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The clean development mechanism
”The Clean Development Mechanism (CDM) allows a country with an emission-reduction or emission-limitation commitment under the Kyoto Protocol to implement an emission-reduction project in developing countries. Such projects can earn salable certified emission reduction (CER) credits, each equivalent to one tonne of CO2, which can be counted towards meeting Kyoto targets.” (unfccc.int)
“The Kyoto Protocol sets binding emission reduction targets for 37 industrialized countries and economies in transition and the European Union. Overall, these targets add up to an average 5 percent emission reduction compared to 1990 levels over the five-year period 2008–2012 (the first commitment period).” (unfccc.int) In Doha, in December 2012, the second period of commitment, from 2013 to 2020, has been adopted.
A CDM activity might involve supporting a rural community by helping them develop in a green and carbon-free way. An example of such an action might be installing electric lampposts powered by solar panels, or finding more efficient ways to provide heating for winter. Important aspects of The Clean Development Mechanism projects are that they must be voluntary, must bring long-term climate change mitigation benefits, and are limited to the countries that have ratified the Kyoto Protocol.
Certified emission reduction
”CERs are standardized GHG reduction credits that are becoming a commodity that can be bought and sold on the global market, and in some cases banked for the future. CERs will be used by companies to meet their GHG reduction targets, but CERs can also be bought by others to sell on the international market, or withdrawn from the market by investors or non-governmental organizations interested in achieving a net reduction of that amount of future emissions.” (unctad.org) More specifically, CERs are electronic certificates issued for greenhouse gas emission reductions.
The fact that greenhouse gases mix uniformly in the atmosphere, making possible the reduction of emissions from any point on the planet, allows countries to pursue GHG (greenhouse gas) reductions at lower costs. Basically, countries that ratified the Kyoto Protocol can invest in projects that reduce greenhouse gas emissions in countries that didn’t ratify the protocol. In other words, CDM projects help both developed and developing countries work together to achieve The Paris Agreement goal.
