Paragraph 8

The Conference of the Parties serving as the meeting of the Parties to this Protocol shall ensure that a share of the proceeds from certified project activities is used to cover administrative expenses as well as to assist developing country Parties that are particularly vulnerable to the adverse effects of climate change to meet the costs of adaptation.

A proportion of the proceeds from CDM project activities must be retained by the Executive Board for two purposes:

The Administration Share of Proceeds is a charge of:

  • USD 0.10 per CER issued for the first 15,000 tonnes of CO2 equivalent for which issuance is requested in a given calendar year;
  • USD 0.20 per CER issued for any amount in excess of 15,000 tonnes of CO2 equivalent for which issuance is requested in a given calendar year.

Lower charges are available for smaller projects, and projects conducted in least-developed countries are exempt from payment.

The Administration Share of Proceeds must be paid prior to issuance and is used to assist with the administrative expenses of the Executive Board and other bodies involved in the Protocol framework. The expected amount for the first year is paid upfront as a registration fee and is based on the expected average annual emissions over the crediting period.  If the project is not registered, any registration fee above USD30,000 is reimbursed.

The Adaptation Share of Proceeds is a deduction of 2% of the certified emission reductions (CERs) generated by the project each year used to fund measures in developing country Parties to the Protocol that will assist them in adapting to the adverse effects of climate change.

The CERs are deducted by the Executive Board prior to issuance, such that only 98% of each issuance of CERs are forwarded to project participants. The proceeds are paid into an Adaptation Fund, which was operationalised at COP/MOP 3 in 2007.

Exemptions are available for small-scale afforestation and reforestation projects and projects conducted in least-developed countries.

Related Topics

Share of Proceeds

Registration fee

Certified emission reductions (CERs)