• Journal of Environmental Policy
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• v.5 no.1
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• pp.25-43
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• 2006

This study is intended to develop an economic feasibility methodology of A/R CDM projects based on two project cases in China and Vietnam and to evaluate the project profitability from the view point of credit type selection between temporary CER (tCER) and long term CER (lCER) as well as from the aspect of CER prices by using indicators IRR, the year in which a single year profit is achieved and the year in which the accumulated deficit is cleared. For A/R CDM projects of industrial plantations, tCER is more suitable than lCER. Profitability of A/R CDM projects depend on the price of wood and CERs. In the case that the project participants take responsibility for replacement of credits to make the price of their CERs at higher levels, thus the project may not be feasible as a CDM project. However, minimum required tCER prices without replacement are 11US$/t $CO_2$, thus the project may be feasible under the future carbon market scheme.