The Kyoto Protocol

The Kyoto Protocol is the first international treaty to set legally binding targets to cut greenhouse
gas emissions. It was adopted on 11 December 1997 in Kyoto, Japan. The agreement, which
entered into force in 2005 and was ratified by 192 parties. It has been superseded by the Paris
Agreement but remains a historic landmark in the international fight against climate change.
The Kyoto Protocol is related to the United Nations Framework Convention on Climate
Change (UNFCC) by committing industrialized countries and economies in transition to limit and
reduce greenhouse gases (GHG) emissions as per agreed individual targets. Article 2 of the
UNFCCC (1992) states that greenhouse gases should be brought down to “a level that would
prevent dangerous anthropogenic (human) interference with the climate system.” The parties
mentioned in Annex B must achieve their fixed emission to promote sustainable development.

History of Kyoto Protocol

The Kyoto Protocol, established in 1997 and enforced in 2005, is a pivotal international climate
change treaty. It mandated binding emission reduction targets for 37 industrialized nations and
the EU, employing mechanisms like emissions trading and the Clean Development Mechanism.
Despite the absence of key players like the U.S., its influence resonates in subsequent
agreements, such as the 2015 Paris Agreement. The Kyoto Protocol is a foundational milestone
in the global fight against climate change. After the first commitment period of the Kyoto
Protocol, the conclusion was that there was a need for amendments, and accordingly, revisions
were made.
In Doha, Qatar, on 8 December 2012, the Doha Amendment to the Kyoto Protocol was adopted
for a second commitment period, starting in 2013 and lasting until 2020. The second commitment
period’s emission reduction targets are discussed in this amendment. Recognizing Kyoto's
limitations, the Paris Agreement was adopted at COP21 to involve all nations. Annual climate
negotiations continue under the UNFCCC, addressing issues like finance, adaptation, and carbon
markets.

List of greenhouse gases as per the Kyoto Protocol 1997

 Carbon dioxide (C02) – Released from burning of fossil fuels in industries, transportation, etc.
 Methane (CH4) – Agricultural activities, landfills
 Nitrous oxide (N20) – Agriculture (overuse of nitrogen-based fertilizers), industrial activities
 Hydrofluorocarbons (HFCs) - Refrigeration and Air Conditioning, Aerosols (spray cans)
 Perfluorocarbons (PFCs) - Aluminum production, Semiconductor Manufacturing (Cleaning
agents)
 Sulphur hexafluoride (SF6) - Electrical Equipment (gas in high-voltage circuit breakers)

Objectives of the Kyoto Protocol

The Kyoto Protocol's objective was to operationalize the United Nations Framework Convention
on Climate Change (UNFCC). The Kyoto Protocol was endorsed at the third session of the
Conference of the Parties (COP 3), in December 1997. The primary agenda of the Kyoto Protocol
is to commit industrialized countries and economies in transition to limit and reduce greenhouse
gas (GHG) emissions by agreed individual targets.
Mechanisms of the Kyoto Protocol
The Kyoto Protocol introduced three market-based mechanisms to help countries meet their
emission reduction targets:
1. Clean Development Mechanisms (CDM)
The CDM allows countries with emission reduction or limitation commitments under the Kyoto
Protocol (Annex B Parties) to implement emission-reduction projects in developing countries.
These projects help reduce global emissions and contribute to sustainable development in the
respective country.
Hypothetical Example Scenario
A developed country has a Kyoto quota of 100 carbon credits, allowing it to emit 100 tonnes of
CO₂. However, it emits 110 tonnes of CO₂ due to excessive emissions, thereby losing 10 carbon
credits and violating its Kyoto quota.
To avoid penalties, the country compensates for the deficit by:
 Funding clean energy projects in developing or least-developed countries.
 Generating 10 CER credits through these projects to offset its excess emissions.
This mechanism enables the country to balance its emissions while supporting sustainable
development in poorer nations, ultimately achieving global climate goals.
 Carbon Credits as evidence: Countries like Australia can showcase the carbon credits earned
through such projects to demonstrate how they meet their Kyoto Protocol targets.
 Tradable CER Credits: Each CER credit represents one tonne of CO₂ reduced. These credits
are tradable and can be used by countries to meet their emission reduction obligations under
the Protocol.
How wealthier Countries benefit from CDM
 Higher Emissions, Higher Responsibility: Wealthier nations, which typically emit more
greenhouse gases, face challenges in meeting their Kyoto emission quotas. If they exceed
their allowed emissions, they lose carbon credits.
 Investing in Clean Energy: Developed nations invest in clean energy projects in developing
and least-developed countries to compensate for these lost credits and avoid penalties.
These projects include building solar power plants, wind farms, and afforestation initiatives.

2. Carbon Emission Trading

A carbon credit (also called a carbon offset) is a transferable certificate that represents the right
to emit one tonne of carbon dioxide (CO₂) or its equivalent greenhouse gases (GHGs). Carbon
credits are an integral part of global efforts to mitigate the rise in GHG levels.
 What is Carbon Trading? Carbon trading involves the buying and selling of carbon emission
allowances. These transactions can occur within a country's economy or between countries.
 Purpose of Carbon Credits: Carbon credits help reduce greenhouse gas emissions by
providing financial incentives for countries and businesses to limit their emissions.
 Methods to Generate Carbon Credits: It can be created through various initiatives, like:
 Afforestation and Reforestation: Planting trees to absorb CO₂ from the atmosphere.
 Renewable Energy Projects: Using wind, solar, or other renewable energy sources to
replace fossil fuels.
 CO₂ Sequestration: Capturing and storing carbon dioxide underground.
  Methane Capture: Collecting methane emissions from landfills or agricultural activities.
 Carbon Credits Trading Platforms: Buying credits through exchanges.
 How the Carbon Credits Trading System Works?
 Countries or companies emitting more than their permitted carbon limit must purchase
carbon credits from those emitting less.
 One carbon credit permits the emission of one tonne of CO₂.
 For example, a developing country like India often acts as a seller of carbon credits,
benefiting financially from these transactions.
 Types of Carbon Trading:
 Emission Trading: Allows entities to trade emission allowances under a cap-and-trade
system.
 Offset Trading: Focuses on projects that generate additional carbon credits by reducing
GHG emissions.
 Carbon Credits in India:
 India has emerged as a key seller of carbon credits due to its various renewable energy
and environmental initiatives. This provides economic benefits to its citizens.
 The Multi-Commodity Exchange of India (MCX) first introduced carbon credit futures
trading in 2009.
 Global Carbon Credit Markets: Carbon credits are traded on multiple exchanges worldwide,
promoting international cooperation in combating climate change.
3. Joint Implementation
A country with a Kyoto Protocol emission reduction commitment (Annex B Party) can earn
emission reduction units (ERUs) from an emission-reduction project in another Annex B Party,
with each ERU equaling one tonne of CO2 that can be used to satisfy its Kyoto target. Parties can
meet a portion of their Kyoto commitments in a flexible and cost-effective manner through joint
implementation, while the host Party benefits from foreign investment and knowledge transfer.

India and the Kyoto Protocol

India endorsed the Kyoto Protocol as soon as it was signed. It asserted the “polluter pays”
principle and argued for extending the commitments in 2012. Although India had no binding
targets, it instituted the National Action Plan on Climate Change under the UPA Government led
by Manmohan Singh.
Achievements of the Kyoto Protocol 1997
The Kyoto Protocol was the first significant international treaty to mandate emission reductions,
successfully establishing emissions trading and Clean Development Mechanism (CDM) projects,
which increased investments in green technologies and renewable energy projects, particularly
in developing countries.
 The Kyoto Protocol only required wealthier countries to cut emissions, which caused
controversy; nevertheless, this anomaly was corrected with the signing of the Paris
Agreement in 2015.
 Although climate science was clearly solid enough to negotiate an international treaty in
the late 1990s, it is difficult to argue that scientific awareness of the climate crisis has
 expanded dramatically over the last two decades, during which the United Nations
Framework Convention on Climate Change (UNFCCC) played an important role.
 The UNFCCC has enabled the creation and implementation of specific adaptation
measures through the National Adaptation Programmes of Action (NAPAs) and the
Nairobi work programme.
 The UNFCCC contributed in the creation of novel climate change mitigation strategies
such as the Clean Development Mechanism (CDM), under which projects in developing
countries that reduce emissions earn credits that can be sold to governments or
businesses that have committed to reducing emissions.
 Since the UNFCCC was created, national governments have encouraged and improved
collaboration on technology production and transfer.
 The UNFCCC provides a framework for financing, technological transfers, negotiations,
and global alliances, among other things, to aid developing countries in combating climate
change.

Key Takeaways:
o Introduction and Objectives: Adopted in 1997 and effective from 2005, the Kyoto Protocol aimed to
reduce greenhouse gas emissions, targeting an average 5% reduction below 1990 levels for 37
industrialized countries and the European Community during 2008-2012.
o Binding Targets: Imposed legally binding emission reduction obligations on developed countries,
focusing on mitigating climate change.
o Mechanisms:
 Clean Development Mechanism (CDM): Allowed developed countries to earn credits by
investing in emission reduction projects in developing countries.
 Emissions Trading: Created a carbon market for trading emission units.
 Joint Implementation (JI): Permitted earning emission reduction units through projects in
other developed countries.
o Differentiated Responsibilities: Recognized that developed countries should lead due to their
historical contributions to emissions.
o Challenges:
 Significant non-participation (e.g. the U.S. did not ratify).
 Economic concerns regarding impact on growth and competitiveness.
 Complex procedures and bureaucracy.
o Successes:
 Set the foundation for future climate agreements.
 Raised global awareness and encouraged innovation in renewable energy.
 Built capacity in developing countries for sustainable projects.
o Legacy:
 The Doha Amendment (2012-2020) extended targets but had limited ratification.
 Paved the way for the more inclusive Paris Agreement in 2015, involving broader participation
from both developed and developing nations.

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