Forging alliance with Russia: the example of a Green Investment Scheme

Russian Kyoto related interests are economic and after the US withdrawal the mission of Russian actors has been to find new demand for Russian credits and allowances. Kyoto related benefits to Russia will be significantly smaller than earlier expected, however, the revenues are now more likely to be focused on climate change mitigation purposes. Competition in the Kyoto market has established buyers’ market and Russia has to accommodate the interests of investors in order to gain benefits. The Russian initiative ‘Green Investment Scheme’ to recycle revenues from International Emissions Trading (IET) to further environmental activities would convene demand for Russian AAUs but experience the same problems than the previous initiatives: inadequate institutional arrangement, unclear division of responsibilities between domestic actors, prolonged ratification process and lack of eligibility strategy. These problems have prevented implementation of GIS so far. Therefore, these problems have to be addressed by high-level Russian policy-makers if serious benefits from Kyoto are sought. Actors building alliances with Russia should focus on assisting with solving these problems.