CARBON CREDIT:

RESPONSIBILITY OF DEVELOPED COUNTRIES

Submitted to:

Prof. (Dr.) Vishnu Konoorayar

(Faculty, Environmental Law)

Submitted by:

Anirudh Dewangan

(Semester 4, Section A, Roll No. 19)

HIDAYATULLAH NATIONAL LAW UNIVERSITY

Uparwara Post, Opp. Jungle Safari,

Atal Nagar, District Raipur

Chhattisgarh, 492002
Introduction

Carbon credits have become an increasingly popular solution to combat the impacts of
climate change. The mechanism allows companies to offset their carbon emissions by
purchasing credits from other companies or organizations that have taken measures to reduce
their carbon footprint. This approach has been viewed as a responsible approach to meeting
international climate change goals.

However, the question of responsibility for the use of carbon credits has remained a
controversial issue, with many arguing that developed countries have a greater responsibility
than developing countries. Environmental law states an important role in controlling the use
of carbon credits and establishing the principles of responsibility. This article will explore
the responsibility of developed countries in the use of carbon credits in the context of
environmental law.

Environmental Law and Carbon Credits

Environmental law states an important role in controlling the use of carbon credits and
establishing the principles of responsibility. “The United Nations Framework Convention
on Climate Change (UNFCCC) was established in 1992 to address the issue of climate
change. The UNFCCC has since been ratified by 197 countries, making it a legally binding
agreement. The UNFCCC recognizes that the issue of climate change is a global problem and
requires global solutions.”1

The principle of “Common but Differentiated Responsibilities (CBDR)” was established by

the UNFCCC and recognizes that developed countries bear a greater responsibility for
reducing greenhouse gas emissions due to their historical contributions to climate change and
their greater economic capacity to mitigate its effects.2

This principle has been reaffirmed in subsequent settlements and agreements, including both
Kyoto Protocol and the Paris Agreement. The Kyoto Protocol, which was adopted in 1997,
established legally binding emissions reduction targets for developed countries, while the
1
“United Nations Framework Convention on Climate Change, What is the United Nations Framework
Convention on Climate Change?
https://unfccc.int/process-and-meetings/what-is-the-united-nations-framework-convention-on-climate-change.”
2
“United Nations, Department of Economic and Social Affairs, The Sustainable Development Goals Report
2021,
https://sustainabledevelopment.un.org/getWSDoc.php?id=4086.”
Paris Agreement, which was adopted in 2015, established a more flexible approach that
allows each country to determine its own emissions reduction targets.

The Paris Agreement also emphasized the need to take lead in minimizing greenhouse gas
emissions and providing financial and technological assistance to developing countries from
the developed countries. The Agreement recognized that developing countries have limited
capacity to address climate change and require support from developed countries to transition
to a low-carbon economy.

In summary, environmental law provides the framework for regulating the use of carbon
credits and establishing the principles of responsibility. The UNFCCC, the Kyoto Protocol,
and the Paris Agreement have created the principle of CBDR, which states that developed
countries have a larger responsibility for reducing greenhouse gas emissions and providing
support to developing countries

Responsibility of Developed Countries

Due to their historical contributions, developed countries have a lager responsibility to

mitigate climate change to greenhouse gas emissions and their greater economic capacity to
take action. Developed countries have historically relied on fossil fuels to fuel their economic
growth, resulting in high levels of greenhouse gas emissions.

As a result, developed countries are anticipated to take the lead in minimizing greenhouse gas
emissions and transitioning to a low-carbon economy. This includes setting ambitious
emissions reduction targets, investing in renewable energy and other low-carbon
technologies, and promoting sustainable practices.

In addition, “developed countries are expected to provide financial and technological support
to developing countries to assist with their efforts to address climate change. The Paris
Agreement calls for developed countries to provide $100 billion in annual climate finance to
developing countries by 2020, with a commitment to increase this amount in the future.”3

However, some critics argue that developed countries have not done enough to fulfill their
responsibility to mitigate climate change. Many developed countries continue to rely heavily
on fossil fuels and have not set ambitious emissions reduction targets. Additionally, some
3
“United Nations Framework Convention on Climate Change, Climate Finance in the Negotiations,,
https://unfccc.int/topics/climate-finance/the-big-picture/climate-finance-in-the-negotiations”
developed countries have been accused of using carbon credits as a substitute for direct
emissions reductions, which can undermine the effectiveness of the mechanism.

To fulfill their responsibility, developed countries must prioritize emissions reductions and
support sustainable practices. This includes investing in renewable energy, implementing
policies that encourage sustainable practices, and providing financial and technological
support to developing countries.

Additionally, developed countries must ensure that their use of carbon credits does not
undermine their commitment to reducing greenhouse gas emissions.

Potential Misuse of Carbon Credits

While carbon credits have the potential to be the effective mechanism for reducing
greenhouse gas emissions, there is a risk of its misuse. One potential misuse of carbon credits
is the use of credits as a substitute for direct emissions reductions. Some companies may
choose to purchase carbon credits instead of investing in measures to reduce their own
emissions, which can undermine the effectiveness of the mechanism.

In addition, there is a risk that carbon credits may be prioritized in developed countries over
direct emissions reductions. While developed countries are obligated to mitigate climate
change, they must prioritize direct emissions reductions over the use of carbon credits. Using
carbon credits as a substitute for direct emissions reductions can undermine the effectiveness
of the mechanism and does not address the root causes of climate change.

To prevent the misuse of carbon credits proper guidelines should be made, for their use and
to ensure that they are only used to supplement, rather than replace, direct emissions
reductions. In addition, there must be transparency in the trading of carbon credits to prevent
fraud and ensure that credits are being used to support sustainable practices.

Overall, while carbon credits have the potential to be a valuable tool for reducing greenhouse
gas emissions, it is important to be aware of their potential misuse and to ensure that they are
used in a responsible manner that supports direct emissions reductions and sustainable
practices
Conclusion

In conclusion, carbon credits are an essential mechanism for minimizing greenhouse gas
emissions and mitigating climate change. However, it is important to recognize that their
effectiveness depends on responsible use and adherence to environmental law. Developed
countries have a larger responsibility to mitigate climate change because of their historical
contributions to greenhouse gas emissions and their greater economic capacity to take action.

They must prioritize direct emissions reductions over the use of carbon credits and give
financial and technological support to the developing countries. Additionally, it is important
to prevent the misuse of carbon credits by establishing clear guidelines for their use and
ensuring transparency in their trading. Through responsible use of carbon credits and
adherence to environmental law, we can work towards a more sustainable future.