Emission trading units from project activities
Can mitigation projects (e.g. in Austria) generate emission trading units?
In the European Emission Trading System (ETS), allowances are not generated by mitigation measures. Usually they have to be purchased in auctions or from other market participants. Some market participants, who are obliged to participate in the ETS, can apply for free allowances under certain conditions.
There was a mechanism under the Kyoto-Protocol (Clean Development Mechanism – CDM), that allowed for mitigation projects or removal projects to generate units, such as Certified Emission Reductions (CERs, t-CERs, l-CERs). For further information about this mechanism, please use the link below “UNFCCC - Clean Development Mechanism (CDM)”. Those projects were hosted in countries that had no emission target under the Kyoto-Protocol at country level. Another mechanism allowed Emission Reduction Units (ERUs) to be generated by projects in countries that had adopted an emissions target under the Kyoto Protocol. Austria did not allow these projects to be hosted in its country.
UNFCCC - Clean Development Mechanism (CDM)
Since 10 September 2023, CERs and ERUs can only be transferred within the Austrian Kyoto Protocol registry, as the additional period for fulfilling the 2nd Kyoto commitment period expired on 09 September 2023. Furthermore the units may not be held in EU ETS accounts.
Under the Paris-Agreement the rules for similar mechanisms have not yet been finalized.
Currently mitigation projects or removal projects (e.g. concerning afforestation) in Austria cannot be used to create tradeable units in the context of the European Emission Trading System or the Paris Agreement. For the voluntary compensation of emissions, there is the option to use the voluntary cancellation of units of the CDM-Kyoto-mechanism. For further information on how to perform this process, please use the link below to the website of the UNFCCC - CDM Registry.
Another option is to donate for mitigation projects in Austria or elsewhere. There are several collectors of donations for mitigation projects and some of them adhere to most of the rules of the CDM mechanism or go beyond these rules. Some issue a receipt for the donation or a documantation of the resulting emission reduction. These voluntary activities are called “voluntary carbon market”.
Electromobility
In Austria, electricity used in road transport, can be used for companies selling fossil fuels, to achieve their mandatory substitution targets or their mandatory GHG-mitigation targets. For more details, please visit the website “Anrechnung (erneuerbarer) Strom” of the Environmental Agency Austria with the link below (using a translation tool) or contact Strom-KVO@umweltbundesamt.at.