Tuesday 8 December 2009

Materiality and the Clean Development Mechanism


Today is the 10th meeting of the DOE/AIE Forum here in Copenhagen. The DOE/AIE Forum (Designated Operational Entities/Accredited Independent Entities) was originally established by the Executive Board as a means of enhancing the channels of communication between the Board and the DOE's and to provide guidance on decisions.


Over recent times, the DOE Forum has looked to progress a number of key issues with regard to validation and verification, including the issue of ‘materiality’. At present, unlike other schemes such as the European Union Emissions Trading Scheme (EU ETS), the CDM does not define a level of materiality and, as a result, there is no defined requirements as to how far a DOE has to go in finding data, or how deeply to analyse that data.
The DOE Forum Chairman has made presentations to the Executive Board (EB) on this subject at recent EB meetings, and it is hoped that progress on incorporating this concept into CDM will happen soon.

At this particular meeting, it is planned for discussions to focus on concerns about Clause 57 of the Accreditation Standard and the lack of clarity with regard to ‘what is a technical area within a sectoral scope?

The lack of clarity in this area has resulted in DOEs developing different systems to determine the competence of team members from a technical perspective, and it is felt that clearer guidelines will result in greater consistency across DOEs in this area.

The meeting will also look at the issue of target timescales for the completion of CDM validations and verifications (180 days and 90 days respectively). This is an area where DOEs have struggled, often due to the time taken to close out corrective actions and clarifications by project participants.

It is also possible that there will be discussion on the current plans to implement a more structured system for monitoring the performance of DOEs, based on a scoring system.

I will be back later in this series with an update on the CDM and DOE's.

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