Clean Development Mechanism and Sustainability in Nigeria

Introduction

Climate change has become a major source of concern for contemporary global society. The core problem stems from the fact that various human activities are the main contributing factors to climate change through the emission of greenhouse gases, which ultimately cause global warming. The global community formally acknowledged climate change as a major international issue in 1992 (Mwinzi, 2009), through the adoption of the United Nations Framework Convention on Climate Change (UNFCCC) at the Rio de Janeiro Earth Summit. Two broad strategies were adopted at that convention: first, to mitigate and adapt to the various effects of climate change; and second, to set targets for industrialized states to stabilize their emission levels. It is worth noting that these strategies were not legally binding.

The growing body of evidence on anthropogenic contributions to climate change, as well as the seemingly irreversible nature of its effects, prompted the international community to develop the Kyoto Protocol in 1997. The Kyoto Protocol introduced legally binding emission targets for industrialized nations, which bear the greatest responsibility for elevated concentrations of greenhouse gases in the atmosphere. Concerns about the cost of implementation led to the inclusion of flexible mechanisms for meeting the agreed targets. Various flexibility mechanisms, including the Clean Development Mechanism (CDM), were established under Article 12 of the Kyoto Protocol to allow industrialized nations with emission reduction commitments to engage in greenhouse gas emissions trading (IPCC, 2007).

Article 12 of the Kyoto Protocol established the CDM, which provides an opportunity for developed countries (referred to as Annex B Parties) to fulfill their mitigation commitments. The two main objectives of the CDM are:

1. To assist non-Annex I parties in achieving sustainable development and contributing to the Convention's ultimate objective.
2. To assist Annex I parties in achieving compliance with their quantified emission limitations and emission reduction commitments.

Overview of the Clean Development Mechanism

The CDM was established to help industrialized countries meet their emission targets by employing emission reduction strategies and earning credits — known as Certified Emission Reductions (CERs) — for their efforts. This applies to both Northern and Southern countries. For Southern countries, benefits are generated through activities aimed at reducing fossil fuel combustion (such as kerosene, coal, oil, and gas), reducing methane emissions, or improving land-use patterns, all of which attract additional investment. Investments directly correlated with reduced emissions increase the viability of businesses in the South.

The fundamental requirements for CDM activities are twofold: first, they must meet specific, measurable environmental criteria; and second, they must align with the development priorities of the host country. Benefits to host countries include positive environmental improvements such as reduced air and water pollution and decreased land degradation, as well as socio-economic gains such as job creation. The CDM has been widely regarded as a trailblazer (UNFCCC, n.d.) because it is the first global environmental investment and credit scheme to provide standardized offset instruments — CERs — for measuring emissions. CDM activities may include rural electrification projects using solar panels or the installation of energy-efficient boilers.

The CDM mechanisms stimulate sustainable development and reduce emissions while providing industrialized nations with flexibility in their choice of emission reduction methods. Carbon Trust (2009, p. 14) clearly stated that one objective of the CDM is achieved by allowing Annex I countries to fulfill part of their emission caps through Certified Emission Reductions sourced from emission reduction projects in developing countries such as Nigeria. The CDM also allows industrialized nations to invest in emission reduction wherever it is cheapest on a global scale (Grubb, 2003). Emission-reducing activities focus on energy efficiency, renewable energy, and fuel switching (World Bank, 2010). There are, however, several weaknesses in the CDM framework (World Bank, 2010, p. 256), many of which are addressed through a special modality known as the Program of Activities (PoA), which accredits a bundle of projects rather than a single one.

CDM Projects in Nigeria

The following CDM projects have been identified in Nigeria:

The first is a project for generating electricity using less carbon-intensive fuels while displacing grid and off-grid steam. This plant is located in Aba, Nigeria, and is funded by the World Bank; its assessment period was 2006. The second is a Transmission and Distribution Losses Reduction project, also bankrolled by the World Bank and assessed in 2006. Both of these are energy efficiency projects. Additional CDM projects in Nigeria include the Recovery of Associated Gas at the Kwale Processing Plant in Delta State; the Ovade-Ogharefe Gas Capture Project, also in Delta State; and the Lafarge Cement (WAPCO) project at Sagamu.

Lemna Energy Resources built a major gas compression plant in Nigeria for two major corporations: the Nigerian National Petroleum Corporation and the Pan Ocean Oil Corporation. Lemna Energy Resources won the tender to construct this facility, known as the Ovade-Ogharafe Processing Plant. Once operational, gas that would otherwise be flared will be used to generate electricity. The Managing Director of Pan Ocean Oil Corporation stated: "This plant (Ovade-Ogharafe Processing Plant) will comply with the directive issued by the State to eliminate wasteful flaring of gases by the year 2008." This project aligns with Lemna's environmental mission by reducing harmful emissions and generating power in an environmentally responsible manner. The project was conceived with the express aim of reducing gas flaring at the Ovade-Ogharefe oil field.

In November 2005, the Nigerian Federal High Court ruled that the legislation permitting continued gas flaring was unconstitutional and therefore "null and void." Shell and its Nigerian partner were immediately ordered to cease all further gas flaring operations, and the Court directed the Nigerian Attorney General to amend the relevant legislation.

This facility is located in the Northern Delta Depobelt in the Western Niger Delta, situated on the Asuokpu/Umutu Field, which was awarded to Platform Petroleum Limited. The field is held through a joint venture agreement between Platform Petroleum Limited and Newcross Petroleum Limited, with a 60:40 equity split (PPLtd and NPLtd, 2008). The Asuokpu/Umutu Gas Recovery and Marketing Facility is the fourth CDM facility registered in Nigeria. It was secured and registered by Platform Petroleum Company Limited under the United Nations Framework Convention on Climate Change (UNFCCC) Clean Development Mechanism. The programme carries reference number 3740 and is designed to recover dry associated gas abundant at the Asuokpu/Umutu marginal field and deliver it to the domestic Nigerian market as an energy product.

The project involves the installation of new compression facilities near the Umutu oil installations, along with a 45-kilometer pipeline to transport gas from the marginal field to the existing gas network at Kwale in Delta State. The gas is then transported onward to the Nigerian Agip Oil Company (NAOC) gas network for use in the Niger Delta region (Obayagbona, 2010).

Conclusion

The benefits of adopting CDM strategies are numerous and far-reaching. Sustainability is essential for preserving the future of any given country and of the world as a whole. The Nigerian government should therefore establish clear guidelines, methodologies, and dedicated committees to guide and oversee the process of implementing CDM across the country.