GLOBAL WARMING AND

CARBON CREDITS

Group No : 6
•Roma Manwani
•Radhika Joge
•Dhiraj Kumar
•Vijay Patil
•Bheem Reddy
INTRODUCTION

The Earth’s changing climate is already wreaking

havoc in destructive ways.

Global Warming, an ecological threat that the world

is currently witnessing. Caused due to an overall
imbalance in nature and referred to as the
increase in the average temperature of Earth's
near-surface air and oceans, resulting in drastic
changes in the climatic conditions.
CAUSES
MAJOR CONTRIBUTORS
IMPACT
DOING YOUR BIT
GOVERNMENTAL AND
INTERGOVERNMENTAL ACTION
 Kyoto Protocol
 Copenhagen 2009
 Carbon emissions trading
 Carbon Tax
MITIGATION

 Climate change mitigation are measures or

actions to decrease the intensity of radiative
forcing in order to reduce global warming.

 Mitigation involves acting to minimize the effects

of global warming through reductions in the
concentrations of greenhouse gases, either by
reducing their sources or by increasing their
sinks.
Carbon credits: Silver lining to global warming
CARBON CREDITS

 What are carbon credits ?

Carbon credits are tradable credits earned for

investing in projects aimed at reducing Green
House Gas Emissions.
CARBON TRADING

 Credit can be sold in open market

 Certificates awarded to countries for reducing
emissions
 Joint Implementation Mechanism (JI)
 Clean Development Mechanism (CDM)
 International Emission Trading (IET)
Carbon Trading (contd…)

 Under JI, a developed country with relatively higher costs of domestic

greenhouse reduction set up a project in another developed country a
relatively low cost.

 Under CDM, a developed country takes a greenhouse gas reduction project

activity in a developing country

 The developed country gets credits for meeting its emission reduction
targets, while the developing country receives the capital and clean
technology to implement the project.

 Under IET mechanism, countries trade in the international carbon credit

market.

 Countries with surplus credits can sell the same to countries with quantified
emission limitation and reduction commitments under the Kyoto Protocol.
THE WORKING

 A country (or group of countries)

caps carbon emissions at a
certain level.

 Issues permits to firms and

industries that grant the firm the
right to emit a stated amount of
carbon dioxide over a time
period.

 Firms are then free to trade

these credits in a free market.
THE WORKING (contd...)

 A shortage of credits increases the price of credits

 Makes it more profitable for firms to engage in carbon

reduction.

 In this way the desired carbon reductions are met at the

lowest cost possible to society.

 Firms whose emissions exceed the amount of credits will

be heavily penalized.
KYOTO PROTOCOL
WHAT IS KYOTO PROTOCOL?

 The Kyoto Protocol is a protocol to the United Nations

Framework Convention on Climate Change (UNFCCC or
FCCC), aimed at fighting global warming.

 Countries that ratify this protocol commit to reduce

(a) their emissions of carbon dioxide and
(b) five other greenhouse gases, or
(c) engage in emissions trading if they maintain or
increase emissions of these gases.
The Kyoto mechanisms are:
 Emissions trading – known as “the carbon
market" 
 Clean development mechanism (CDM)
 Joint implementation (JI).
THE PRINCIPLES
 Underwritten by governments and is governed by global
legislation enacted under the UN’s aegis (protection)

 Two General Categories: Developed Countries {ANNEX}

Developing Countries {NON – ANNEX 1}

 The country that fails target will be penalized.

 Concept of “flexible mechanisms”

 Financial exchanges like the new EU Emissions Trading

Scheme or from projects which reduce emissions in non-Annex 1
economies under the Clean Development Mechanism (CDM)
COMMON but DIFFERENTIATED
RESPONSIBILITY
 The United Nations Framework Convention on Climate Change
agreed to a set of a "common but differentiated responsibilities." The
parties agreed that:

1. The largest share of historical and current global emissions of

greenhouse gases has originated in developed countries;

2. Per capita emissions in developing countries are still relatively low;

3. The share of global emissions originating in developing countries will

grow to meet their social and development needs.

 In other words, China, India, and other developing countries were

exempt from the requirements of the Kyoto Protocol because they
were not the main contributors to the greenhouse gas emissions
during the industrialization period.
Clean Development
Mechanism
 The 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, also called as CARBON CREDIT each equivalent
to one tonne of CO2, which can be counted towards meeting
Kyoto targets.

 These CERs can be traded and sold, and used by industrialized

countries to a meet a part of their emission reduction targets
under the Kyoto Protocol.
THANK YOU