October 31, 2008 / 10:41 AM / 9 years ago

Developers partly to blame for CO2 offset delays: U.N.

<p>Steam and other emissions are seen coming from funnels at a chemical manufacturing plant in Melbourne in this September 23, 2008 file photo.Mick Tsikas</p>

GOLD COAST, Australia (Reuters) - Developers of U.N.-backed carbon projects should stop blaming the scheme's governing panel for lengthy approval delays, a senior U.N. official said on Friday, accusing sloppy paperwork by some developers for the backlog.

"When it comes to project-specific delays, the project developer is very unfair in not admitting that they have had a delay because they have failed to complete the documents correctly," said John Kilani, director of Sustainable Development Mechanisms at the U.N. Climate Change Secretariat.

The carbon offset market under the Kyoto Protocol's Clean Development Mechanism is worth billions of dollars annually. But a slowdown in project approvals is worrying investors because there is no guarantee the CDM will exist after 2012.

The market hopes U.N.-led talks at the end of next year will sanction a broader pact to fight climate change and usher in a revised and expanded CDM.

At present, nearly 1,200 projects have been approved and registered.

But there are about 3,000 projects in the CDM pipeline awaiting verification and possibly formal approval and project developers say it is taking up to two years to process applications from initial submission through to approval by the CDM Executive Board and the issue of saleable carbon offsets. Concerns over the quality of the projects has led to the board tightening some rules.

Under the CDM, rich countries can invest in clean-energy projects in developing nations and in return receive offsets called CERS, which are currently trading under 15 Euros per tonne of CO2-equivalent. The sale of the offsets helps pay for the project that would not otherwise have been viable to develop.

Surge in Projects

Kilani said there had been a surge in projects requiring "completeness" checks by the Secretariat as well as for vetting, or review, by a limited number of U.N.-approved auditors.

Recent changes to regulations had led to a jump in submissions by developers trying to get their projects approved before the new rules take effect.

But he said it was wrong to blame the board for delays in the review process.

"Where people have a problem with is the completeness check," he said on the sidelines of a major carbon market conference on the Gold Coast in Australia's Queensland state. These checks prior to a project's submission to the board can take three or more months, some developers at the conference said on Friday.

"Yes there are some delays in that respect," said Kilani, a former CDM Executive Board chairman, adding there were resource constraints in the Secretariat and that hiring short-term contract staff might fix the problem.

"But more importantly, there are project developers who don't take the time to check the requirements and they just put the projects through expecting somebody to do the job for them. That also causes delays."

He acknowledged there were grounds for some of the criticisms, adding, "A lot of steps need to be taken."

Some delegates at the conference said the CDM needed to become less bureaucratic.

"Every day of delay costs money," said one project developer who didn't wish to be identified.

Editing by Michael Urquhart

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