The "Magic" of the Kyoto Mechanisms: Will It Work for Buildings?

According to their design, the flexible mechanisms of the Kyoto Protocol should deliver a wide spectrum of “magical” outcomes in all sectors of developing countries and transition economies including, among others, technology and know-how transfer, skilled experts, investment capital, and capacity building. Buildings should, in theory, be prime targets of clean development mechanism (CDM) and joint implementation (JI) projects since they house major cost-effective potentials for saving carbon-dioxide (CO2) through the improvement of energy efficiency all around the world. Host countries should welcome activities channeled to buildings, as these mechanisms could help overcome barriers inhibiting the improvement of energy efficiency in homes and businesses.

Will these opportunities be realized? The paper examines the three flexible mechanisms of the Kyoto Protocol from the perspective of their promise to save energy in the buildings sector. First, it highlights the priority of the buildings sector for climate mitigation policies. Then, it reviews on-going JI and CDM projects, and planned activities. It examines the prime barriers to the application of these mechanisms in buildings. Finally, the paper identifies a selection of opportunities for improving the present implementation of these mechanisms to better deliver the “magic” in buildings. It concludes that introduction of such policies as Green Investment Schemes (GIS) and project-based emission trading, methodological improvements for JI and CDM, and capacity building programmes targeted to local audience may help to overcome some of the barriers to implementation of these mechanisms in the buildings sector.