Reducing greenhouse gas emissions at home or abroad has become the dilemma within contemporary climate change policy, touching upon various concepts such as cost-effectiveness, environmental effectiveness, equity, and sustainable development, and challenging the North-South relationship in itself. Although Annex I Parties to the Kyoto Protocol are legally obligated, through the supplementarity requirement, to meet their Kyoto emission reduction targets to a certain extent through ‘domestic actions’, most Parties prefer to make use of flexibility mechanisms arguing that actions to reduce emissions should be taken where it is cheapest given the fact that the effect on the atmosphere will be the same.
This research paper explores the limits to flexibility and elucidates the understanding of the supplementarity requirement in the Articles 6, 12 and 17 of the Kyoto Protocol. While the flexibility mechanisms allow Annex I Parties to earn and trade emission allowances through projects implemented either in other developed countries or in developing countries and which they can use towards meeting their commitments, the supplementarity requirement in the articles was adopted to safeguard concerns as to the integrity of the international climate regime.
Even though the objective the supplementarity requirement is clear, the practical implications of the requirement have been subject to a long debate particularly due to the lack of a quantified definition of the requirement. As the Kyoto Protocol only mentions that use of the flexibility mechanisms ‘shall be supplemental to domestic actions’ for the purposes of meeting the Kyoto reduction commitments, Kyoto Parties have disagreed on the amount of actions to be taken at home. This research paper attempts to provide an effective and justifiable interpretation of the supplementarity requirement which would be acceptable to both industrialized and developing countries taking into account cost-, and environmental effectiveness as well as equity considerations.