This pre-COP22 policy briefing evaluates the impact of the existing CDM Pipeline on the ongoing Article 6 negotiations. The current pipeline of CDM activities presents both liability and opportunity for the new generation of mechanisms under the Paris Agreement. The liability is that the credibility of the Article 6.4 mechanism is at stake. The private sector already has “burnt fingers” over the continuing low-price environment for CERs. Disregarding the investments made in the CDM may be a fatal blow for investor confidence in mechanisms governed by the UNFCCC.
However, harnessing the mitigation potential of the CDM pipeline can also be turned into an opportunity. The existing pipeline of CDM activities, especially PoAs, is ideally placed for rapidly scaling up mitigation action.
The key question addressed in this policy brief is how the African CDM pipeline can be transitioned and find a new place in the context of the Paris Agreement.