Assigned Amount Units. Allowances for carbon emissions under the
Kyoto Protocol's emission trading mechanism. Each unit equates to
one tonne of CO2e.
Annex I, or Annex
The signatory nations to the Kyoto Protocol that are subject to
caps on their emissions of greenhouse gases and committed to reduction
targets - countries with developed economies. Annex I refers
to the 36 countries identified for reduction in the UNFCCC, while
the Annex B is an adjusted list of 39 countries identified
under the more recent Kyoto Protocol. Annex B countries have their
reduction targets formally stated.
A subset of Annex 1/B, Annex II countries are signatory nations
to the UNFCCC, which are also members of the OECD - the most industrialised
economies. They have extra obligations to help developing nations
combat climate change via technology transfer and financial
on Clean Development and Climate (AP6)
The Asia-Pacific climate pact is a rival international climate
change agreement to the Kyoto Protocol. Its initiators are the United
States and Australia - the only two industrialised nations not to
ratify the Kyoto treaty - and the group also includes China, India,
Japan and South Korea. AP6 rejects Kyoto-style emission reduction
targets in favour of encouraging business to invest in clean fossil
fuel technology and renewable energy.
Baseline and credit
A type of emissions trading scheme where firms are encouraged to
reduce their greenhouse gas emissions below a projected 'business
as usual' path of increasing emissions. Any reductions below
that future path earns credits for the difference, which can be
sold to other emitters struggling to contain increases to baseline
levels. See also cap and trade.
Biofuels are renewable fuels made from plants that can
be used to supplement or replace the fossil fuels petroleum and
diesel used for transport. The two main biofuels are ethanol
Ethanol is produced from the fermentation of sugar or starch in
crops such as corn and sugar cane. Biodiesel is made from vegetable
oils in crops such as soybean, or from animal fats. Depending on
the processes used to make biofuels, greenhouse emissions from cars
and fuel-powered machinery can be substantially reduced by their
Cap and trade
The most popular type of emissions trading scheme - where emissions
are subject to a cap. Permits are issued up to that cap and a market
allows those emitting less than their quota of the cap, to sell
their excess permits to emitters needing to buy extra to meet their
quota. See also baseline and credit.
An individual, family or organisation that is responsible for
no net emissions of greenhouse gases from all its activities, is
considered 'carbon neutral'. Emissions must be cut to a minimum
and any necessary emissions then offset by emission-reducing activities
elsewhere. Buying accredited clean electricity helps cut household
or office greenhouse emissions - while investing in sustainable
energy projects or afforestation schemes are examples of offsets.
An individual, family or organisation that is responsible for taking
more greenhouse gases out of the atmosphere than it emits, is said
to be 'carbon positive'. This requires paying for activities
such as forest planting or investing in renewable energy.
Clean Development Mechanism. A Kyoto Protocol initiative, under
which projects set up in developing countries to reduce atmospheric
carbon, generate tradable credits called CERs. The credits can be
used by industrialised nations to offset carbon emissions at home
and meet their Kyoto reduction targets. The projects include afforestation,
reforestation and implementation of clean fuels technology.
Certified Emission Reductions. Credits generated under Kyoto's
Clean Development Mechanism (CDM). They are designed to be used
by industrialised countries to count toward their Kyoto targets,
but can also be used by EU companies and governments as offsets
against their emissions under the EU Emissions Trading Scheme.
Economies In Transition. Those nations in Annex I of the Kyoto Protocol,
considered developed but currently in transition to a market economy.
Generally, the nations and former republics of the old Soviet brbloc.
A market-based system for regulating the emission of greenhouse
gases. The quantity of emissions is controlled and the price allowed
to vary by the issuing of tradeable emission permits. These rights
to emit can be traded in a commercial market under an emissions
trading scheme. More in FAQs
Emission Reduction Units. Tradeable credits generated from activities
to reduce greenhouse emissions in former Soviet-bloc countries under
the Kyoto Protocol's Joint Implementation (JI) mechanism.
Emissions Trading Scheme. More in FAQs
European Union Allowances. Tradeable emission credits from the
European Union Emissions Trading Scheme. Each allowance carries
the right to emit one tonne of carbon dioxide.
Greenhouse gases. More in FAQs
Global warming potential. This refers to the potency of greenhouse
gases - that is, their ability to trap heat in the atmosphere. The
GWP is a numerical measure relative to carbon dioxide - the most
abundant greenhouse gas - so, carbon dioxide itself has a GWP of
1. For the GWPs of all greenhouse gases - see FAQs.
Intergovernmental Panel on Climate Change. An international
scientific panel charged with informing the UNFCCC with the latest
scientific evidence on climate change. With representatives from
130 nations, it is the world's pre-eminent scientific advisory body
on global warming.
Joint Implementation. A Kyoto Protocol mechanism, which allows developed
countries - particularly those in transition to a market economy
- to host carbon-reducing projects funded by another developed country.
The arrangement sees the credits generated - called ERUs - go to
the investor country, while the emission allowances (AAUs) of the
host country are reduced by the same anount.
Land use, land use change and forestry. The term given to tree-planting
projects, reforestation and afforestation - designed to remove carbon
from the atmosphere.
National Allocation Plans. These set out the overall emissions
cap for countries in the EU Emissions Trading Scheme and the allowances
that each sector and individual installation within each country
Project Design Document. The official application drawn up by an
entity applying for project approval under the Clean Development
Mechanism (CDM). PDDs must be validated by an independent third
party, then approved and registered by the CDM Executive Board,
before a project qualifies as a CER carbon credit earner.
Removal Units. Credits earned from land use, land-use change
and forestry projects (LULUCF) in industrialised countries - including
such projects under the Kyoto Protocol's JI mechanism.
Tonnes of carbon dioxide equivalent and millions of tonnes of carbon
dioxide equivalent. This is the metric measurement unit for greenhouse
emissions. The global warming impact of all greenhouse gases is
measured in terms of equivalency to the impact of carbon dioxide
(CO2). For example, one million
tonnes of emitted methane - a far more potent greenhouse gas than
carbon dioxide - is measured as 23 million tonnes of CO2
equivalent, or 23 MtCO2e.
The United Nations Framework Convention on Climate Change - also
referred to, more informally, as the UN climate change convention.
It is the international agreement for action on climate change and
was drawn up in 1992. A framework was agreed for action, aimed at
stabilising atmospheric concentrations of greenhouse gases.
The UNFCCC entered into force on March 1994 and, currently, has
189 signatory parties. The UNFCCC, in turn, agreed the Kyoto Protocol
in 1997 to implement emission reductions in industrialised countries.
Verified Emission Reductions. Tradeable credits for greenhouse emission
reduction activities generated to meet voluntary demand for carbon
credits by organisations and individuals wanting to offset their