Monday, December 22, 2008

UN suspends carbon-trading auditor

The Times (UK): The validity of the Kyoto Protocol’s $100 billion (£67 billion) carbon-trading scheme has been called into question after the United Nations suspended the world’s largest auditor of clean-energy projects. Norway’s DNV, which claims to have approved half of the world’s carbon-credit ventures, had its accreditation suspended last month after it was unable to prove that its agents had properly vetted projects that it then approved for the carbon-trading scheme.

The episode will provide fresh ammunition to those who have long criticised the EU’s so-called Clean Development Mechanism (CDM), which allows investors in developed countries to fund green projects in the developing world. Once approved, they are then granted carbon credits that can be sold on the open market for profit.

Simon Shaw, chairman of EEA Fund Management, an investor in CDM projects and backer of the carbon-trading market Climate Exchange, said: “This is embarrassing for everybody and clearly bad news for the industry because DNV is the largest validator.” He said his firm had begun using other firms to verify proposed projects after it became apparent that DNV was overloaded.

“It became clear to us last year that they had a lot of work and were unable to resource the work properly.” UN inspectors found five “non-conformities” when they visited DNV last month, including not being able to get evidence that technical experts had examined the projects they had approved….

Coal silos on Pape Avenue in Toronto, circa 1926.

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