The Clean Development Mechanism (CDM) is one of the three flexible mechanisms outlined in the Kyoto Protocol. Under the CMD, industrialized countries implement GHG mitigation projects in developing countries, so that they achieve ‘Certified Emissions Reduction’ (CER) according to the emissions reduction accomplished in the projects. Since such projects in developing countries cost less than domestic measures, industrialized countries can succeed in reducing GHG emissions more cost-effectively. Developing countries can use the CDM as a change to obtain financial resources and state of the art technology. The aim of this paper is to present briefly the flexible mechanism of Kyoto Protocol and to illustrate a step by step preparation of a possible CDM project.

Keywords : Kyoto Protocol, Clean Development Mechanism, Greenhouse Gas