Canada could meet its Kyoto targets with Chinese CDM

OTTOWA, CANADA, June 10 — Kyoto’s targets are unattainable for Canada, its Environment Minister Rona Ambrose has said. “The next phase of Kyoto hinges on the need for both sides to give in,” said Ambrose is reported saying Wednesday in the Ottawa Citizen.

Her comments come a month after government statistics revealed its greenhouse gas emissions were around 135% of its 1995 levels. Kyoto targets require Canada to cut its emissions to 94% of its 1990 levels.

Ambrose’s comments caused a stir of controversy in the Canadian political arena – Ambrose has since struck out at her critics accusing the opposition and environmental groups that have assailed the Conservative party are practicing “self-serving politics” or “self-righteousness.”

At the risk of being accused of self-righteousness itself, Blue Skies China is shocked to hear senior politicians admitting that anything “can’t be done”. It does not set a good example to its young people.

Canada indeed has a long way to go if it is to meet its Kyoto targets. In 1990, it emitted 599 million tonnes greenhouse gases (GHGs). In 2004, the most recent annual statistics available, Canada emitted 758 million tonnes – yet to meet Kyoto targets by 2012, it must reduce its emissions to 563 million tonnes.

To achieve this by 2012 from the 2004 levels requires a cut of 200 million tonnes and zero growth in emissions output. Difficult – but impossible?

Given that last week an Italian utility announced it would be net short 50 million tonnes, and had embarked on a clean development mechanism (CDM) programme to recover its shortfall, could the Canadian government not too have a more “can-do” attitude about its Kyoto shortfalls?

It should look at CDM in China. It’s easy carbon. It’s good for the technology, engineering and finance exporters. It’s good for bilateral relations with the fastest growing economy in the world.

All Canada needs is 20 projects of 10 million tonnes each by 2012, and a pledge to keep growth of homegrown emissions low. It could do that. The conservative party has ideas on homegrown measures; but these are just tidying measures, while 200 million tonnes could be wiped off the baseline just like that with CDM.

These projects are out there, available, and they will be done by someone, whether it is Canada, the UK, Netherlands, Spain, Japan, even private enterprises, Italian utility Enel, Spanish utility Endesa for example.

20 projects by 2012 equates to three or four projects a year. Could a small, well formed government department sell three or four CDM projects a year to Canadian business, investors, industry?

As yet, Canada has no CDM projects in China, which is curious because in 2003 the government paid Resource Futures International (RFI) CA$5 million (US$4.5 million) in cash for the “C5” project. C5 was developed precisely for the purpose of developing a CDM framework in China:

The main components of the … [project] are the development of operational guidance documents for the CDM, case studies in the areas of transportation and renewable energy, and a research study on carbon sinks. The two case studies are being designed from the start as commercially viable CDM projects between Canada and China,”
-Canadian government website on January 1, 2003.

There is no further mention of the C5 project anywhere on the government website or the RFI website – and, as mentioned Canada has no CDM projects registered, or pending approval, through the UN. It has several small projects in Latin America.

What is it waiting for? Italy, Spain, the Netherlands, Japan, the UK have projects amounting to nearly 40 million tonnes registered over the last year in China and more are expected.

Why has Canada given up on Kyoto, when there is such a gold mine waiting for it over in China? These CDM projects can practically pay for themselves if structured finance and a good home market for carbon exists.

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