Carbon Credits: Credit Where It's Not Due

I went to a lunchtime fundraiser that sought to bring attention to the questionable practice of carbon credit generation from hydro power and to raise money for organizations that support more environmentally-sound alternatives.

If we really want to avert an irreversible global climate crisis by drastically reducing carbon emissions in the next 50 years, we must intensively overhaul our collective and individual plans, according to the first speaker, Patrick McCully, Executive Director of International Rivers. Global reduction in carbon emissions can and must be achieved by promoting wise investments, such as photovoltaic panels on existing rooftops, instead of hydroelectric dams built in developing countries for an often subliminal, misguided reason: generating carbon credit revenue.

Hydroelectric dams may seem like a good option at first glance, but deeper investigation by organizations such as International Rivers exposes flaws in the system. McCully outlined the current situation as viewed through his group's eyes. Nearly 10 years ago, the Kyoto Protocol created the Clean Development Mechanism (CDM), now the main program used for international carbon trading. Its goal is to promote sustainable, clean technology in developing countries by cutting costs through the sale of carbon credits.

McCully says the CDM is actually contributing to sales of fake credits with little to no environmental benefit, worsening the climate crisis. The biggest issue at stake is that this baseline-and-credit carbon offset system (as opposed to cap-and-trade) creates legal property rights for something that he believes are false commodities: how can you sell credits for carbon that is "not being emitted"? He asks, are some dam projects only happening because they can get carbon credits? Developers stand to benefit from these lucrative projects for the wrong reasons; in turn, the hydroelectric dams they build can also severely diminish biodiversity and put local human populations at risk.

Rooftop photovoltaic solar panels may be a better option, says Danny Kennedy, President and CEO of Sungevity. Kennedy, who in running a solar power company has a clear self-interest, argues that like the recent global boom in cellphone use, photovoltaic panels can benevolently follow suit. With 14 current rooftop PV options available to homeowners, design and cost will be optimized for widespread use by 2050, potentially earlier with strong political support. As an example, Kennedy cited Germany's desire to accept responsibility for the current climate crisis ten years ago, when it incentivized the uptake of renewable energy solutions like solar and wind power. If Germany did it, why can't the U.S.?

Kennedy argues that rooftop PV panels avoid loss or destruction of habitat when compared to solar projects in western deserts, for example. But I'm not sure that it is the wisest option, or that U.S. adoption will lead to lower prices for solar in developing nations. He says that such panels, though sometimes produced using energy from coal plants in China, pay back this energy in as little as two to three years. Kennedy believes that PV panel use will not only cut your household's energy bill, but it will also help to eventually make the commodity affordable in developing countries desperately seeking electricity.

Increasingly, I hear that we must support "watchdog" organizations such as International Rivers and businesses that promote seemingly brilliant, sustainable tech solutions like Sungevity. IR states that they work to halt benefits to hydro developers through CDM's imperfections, as well as fix the cracks in the system. I'm interested to read about their efforts to change an oft-labeled bureaucratic regulatory mechanism. My previous discontent at the United States' refusal to sign on to the Kyoto Protocol has turned into genuine wonder- is there a silver lining to this? If we keep CDM out of the US, we might do ourselves a favor by lowering overall carbon emissions.

McCully believes that between one-third and two-thirds of CDM offsets are in fact fake. I find such a large percentage difficult to ignore, even if it is one person's opinion.

For further information about dams and their local impact, check out the well-reviewed documentary, "Up the Yangtze".