CDM Leakage Quantification Methods : A content analysis of CDM methodologies linked to 15 sectoral scope
Abstract: The paper sheds light upon a specific issue: carbon leakage. Leakage can be understood as an unanticipated net carbon loss or gain, attributable to a climate policy, or reduction activities. Benign leakage effects are harmless. Unsettling are the ones that pose a threat to project’s environmental integrity. The Clean Development Mechanism (CDM) is no exception to such risk. In order to investigate leakage and the corresponding leakage calculation methods addressed in the CDM projects, a qualitative content analysis is conducted on 203 methodologies. Methodology documents serve as ideal textual data for examining CDM related leakage because the development of any new project must be based on methodologies. In relation to the research question, the content analysis synthesizes 11 types of leakage sources. Excluding the case where no leakage is considered, 10 type of leakage sources are then broadly classified as Activity Shift, Market Effects and Life Cycle Leakage. Their corresponding leakage calculation methods are described and reviewed in terms of their geographic reach, and leakage characteristics. A percentage pattern is presented in relation to each sector. The findings are that the vast majority of the CDM leakage calculation methods address primary leakage specific to each individual project at a localized scale, among which, methods addressing Life Cycle Leakage are in the predominant majority. Market Effects as secondary sources are acknowledged as a potential threat to the overall benefit, but the CDM methodologies offer no quantitative method.
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