Page - (000230) - in Evaluating Climate Change Action for Sustainable Development

12.1 Introduction Efforts toprovidecleancookingandwaterfiltrationfacilities to thepoorhavebeen pursued in earnest by aid agencies, government ministries and the non-governmental sector for decades, thoughmany initiatives have been stymied by inadequate and inconsistent funding, the introduction of inappropriate technol- ogies, and a lack of follow-up (Clasen et al. 2004; Baumgartner et al. 2007; Lantagne et al. 2008). In2005, the internationalcarbonmarketwas launchedunder theKyotoProtocol and the concept of “carbon finance” entered the world stage. Carbon finance marked an innovative approach to development finance in that it was designed to harness the motor of private finance to goals for the public good by awarding fungible “carbon offsets” for the delivery of development services that displaced activities that would otherwise generate greenhouse gas emissions (UNFCCC 1997). Two years later, the voluntary carbonmarket was launched and remained a viable channel for financing low-carbon projects even as support for theKyoto Protocol’smarketmechanismswaned (Peters-Stanley2013)Theprojects analysed in this chapter draw fromboth theKyotoProtocol’smarketmechanism for devel- oping countries, the “Clean DevelopmentMechanism” (CDM) and the similarly structuredvoluntary carbonmarket.While theCDMand the voluntarymarket are both undergoing transformation as the Kyoto Protocol’s implementation period draws to a close, consensus on the ParisAgreement at the 21st Conference of the Parties to theUNFCCC inDecember 2015 indicates thatmarketmechanismswill continue to play a role in the upcoming climate regime.As such, lessons derived from the first generation of carbon market efforts under the Kyoto Protocol are relevant towards the design of the next generation of market-oriented climate finance tools. Projects that aim for a high social and local development component are called “pro-poor carbon projects” (Verles and Santini 2012), “charismatic carbon pro- jects” (Cohen2011), “premiumcarbon”(TheGoldStandard2010)or“carbonwith a human face” (World Bank 2002). These terms encompass carbon projects targeting the least well-off, either by introducing technological innovations to underserved households or by being physically located inLeastDevelopedCoun- trieswheretheemissionsfootprint isalreadylowandinvestmentrisksarehigh(and therefore the incentive to invest in carbon reductions isminimal). The majority of pro-poor projects are household-level interventions for responding to basic needs, such as fuel-efficient cook stoves, water filtration devices, andmini biodigesters that convert livestock andorganic householdwaste into gas for cooking and household lighting. Significantly, pro-poor projects emphasize “co-benefits,” or sustainable development deliverables, to the project recipients beyond offsetting emissions alone: they promise the creation of skilled job opportunities, increased household income, improved health outcomes, etc. Premiumcertification schemes, such as theGold Standard for both theCDMand thevoluntarycarbonmarket, specialize inverifying thatbothemissions reductions 214 J.Hyman