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Selecting a CDM investor in China: A critical analysis

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  • Maraseni, Tek Narayan

Abstract

The Kyoto Protocol adopted three flexible market-based mechanisms (Emissions Trading; Joint Implementation; Clean Development Mechanism) to meet emission reduction targets in a cost-effective manner. Of these, the Clean Development Mechanism (CDM) is the only mechanism that links developed and developing countries. China has been a dominant player in CDM markets with >50.86% of the world's 4768 CDM projects. This study surveyed key CDM stakeholders from which the identification and ranking of the 10 most important factors that determine the selection of CDM investors in China. The most important factors were “reputation of company” and “experience in CDM project in China” whilst “personal friendship or relationship” was the least influential. European countries (mainly UK, The Netherlands, Sweden and Germany) are the major investors and have both strong reputations in the CDM arena in addition to having assisted China in capacity development activities for CDM in early 2000. An understanding of these selection factors that potential CDM hosts use in their joint venture decisions should benefit CDM investors. This knowledge should also provide the policy and strategic level framework for future potential CDM hosts in other developing countries.

Suggested Citation

  • Maraseni, Tek Narayan, 2013. "Selecting a CDM investor in China: A critical analysis," Energy Policy, Elsevier, vol. 53(C), pages 484-489.
    • Handle: RePEc:eee:enepol:v:53:y:2013:i:c:p:484-489
    DOI: 10.1016/j.enpol.2012.11.019
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    References listed on IDEAS

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    1. Zhang, Bin & Lai, Kee-hung & Wang, Bo & Wang, Zhaohua, 2017. "Shareholder value effects of corporate carbon trading: Empirical evidence from market reaction towards Clean Development Mechanism in China," Energy Policy, Elsevier, vol. 110(C), pages 410-421.
    2. Lu, Shibao & Wang, Jianhua & Shang, Yizi & Bao, Haijun & Chen, Huixiong, 2017. "Potential assessment of optimizing energy structure in the city of carbon intensity target," Applied Energy, Elsevier, vol. 194(C), pages 765-773.
    3. Kim, Jeayoon & Park, Kwangwoo, 2018. "Effect of the Clean Development Mechanism on the deployment of renewable energy: Less developed vs. well-developed financial markets," Energy Economics, Elsevier, vol. 75(C), pages 1-13.
    4. Cui, Lian-Biao & Fan, Ying & Zhu, Lei & Bi, Qing-Hua, 2014. "How will the emissions trading scheme save cost for achieving China’s 2020 carbon intensity reduction target?," Applied Energy, Elsevier, vol. 136(C), pages 1043-1052.
    5. Watts, David & Albornoz, Constanza & Watson, Andrea, 2015. "Clean Development Mechanism (CDM) after the first commitment period: Assessment of the world׳s portfolio and the role of Latin America," Renewable and Sustainable Energy Reviews, Elsevier, vol. 41(C), pages 1176-1189.
    6. Jiang, Jingjing & Xie, Dejun & Ye, Bin & Shen, Bo & Chen, Zhanming, 2016. "Research on China’s cap-and-trade carbon emission trading scheme: Overview and outlook," Applied Energy, Elsevier, vol. 178(C), pages 902-917.
    7. Zhang, Da & Karplus, Valerie J. & Cassisa, Cyril & Zhang, Xiliang, 2014. "Emissions trading in China: Progress and prospects," Energy Policy, Elsevier, vol. 75(C), pages 9-16.
    8. Benites-Lazaro, L.L. & Mello-Théry, N.A., 2019. "Empowering communities? Local stakeholders’ participation in the Clean Development Mechanism in Latin America," World Development, Elsevier, vol. 114(C), pages 254-266.
    9. Röttgers, Dirk & Grote, Ulrike, 2014. "Africa and the Clean Development Mechanism: What Determines Project Investments?," World Development, Elsevier, vol. 62(C), pages 201-212.
    10. Hu, Guangyu & Rong, Ke & Shi, Yongjiang & Yu, Jing, 2014. "Sustaining the emerging carbon trading industry development: A business ecosystem approach of carbon traders," Energy Policy, Elsevier, vol. 73(C), pages 587-597.
    11. Tang, Wenzhi & Du, Shaofu & Hu, Li & Wang, Bill & Zhu, Yangguang, 2022. "The effects of leadership in Clean Development Mechanism low-carbon operations," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 158(C).
    12. Xie, Huiming & Shen, Manhong & Wang, Rui, 2014. "Determinants of clean development mechanism activity: Evidence from China," Energy Policy, Elsevier, vol. 67(C), pages 797-806.

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