The NYT reported that the United States, along with Japan, the United Kingdom, and the World Bank, are putting up $5.5 billion to help developing countries adopt clean technologies. In addition to not giving readers any clear idea as to how significant this sum is (it's presumably a revolving loan fund, but even that is not entirely clear from reading the article), the article also does not give readers any ability to assess it's likely impact. To do that, readers should look back to a NYT piece published in December that reported on how the Clean Development Mechanism (CDM), which is presumably the context in which this fund is being created, was rife with fraud and having little impact on greenhouse gas emissions. The basic story is that it is very difficult to assess the impact of actions on a project by project basis. For example, a utility may have already planned to shut down a 60 year-old coal burning power plant, simply because it was no longer cost effective. If the utility gets paid to shut down the plant through the CDM, this is not a new reduction in emissions. Without a well developed baseline path, it is very difficult to determine where specific projects are actually leading to actual reductions in emissions. It is easy to design mechanisms that could achieve real reductions in emissions in developing countries in far way, but thus far almost no politicians have been interested in pursuing such paths and the media have chosen not to discuss such alternatives.
--Dean Baker
