Concept

Countries around the world have recognised the urgent need to take action to reduce Greenhouse Gases (GHGs) in order to address the climate change challenge. In December 1997, more than 160 other countries met in Kyoto, Japan, and agreed to targets to reduce GHG emissions. The agreement that set out those targets, and the options available to countries to achieve them, is known as the Kyoto Protocol.
The European Union signed up to an agreement to reduce GHG Emissions by 8% on 1990 levels during the years 2008 - 2012.
The Protocol will only become legally binding when it is ratified by at least 55 countries, covering at least 55 per cent of the emissions addressed by the Protocol.

The Protocol also includes market-based instruments known as the Kyoto Mechanisms that allow countries to earn or buy credits outside their borders, including the Clean Development Mechanism (CDM) and the International Emissions Trading (IET). The CDM is a way to earn credits in the form of "certified emission reductions" (CERs) by investing in emission reduction projects in developing countries. and these credits can be used towards meeting a country's Kyoto target. IET will permit developed countries that have taken on a Kyoto target to buy and sell part of their assigned amount of CO2 emissions among themselves.

The goal of the project IRIS KYOTO "Innovative Risk Coverage and Financing of Projects related to the implementation of the CDM focussing on India and Morocco" is to address important project development and financing barriers to the successful implementation of the CDM, building a practical methodology for implementing real CDM projects. In developing CDM projects, risk analysis and spread, taking into account risk perception and aversion of private players and their related requirements in terms of returns must be revisited, looking not only at the classical project risks but also those related to the mobilisation of carbon finance.