Lack of proper infrastructure for registration of projects related with clean development mechanism is leading to increase in the cost of such ventures, says a study by industry body Ficci.
New Delhi: Lack of proper infrastructure for registration of projects related with clean development mechanism is leading to increase in the cost of such ventures, says a study by industry body Ficci.
Majority of the respondents participated in the study said that "lack of sufficient number of designated operational entities (DOE) affects the registration process and even increases costs associated with the projects".
The study said the CDM has proved to be a useful mechanism for industry to implement climate change mitigation measures and implement renewable energy projects, it said.
Clean projects like energy efficiency and renewable energy projects have also been provided with financial incentives for undertaking greenhouse gas mitigation measures, it added.
However, "the registration process of CDM is cumbersome and time consuming", the study said.
It has suggested the government to take steps to improve CDM process and its future role in the Indian industry.
"Indian industry has given a big thumbs up to the continuation of CDM and market based mechanisms for climate change mitigation," it said.
The key recommendations include increasing the number of DOE and technical review teams; streamlining project cycle to improve efficiency and lower transaction costs; strengthening the requirements for stakeholder consultation process and constituting a separate appeals process for registration and issuance.
It also suggested to improve the distribution of projects at international and national levels.
It said that the recommendations of the report provide useful insights which the United Nations Framework Convention on Climate Change (UNFCCC) can look into as it designs a framework for the new market mechanisms which will evolve after December 2012.
India continues to be an important player in CDM as it accounts for more than 800 registered projects and along with China hosts more than 70 percent of such projects in the world.
The recommendations assumes significance as the 18th Conference of Parties of the UNFCCC would be held in Doha next month.
It said that a reform of the CDM process is imperative to ensure that steps taken by industry for climate change mitigation are provided further impetus.