B of the Kyoto Protocol

Parties to the Kyoto Protocol adopted an Amendment to Annex B to the Kyoto Protocol by   decision
10/CMP.2 in accordance with Articles 20 and 21 of the Kyoto Protocol, at the second session of the
Conference of the Parties serving as the meeting of the Parties to the Kyoto Protocol held in Nairobi,
Kenya, in November 2006.
Currently, 23 Parties have accepted the amendment to Annex B to the Kyoto Protocol set out in decision
10/CMP.2. To date, this amendment has not entered into force.

Kyoto Protocol Bodies

CMP
The Conference of the Parties (COP) serves as the meeting of the Parties to the Kyoto Protocol. This
is referred to as the Conference of the Parties serving as the meeting of the Parties to the Kyoto
Protocol (CMP).
The CMP meets annually during the same period as the COP. Parties to the Convention that are
not Parties to the Protocol are able to participate in the CMP as observers, but without the right to
take decisions.  The functions of the CMP relating to the Protocol are similar to those carried out by
the COP for the Convention. 
The first meeting of the Parties to the Kyoto Protocol was held in Montreal, Canada in December 2005,
in conjunction with the eleventh session of the Conference of the Parties (COP 11).
Decisions were adopted that outline the path to future international action on climate change.  The
Parties to the Kyoto Protocol also formally adopted the “rulebook” of the 1997 Kyoto Protocol, the so-
called ‘Marrakesh accords’, which sets the framework for implementation of the Protocol.  
The Subsidiary Body for Scientific and Technological Advice (SBSTA) and the Subsidiary Body for
Implementation (SBI)
These two permanent subsidiary bodies established under the Convention also serve the CMP.
The Bureau
The Bureau of the COP also serves the CMP. However, any member of the COP Bureau representing a
non-Party to the Kyoto Protocol has to be replaced by a member representing a Kyoto Protocol Party.

Constituted Bodies under the Kyoto Protocol

 
Clean Development Mechanism (CDM) Executive Board
The CDM Executive Board supervises the CDM under the Kyoto Protocol and prepares decisions for the
CMP. It undertakes a variety of tasks relating to the day-to-day operation of the CDM, including the
accreditation of operational entities.
Joint Implementation Supervisory Committee
The Joint Implementation Supervisory Committee (JISC), under the authority and guidance of the CMP,
inter alia, supervises the verification of emission reduction units (ERUs) generated by JI projects
following the verification procedure under the JISC.
Compliance Committee
The compliance regime consists of a Compliance Committee made up of two branches: a Facilitative
Branch and an Enforcement Branch.

The Mechanisms under the Kyoto Protocol:

Emissions Trading, the Clean Development Mechanism and
Joint Implementation
 
Background
 
Countries with commitments under the Kyoto Protocol to limit or reduce
greenhouse gas emissions must meet their targets primarily through national
measures. As an additional means of meeting these targets, the Kyoto Protocol
introduced three market-based mechanisms, thereby creating what is now known
as the “carbon market.”  
The Kyoto mechanisms are:
 Emissions Trading
 The Clean Development Mechanism (CDM)

 Joint Implementation (JI)

The Kyoto mechanisms:

 Stimulate sustainable development through technology transfer and investment

   Help countries with Kyoto commitments to meet their targets by reducing
emissions or removing carbon from the atmosphere in other countries in a cost-
effective way

 Encourage the private sector and developing countries to contribute to emission

reduction efforts

 JI and CDM are the two project-based mechanisms which feed the carbon
market. JI enables industrialized countries to carry out joint implementation
projects with other developed countries, while the CDM involves investment in
sustainable development projects that reduce emissions in developing countries.
 
The carbon market is a key tool for reducing emissions worldwide. It was worth 30
billion USD in 2006 and is growing.

Annex I Parties must provide information in their national communications under

the Protocol to demonstrate that their use of the mechanisms is “supplemental to
domestic action” to achieve their targets. This information is assessed by the
facilitative branch of the Compliance Committee
Eligibility requirements
 
To participate in the mechanisms, Annex I Parties must meet, among others, the
following eligibility requirements:

 They must have ratified the Kyoto Protocol.

 They must have calculated their assigned amount in terms of tonnes of CO2-

equivalent emissions.

 They must have in place a national system for estimating emissions and removals
of greenhouse gases within their territory.

 They must have in place a national registry to record and track the creation and
movement of ERUs, CERs, AAUs and RMUs and must annually report such
information to the secretariat.

 They must annually report information on emissions and removals to the

secretariat.

 
Detailed eligibility requirements
Detailed eligibility requirements can be found under the respective decisions
agreed by the CMP, as follows:

 ET eligibility requirements are reflected in the Modalities, rules and guidelines for

 emissions trading under Article 17 of the Kyoto Protocol (  decision 11/CMP.1);

 CDM eligibility requirements are reflected in section F in the modalities and

procedures (  decision 3/CMP.1);

 JI eligibility requirements are reflected in section D in the Guidelines for

implementation of Article 6 of the Kyoto Protocol (  decision 9/CMP.1);

Businesses, non-governmental organizations and other legal entities may

participate in the three mechanisms under the authority and responsibility of
governments.

Emissions Trading
Greenhouse gas emissions – a new commodity
Parties with commitments under the Kyoto Protocol (Annex B Parties) have accepted targets for
limiting or reducing emissions. These targets are expressed as levels of allowed emissions, or “assigned
amounts,” over the 2008-2012 commitment period. The allowed emissions are divided into “assigned
amount units” (AAUs).
Emissions trading, as set out in Article 17 of the Kyoto Protocol, allows countries that have emission
units to spare - emissions permitted them but not "used" - to sell this excess capacity to countries that
are over their targets.
Thus, a new commodity was created in the form of emission reductions or removals. Since carbon
dioxide is the principal greenhouse gas, people speak simply of trading in carbon. Carbon is now
tracked and traded like any other commodity. This is known as the "carbon market."
Other trading units in the carbon market
More than actual emissions units can be traded and sold under the Kyoto Protocol’s emissions trading
scheme.
The other units which may be transferred under the scheme, each equal to one tonne of CO2, may be
in the form of:

 A removal unit (RMU) on the basis of land use, land-use change and forestry
(LULUCF) activities such as reforestation

  An emission reduction unit (ERU) generated by a joint implementation project

 A certified emission reduction (CER) generated from a clean development

mechanism project activity

Transfers and acquisitions of these units are tracked and recorded through the registry
systems under the Kyoto Protocol.
An international transaction log ensures secure transfer of emission reduction units between
countries.
The commitment period reserve
In order to address the concern that Parties could "oversell" units, and subsequently be unable to
meet their own emissions targets, each Party is required to maintain a reserve of ERUs, CERs, AAUs
and/or RMUs in its national registry. This reserve, known as the "commitment period reserve", should
not drop below 90 per cent of the Party's assigned amount or 100 per cent of five times its most
recently reviewed inventory, whichever is lowest
Relationship to domestic and regional emissions trading schemes
Emissions trading schemes may be established as climate policy instruments at the national level and
the regional level. Under such schemes, governments set emissions obligations to be reached by the
participating entities. The European Union emissions trading scheme is the larges

Clean Development Mechanism (CDM) 

The Clean Development Mechanism (CDM), defined in Article 12 of the Protocol, allows a country with
an emission-reduction or emission-limitation commitment under the Kyoto Protocol (Annex B Party) to
implement an emission-reduction project in developing countries. Such projects can earn saleable
certified emission reduction (CER) credits, each equivalent to one tonne of CO2, which can be counted
towards meeting Kyoto targets.
The mechanism is seen by many as a trailblazer. It is the first global, environmental investment and
credit scheme of its kind, providing a standardized emissions offset instrument, CERs.
A CDM project activity might involve, for example, a rural electrification project using solar panels or
the installation of more energy-efficient boilers.
The mechanism stimulates sustainable development and emission reductions, while giving
industrialized countries some flexibility in how they meet their emission reduction or limitation
targets.
Operating details of the CDM
A CDM project must provide emission reductions that are additional to what would otherwise have
occurred. The projects must qualify through a rigorous and public registration and issuance process.
Approval is given by the Designated National Authorities. Public funding for CDM project activities
must not result in the diversion of official development assistance.
The mechanism is overseen by the CDM Executive Board, answerable ultimately to the countries that
have ratified the Kyoto Protocol.
Operational since the beginning of 2006, the mechanism has already registered more than 1,650
projects and is anticipated to produce CERs amounting to more than 2.9 billion tonnes of CO2
equivalent in the first commitment period of the Kyoto Protocol, 2008–2012. 
For up-to-date information on the CDM, see the UNFCCC CDM website.
Joint Implementation (JI)
The mechanism known as “joint implementation,” defined in Article 6 of the Kyoto Protocol, allows a
country with an emission reduction or limitation commitment under the Kyoto Protocol (Annex B
Party) to earn emission reduction units (ERUs) from an emission-reduction or emission removal project
in another Annex B Party, each equivalent to one tonne of CO2, which can be counted towards
meeting its Kyoto target.
Joint implementation offers Parties a flexible and cost-efficient means of fulfilling a part of their Kyoto
commitments, while the host Party benefits from foreign investment and technology transfer.
Eligibility and approval
A JI project must provide a reduction in emissions by sources, or an enhancement of removals by sinks,
that is additional to what would otherwise have occurred.  Projects must have approval of the host
Party and participants have to be authorized to participate by a Party involved in the project.
Projects starting as from the year 2000 may be eligible as JI projects if they meet the relevant
requirements, but ERUs may only be issued for a crediting period starting after the beginning of 2008.
Track 1 and Track 2 procedures
If a host Party meets all of the eligibility requirements to transfer and/or acquire ERUs, it may verify
emission reductions or enhancements of removals from a JI project as being additional to any that
would otherwise occur. Upon such verification, the host Party may issue the appropriate quantity of
ERUs. This procedure is commonly referred to as the “Track 1” procedure.”
If a host Party does not meet all, but only a limited set of eligibility requirements, verification of
emission reductions or enhancements of removals as being additional has to be done through the
verification procedure under the Joint Implementation Supervisory Committee (JISC). Under this so-
called “Track 2” procedure, an independent entity accredited by the JISC has to determine whether the
relevant requirements have been met before the host Party can issue and transfer ERUs.
A host Party which meets all the eligibility requirements may at any time choose to use the verification
procedure under the JISC (Track 2 procedure).
For up-to-date information on JI, see the UNFCCC JI website.
Registry systems under the Kyoto Protocol
 
National registry of Iceland linked to the International Transaction Log
On 6 May 2010, the national registry of Iceland became the thirty-seventh registry linked to the
international transaction log.

Registry systems under the Kyoto Protocol

Emission targets for industrialized country Parties to the Kyoto Protocol are expressed as levels of
allowed emissions, or “assigned amounts”, over the 2008-2012 commitment period. Such assigned
amounts are denominated in tonnes (of CO2 equivalent emissions) known informally as “Kyoto units”.
The ability of Parties to add to their holdings of Kyoto units (e.g. through credits for CDM or LULUCF
activities) or move units from one country to another (e.g. through emissions trading or JI projects)
requires registry systems that can track the location of Kyoto units at all times.
Two types of registry are being implemented:
 Governments of the 38 Annex B Parties are implementing national registries, containing
accounts within which units are held in the name of the government or in the name of legal
entities authorized by the government to hold and trade units.
 The UNFCCC secretariat, under the authority of the CDM Executive Board, has implemented
the CDM registry for issuing CDM credits and distributing them to national registries. Accounts
in the CDM registry are held only by CDM project participants, as the registry does not accept
emissions trading between accounts.
In addition to recording the holdings of Kyoto units, these registries “settle” emissions trades by
delivering units from the accounts of sellers to those of buyers, thus forming the backbone
infrastructure for the carbon market.
Each registry will operate through a link established with the International transaction log put in place
and administered by the UNFCCC secretariat. The ITL verifies registry transactions, in real time, to
ensure they are consistent with rules agreed under the Kyoto Protocol. The ITL requires registries to
terminate transactions they propose that are found to infringe upon the Kyoto rules.

In verifying registry transactions, the ITL provides an independent check that unit holdings are being
recorded accurately in registries. After the Kyoto commitment period is finished, the end status of the
unit holdings for each Annex B Party will be compared with the Party’s emissions over the
commitment period in order to assess whether it has complied with its emission target under the
Kyoto Protocol.
EU emissions trading
Domestic or regional emissions trading schemes that use Kyoto units also undertake their settlement
through these registry systems. For example, under the second phase of the European Union
emissions trading scheme, EU allowances are specific Kyoto units which have been designated as being
valid for trading under the scheme. Transactions in EU allowances are therefore recorded
automatically as transactions under the Kyoto Protocol.
As EU trading legislation sets in place rules over and above those agreed for the Kyoto Protocol, a
supplemental transaction log has been implemented by the European Commission. The Community
Independent Transaction Log has been in place since the start of the scheme in 2005 and EU registries
are now operating with it.
For the start of the Kyoto commitment period in 2008, EU registries are to switch their connections
from the CITL to the ITL. The ITL will conduct “Kyoto checks” on transactions proposed by both EU and
non-EU registries. In the case of transactions involving EU registries, the ITL will forward information to
the CITL so that it can conduct “supplementary checks” defined under the EU scheme.

Guidelines under Articles 5, 7 and 8: Methodological Issues, Reporting and Review under the Kyoto
Protocol
Background
The Kyoto Protocol’s effectiveness will depend upon two critical factors: whether Parties follow the
Protocol’s rulebook and comply with their commitments; and whether the emissions data used to
assess compliance is reliable. Recognizing this, the Kyoto Protocol and Marrakesh Accords, adopted by
CMP 1 in Montreal, Canada, in December 2005, include a set of monitoring and compliance
procedures to enforce the Protocol’s rules, address any compliance problems, and avoid any error in
calculating emissions data and accounting for transactions under the three Kyoto mechanisms
(emissions trading, clean development mechanism and joint implementation) and activities related to
land use, land use change and forestry (LULUCF).
The Protocol’s monitoring procedures are based on existing reporting and review procedures under
the Convention, building on experience gained in the climate change process over the past decade.
They also involve additional accounting procedures that are needed to track and record Parties’
holdings and transactions of Kyoto Protocol units - assigned amount units (AAUs), certified emission
reductions (CERs) and emission reduction units (ERUs) - and removal units (RMUs) generated by
LULUCF activities.
Articles 5, 7 and 8 of the Kyoto Protocol address reporting and review of information by Annex I Parties
under the Protocol, as well as national systems and methodologies for the preparation of greenhouse
gas inventories.
  Article 5 commits Annex I Parties to having in place, no later than 2007, national systems for
the estimation of greenhouse gas emissions by sources and removals by sinks (Article 5.1). It
also states that, where agreed methodologies (that is, the revised 1996 IPCC Guidelines for
National Greenhouse Gas Inventories, see decision   2/CP.3) are not used to estimate
emissions and removals, appropriate "adjustments" should be applied (Article 5.2).
 Article 7 requires Annex I Parties to submit annual greenhouse gas inventories, as well as
national communications, at regular intervals, both including supplementary information to
demonstrate compliance with the Protocol. In addition, Article 7 states that the Conference of
the Parties serving as the meeting of the Parties to the Protocol (CMP) shall decide upon
modalities for the accounting of assigned amounts prior to the first commitment period.
 Article 8 establishes that expert review teams will review the inventories, and national
communications submitted by Annex I Parties.
more>>
Initial reports under Article 7, paragraph 4, of the Kyoto Protocol and initial review reports  
Submissions of initial reports (last updated 13 November 2008)
This page contains reports submitted by Annex I Parties that are also Parties to the Kyoto Protocol in
accordance with its Article 7, paragraph 4.
According to decision 13/CMP.1, each Annex I Party with a commitment inscribed in Annex B to the
Protocol shall facilitate the calculation of its assigned amount pursuant to Article 3, paragraphs 7 and
8, for the commitment period and demonstrate its capacity to account for its emissions and assigned
amount. To this end, each Party shall submit a report containing all information required for this
purpose, as defined in the annex to decision 13/CMP.1, prior to 1 January 2007 or one year after the
entry into force of the Kyoto Protocol for that Party, whichever is later. ) The timely submission of the
so-called "Initial Report" is an essential step for the Party in calculating its assigned amount under
Article 3, paragraph 1, which is a precondition for the participation in the Kyoto Protocol mechanisms
(emissions trading, joint implementation and clean developing mechanism).
The page also contains the results of the reviews of the initial reports under Article 8 of the Kyoto
Protocol.
According to decision 22/CMP.1, the review of the initial reports submitted by Parties shall be initiated
upon receipt of the reports. The review reports shall be forwarded expeditiously to the Conference of
the Parties serving as the meeting of the Parties and the Compliance Committee.
KYOTO PROTOCOL –
 It is a contract /agreement (legal) which is internationally developed by the United
Nations Framework convention on Climate Change (UNFCC). It legally binds the parties
who has signed the document under the protocol.
 Its focus/aim is to reduce green gas house emissions which leads to climate change.
 It is a tool/concept used or part of the broader system.
 It is a planning, management, measuring and monitoring tool.
 Tool is best suited to national governments wherein different countries are a part of it.
It affects the policy level and other implications of signed nations. However local
business organizations, industries gets benefited directly under this protocol.
Businesses, non-governmental organizations and other legal entities may participate in
the three mechanisms under the authority and responsibility of governments.
 Yes, it states the reduction in carbon emission to the signed parties by 5% within a
limited time period (i.e. 5-10, 20, 25 years). This amount to an average of five per cent
against 1990 levels over the five-year period 2008-2012.

 Recognizing that developed countries are principally responsible for the current high
levels of GHG emissions in the atmosphere as a result of more than 150 years of
industrial activity, the Protocol places a heavier burden on developed nations under the
principle of “common but differentiated responsibilities.”
The Kyoto mechanisms
Under the Treaty, countries must meet their targets primarily through national measures (it would
depend on individual countries, to make policy level changes in order to meet the GHG emission targets,
how they would achieve is not clearly mentioned under kyoto protocol). However, the Kyoto Protocol
offers them an additional means of meeting their targets by way of three market-based mechanisms.
The Kyoto mechanisms are:
 Emissions trading – known as “the carbon market" 
 Clean development mechanism (CDM)
 Joint implementation (JI).
The mechanisms help stimulate green investment and help Parties meet their emission targets in a cost-
effective way.
 These mechanisms has more implications in economic terms for developing countries.
Developing countries get benefited by taking carbon target of developed countries.
Developed countries just relax by giving money to the developing countries.

Annex B parties
Annex I parties
What r the implications if parties are not meeting with the emission targets?
Implications on developing countries, (economic, technology, social)