Luis Mundaca
Professor
CDM wind-energy projects: exploring small capacity thresholds and low performances
Author
Summary, in English
This article analyses existing small-scale wind farms located in India as hypothetical projects implemented under the Clean Development Mechanism (CDM). It addresses them from three different viewpoints (sustainable development, financial feasibility and institutional conditions), focusing mostly on identifying the smallest capacities and lowest performances at which these cases may become attractive for CDM investors. Although the case studies exhibit the potential to achieve the dual objective of the CDM; based on our estimates of related transaction costs we find that small-scale CDM wind farms that generate a minimum of 3,500-5,000 certified emission reductions (CERs) per year may start to attract the attention of CDM investors, as long as a minimum of just US$5 per CER is obtained and supportive strategies such as project bundling and unilateral implementation model are in place. Lessons from the Indian wind-energy experience indicate that non-Annex I countries interested in attracting the attention of CDM investors for wind-energy projects should undertake domestic efforts to build institutional and human competences capable of supporting both their domestic wind-energy markets and the development of CDM wind-energy projects in general. Some policy recommendations are drawn.
Department/s
- The International Institute for Industrial Environmental Economics
Publishing year
2005
Language
English
Pages
399-418
Publication/Series
Climate Policy
Volume
4
Issue
4
Document type
Journal article
Publisher
Taylor & Francis
Topic
- Social Sciences Interdisciplinary
Keywords
- CDM
- small-scale projects
- wind energy
- transaction costs
Status
Published
ISBN/ISSN/Other
- ISSN: 1469-3062