Projects that curb greenhouse-gas emissions in developing nations must apply for credits within a year to demonstrate they need the credits, a representative of certification firms said.
Quick applications are ``a good indicator'' that project managers seriously considered getting credits under the UN's Clean Development Mechanism when they began the project, said Robert Dornau, climate-change program director at Geneva-based certification firm SGS SA.
``This time gap should not be more than 12 months,'' he said today in an e-mailed statement. The new limit will take effect this month, he said.
A project's start date is marked by financial closure, major equipment orders, construction permit awards or start of construction, whichever comes first, Dornau said. One of the main reasons for rejection by the CDM executive board is failure to show the project needs the credits to be viable, he said.
The value of trade in the CDM, the world's second-biggest emissions trading market, more than doubled last year to $12.9 billion, the World Bank said in a May report.
The guidance from the certification firms is in response to criticism from environmental groups including WWF that some CDM grants lack credibility. Dornau is also vice chairman of the Designated Operational Entities Forum, a group of certification firms including Det Norske Veritas, TUV Sud AG and TUV Rheinland Holding AG.
Projects that are granted credits must not be ones that would have been carried out anyway, according to UN rules. Factories and power stations in the European Union, which has the biggest greenhouse-gas trading system, can use UN credits for compliance as an alternative to EU allowances.
The 12-month limit also applies to requests to approve new emission-reduction methods, Dornau said. Older, stalled projects that have tried unsuccessfully for 12 months to secure a loan without credits and that can demonstrate the need for credits to arrange financing may be eligible for a grant, he said.

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