What are CERs?

CERs, or Certified Emission Reductions, are carbon credits generated by CDM projects which have completed the registration process. Each CER represents the abatement of one tonne of carbon dioxide equivalent, and CERs are only issues by the CDM Executive Board once estimated abatement volumes have been validated independently, and a stringent verification process is in place for ongoing monitoring.

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What is the current state of the CDM Market?

Several organizations regularly provide updates of the state of the CDM market. These include the States and Trends of the Carbon Market by the World Bank, IETA, and The Developing CDM Market by the OECD Environment Directorate, Climate Change division (published in May 2006). Broadly speaking, CDM projects are currently clustered in South America and Asia, although there are several emerging countries in Africa where CDM projects are currently being developed. There is a clear need to focus capacity building in sub-Saharan regions, as highlighted by the 2006 COP/MOP2.

The largest volumes of CERs are being generated by project types such as large-scale chemical processes e.g. HFC-23 destruction, but there are only a handful of these projects. Projects involving renewable energy generation tend to be more modestly-sized, but dominate the project pipeline in terms of number of projects both registered and in development. It is expected that opportunities to develop projects such as HFC-23 will be exhausted within the near future, to be replaced by more expensive options of carbon abatement such as renewables, energy efficiency and process based projects.