Certified Emission Reductions (CERs) are a type of emissions unit (or

carbon credit A carbon credit is a generic term for any tradable certificate or permit representing the right to emit a set amount of carbon dioxide or the equivalent amount of a different greenhouse gas (tCO2e). Carbon credits and carbon markets are a compo ...

s) issued by the

Clean Development Mechanism The Clean Development Mechanism (CDM) is a United Nations-run carbon offset scheme allowing countries to fund greenhouse gas emissions-reducing projects in other countries and claim the saved emissions as part of their own efforts to meet internat ...

(CDM) Executive Board for emission reductions achieved by CDM projects and verified by a DOE (Designated Operational Entity) under the rules of the

Kyoto Protocol The Kyoto Protocol was an international treaty which extended the 1992 United Nations Framework Convention on Climate Change (UNFCCC) that commits state parties to reduce greenhouse gas emissions, based on the scientific consensus that (part ...

. CERs can be used by Annex 1 countries in order to comply with their emission limitation targets or by operators of installations covered by the European Union Emission Trading Scheme (EU ETS) in order to comply with their obligations to surrender EU Allowances, CERs or Emission Reduction Units (ERUs) for the emissions of their installations. CERs can be held by governmental and private entities on electronic accounts with the UN. CERs can be purchased from the primary market (purchased from an original party that makes the reduction) or secondary market (resold from a marketplace). At present, most of the approved CERs are recorded in CDM Registry accounts only. It is only when the CER is actually sitting in an operator's trading account that its value can be monetized through being traded. The UNFCCC's International Transaction Log has already validated and transferred CERs into the accounts of some national climate registries, although European operators are waiting for the

European Commission The European Commission (EC) is the executive of the European Union (EU). It operates as a cabinet government, with 27 members of the Commission (informally known as "Commissioners") headed by a President. It includes an administrative body ...

to facilitate the transfer of their units into the registries of their Member States. Temporary CERs and Long CERs are special types of CERs issued for forestry projects. They are two ways of accounting for non-permanence in forestry CDM project activities. Temporary CER or tCER is a CER issued for an afforestation or

reforestation Reforestation (occasionally, reafforestation) is the natural or intentional restocking of existing forests and woodlands ( forestation) that have been depleted, usually through deforestation, but also after clearcutting. Management A de ...

project activity under the CDM which expires at the end of the commitment period following the one during which it was issued. Long-term CER or lCER is a CER issued for an afforestation or reforestation project activity which expires at the end of its crediting period.Decisions adopted by the Conference of the Parties serving as the meeting of the Parties to the Kyoto Protocol
Report of the Conference of the Parties serving as the meeting of the Parties to the Kyoto Protocol on its first session, held at Montreal from 28 November to 10 December 2005. In August 2008 prices for CERS were $20 a tonne. By September 2012, prices for CERS had collapsed to below $5. This was in response to the

Eurozone debt crisis The European debt crisis, often also referred to as the eurozone crisis or the European sovereign debt crisis, is a multi-year debt crisis that took place in the European Union (EU) from 2009 until the mid to late 2010s. Several eurozone membe ...

reducing industrial activity and the over-allocation of emission allowances under the European Union Emissions Trading Scheme. ''The Economist'' described the Clean Development Mechanism as a "complete disaster in the making" and "in need of a radical overhaul". ''The Guardian'' also reported the prolonged downward trend in the price of CERs, which had been traded for as much as $20 (£12.50) a tonne before the global financial crisis to less than $3. In October 2012, CER prices fell to a new low of 1.36 euros a tonne on the London ICE Futures Europe exchange. In October 2012 Thomson Reuters Point Carbon calculated that the oversupply of units from the Clean Development Mechanism and Joint Implementation would be 1,400 million units for the period up to 2020. Point Carbon predicted that CER prices would to drop from €2 to 50 cents. On 12 December 2012 CER prices reached another record low of 31 cents.

References

{{reflist Climate change policy Emissions reduction