Isramart : Carbon-cutting projects face uncertainty after 2012

Isramart news:
NEW DELHI – Giant mountains of kitchen waste, bottles, coconuts, plastic, and paper in the heart of New Delhi’s industrial district are being transformed into rich, black organic fertilizer for farming.

The treatment is good for the environment in more ways than one: It creates both fertilizer and carbon emission credits for a German company that is paying the Indian firm for treating the trash. It has been going on for only a year, but now there is fear that it might not last.

In a sign of how widespread the global impact of carbon emissions is and how far-reaching the efforts are to reduce them, dozens of similar projects in India, China, and Brazil face uncertainty after 2012 because of a failure so far to renew provisions of the historic Kyoto Protocol meant to cut greenhouse gas emissions.

Last week, representatives from 177 nations met in Bangkok to work on ways to extend and expand the climate change agreement in anticipation of a global summit on the subject in Copenhagen in December.

Some industrialized nations want to abandon the treaty and work on a new agreement, in part because some leaders believe it will be the only way to persuade the United States – the largest industrialized nation that refused to sign the agreement – to join. The Kyoto accord calls for developed countries to cut their 1990 level of greenhouse gas emissions by 5 percent by 2012.

Less-developed nations were not required to make the cuts. But a new business model flourished when those nations – including China, Brazil, and India – launched environmentally friendly enterprises and began selling carbon credits to companies in countries such as Australia, Japan, and Germany.

India and some of the other less industrialized countries have refused to adopt mandatory cuts in greenhouse emissions, saying the burden should fall heaviest on those nations that have caused the problem and can afford the changes. But they also are deeply interested in maintaining the Kyoto goals both for the environment and for their own economic well being.

“What will happen to the projects and the money invested?’’ said a senior Indian environment ministry official who spoke on the condition of anonymity because he is not authorized to speak to the media. “What will be the shape of the carbon market after 2012?’’

He said that there is little time left before the December summit to come up with a new treaty.

India has 460 green businesses registered for carbon credits, second only to China’s 642 projects.

Mahesh Babu, chief executive of IL&FS Ecosmart, which operates the trash-to-fertilizer operation in New Delhi, said: “With such projects, developed nations can meet their carbon emission targets at one-tenth the costs. We . . . reduce toxic run-offs into our sacred rivers and enhance soil productivity. It is a win-win.’’

But those in favor of a new treaty, including the United States and the European Union, want to bind large, emerging economies like India and China into accepting internationally verifiable emission targets. India has resisted, contending that its per capita emission is far lower than those of wealthier, developed countries.

But Babu hopes that at least the carbon-trading component of the Kyoto accord will be retained in a new treaty, so that India can help itself and others cap emissions at a fraction of the cost.

“Carbon markets are a good way of accelerating the involvement of developing countries in global emission reduction,’’ said Ajay Mathur, director of India’s Bureau of Energy Efficiency. “If there is a hesitation in adopting new technology because of the cost risk, the carbon trade makes them do it sooner.’’