A loophole in the UN's carbon market may have led to
an increase in emissions from some Russian factories, according to
study published in Nature Climate Change.
It suggests that weak environmental oversight of the
UN's 1997 carbon credit scheme led to "perverse incentives" for
some industrial plants to increase emissions, so they could then be
paid to reduce them.
This scheme was created to provide countries with a
cheaper and efficient means to reduce emissions, but could instead
have caused emissions to rise by 600 million tonnes of CO2, claims
a parallel study by
the same authors.
The study focuses on four factories in Russia, which stood to
benefit in particular due to the country's unique
Carbon Brief looks at what has happened, and why these
industries have been able to slip through the net when it comes to
UN jargon explained
In 1997, countries signed a UN agreement called
Protocol, committing so-called
"Annex 1" developed nations to reduce their emissions.
This included provisions for a new carbon market
scheme. Under this, countries are allowed to generate a carbon
credit for every tonne of additional greenhouse gas that they cut
or remove from the atmosphere. Instead of counting this reduction
towards their own target, a country can sell it on to another
This scheme is known as "joint implementation".
The idea behind it is that emissions are reduced cost effectively,
with the potential for foreign investment enabling host countries
to make cuts that may have otherwise been too expensive.
While carbon dioxide is the main driver of climate
change, this scheme can also be used to trade reductions in other
Today's study looks at two greenhouse gases that
emerge as waste gases from industrial processes:
hydrofluorocarbon-23 (HFC-23) and sulphur hexafluoride (SF6).
These gases have a high
global warming potential, which means that a small volume of
them causes the same temperature rise as a large amount of CO2.
HFC-23 is 12,000 times more potent than CO2 and SF6 is 16,300 times
more potent than CO2 over a 20-year time frame.
This means that factories earn more credits for
cutting emissions of these two gases than they would for cutting
the same volume of CO2.
Furthermore, these gases can be reduced cheaply, and
for less than the price of a carbon credit. This means that cutting
HFC-23 and SF6 and selling the credit can be a quick way for
industries to turn a profit.
This creates a "perverse incentive" for factories to
increase their production of these waste gases - to produce more,
reduce more, and, therefore, earn more. And this is exactly what
has been taking place in Russia, argues the study.