Private authority in global climate governance: the case of the clean development mechanism

Abstract

The Clean Development Mechanism (CDM) is a prominent example of the mix of public and private authority in global climate policy-making. While national governments hold the supreme authority in the CDM, the oversight and daily supervision of the project-based mechanism have been delegated via an intergovernmental body to private corporations that evaluate the environmental performance of individual CDM projects. By focusing on the CDM as a particular instance of private authority in global climate governance, this article analyses the consequences associated with the delegation of authority to private actors. The article critically assesses the role of private auditing corporations, labelled Designated Operational Entities, in the regulatory framework of the CDM and points to serious trade-offs which accompany the privatisation of authority. The article's findings suggest that the promise of innovative modes of governance to increase the effectiveness of international regulation is seriously compromised by the profit-seeking behaviour of private actors. Hence, the article underscores the need to reconsider the balance between public and private authority in global (climate) governance.

Keywords:

• carbon markets
• Clean Development Mechanism
• climate policy
• global climate governance
• post-2012 negotiations
• private authority

Notes

Other scholars reject the thesis that states have lost dominance in the international system (e.g. Krasner, 1999). A recent elaboration of this argument is formulated by Drezner (2007).

The other two flexible mechanisms introduced with the Kyoto Protocol are International Emissions Trading and Joint Implementation. For a comprehensive overview of these instruments, see the work by Yamin and Depledge (2004, pp. 136–196).

These are: (i) the Accreditation Panel that assists the Executive Board to accredit the DOEs; (ii) the Methodologies Panel that develops guidelines for the methodologies used to assess the projects; (iii) the Afforestation and Reforestation Working Group; and (iv) the Small Scale Working Group that provides recommendations on specific projects as well as (v) the Registration and Issuance Team that assists the Executive Board in questions regarding project registration and the issuance of carbon credits (UNFCCC, 2011a).

These DOEs have already been re-accredited under the CDM (CDM Executive Board, 2010).

This rule does not apply to evaluations of small-scale projects (UNFCCC, 2006). In exceptional cases the Executive Board may, moreover, allow a single DOE to perform both the validation and the verification of a certain project activity (UNFCCC, 2002).

Scholars have made various proposals for a reform of the CDM. A practical discussion of many of these recommendations can be found in Streck and Lin (2008, pp. 435–440).