The relationships between CDM project characteristics and CER market prices

Abstract

This study explores the relationship between key characteristics of Clean Development Mechanism (CDM) projects and Certified Emission Reduction (CER) prices. Using Multiple Correspondence Analysis, we show that the CER credit prices are likely to have had a greater influence than regional levels of economic development on the sectors, regions and sizes of CDM projects. There are comparatively few CDM projects in Sub-Saharan Africa (less South Africa) and the small-scale forestation projects that are characteristic for the region mainly entered the CDM pipeline when CER credit price levels were high. Latin America hosts a larger number of projects, and the small-scale methane, biofuel and hydro projects that are typical for this region generally also applied for validation under high CER price levels. The large industrial gas and energy efficiency projects typical for the Middle East/Northern Africa region appear to have been largely insensitive to CER price levels. The large number and variety of projects in Asia have applied for registration under a broad range of CER price levels.