Carbon Market Watch

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WATCH THIS! NGO Newsletter #7: The Mundra coal project in India, another battle against coal power in the CDM

07 Nov 2013

Watch This! PDF (English)

Coal projects inflict a toxic burden on local peoples’ health and ecosystems while levels of greenhouse gas emissions remain very high for many years to come. The UNFCCC has yet to address this highly contentious form of climate finance. Under increased pressure from buyers of carbon credits, governments and civil society organizations, coal climate finance under the CDM must come to an end. 

Six coal CDM projects registered

Under the CDM, developers who plan to build new coal power plants can still apply to receive offset credits by claiming that they would build a less efficient new coal plant if they did not receive CDM offset revenues. Despite questionable additionality of these projects and the fact that coal power projects inflict toxic burdens on local populations and ecosystems, six projects located in India and China have already been registered by the CDM Executive Board. More than 40 projects are at validation stage.

But political support for providing climate finance through the CDM is shrinking. In August, the British government announced that starting in September 2013 it will stop endorsing investments for new CDM coal projects. Norway, one of the biggest buyers of CDM carbon credits has also announced that it will not buy credits associated with coal power projects. Moreover, French energy giant EDF Trading, the buyer of offset credits from Adani’s coal power project in Mundra, India has recently announced that it is no longer associated with CDM coal project.  We have demanded to exclude coal power projects from the CDM for many years and we’ll keep campaigning for this at the upcoming climate change conference in Warsaw.

 

Adani’s Mundra project violates India’s air pollution regulation

One of the six registered projects is the Mundra project located at the villages Tunda and Siracha, MundraTaluka, Kutch District of Gujarat, in western India. This project is in violation with various national regulations, as highlighted in the inspection committee report of the Indian Ministry of Environment and Forests (MoEF) released in April 2013.

For example, the report states that even though the company claimed it had adequate pollution control equipments in place, their operation is an aspect that cannot be verified/commented upon by the Committee because of missing monitoring reports. This does not comply with the directive for controlling fugitive emissions which was adopted by the Gujarat Pollution Control Board (GPCB) in 2011. GPCB officials observed fugitive emissions due to movement of fly ash loaded dumpers and other heavy vehicles. In particular the report noted:

It is clear that the company has been less than serious about reporting on compliance with the conditions set at the time of clearance. In many cases non-compliance with reporting conditions has been observed.

Despite these serious violations of India’s air pollution regulations and evidence that the sustainable development criteria as highlighted in the project design document are not met the project remains registered as a CDM project. In August, 25 Indian civil society organisations wrote a letter to the Indian authority that approved the project’s registration to withdraw the authorisation of the project under the CDM and to take urgent steps to repair the damage and to mitigate future harm as proposed in the inspection committee report’s action plan. To download the letter, click here.

In October, another 30 civil society organisations have sent letters the French government authority urging to end any involvement in the project immediately and the support   the letter of approval for the project to be withdrawn and support the exclusion of coal power projects from the CDM at the upcoming COP-19 climate change conference in Poland. To download the letters, please click here.

The mysterious involvement of EDF Trading in Adani’s Mundra projectEDF Trading is listed as one of the beneficiaries of carbon credits generated by Adani’s Mundra CDM project[1] which was registered in 2009. In August 2013 EDF Trading informally announced that it is no longer involved in the project but has ever since refused to make a public statement and to provide any sort of information about the background of the decision, and who – if not EDF Trading – has purchased the 600.000 carbon offsets.  On 13 August 2013, EDF Trading stated in the French energy daily “Enerpresse” that the company is no longer associated contractually under the CDM, with this [Adani Mundra] supercritical coal power project in India.Since EDF Trading’s involvement in the project is confirmed by a letter of approval issued by the French government, and listed at the UNFCCC website, this decision came as a surprise. This statement is of special interest because Adani Mundra has been the first CDM coal power project that has been awarded 600.000 carbon offset credits.

 

Given the severe toxic burden this project poses to the local environment in Gujarat, numerous civil society organisations have sent letters to the Indian government, the French government and to EDF Trading to gain clarity about the mysterious destination of Mundra’s carbon offset credits. Stay tuned!

 


[1] Project 2716 : Grid connected energy efficient power generation: http://cdm.unfccc.int/Projects/DB/DNV-CUK1245932980.89

By Falguni Joshi, Gujarat Forum on the CDM