Energy Policy 65 (2014) 512–523

Contents lists available at ScienceDirect

Energy Policy
journal homepage: www.elsevier.com/locate/enpol

The implementation of clean development mechanism (CDM)

in the construction and built environment industry
Ken L. Mok, Seung H. Han n, Seokjin Choi
Department of Civil & Environmental Engineering, Yonsei University, 120-749 Seoul, South Korea

H I G H L I G H T S

We review the development and limitation of CDM relates to the construction and built environment (C&BE) industry.

We obtain experts' opinions on the feasibility of CDM in the C&BE industry.

Validation, monitoring, verification and additionality of CDM projects are crucial.

Experts agreed that most of our suggestions are feasible in principle.

art ic l e i nf o a b s t r a c t

Article history: Greenhouse gas emissions due to human activities are the main contributors to global climate change, a
Received 6 March 2012 problem that should not be ignored. Through the clean development mechanism (CDM) introduced
Accepted 14 October 2013 under the Kyoto Protocol, developing countries are able to earn certified emission reduction (CER) credits
Available online 12 November 2013
through a myriad of emission reduction projects. This study aims to explore the potential of
Keywords: implementing CDM projects in the construction and built environment (C&BE) industry, which has
Clean development mechanism been criticized for not only consuming an enormous amount of resources, but also for contributing to
Construction and built environment adverse environmental health. In this research, we limit the boundary of the C&BE industry to include
Sustainable development the planning, procurement, construction, occupation and refurbishment/demolition phases of a project's
life cycle. Surveys and in-depth follow-up interviews with experts have generated useful insights
pertaining to CDM potential and its adaptation into the C&BE industry. From this foundation, this paper
evaluates the current obstacles to CDM and presents feasible suggestions to increase CDM projects
related to the C&BE industry.
& 2013 Elsevier Ltd. All rights reserved.

1. Introduction construction, occupation, and demolition/refurbishment phases. All

these phases are a part of the construction industry except for the
According to the International Standard Industrial Classification occupation phase which is a part of the built environment industry.
(ISIC Rev.4) identified by the United Nations Statistics Division, the The C&BE industry has been criticized for not only consuming
construction industry involves new work, repair, additions and an enormous amount of resources, but also for contributing to
alterations, the erection of prefabricated buildings or structures on adverse environmental health. Buildings alone account for 40% of
the site and also construction of a temporary nature. Under the same global energy consumption WBCSD, 2009b). The embedded
classification, the construction industry also includes the develop- energy attributable to material manufacturing, building delivery
ment of building projects for buildings or civil engineering works by process and demolition can account for over 35% of the lifecycle
bringing together financial, technical and physical means to realize energy demand for a residential building (Chen et al., 2001; Sartori
the construction projects for later sale. On the other hand, built and Hestnes, 2007). For structures such as bridges and tunnels, the
environment refers to the human-made surroundings that provide embodied energy can account for up to 90% of the lifecycle
the setting for human activity in general. The classification of the emissions (Maguire, 2009).
project life cycle includes the construction and built environment The efforts of international communities to battle global
(C&BE) industry which involves the planning, procurement, warming are evident in the establishment of the United Nations
Framework Convention on Climate Change (UNFCCC). This inter-
national treaty, signed by most countries, entered into force in
n
Corresponding author. Tel.: þ 82 2 2123 2799; fax: þ82 2 364 5300. March 1994. The Kyoto Protocol (KP), an international agreement
E-mail address: shh6018@yonsei.ac.kr (S.H. Han). ratified by a near-universal membership of 193 Parties linked to

0301-4215/$ - see front matter & 2013 Elsevier Ltd. All rights reserved.
http://dx.doi.org/10.1016/j.enpol.2013.10.039
 K.L. Mok et al. / Energy Policy 65 (2014) 512–523 513

the UNFCCC, was adopted in December 1997 to bind greenhouse offering new ideas for feasible solutions to CO2 emissions reduction
gas (GHG) emissions reduction targets for 37 industrialized coun- that can be applied in the C&BE industry. The opinions obtained
tries and the European Community at an average of 5% against were then sent to the respondents again to verify the research
1990 levels during the period of 2008 to 2012. In December 2011, a results. All of the information gathered through survey forms and
highly significant achievement was enacted at the UN Climate in-depth interviews became an essential part of the discussion and
Change Conference (COP17) in Durban, South Africa, where gov- the justification for the research conclusions.
ernments agreed on a second commitment period of the Kyoto
Protocol, starting from January 1, 2013 and ending on 31 Dec 2017
or 31 Dec 2020 (UNFCCC, 2012a). 3. CDM governance
There are three market-based mechanisms in the Kyoto Protocol,
including emission trading (ET), the clean development mechanism The CDM is supervised by the UNFCCC CDM Executive Board.
(CDM), and joint implementation (JI). Developing countries were A CDM project must obtain approval from the Designated National
able to benefit from the Kyoto Protocol through the CDM by earning Authorities (DNA) of each host country to ensure that the project
saleable certified emission reduction (CER) credits, which would be conforms to the national sustainable development agenda. Emis-
bought by the binding parties in the Kyoto Protocol to meet their sion reductions resulting from each project must be validated and
emission reduction commitments. One CER is equivalent to one verified by a domestic legal entity or international accredited
tonne of CO2 eq. and more than 1.15 billion CERs have been issued organization that is recognized as one of the Designated Opera-
to 1987 projects worldwide as of 31 Dec 2012 (UNFCCC, 2012b). The tional Entities (DOE) and accredited by the Executive Board. The
CDM engine created a fertile foundation to promote environmen- verified project and emission reductions shall entitle the project
tally friendly measures in the context of CO2 emissions reduction, developer to obtain a certification assured by the DOE. Once the
particularly in developing countries facing technological and CDM project has been verified, the DOE submits a verification
economic barriers. The current CDM projects are mainly technol- report to the UNFCCC CDM Executive Board in order to request the
ogy-based, targeting the energy and industrial production sectors. issuance of CERs. The CERs assist the project participants in the
However, despite the importance of the C&BE industry, there form of financial benefits through saleable credits to the binding
are currently no approved CDM projects aimed at the construction parties listed in the Kyoto Protocol.
and demolition phases. The objective of this research is to under-
stand the logic behind the CDM system and explore the potentials 3.1. CDM project types and conditions
of its implementation in the C&BE industry in the context of a
project's lifecycle. The CDM project types include seven different categories which
are defined by mitigation activity type: Renewable energy, Energy
efficiency, GHG destruction, GHG emission avoidance, fuel/feedstock
2. Research methodology switch, GHG removal by sinks, and displacement of a more-GHG-
intensive output (UNFCCC, 2012c). Similar to the transport sector, the
This research starts with a contextual study of the background of mitigation activity that is most relevant to the C&BE industry is
the Kyoto Protocol and the structure of its agreement under the energy efficiency. These activities include: (i) construction machinery
UNFCCC. Next, documentary analysis on carbon-related issues and and construction site facilities which use up the major portion of
CDM procedures is carried out. Understanding CDM and its imple- energy needed in the construction process, and (ii) the operation or
mentation process is vital to forming an early perception and occupation of a building which contributes to major long-term
hypothesis related to CDM's trends, limitations, and potential for energy consumption over the life span of the building. Another
better impact. mitigation activity that can be easily adopted into the C&BE industry
Identifying experts in the C&BE industry who are familiar with is renewable energy, such as solar power, which can be utilized at
CDM requirements and procedures was challenging, and it was remote site offices and workers quarters on long-term construction
concluded that it would be more efficient to first gather the opinions projects, buildings in operation, and street lights.
of the author's researchers (who already understand the topic in In order to qualify as a CDM activity, a project must go through a
question) from the Construction Management & Information Labora- validation process to determine compliance with the requirements
tory of Yonsei University. Suggestions were further refined after of paragraph 37 of the CDM modalities and procedures. These
some preliminary feedback from the CDM expert involved in the procedures include proof of reduction in anthropogenic emissions
survey. The underlying theory of selecting the suggestions was based by sources of greenhouse gases that are additional to any that
on the review of the existing CDM methodologies and CDM project would occur in the absence of the proposed project activity. On top
examples that could possibly be used in the C&BE industry. Then, we of that, the baseline, monitoring, verification and reporting meth-
formed new ideas and suggestions based on the opinion of the CDM odology will also need to comply with the requirements of the
experts through surveys. The authors conducted surveys and follow- Executive Board and in accordance with decision 17/CP.7.
up interviews with experts via email, with both closed and open- CDM also desires that the technology that is applied to a given
ended questions included in the surveys. project is replicable and commercially feasible so that it can effectively
In order to obtain useful insight and relevant data, the authors be transferred to the host country (UNDP, 2003). Another requirement
sent surveys to the parties involved in CDM projects, including that remains one of the most challenging is the stipulation to facilitate
government entities, such as the Designated National Authority additional emissions reductions by the proposed CDM project beyond
(DNA) in each country, the Designated Operational Entities (DOE), those that occur in its absence or in a business-as-usual (BAU)
and other CDM experts. On the survey forms, the experts were situation. In order to fulfill this requirement, a CDM project needs to
invited to rate the demand for CDM measures, limitations, and prove that it can bring real, measurable and long term benefits related
suggestions for different measures of the CDM approach related to to the mitigation of climate change and reductions in emissions that
the C&BE industry, using a five-level Likert scale. The Likert scale is a are additional to any that would occur in the absence of the certified
widely used approach to scaling responses from respondents on project activity (Kyoto Protocol, Article 12(5)). The “Tool for the
equal amounts of positive and negative choices. In this study, the Demonstration and Assessment of Additionality”, developed by the
level of agreement and disagreement of the respondents was Executive Board, requires that the developer of a CDM project provides
measured. The survey forms also collected open-ended comments, evidence of possible barriers that would have prevented alternatives
514 K.L. Mok et al. / Energy Policy 65 (2014) 512–523

to the project. These barriers include investment barriers, techno- The occupation phase of a building project also enjoys numerous
logical barriers, barriers due to prevailing practices (that the project CDM methodology options ranging from renewable energy (i.e.
activity is the ‘first of its kind'), and other barriers—all of which would CDM methodology AMS-III.AE.) to energy efficiency (i.e. CDM
prevent potential project proponents from carrying out the proposed methodology AMS-II.Q.). In the end of the lifecycle of a building/
project activity without being registered as a CDM project activity. infrastructure project, the demolition/refurbishment phase involves
activities that are considered part of the ‘construction’ activitiess.
Hence, theoretically, CDM methodologies that are energy efficient in
3.2. CDM methodologies applicable to different phases of a project's nature can also be applied during the demolition/refurbishment
lifecycle (buildings and infrastructure) phase, subject to its duration. Increasing the share of projects
undertaken by the construction sector in the CDM pipeline requires
The lifecycle approach allows us to assess a project's emission investigating the feasibility of earning saleable credits from a
in terms of how it pertains to the following activities: (1) the measurable quantity of emissions compared to transaction costs
manufacturing of construction materials (‘embedded' emission); in reality. The duration of a normal construction project might not
(2) the transportation of materials from the production plant to be long enough to accumulate the amount of emission reductions
the construction site (‘gray' emission); (3) the construction phase needed to offset the high upfront and transaction costs required to
(‘induced’ emission); (4) the operation/occupation phase (‘opera- develop as a single CDM project. However, for a mega project such
tional’ emission); and (5) the demolition/recycle phase (UNEP- as hydropower dam and other national infrastructure projects, the
SBCI, 2009). According to UNEP-SBCI (2010), it is better to focus construction duration can last for 5 to 10 years before completion.
the Common Carbon Metric & Protocol on the operation/occupa- One of the authors draws on his own experience in a mega
tion phase of a building's lifecycle because that is where 80–90% of infrastructure project that had remote site facilities (off grid) for
emissions are accounted for. The remaining 10–20% of energy is more than 700 workers and 450 machinery working at the
consumed during the extraction and processing of raw materials, construction site in a single day. The average diesel and cement
the manufacture of products, construction, and demolition stages usage was close to 300,000 l/month and 600 t/month, respectively.
over the life span of a building. An owner of wide industries that The usage of resources and heavy construction machinery in a mega
are involved in different phases of a building/infrastructure project is also huge. Thus, enough emission reductions could be
project’s lifecycle may find available CDM methodologies that made to cover any transaction cost that would be needed to develop
can be readily applied to a project. In the manufacturing phase a feasible CDM project.
of construction materials, one can apply CDM methodologies for Currently, the approved CDM methodologies are focused mainly
feedstock switch (CDM methodology ACM0015) in cement on the manufacturing of construction material (pre-construction
production, for example. phase) and the occupation phase (post-construction) of the facil-
The CDM Accreditation Panel adopted a list of 15 CDM sectoral ities. There are currently no approved CDM projects aimed at the
scopes based on the sectors and sources contained within Annex A construction and demolition phases. Although some approved CDM
of the Kyoto Protocol. Since the energy consumed during the methodologies have been applied to recover methane emissions
construction phase is relatively low compared to the amount from municipal solid waste, the construction waste treated during
consumed over the building’s lifecycle, CDM projects did not receive the demolition phase is not considered applicable due its lower
attention from developers and construction firms and thus, there are organic composition. According to the WBCSD (2009a), construction
currently no approved CDM methodologies identified under the and demolition waste (C&DW) represents around 40% of the total
construction sectoral scope (6) in the CDM pipeline. In addition, waste generated each year in Europe, whereby concrete waste
there are no other sectoral scope methodologies that have been contributed to a large portion of the total. Accordingly, there have
targeted or are being applied during the construction phase. How- been attempts to recycle the concrete, but few opportunities remain
ever, experts and researchers do recognize some of the registered to reduce carbon emissions. The potential of CO2 absorption/
CDM projects as being strongly related to the C&BE industry, sequestration by cement/concrete carbonation to produce calcium
especially for the occupation phase. Cheng et al. (2008) found that carbonate is still yet to be explored (Haselbach, 2009).
only six small-scale projects out of over 3000 approved CDM There is also marginal potential for emission reductions to be
projects were targeting energy efficiency betterment in the building derived from: (1) vegetation waste decay after initial construction
or construction segment as of the second quarter of 2008. Up to the site clearing; (2) improper conservation of herbaceous topsoil
second quarter of 2013, there were 11 CDM projects registered under being excavated to give way for construction; (3) household waste
energy efficiency (service) and 69 CDM projects registered under decay (from the construction workers camp); (4) construction
energy efficiency (households) (UNEP Risø Centre, 2013). waste decay and (5) emissions from the recycling process.
Sectoral scopes are the categories of GHG source sectors or
groups of activities that apply to CDM project activities and are used 3.3. Barriers to CDM implementation in the C&BE industry
for the accreditation of DOEs. The authors presume that one can
implement CDM methodologies that are energy efficient in nature The low utilization of CDM in the C&BE industry, particularly
during the construction/occupation/demolition phases of a building during the construction phase, is mainly due to the limitations in
project. This is because there are approved CDM methodologies for CDM modalities and procedures, including the methodology require-
the transportation and building environment industry but none for ment (Cheng et al., 2008). The Kyoto Protocol calls for all CDM
the construction industry itself. The construction industry involves project activities to be certified by the DOE in terms of emissions
machinery operation similar to the transportation industry and reductions that are ‘additional’ to baseline emissions or any that
building operations on the construction site are also similar to would occur in the absence of the certified project activity. According
residential occupation. For example, CDM methodology AMS-III.B. to this guideline, the baseline should be firmly established, taking
can be applied to a project of fossil fuel switching in new or existing into account relevant national or sectoral policies.
industrial, residential, commercial, institutional or electricity There are barriers born of the nature of the construction sector
generation applications (UNFCCC, 2012c). One can expect that the such as the relatively short duration of construction process
same or modified methodology can also be applied to fossil fuel compared to the lifecycle of a building. The huge energy demands
switch in a generator set that is used at the construction site for of heavy construction machinery also render switching to renew-
electricity generation. able energy sources difficult. Reference can be made to a report
 K.L. Mok et al. / Energy Policy 65 (2014) 512–523 515

from UNEP-SBCI (2009) which summarized the major barriers to designer, with the intention that this would lead to a real incentive
energy efficiency in the building sectors. The barriers are: (1) payment once energy savings of at least 10% were verified. WBCSD
economic barriers (such as higher upfront costs for more efficient (2009a) has suggested engaging new tenants to share the costs and
equipment); (2) hidden costs/benefits (such as transaction costs); benefits of energy efficiency investments. Love et al. (2011) also
(3) market failures (such as a fragmented market structure), a split provides an insightful study of a compensation model that led to
interest between stakeholders and imperfect information; (4) positive behaviors.
behavioral and organizational barriers (such as ignorance and Third, in order to address the lack of know-how in CDM and
lifestyle); (5) information barriers; and (6) political and structural green construction, the most feasible solution is an education and
barriers (such as a lack of guidelines, tools, or expertise). training campaign. WBCSD (2009c) stressed the need for education,
Michaelowa and Jotzo (2005) estimated that the minimum fixed training, and communication to promote energy-efficiency practices.
transaction cost for a typical CDM project was 150,000 Euros. The main problems related to the limitations of CDM in the C&BE
Economies of scale play an important role in ensuring that the industry include the difficulties of verifying common measures, a
generation of CER is adequate to cover at least the fixed costs. The lack of references for baselines, and the strictness of the ‘addition-
higher ratio of transaction costs per total savings is clearly one of ality’ requirement. In this regard, Cheng et al. (2008) recommended
the key factors that explains why the CDM approach is not so developing common performance-based baselines, a general data-
attractive or viable in the construction sector. base contains local factors such as climate, building type, availability
Some other limitations facing the construction sector are: (i) a of materials and technologies for different types of buildings.
lack of information and understanding of the importance of the Accordingly, developing a nationwide database tool that serves as
building and construction sector in relation to climate change; (ii) an automatic record and reporting system is essential for the
a lack of provision of standardized methodologies for facilitating establishment of both a complete database and baseline scenarios.
the replication of implemented project; (iii) a lack of references for To this end, it is also vital to foster cooperation and data sharing
baselines for Energy Efficient Building CDM projects in new between land offices, building departments (i.e., records of construc-
buildings presents a major challenge to project developers; (iv) tion duration, energy usage during construction process, gross floor
the complexity of the CDM process from PIN submission to Project area, room orientation, and opening), utility providers, such as
registration and the associated cost are causing the constructors to electricity providers (energy consumption records), meteorology
loss interest. departments (micro-climate records), municipal and local authorities
(socioeconomic records), and so on.
Lastly, as stated above, a nationwide performance-based baseline
takes more time and requires the full commitment of various parties.
4. Feasible solutions: Survey and discussion No one can stipulate the exact date of database development, and
until then, the question of how similar and comparable the common
4.1. Overview of potential solutions baseline is to the proposed CDM project will linger. The CDM
methodology, AMS-III.AE (energy efficiency and renewable energy
Cheng et al. (2008) recommended a few preliminary solutions measures in new residential buildings condition), allows existing
to tackle the aforementioned problems. Prior to conducting baseline residences to be within 100 km of the project residences,
surveys, we took the initiative to suggest more practical solutions with similar gross floor areas (to 50% accuracy), micro-climates, and
based on the extensive documented investigations on record and socioeconomic classes (UNFCCC, 2009). However, the confidence
our own presumptions. level regarding the similarity of energy consumption for buildings
First, to deal with the upfront cost and transaction cost with similar gross floor areas is unclear. Heat or cold might just be
problem, economies of scale play an important role. The contractor poorly preserved in different room orientations and room partitions,
of a construction project, for example, can benefit from using although with the exact same floor area. Bjørn and Brohus (2006)
alternative climate-friendly fuel rather than petro/diesel. The use stated that the fundamental design choices of building planners have
of each liter of biodiesel is estimated to save about 3 kg of CO2 a profound influence on indoor climate and energy consumption. To
compared to conventional diesel (European Biodiesel Board). The address this matter, we suggest using a new building as the baseline
CDM methodology ACM0017 (Production of biodiesel for use as fuel) for the same development as the proposed CDM project. For
and AMS-III.AK (Biodiesel production and use for transport applica- example, a twin building in a new development site can be a better
tions) enable the producer of biodiesel to earn CERs and hence, baseline for comparison with its sister building that is a CDM project,
lower the price of biodiesel (UNFCCC, 2010, 2011b). If supported by in terms of floor area and fascia design, micro-climate, and socio-
a growing demand of biodiesel, the cost of biodiesel can be economic class. The same approach could also be applied in infra-
lowered even further through mass production and could even- structure project whereby part of a new highway can be the baseline
tually become sustainable enough to bring long term benefits to for its remaining stretch. Our research included these possible
offset any upfront and transaction costs. suggestions in the following survey form, which was distributed to
Second, regarding the split interest among various stakeholders relevant experts involved in the CDM field and carbon markets.
in a construction project, incentive sharing between stakeholders Considering that there are not many projects in the C&BE
for an energy-efficient project would be the optimal method, along industry that would be worth pursuing as CDM projects given the
with an education and awareness campaign on green construction. prevailing high transaction costs, a CDM project developer can
In the case of a household energy-efficiency project, a similar kind consider coordinating and implementing policy and programmes
of incentive sharing between the CER receiver and the designer or related to C&BE industry into a Programmes of Activities (PoA).
contractor can also serve as a feasible solution. For example, the A PoA is a voluntary coordinated action by a private or public
Imperial Irrigation District (IID) in California has introduced the entity which coordinates and implements any policy measure or
New Construction Energy Efficiency Program (NCEEP) for a non- stated goal (i.e. incentive schemes and voluntary programmes),
residential new construction project that combines an integrated that leads to anthropogenic GHG emission reductions or net
design process with financial incentives for energy saving at least anthropogenic greenhouse gas removals by sinks that are addi-
10% above the local policy requirement (New Construction Energy tional to any that would occur in the absence of the PoA, via an
Efficiency Program (NCEEP), 2011). Agreements for incentive shar- unlimited number of Component Project Activities (CPAs) (EB 55
ing were made in advance between the customer, the IID, and the Report, Annex 38).
516 K.L. Mok et al. / Energy Policy 65 (2014) 512–523

A project developer – such as a conglomerate involved in Table 2

various industries including the C&BE industry – could integrate Experience of respondents.
combinations of technologyies or measures and methodologies
Experience in CDM- Not o3 3–5 5–10 410 No. of
that vary across component project activities (CPA) within a PoA. related matters availablea years years years years respondents
This may include, for example, a range of activities and microscale
or small-scale projects within different sectors such as industrial No. of respondents 7 0 3 7 6 23
processes (e.g. feedstock switch in cement production using a
Note: Responses from organizations such as DNA or respondents made no
ACM0015, Biodiesel production and use for transport applications disclosure.
using AMS-III.AK), energy efficiency (e.g. efficiency lighting using
AMS-II.J and fossil fuel switching using AMS-III.B), renewable
energy (e.g. renewable measures in buildings using AMS-III.AE.), fragmentation makes it easy to focus, educate, and transfer know-
or transportation (e.g. retrofit technologies using AMS-III.AA). how, leading to a reduction in overall transaction costs.
There are numerous methodologies categorized in the CDM
4.2. Survey outline pipeline under different types of production, process treatments,
and system improvements. A higher percentage of experts were in
Surveys and in-depth interviews were conducted through email positive agreement on the potential of the following methodologies
communications with the relevant experts. Potential survey respon- being applied into the construction sector: cement production
dents were selected from the DOE and DNA lists on the UNFCCC methodology (71%), energy efficiency methodology (95%), fossil fuel
website, the guest speakers list for the UNFCCC CDM workshop, the switch methodology (83%), transportation methodology (71%), and
service providers registered with the UNFCCC CDM Bazaar (2012), zero-emission renewable methodology (69%). It was also stated that
the DOE & Independent Entities Association, UNFCCC members of other CDM methodologies are not really suitable for the construc-
the expert roster, and the field’s pool of other experienced carbon tion sector, at least for the near future, unless there are technology
experts. Tables 1 and 2 each shows statistics on the respondents’ breakthroughs in CO2 capturing, for example.
background and years of experience, respectively, which reflect
sufficient expertise and experience within this subject. At the outset
of this research in 2011, only 37 DOEs were recognized by the CDM 4.3.2. Feasibility of the proposed solutions
Executive Board. Of this number, only 18 DOEs were accredited for Table 4 presents the survey results of the experts’ opinions
both validation and verification under sectoral scope 6 (construc- concerning the feasibility of our proposed solutions to increase
tion), as defined by the UNFCCC. Thus far, within the limited pool of potential C&BE industry CDM projects long term. In order to further
candidates, 23 respondents have actively responded to our ques- validate the survey results, we adopted the triangulation validation
tionnaires and evaluated the possible solutions. method, using different sources of information to confirm and
improve the clarity of the research findings (Richie and Lewis,
2003). We also took the survey results back to the respondents for
4.3. Results and discussion
their review and confirmation of our proposed measures.
The first suggestion was to develop a nationwide database tool to
4.3.1. Construction sector’s potential
record baseline data of utility and energy usage, along with coopera-
Table 3 summarizes experts’ opinions on the implementation
tion and data sharing among the various participants. Eighty eight
of CDM projects related to the construction sector through
percent (88%) of the respondents were in strong agreement with this
potential CDM methodologies. Concerning the issue of increasing
suggestion. The experts stated that information should be used for
the number of approved CDM projects related to the C&BE
developing standardized baselines and facilitating the demonstration
industry, 46% of the experts agreed and 31% remained neutral
of emission reductions. This option is also considered an appropriate
regarding the potential of infrastructure projects, such as highway,
vehicle, particularly for buildings. The experts also pointed out that
port, and railway projects.
this tool should be certified as a proper baseline in advance so that it
It is well-known that there are no methodologies for the CDM can readily be accepted during the validation and registration of CDM
construction sector under CDM. Despite this, there are some projects. Thus, creating a set of country-specific default factors for
activities in other CDM categories, such as energy efficiency in certain building types has become salient for this resolution. A
houses, or transportation, which have approved methodologies baseline for energy use during the construction phase of similar
that can be connected with construction sector projects.—DNA building or infrastructure types will benefit CDM project developers.
of Peru. Accordingly, more systematic methods should be developed to
standardize baselines and facilitate the demonstration of emission
The experts agreed that infrastructure projects would benefit from reductions, such as developing a web-based tool to report energy
larger emission reduction opportunities; hence, infrastructure projects consumption and fuel consumption in a more automated manner. A
are more likely to overcome transaction costs in CDM applications. greater understanding of energy uses and their statistical relation-
Additionally, 50% of the experts agreed and 42% remained neutral ships with physical features is thus quite imperative for establishing
regarding a high potential for infrastructure projects due to the less CDM baselines, specifically on a project-by-project basis.
fragmented nature of the infrastructure sector. This lack of Regarding the suggestion of forming a new baseline and CDM
projects with exact gross floor areas, room orientations, and
Table 1 micro-climates in the same development area, 69% of the experts
Background of respondents.
agreed and 16% remained neutral. The experts did welcome a
Organization DOE DNA CDM Othersa Total no. of more detailed study, as this question is very relevant to CDM in the
consultancy respondents construction sector.
The experts who expressed a positive response to the second
No. of 3 2 14 4 23 suggestion also agreed that the same idea could be referenced in
respondents
infrastructure projects such as highways, railways, and airports.
a
Note: Opinions from 2 respondents with UNFCCC background are not to be Baseline emissions levels are obtained through historical records,
considered as UNFCCC’s opinions. industry averages, or optimal technologies (expected emissions)
 K.L. Mok et al. / Energy Policy 65 (2014) 512–523 517

Table 3
The potential of CDM implementation in the construction and built environment industry.

The potential of implementing the following CDM in the construction and built environment Strongly Agree Neutral Disagree Strongly No. of
industry is high agree (%) (%) (%) (%) disagree (%) respondents

Infrastructure projects have bigger emissions reduction opportunities in a single project and 31 15 31 23 0 13
hence, are able to overcome transaction costs in CDM applications
Infrastructure projects are less fragmented and hence, it is easy to focus, educate, and transfer 25 25 42 8 0 12
know-how
Through afforestation and reforestation methodology 0 18 29 35 18 17
Through agriculture methodology 0 6 25 38 31 16
Through biofuels methodology 0 29 21 29 21 14
Through biomass methodology 13 31 19 19 19 16
Through cement methodology 6 65 6 12 12 17
Through CO2-capturing methodology 0 7 27 40 27 15
Through coal/mine methane methodology 7 7 27 33 27 15
Through energy distribution methodology 0 47 29 18 6 17
Through aEE methodology 28 67 0 6 0 18
Through Fossil fuel switch methodology 12 71 0 12 6 17
Through Fugitive emissions from fuels methodology 0 27 27 27 20 15
Through bHFCs methodology 14 0 14 36 36 14
Through Landfill methodology 6 38 13 25 19 16
Through methane avoidance methodology 13 19 25 25 19 16
Through cN2O methodology 7 0 40 20 33 15
Through dPFCs methodology 0 13 27 13 47 15
Through eSF6 methodology 0 7 27 20 47 15
Through transport methodology 12 59 18 12 0 17
Through Zero-emission renewables methodology 25 44 13 13 6 16

Note:
a
EE ¼ energy efficiency.
b
HFCs ¼Hydrofluorocarbons.
c
N2O¼ Nitrous oxide.
d
PFCs ¼Perfluorocarbons.
e
SF6 ¼ Sulfur hexafluoride.

(Imai et al., 2005). More often than not, a baseline and CDM construction of a 50-km single-lane, dual carriageway alone has
project can potentially exist in the same development. For exam- about 5 times the carbon footprint than the total lifecycle emis-
ple, during highway development, the first 30 km of the newly sions from a 20-story apartment (a total of 40 units, with each unit
built highway can be used as the baseline and the remaining area being 85 m2 and having a service life of 60 years). It should be
stretch can be the CDM project. The monitoring can be validated noted that larger GHG emissions and simpler baseline-project
through the difference in energy usage between the baseline and differences certainly facilitate cost-effectiveness for CDM projects
the CDM project after cancelling out other common controlling in terms of lowering transaction costs. Sekimoto (2003) has
factors. This provides better estimation, comparison, confidence, concluded that CDM is applicable to port projects. Providing public
and monitoring of emissions reductions. The proposed new base- transport systems and their related infrastructures can also con-
line corresponds to the criteria for the baseline setting outlined in tribute to GHG mitigation (Kahn Ribeiro et al., 2007).
Appendix B, Decision 9/CMP1 (UNFCCC, 2011a). Therefore, part of Fifty eight percent (58%) of respondents agreed to the proposal
a highway or building constructed by conventional methods can to promote and provide education on green construction and CDM
serve as a baseline subject to the demonstration of additionality. know-how. One respondent, and expert with UNFCC, noted that
As an immediate reflection, this could be a sensible approach, but knowledge and education are useful in general, but will not in
it would be very difficult because many more details are required themselves be enough to get real green construction CDM projects
to reach a conclusive judgment according to a survey respondent. off the ground and earning CERs. There are numerous documented
In addition, with reference to the documented accounts (Akita studies supporting the role of green construction education
et al., 2005; Cheng and Zhu, 2009; Fischer, 2005; Imai et al., 2005), (Cheng and Zhu, 2009; Cheng et al., 2008; Koeppel and Ürge-
we go on to suggest that the proposed new baseline can be a good Vorsatz, 2007; Levine et al., 2007; WBCSD, 2009c). Insufficient
blend of both expected emissions (ex-ante calculation performed knowledge on all stakeholder levels, including those of designers,
during the pre-construction of a new baseline) and historical or builders, and individual energy users, has been one of the common
actual emissions (ex-post verification at the post-construction factors cited for the existence of the current barriers. As Cheng and
point of the new baseline). Although the CDM Executive Board Zhu (2009) pointed out, though they might not represent an easier
indicates that the ex-ante baseline is of primary significance, most way to achieve emissions reductions, policy measures such as
of the approved methodologies are, in reality, adopting ex-post training and raising awareness have a deep impact and offer
methods, whereby manipulation may exist under an ex-post extensive co-benefits.
baseline but not an ex-ante baseline (Akita et al., 2005). Fischer Forty eight percent (48%) of respondents agreed with the proposal
(2005) also mentioned that the baseline of expected emissions can to utilize solar and wind power at remote construction sites. There are
be seen as a balance between historical and industry averaging concerns that solar and wind may not suffice in meeting energy-
methods. intensive requirements. The construction phase is generally too short to
The response to the next suggestion, which focused on a single obtain a reasonable payback on the renewable energy used for energy
infrastructure project due to its larger emissions reduction poten- supply. In this regard, other experts emphasized that renewal energy
tial, was 43% agreement and 50% neutral from all of the experts. By usage in building or infrastructure projects during their occupation
way of a simple comparison between the reports from Greening phases (e.g., solar water heater, photovoltaic) for street-lighting, passive
Australia (2011) and Tae et al. (2011), the CO2 emissions from the solar heating, cooling and day-lighting approaches) is more likely to be
518 K.L. Mok et al. / Energy Policy 65 (2014) 512–523

Table 4
Evaluation of the proposed suggestions target to increase potential CDM projects related to the C&BE industry in long term.

Suggestions Survey Documented accounts Follow up interviews Feasibilityd

observation

1. Nationwide database tool for utility and 88% Agreed Cheng and Zhu (2009); Nationally Strongly agreed on database building; Will be High
energy usage baseline recording, along with and 12% Appropriate Mitigation Actions very beneficial in establishing the baseline
cooperation and data sharing. (All phases) remained (NAMA) Program
neutral

2. A new baseline and CDM project in the same 69% Agreed, UNFCCC (2012); Imai et al. (2005); Mostly agreed based on the proposal’s initial Medium
single development (with exact cGFA, 16% disagreed Akita et al. (2005); Fischer (2005) feasibility and sensibility; Can provide better
orientation, micro climate, etc.) and 16% estimation, comparison, confidence, and easy
(Construction & Operation phases) remained monitoring. Argument remains on why part of
neutral the project is the baseline and the rest is the
clean project. Justifications will have to be
provided during validation

3. Aim for an infrastructure project with a 43% Agreed, 7% Sekimoto (2003); Kahn Ribeiro et al. Agreed to the high potential of true emissions Medium
larger emissions reduction potential, less disagreed and (2007) reduction, especially in the case of large projects
segmentation, and easy transfer of know- 50% remained (highway, airports, etc.). Bigger GHG emissions
how. (Construction and Operation phases) neutral and simpler baseline certainly help CDM
projects’ cost-effectiveness in terms of
transaction costs and success.

4. Promotion and education on green 58% agreed, Cheng and Zhu (2009); Koeppel and Knowledge and education are useful in general, Medium
construction & CDM know-how 14% disagreed Ürge-Vorsatz (2007); WBCSD but will not in themselves be enough to get real
and 29% (2009c); Levine et al. (2007) green construction CDM projects off the ground
remained to earn CERs
neutral

5. Solar and wind power for remote 48% Agreed, Alawaji (2001) Will be classified as a renewable energy CDM Low
construction sites, especially infrastructure 27% disagreed project and not a construction sectoral project.
projects. (Construction phase) and 26% Construction projects are energy intensive, solar
remained and wind may not meet the requirements. The
neutral construction phase is generally too short to get a
reasonable payback

6. Apply a new CDM methodology based on 70% Agreed, Zhang et al. (2010); Kahn Ribeiro It is a viable CDM project and will fall into the Medium
total GHG emissions reduction from all 20% disagreed et al. (2007); Kato et al. (2003) sectoral scope of transportation. It will be
vehicles running on engineered pavement and 10% feasible when applied to a new road/re-paving
with optimum roughness. (Operation phase) remained project via avoided emissions. However, it seems
neutral very difficult to quantify the improvement of the
fuel economy of the vehicles running through the
remaining stretch

7. Benefit and incentive sharing between 40% Agreed, NCEEP (2011); WBCSD (2009a); Love Energy saving should be able to compensate the Medium
designer, contractor, and owner. (All phases) 15% disagreed et al. (2011) investment cost. If the body spending the capital
and 45% upfront is different from the second body with
remained the later benefit, the gains have to be shared
neutral somehow. However, costs versus benefits may
not fit a business case

8. Construction of bridge/tunnel to shorten the 52% Agreed, Roads & Traffic Authority, The New Could be eligible, but may be less so in emission Low
transportation distance and improve fuel 38% disagreed South Wales Government (2011); reduction. Extra traffic induced could be very
economy in the long term. (Operation phase) Eurotunnel Group (2009) problematic for a conservative manner of CDM.
Will fall into the sectoral scope of transportation

9. Reduce heat and CO2 emissions by mixing fly 53% Agreed CDM ameth.: ACM0005 (Increasing Could be eligible by making sure the concrete High
ash to produce in-situ fresh concrete at and 47% the blend for cement production); conforms to the structural standard. If the fly ash
construction site. (Construction phase) remained Flower & Sanjayan (2007) is already being used often, common practice
neutral barriers can be hard to justify

10. bEE measure for construction machinery. 85% Agreed, CDM ameth.: AMS-III.C. (Emission Proper maintenance of construction machinery High
(Construction phase) 10% disagreed reductions by electric and hybrid and vehicles may lead to less consumption and
and 5% vehicles); Ochiai and Ryu (2008); lowers emissions. However, it is difficult to
remained Filla (2008); Achten (2008) quantify and measure the emissions reductions
neutral

11. Switching fossil fuel for construction 74% Agreed, 5% CDM ameth.: AMS-II.F. (EE and fuel This will lead to emissions reduction. However, it High
machinery. (Construction phase) disagreed and switching measure for agricultural is difficult to quantify and measure the emissions
21% remained facilities and activities) reductions
neutral

12. Avoided emission through reducing waste 73% Agreed, Poon et al. (2004); Hong Kong Perhaps possible, though not very likely, to go Medium
in the timber formwork by replacing it with a 18% disagreed Housing Authority (2004); Poon and within CDM. Will be applicable in principle if the
reusable aluminum/steel system formwork. and 9% Robin (2005). justification of a baseline can be done with a
(Construction phase) remained conservative calculation on the anaerobic
neutral digestion of the baseline formwork
 K.L. Mok et al. / Energy Policy 65 (2014) 512–523 519

Table 4 (continued )

Suggestions Survey Documented accounts Follow up interviews Feasibilityd

observation

13. Reduction in consumption of fuel by mixing 38% Agreed, Morledge and Jackson (2001); Fox May result in less consumption and lead to Low
booster or chemical lubricant into engine oil/ 31% disagreed (2005); EPA (2010) emissions reductions. Unlikely to prove the gains
fuel additives for emission reduction. and 31% beyond the margin of error of fuel economy
(Construction phase) remained measurements
neutral

14. Transportation bEE activities using retrofit 57% Agreed, CDM ameth.: AMS-III.AA. Machinery is already highly optimized; therefore, Medium
technologies in construction machinery. 24% disagreed (Transportation EE activities using it is hard to cost effectively retrofit existing
(Construction phase) and 19% retrofit technologies); EPA (2010); equipment
remained Itomi and Ito (2008)
neutral

Note:
a
meth. ¼Methodology.
b
EE ¼Energy efficiency.
c
GFA ¼ Gross floor area.
d
Feasibility levels are based on the survey results, cross-checked with documented accounts and interviews. High: (agreementþ 0.5 Neutral) 475%, cross-checked with
similarity to existing CDM methodology; medium: 25% 4disagreement 415% or neutralZ 50%, partial support with argument and difficulty; low: disagreement 425%,
without confidence support from the experts interviews.

cost-effective than usage in the construction phase only. For example, Authority, The New South Wales Government, 2011). As a repre-
the photovoltaic system was utilized for power highway devices in sentative example, the Eurotunnel has carried 50 million vehicles,
various remote locations within Saudi Arabia (Alawaji, 2001). saving 3.5 million carbons equivalent tons in 15 years (Eurotunnel
The next suggestion concerned the possibility of whether Group, 2009).
operators of civil infrastructure projects, like highways, are able to Regarding the reduction of heat and CO2 emissions by mixing
apply new CDM methodology based on total GHG emissions cement and fly ash to produce in-situ fresh concrete at the
reductions from all vehicles running on engineered pavement with construction site, the quality control of concrete was found to be
optimum roughness. It has long been expected that the new crucial. Fifty three (53%) of the respondents agreed with this
material for highway pavement (e.g., engineered cementitious observation, while 47% remained neutral. Fly ash is supplementary
composites with roughness that is not easily deteriorated overtime) cementitious material that can be used to replace some of the
would provide better fuel economy for vehicles. Approximately 70% cement in concrete. Currently, only cement plants have success-
of the experts agreed that this suggestion remains a valid option, fully registered CDM projects by replacing a certain amount of
while other experts doubted this would provide a relevant amount cement with fly-ash blending during cement production. Com-
of CERs. It is difficult to establish baselines and monitor the savings pared to normal concrete, the fly ash-blended concretes show CO2
in traffic. A CDM methodology has to be developed together by the emissions reductions of up to 15% (Flower and Sanjayan, 2007). To
construction industry association and it will take a long time ensure that an in-situ concrete mix is conforming to the structural
(commented O. Levallois of Carbonium and W. Betzenbichler of integrity requirement, mobile-volumetric concrete batch plants
BeCe). The potential for emissions reductions through engineered are available to mix concrete and screed to exact requirements and
pavement, shortened traveling distances, improved rolling resis- specifications on site (Reimer Engineering UK Ltd., 2011). The
tance on tires, or advanced pavement technology using recycled mobile batch plant also allows operators to accurately mix on-site,
materials is also well supported by previous research (Greening hence causing less waste and reducing the environmental impact
Australia, 2011; Kato et al., 2003; Kahn Ribeiro et al., 2007; Santero compared to traditional concrete batching and delivery methods.
and Horvath, 2009; Zhang et al., 2010). Eighty five percent (85%) of experts agreed with the energy-
Regarding whether a bridge or a tunnel could be a feasible CDM efficiency measure for construction machinery. Different types of
project that contributes to the avoidance of unnecessary vehicular machinery and vehicles are used during construction; these machines
travel and also bypasses the obstructions present under business- are operating through the consumption of diesel, furnace oil, and light
as-usual conditions, there was a split amongst the responses (52% diesel oil that release emissions into the atmosphere. As a possible
agreed and 38% disagreed). If relevant data can lead to a baseline example, adding chemical lubricant into the diesel machine that
calculation of project emissions, it could indeed become a CDM cleans the engine can result in less fuel consumption by construction
project subject to the environmental impacts associated with the machinery. Perhaps a better-optimized usage of machinery could also
activities that occur during construction work. The CDM incentive comprise a relevant CDM project. This is well supported by numerous
would probably not be able to finance the gap between two previous studies claiming that the development of hybrid construction
alternatives, considering the cost of roads and the small emissions machinery or the use of hybrid technology in wheel loaders can lead
reductions that could be avoided. The rebound effect would lead to to significant improvements in fuel consumption (Achten, 2008; Filla,
a high level of leakage (commented by A. Michaelowa of Perspec- 2008; Ochiai and Ryu, 2008). Hybrid construction machines were
tive) and the project might trigger additional traffic or even be selling at a premium compared against the market. The premium to
counterproductive by pulling commercial transportation from rail to be paid can be seen as an economic barrier in the proposed CDM
road (commented by M. Brinkmann of TUV Rheinland). However, project in order to fulfill the additionality requirement.
this topic is one that should be discussed further. There is still the The rest of the proposals (fossil-fuel switching for construction
positive possibility that infrastructure projects, like roads and machinery; avoiding emissions through reduced construction waste
railways, could be developed as CDM projects depending on the from timber formworks by replacing it with reusable aluminum or
validation of effective CO2 reduction based on the implementation steel formwork; reducing the consumption of fuel by mixing booster
of those facilities. The road tunnels provide more direct connections or chemical lubricant into the fuel; and using retrofit technologies in
and avoid vehicular stopping and starting at traffic lights, hence construction machinery utilized for energy-efficient activities)
reducing fuel costs and vehicular emissions (Roads & Traffic received 74%, 73%, 37%, and 58% support from the experts,
520 K.L. Mok et al. / Energy Policy 65 (2014) 512–523

Table 5
Integrated combinations of different CDM activities and approaches for the whole lifecycle of an infrastructure project.

Description Planning Construction phase Operation phase Demolition

phase phase

Duration (year) Less than Could be less/more than 7 years More than 28 years Less than
7 years 7 years
Applicable CDM methodology N.A. 1. Construction site clearing and 1. AMS-II.L. (Efficient street lighting) N.A.
topsoil conservation 2. AMS-III.AK (Biodiesel production & use for
– AMS-III.E. (Avoidance of transport)
methane) 3. AMS-I.A. (Electrical generation by the user in
– AMS-III.F. (Avoidance of off-grid locations).
methane) 4. AMS-I.B. (Mechanical energy – i.e. wind
power pump)
2. Site office and large-scale
worker’s quarters (off-grid)
– AMS-I.A. (Electrical
generation by user)
– AMS-I.B. (Mechanical
energy)
– AMS-I.I. (Biogas for
small users)
– AMS-I.J. (Solar water
heating)
– AMS-II.C. (EE activities)
– AMS-II.M. (EE for hot water
savings)
– AMS-III.E. (Avoidance of
methane)
– AMS-III.F. (Avoidance of
methane)
– AMS-III.H. (Methane
recovery)
– AMS-III.I. (Avoidance of
methane)

3. Construction machinery &

vehicles
– AMS-III-C. (Electric & hybrid
vehicles)
– AMS-III.AK (Biodiesel)
– AMS-I.H. (Biodiesel)
– AMS-III.AA. (Retrofit
technologies)

Feasible methodology that could possibly be - 1. Solar and wind power for remote 1. GHG emissions reduction from all vehicles -
developed as CDM or micro-scale component sites running on engineered pavement with
project activity 2. Mixing fly ash for in-situ concrete optimum roughness
at site 2. Construction of bridge/tunnel to shorten
3. EE measure for construction transportation distance and improve fuel
machinery economy in long term
4. Switching fossil fuel for constr.
Machines
5. Replacing timber formwork with a
reusable aluminum/steel system
formwork
6. Mixing booster/chemical lubricant
into engine oil/ fuel additives
7. Transportation EE activities using
retrofit technologies in
construction machinery

Other contributing efforts 1. Nationwide database tool for utility and energy usage baseline recording, along with cooperation and data sharing
2. A new baseline and CDM project in the same single development
3. Aim for infrastructure project with bigger emissions reduction potential, less segmentation, and easy transfer of
know-how
4. Promotion and education on green construction & CDM know-how
5. Benefit and incentives sharing between designer, contractor, and owner

Note: EE ¼ Energy efficiency.

Microscale project activities are activities up to 5 MW that employ renewable/energy efficiency/emission reduction technology, that is: (i) in lease developed countries/small
island developing States/special underdeveloped zone, or (ii) off-grid activity supplying energy to households/communities, or (iii) Subsystem smaller than 1500 kW
(renewable)/ energy saving of 600 MW h (EE)/ annual emission reduction less than 600 tCO2eq per year for households/communities/small & medium enterprises.

respectively. There was greater dispute over the proposal to reduce reductions, 31% of experts were still concerned that this type of CDM
fuel consumption by mixing in booster or chemical lubricant. project is unlikely to provide gains beyond the margin of error for
Although adding booster or chemical lubricant may lead to emissions fuel economy measurement.
 K.L. Mok et al. / Energy Policy 65 (2014) 512–523 521

In sum, the survey results and experts’ opinions reasonably and verification of sectoral scope 6 (construction). This was
reflect the general truth behind these important insights. As for explained via email communication in April 2011 whereby Mr.
the possibility of extending CDM methodology for construction Werner Betzenbichler, the General Manager of DIA, (DOE and
and built environment projects, the majority of the experts were Independent Entities Association) had opined that:
in agreement with the potential of following methodologies being
applied to the C&BE industry, such as those related to cement The coverage of other scopes has a historic reason. In the former
accreditation procedure there have been bundles of scopes. If
(71%), energy distribution (47%), energy efficiency (95%), fossil-fuel
switching (83%), transportation (71%), and zero-emission renew- you passed accreditation in ONE scope of such a bundle, the DOE
has been accredited for ALL scopes of this bundle. Meanwhile the
able energy (69%). The proposals to develop a nationwide database
tool and replace cement with fly ash for site-mixed concrete were procedure changed, but it was always possible to restrict the
accreditation voluntarily to those scopes a DOE has experts in.
found to have a high feasibility of increasing CDM projects related
to the construction sector. Fossil-fuel switching, energy efficiency, The lack of involvement from the C&BE industry’s very own
and renewable-energy measures in new infrastructure projects expertise in the CDM business could be one of the reasons that we
and construction machinery were also highly feasible for being see no presence and less promotion of CDM projects in the
developed as CDM projects related to the construction sector. At a construction phase despite a few CDM projects that are related
glance, since all of the phases throughout the whole lifecycle of to the operation phase in the built environment. The understand-
the construction project somehow involve the use of machinery, ing of the definition and boundary of both the general perception
materials, or appliances that consume fossil fuels and electricity, about the construction industry and the construction sectoral
there are significant possibilities to achieve direct as well as scope defined by UNFCCC is important for all partiesto gain
indirect emissions reductions from those uses, despite the gaps starting interest without ambiguity from the construction industry
and barriers currently facing the C&BE industry. stakeholders. However, it is more important to look into why an
Table 5 shows integrated combinations of the above suggestions activity does not reduce emissions more than it does, and not just
that could be applied across the whole lifecycle of an infrastructure focus on assigning activities to the construction sectoral scope.
(i.e. highway) project. This can give us a clearer picture of how a PoA Hence in this study, the authors had opted to focus on feasible
could be designed to include component project activities involved CDM projects that could possibly cross the boundary of the C&BE
in the lifecycle of a building/infrastructure development project. industry.
On the other hand, the authors also came across interesting
4.3.3. Authors’ opinions on implications and future direction arguments from a totally different view of the bigger picture, the
As one of the sub-sectors identified in Annex A of the Kyoto critiques of the carbon market. A collection of such arguments can
Protocol, the Fuel Combustion involved in the construction sector be found in Böhm and Dabhi (2009), claiming that the introduction
should not be ignored. The authors are of the opinion that people of carbon markets has been a big delaying tactic introduced by the
are still not clear enough on the boundary of the construction world’s biggest polluters in the North. The critics also opined that by
sector and the definition of the sectoral scope of construction turning GHG into commodity, one might invite speculation and
defined by UNFCCC. The original impetus for this research was lack thereby encourage pollution. In the authors’ opinion, the saving cost
of approved methodology and CDM projects categorized under the of emission reduction in one country (developed country with
sectoral scope of construction. The impression that the general higher cost index) by CER generated from another country (least
public may have could be that the construction industry is either develop or developing country with lower cost index) is akin to
being left out or is just not buying into the concept of CDM. The outsourcing practices in the business world. There are also claims
authors are unclearabout the categorization of their own domain that outsourcing has pushed environmental standards down in
industry (the construction sectoral scope) given by UNFCCC. In Apr developing countries, as low environmental regulations will lower
2011, the UNFCCC CDM team told the authors that: production costs and thus attract investment. Although the com-
modity of emissions reduction might invite speculation, it is noted
In order to be classified under sectoral scope 6, a methodology that the increased cost of preventing pollution would not majorly
has indeed to belong to the construction industry sector or a determine CER trade flows if we adopt the same logic that Copeland
construction activity. An energy efficiency project within the (2007) suggested regarding outsourcing. Before considering CER
construction industry (e.g. energy efficiency during an activity speculation that might be raised by the construction sector, it would
of construction of building or energy efficiency in a construc- be best to get a CDM project from the construction sector validated
tion material industry such as brick etc.) would belong to both to prove its CER generation capacity.
sectoral scopes (3-energy demand and 6-construction).

The UNFCCC CDM team has clarified that the construction material 5. Conclusion
industry is considered a part of the construction sectoral scope.
However, the reason that the existing methodology of cement This study has reviewed the development of CDM, especially as
production is not tagged for both the manufacturing sectoral scope it relates to the construction and built environment industry (C&BE),
and the construction sectoral scope is unclear. Switching fuel and by identifying reasons for the scarcity of related projects under the
energy efficiency in transportation (which also involving machines) registered CDM pipeline. Surveys were conducted, along with
can be tagged as a sectoral scope of transportation. If the same logic follow-ups through in-depth interviews with experts who provided
applies, one could see that switching fuel and energy efficiency in the useful references and information regarding the suggestions we
construction machinery can also be tagged under the construction proposed to increase CDM projects in the C&BE industry, particu-
sectoral scope. The answer lies in the list of sector and sources larly for the different lifecycle phases of a building/infrastructure
contained in Annex A of the Kyoto Protocol, whereby the construction project. The majority of the experts were in absolute agreement
sector, transportation sector and other unlisted sectors, such as the with the high potential of the application of CDM energy efficiency
built environment sector, are just sub-sectors under the Energy sector. methodology (95%) and fossil fuels switch methodology (83%) in the
A large part of the respondents in the survey do not have a C&BE industry. Most of the experts agreed that the solutions
background in construction or built environment, including those suggested can be generalized to both buildings and infrastructure
respondents representing DOE who are accredited for validation subsectors, as both share similar causal factors and circumstances,
522 K.L. Mok et al. / Energy Policy 65 (2014) 512–523

such as construction materials, fuel, stakeholders, common prac- by the Ministry of Land, Transport and Maritime Affairs of the
tices, and industry barriers that must be tackled in dealing with the Korean government.
implementation of CDM.
Among the 14 suggestions that we proposed, 3 suggestions are
concluded as low feasibility and 4 suggestions are highly feasible, References
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