On 9 June 2011, fighting started at the Dapein hydropower plant within the northernmost state of Myanmar between the Kachin Independence Organisation's military arm and Burmese soldiers posted there to safeguard the dam.
It broke a 17-year ceasefire inside a long and little reported conflict between your largely Christian minority group and government militias. Scores of people were killed and up to 100,000 refugees continue to be residing in camps within the borderland with China.
Gumring Hkanda was born inside a village of Kachin state. He now researches the conflict via a cultural lens at the University of Manchester. He described the violence as “most brutal and cruel”. “It's been a terrible 11 years,” he said.
A partnership between Chinese state-owned company Datang and also the Myanmar's state electric power enterprise, the Dapein dam became a battleground for social struggles, representing military oppression while exporting almost all the electricity to China. “These mega dams are fueling further conflict, not benefitting the people of Burma,” Sai Sai from the Burma Rivers network said at the time.
The dam prevented greenhouse gas emissions compared to the alternative of coal-fired power generation. And despite its troubled history, those carbon savings have currency today.
Exclusive analysis of publicly available data for Climate Home News implies that the Dapein dam is one of at least 804 projects whose past emission reductions can be bought by countries as a cheap method to meet their climate targets.
Under rules agreed at last year’s UN climate summit in Glasgow, UK, carbon credits generated by these projects qualify for use towards national 2030 emissions goals.
While conflict in Kachin was raging, the 240MW dam was registered with the Clean Development Mechanism (CDM), at the beginning of 2013.
The world's largest carbon offsetting programme, established underneath the Kyoto Protocol by UN Global warming, the CDM allowed rich countries to meet some of their climate obligations by financing carbon-cutting projects in poorer ones.
The scheme has been widely criticised for its patchy human rights record and failure to deliver promised climate benefits. Projects were approved without always consulting local neighborhoods and, at times, causing them harm.
The Kyoto Protocol continues to be superseded through the Paris Agreement, which requires every country to contribute climate targets. But, old credits that meet certain criteria continue to be readily available for governments and companies to purchase, promoted by UN Global warming.
“This is actually problematic,” said Jonathan Crook, policy officer at Carbon Market Watch. “Most of those are poor-quality credits, many from almost Ten years ago.”
“We call them 'junk' or 'zombie' credits since they're unlikely to represent real environmental integrity,” he said. “These largely worthless credits now have a stamp of approval, which gives them more credibility and means they could be used for greenwashing.”
In total, approximately 320 million old credits – equal to the annual emissions of 86 coal-fired power plants – are for sale to nations to count towards their climate commitments.
Climate Home’s data analysis reveals which from the CDM's a lot more than 8,200 projects are allowed to carry over into the new Paris Agreement regime.
India alone hosts near to half of CDM projects permitted to sell old emission cuts. This really is followed by China with 12% and Brazil with 6.5%.
One in five of these projects are hydropower dams. Campaigners have repeatedly required large dams to be excluded in the UN's or other offsetting scheme over human rights concerns and environmental damage.
In Myanmar, the central government granted permission for that construction from the Dapein dam and introduced troops to protect it against local opposition.
The dam was built with a Chinese workforce and 92% from the electricity it generated was exported back to China.
“Local people did not enjoy it since it wasn't for local people. They were no benefits whatsoever,” Hkanda said.
Registration documents towards the CDM explained that the exported electricity is needed cut emissions in southern China's power company by displacing fossil fuel sources. They provided no reference to the conflict in Kachin.
The project developers argued the dam would “improve living conditions” for local rural households by providing electricity and “stimulate” local economic development – something Hkanda says his family never saw materialise. Neither Datang nor the government of Myanmar responded to our request to comment.
A further 43% of projects with carry-over credits are in solar and wind power. Whilst not typically related to human rights abuses, these projects have dubious climate benefits. After years functioning, they're apt to be profitable from the sale from the electricity alone, not driving any more emissions cuts.
A 2023 study commissioned through the European Commissioned discovered that the CDM “has fundamental flaws in terms of overall environmental integrity” and that nearly all projects “are not providing real, measurable and additional emission reductions”.
Two projects in the 2GW Pavagada solar park in the southern Indian state of Karnataka illustrate this. When the projects were registered using the CDM in 2023 and 2023, the work developer, Finnish state-owned energy company Fortum, argued that solar projects were “not common practice” in the area and needed CDM funding to become profitable.
But satellite images of the area show an immediate growth and development of solar farms because the oncoming of 2023. Most didn't depend on the CDM for their investment case.
Further north, within the state of Rajasthan, Fortum was commissioned to build a 70MW solar field in 2023. The project was registered under the CDM on the same basis solar PVs were uncommon in the region.
Today, the guarana plant continues to be engulfed through the 2.7GW Bhadla Solar Park Body of the world's largest, covering a place half how big Dublin.
Fortum declined to respond to Climate Home's questions.
CDM-backed wind projects in India consume a similar story. Research conducted recently by the Center for Economic Studies in the University of Munich discovered that several in two projects it considered were not generating additional emissions cuts.
“Our study shows that, despite good intentions, the CDM might actually have increased emissions,” the authors concluded.
“Is there value in buying these credits now? Absolutely not if I am concerned. There should not be in circulation. Period,” Sandeep Roy Choudhury, director of VNV Advisory, an Indian social enterprise that develops community-based projects for the carbon market, told Climate Home.
Choudhury argued that although renewable energy credits in India may have generated additional emissions cuts before 2012, this was no longer the case.
“I understand the value of offsets but you will find higher quality credits out there that would really benefit the world – this legitimises bad quality credits and is undermining many of our work,” he said.
These concerns aren't new.
Martin Cames, a researcher at the “Oko Institute in Germany, served as an executive board member towards the CDM from 2012 to 2013. European members raised these concerns at that time, he told Climate Home, but lacked a majority to do something.
Some representatives of the countries exporting credits, because he saw it, were more focused around the revenue stream than environmental integrity.
“It was considered to be a technical body however it was really quite political,” said Cames. “Board members were mandated by their region coupled with different agendas.”
The most vocal defenders of the CDM have been individuals with credits to sell, but it takes two to make a trade. Who is buying?
So far, no government has declared plans to use CDM credits, but not everyone has ruled it.
MJ Mace, who negotiated for the Alliance of Small Island States, told Climate Home these old credits undermine ambition by letting polluters duck hard work of reducing their very own emissions.
“[Countries] do not have to go and make an emission reduction if [they] can simply buy one. It's less effort,” she explained.
India, for instance, is considering with a couple CDM credits as part of a domestic carbon market expected to launch the coming year.
An alliance of 36 vulnerable nations and European countries, known as the San José coalition, argued any utilization of carry-over credits would undermine global efforts to limit global heating to at least one.5C. They've refused to use them towards their climate goals.
As long as CDM credits for pre-2023 emission reductions are issued, “they will have a market,” said Lambert Schneider, a carbon market expert in the “Oko Institute and person in the CDM executive board. If not with governments, then with corporations.
So far, there aren't any restrictions on companies purchasing old CDM credits, even those older than 2013, to create carbon neutrality claims.
Some CDM credits can be bought under South Korea's emission trading scheme. The aviation industry's offsetting scheme Corsia has also allowed old credits to become purchased under its first pilot phase, with some restrictions.
Of the world's biggest publicly traded companies, 702 have set net zero emissions targets, based on the Net Zero Tracker database. That ambition is not yet matched with credible action plans, with sixty-six per cent of companies not meeting basic emissions reporting standards.
CDM credits will likely be used towards those voluntary targets, Kentaro Takahashi from the Japan-based Institute for Global Environmental Strategies (Iges) told Climate Home.
UN Global warming is nurturing interest in the marketplace and it has an interest in doing this. For every CDM credit issued, it receives up to $0.2 to cover administrative expenses. An additional 2% of revenues from issued credits visit the Adaptation Fund.
In 2023, the UN body issued an advertising video called “Keep calm and offset” – then retracted it following a backlash. Critics described it as mocking green life choices and promoting “junk” credits.
Since then, its support for the mechanism has been more subtle. Earlier this year, it partnered having a blockchain-based exchange to market old credits to companies on the voluntary market – to the surprise of some climate negotiators.
Franz Perrez, chief climate negotiator in Switzerland, described it as being “clearly not using the ambition of Paris”. Janine Felson, ambassador for Belize and deputy head of the small island's delegation at Cop26, told Climate Home the move “didn't square” with rules adopted at Cop26 in Glasgow.
A UN Climate Change spokesperson said this remained part of the organisation's mandate which “all [credits] under the CDM already went through a a three stage evaluation process to ensure each one represents a real, measurable, verifiable and attributable emission reduction”.
