The Clean Development Mechanism (CDM) is a part of the Kyoto Protocol which promotes carbon reducing projects in developing countries. When the protocol enters into force, the carbon credits generated by these projects could be used to help meet greenhouse gas reduction targets by the 37 industrialized countries governed by the treaty.

In their report "Damming the CDM," authors Barbara Haya, Patrick McCully and Ben Pearson say that seven hydro projects claimed for emissions credit under the CDM are already under development, and in some cases are nearly complete. They are "business as usual projects that would go ahead without the CDM," the report says.

The Marrakesh Accords, which defined the rules by which the CDM will function, state that to receive CDM credits a project must be "additional," meaning that "anthropogenic emissions of greenhouse gases by sources are reduced below those that would have occurred in the absence of the registered CDM project activity."

Five out of the seven dam projects at issue are in Latin America - the 25 megawatt Chacabuquito Dam in Chile; two dams in Costa Rica, the 7.5 megawatt El Encanto and the 35.4 megawatt Penas Blancas dams; three dams in Panama totalling 242 megawatts; and the 90 megawatt Huanza dam in Peru.

The other two dams are in Uganda. In particular, the possibility that the Dutch Government may source credits from the controversial 200 megawatt Bujagali Dam on Uganda's White Nile River "would totally undermine the credibility of the CDM as a driver for sustainable development," the groups say.

The Bujagali Dam could destroy the Bujagali Falls, and would be built eight miles below two other large dams. The project is expected to catalyze further hydro development along the Nile. Uganda has plans to build up to six more dams on the Nile.

Few Ugandans have access to electricity but Bujagali critic Martin Musumba says, "The real issue in Uganda is not electricity but poverty. Currently the majority of Ugandans have no money for electricity. Production of more electricity will not reduce the use of fuelwood and charcoal until deliberate programs are evolved to reduce poverty and the cost of power."

Of the 30 projects moving through the CDM approval process, these seven dam projects account for nearly 40 percent of the credits being claimed.

IRN's McCully said, "Giving these projects approval to generate carbon credits would turn the CDM into a subsidy mechanism for hydro developers and a carbon accounting loophole for industrialized countries, instead of a tool for climate protection."

"The social and environmental damage that will be caused by some of these projects also means that they are in breach of the CDM's mandate to promote sustainable development," the groups say.

IRN and CDM Watch are at the Eighth Conference of Parties to the United Nations Framework Convention on Climate Change where the Clean Development Mechanism is a major issue on the agenda. The conference, which opened October 23, will conclude November 1.

The Executive Board of the Clean Development Mechanism will consider whether these non-additional hydropower projects will be accepted under CDM rules. "If non-additional hydro projects are allowed into the CDM, it will undermine the entire mechanism," said Ben Pearson of CDM Watch. "We urge the Board to make it clear that these projects will be rejected."

IRN and CDM Watch are lobbying for the exclusion of large hydropower projects from the Clean Development Mechanism, and for small hydro projects to be restricted to those which comply with the recommendations of the World Commission on Dams.