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A |
AAU |
Assigned Amount Unit |
Unit measured in tonnes of carbon dioxide equivalent, in
which Annex I country targets are denominated, under the
Kyoto Protocol. |
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ACM |
Approved Consolidated Methodology |
Large-scale methodology to calculate emission reductions for
a project, approved for use by the Executive Board of the
CDM. Consolidated from a number of approved methodologies (AMs).
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Additionality |
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According to the Kyoto Protocol, all Clean Development
Mechanism (CDM) projects are required to achieve emissions
reductions which are additional to those which would have
occurred in the absence of the project.
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AM |
Approved Methodology |
Methodology to calculate emission reductions for a
large-scale CDM project, approved by the Executive Board of
the CDM.
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A/R |
Afforestation and reforestation |
Afforestation and reforestation as CDM project activities.
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B
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Bundle |
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Bundling signifies the bringing together of several CDM
project activities, to form a single CDM project activity in
order to reduce CDM-related transaction costs. |
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C
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CCN |
Carbon Credit Note |
A fully underwritten obligation (in the form of a note or
bond) to deliver a carbon credit (Certified Emission
Reduction) to the purchaser at a specified future date. |
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CDM |
Clean Development Mechanism |
Flexible mechanism introduced by the Kyoto Protocol
governing project-level carbon credit activities in
non-Annex I countries.
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CER |
Certified Emission Reduction |
Carbon credit from a CDM project, expressed in tonnes of CO2
equivalent (tCO2e).
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CO2 |
Carbon dioxide |
The most common greenhouse gas.
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CO2-e |
Carbon dioxide equivalent |
Unit in which different greenhouse gases can be measured in
terms of the amount of carbon dioxide (CO2) that would have
the same global warming potential.
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Crediting period |
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The crediting period for a CDM project activity is the
period for which reductions from the baseline takes place.
Project participants shall choose the starting date of a
crediting period to be after the date the first emission
reductions are generated. Normal CDM projects have either
fixed (10 years) or renewable (3x7 years) crediting periods.
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D
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Debundling |
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Debundling is defined as the fragmentation of a large scale
project activity into smaller parts. A small scale project
activity that is part of a large scale project activity is
not eligible to use the simplified procedures for
small-scale CDM project activities. |
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DNA |
Designated National Authority |
Climate change focal point of a member country of the UNFCCC
which approves CDM projects in the project host country.
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DOE |
Designated Operational Entity |
Organisation accredited by the EB for validating CDM
projects.
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E
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EB |
Executive Board |
International authority which supervises the registration of
CDM projects and CDM related procedures. |
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Equity IRR |
Equity Internal Rate of Return |
The return on an equity investment. This represents the
yield of the project for the equity investors, after any
debt financing has been taken into account. See also IRR.
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ERPA |
Emission Reduction Purchase Agreement
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Contractual agreement for the purchase of CERs. |
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ESCO |
Energy Service Company |
Company which specialises in the provision of energy
services, e.g. energy efficiency.
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EUA |
EU ETS
Allowance |
Carbon credits created as a tradable commodity under the EU
ETS, expressed in tonnes of CO2 equivalent.
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EU ETS |
European Union Emissions Trading Scheme |
Cap-and-trade scheme for carbon dioxide emissions from major
industrial sectors within the EU.
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ERU |
Emission Reduction Unit |
Carbon credit from a Joint Implementation (JI) project,
expressed in tonnes of CO2 equivalent (tCO2-e).
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F |
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G
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GHG |
Greenhouse
Gas |
Defined by the Intergovernmental Panel on Climate Change as
one of a group of six gases which contribute to
human-induced climate change. The groups
are:
CO2 - Carbon dioxide;
CH4
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Methane;
N2O - Nitrous oxide;
PFC's - Perfluorocarbons;
HFC's - Hydrofluorocarbons
and
SF6 - Sulphur hexafluoride |
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GIS |
Green Investment Scheme |
A scheme to promote the environmental effectiveness of AAU
transfers between Annex I countries, by earmarking revenues
from these transfers for environmentally-related purposes in
the seller countries.
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Gold standard |
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The Gold
Standard Foundation offers a quality label to CDM/JI and
voluntary offset projects, fetching premium prices.
Renewable energy and energy efficiency projects with
sustainable development benefits are eligible. |
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GWP |
Global Warming Potential |
The different potencies of GHG's with regards to their impact
on climate change, expressed in comparison to the GWP of
CO2 which is 1.
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H |
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I
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IRR |
Internal rate of return |
Indicator for the profitability of an investment. |
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ITL |
International Transaction Log |
Global electronic transfer system to enable trading of
carbon credits under the Kyoto Protocol. |
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J
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JI |
Joint Implementation |
Mechanism introduced by the Kyoto Protocol governing
project-level carbon credit activities between Annex I
countries. |
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K
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KP |
Kyoto Protocol |
International legal instrument on climate change containing
emission reduction commitments for Annex 1 Parties. |
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L
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LoA |
Letter of Approval |
Letter issued by the Designated National Authority (DNA) in
the approval process of a CDM project. |
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LULUCF |
Land use, land-use change and forestry |
Kyoto Protocol jargon for terrestrial carbon sink activities
(forestry, agriculture, etc.).
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M
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MFIs |
Micro Finance Institutions |
Financing institutions which focus on micro credits. These
institutions are typically located in rural areas of
less-developed countries. |
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MoP |
Meeting of Parties |
With the coming into force of the KP, the CoP started to
function as a Meeting of Parties to the Kyoto Protocol.
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N
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NAP |
National Allocation Plan |
Document prepared by each EU Member State in advance of each
Phase of the EU ETS, setting out allocations to individual
installations in that country for that phase. |
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NGO |
Non-Governmental Organisation |
A special interest group with no affiliation to the
government.
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NM |
New Methodology |
A new methodology submitted for approval to the Methodology
Panel of the CDM Executive Board.
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Non-Annex I
countries |
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Countries not listed in Annex I to the UNFCCC; generally
developing countries.
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NPV |
Net Present Value |
Sum of the future discounted cash flows of a project.
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O
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ODA |
Official Development Assistance |
Development aid from developed to developing countries.
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OTC |
Over The Counter |
Bilateral trades between a buyer and a seller, not mediated
through an exchange.
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P
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PCF |
Prototype Carbon Fund |
Early carbon fund established by the World Bank. |
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PDD |
Project Design Document |
Document that needs to be prepared and submitted to the CDM
Executive Board through a Designated Operational Entity
(DOE) in order to register a CDM project.
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PIN |
Project Idea Note |
Preliminary CDM feasibility study; not a statutory part of
the CDM process but often produced to facilitate host
country approval and/or financing of a project.
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PoA |
Program of Activities |
A voluntary coordinated action by a private or public entity
which coordinates and implements any policy/measure or
stated goal (i.e. incentive schemes and voluntary
programmes), which leads to GHG emission reductions. An
unlimited number of project activities under a PoA can be
registered as a single CDM project. PoA is often referred to
as Programmatic CDM.
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PPA |
Power Purchase Agreement |
Contractual agreement for the purchase of electricity
generated by a project.
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Primary
Market |
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The Primary Market signifies the first transaction of
Certified Emissions Reductions (CERs) related to a specific
CDM project. CERs can be sold either as the volume of a
whole project or as a pool of Primary Market CERs from a
certain share of a project or from several projects.
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Q |
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R
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Registration |
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Registration is the formal acceptance by the Executive Board
of a validated project activity as a CDM project activity.
Registration is the prerequisite for the subsequent
verification, certification and issuance of Certified
Emissions Reductions (CERs). |
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RMU |
Removal Unit |
Carbon credit from a LULUCF project in an Annex I country,
expressed in tonnes of CO2 equivalent (tCO-e).
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S
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Secondary Market |
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The Secondary Market signifies the second transaction or
trading of Certified Emissions Reductions (CERs) related to
CDM projects. Secondary Market CERs can be traded a pool of
CERs from a certain share of a project or from several
projects. |
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SPV |
Special Purpose Vehicle |
Legal entity established for a specific purpose, for example
to carry out a single project.
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SSC |
Small-scale |
Refers to the Methodology to calculate emission reductions
for a small-scale project, approved by the CDM EB.
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T
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tCO2e |
Tonnes of carbon dioxide equivalent |
Common unit for carbon credits. |
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U
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UNFCCC |
United Nations Framework˙ Convention on Climate Change |
International legal instrument to address climate change,
signed in 1992. |
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V
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Validation |
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Validation is the process of independent evaluation of a
project activity by a Designated Operational Entity (DOE)
against the requirements of the CDM on the basis of the
Project Design Document (PDD) |
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VER |
Voluntary Emission Reduction |
Carbon credit which has been verified by an independent
third party, but not otherwise approved under the Kyoto
Protocol. Carbon credit created specifically for the
voluntary offset market. |
