The Kyoto Protocol 1997

30th August 2012

International climate change legislation

Date of signature: 11 December 1997 
Entered into force: 16 February 2005
Signatory Parties: Status of ratification, as of December 2010

What are the aims and requirements of the Protocol?

The Kyoto Protocol, which was agreed in 1997, provides Contracting Parties with legally binding obligations and targets for the reduction of their greenhouse gas emissions. It shares the Convention's aims, principles and institutions, but requires developed countries (those listed in Annex I) to reduce their emissions of greenhouse gases by at least 5 per cent from 1990 levels in the commitment period 2008-2012. The EU has agreed to reduce its combined emissions by 8 per cent below 1990 levels. This will be achieved by means of a so-called 'bubble', designed to allow the EU's target to be redistributed between the Member States to reflect their national circumstances, their requirements for economic growth and the scope each has for further emission reductions. The Protocol needs to be read in conjunction with the UNFCCC, as discussed above, since the Convention is the 'parent law' and the definitions contained within its articles are used in the Protocol.

The Protocol has attached a 'monetary value to the earth's shared atmosphere' (UNFCCC) with the restrictions it has placed upon greenhouse gas emissions. The introduction of mandatory emissions targets effectively assigns a financial cost to greenhouse gas emissions and creates an incentive for the Parties to the Convention to seek the most cost-effective methods for reducing them. It is this latter element that is reflected in the creation of the flexible mechanisms (see Flexible mechanisms section below).

Protocol bodies

The Conference of the Parties (COP) serves as the meeting of the Parties to the Protocol, which is known as the CMP. The meetings of the CMP are timed to coincide with the meeting of the COP and its functions are similar to those carried out by the COP. The first meeting of the CMP was held in Montreal in 2005, during the 11th meeting of the Conference of the Parties (COP). Those Parties that have acceded to the Convention, but not to the Protocol, may participate in the CMP, but only in the role of observers (e.g., the USA). The subsidiary bodies created under the UNFCCC, such as the Subsidiary Body for Scientific and Technological Advice (SBSTA) and the Subsidiary Body for Implementation (SBI), also serve the CMP (see UNFCCC page).

In addition, the Protocol also established three further bodies, which provide advice and support to the CMP. The CDM Executive Board (CDM EB) and the Joint Implementation Supervisory Committee (JISC) supervise and verify Clean Development Mechanism and Joint Implementation projects respectively (see Flexible Mechanisms section below). The third body established under the Protocol is the Compliance Committee, which is responsible for overseeing Parties' compliance with the Protocol.

In 2005, the CMP established the Ad-Hoc Working Group on Further Commitments for Annex I Parties under the Kyoto Protocol (AWG-KP), which is in charge of considering Annex I Parties' commitments under the Protocol 'at least seven years before the end of the first commitment period' (Article 3.9). Furthermore, in 2007, the Ad-Hoc Working Group on Long-Term Cooperative Action (AWG-LCA) was created under the Convention as a negotiating forum for Parties' cooperation (Decision 1/CP.13 - FCCC/CP/2007/6/Add.1). The activities of these Working Groups concerning further Parties' commitments and cooperation were expected to conclude at the COP 15 in Copenhagen, in December 2009. In the light of the failure to reach a compromise in Copenhagen, Contracting Parties decided to renew their mandate.

Financial mechanisms

To enhance the financial support required under the UNFCCC, Contracting Parties to the Kyoto Protocol have agreed the institution of an Adaptation Fund to sustain developing countries in adapting to climate change. This fund is mainly financed by a levy on Certified Emissions Reductions (CERs) issued in the framework of Clean Development Mechanisms (CDM) projects (see CDM section below). In Copenhagen in December 2009, the launch of a new fund, called the Copenhagen Green Climate Fund, was included into the Copenhagen Accord. However, this Accord was not legally binding and the operational establishment and characteristics of the Green Climate Fund were only agreed at Cancun, the following year (see Cancun Accord). The fund was made operational at the Durban Conference in 2011.

Flexible mechanisms

Flexible mechanisms allow Parties to decide how best to achieve their required reductions during the commitment period, and are intended to lower the cost of compliance with the targets issued. Under the Protocol, Annex I Parties may use two project-based mechanisms to fulfill their obligations: Joint Implementation (JI) and the Clean Development Mechanism (CDM). Flexible mechanisms under the Kyoto Protocol also include Emissions Trading, which is a purely market-based mechanism established to stimulate cost-effective emissions reductions.

  • Joint Implementation (JI) allows an Annex I Party to 'transfer to, or acquire from, any other such Party emission reduction units resulting from projects aimed at reducing anthropogenic emissions by sources or enhancing anthropogenic removals by sinks of greenhouse gases in any sector of the economy'. These projects are required to provide 'a reduction in emissions by sources, or an enhancement of removals by sinks, that is additional to any that would otherwise occur' (Article 6.1(b)). Article 6 allows a Party to undertake an emission-reducing project or a project that enhances removals by sinks in the territory of another Annex I Party. Emission Reduction Units (ERUs) obtained in this manner may then be used to meet the original Party's Kyoto targets although they must be 'supplemental' to domestic actions for that purpose (under Article 3).
  • The Clean Development Mechanism (CDM) is another project-based mechanism, which generates credits that may be used by Annex I Parties to meet their commitments under the Protocol. Article 12 provides that Certified Emission Reductions (CERs) shall be generated by CDM projects, which assist developed country Parties (Annex I Parties) in meeting their emissions targets. Essentially, developed nations sponsor or pay for emission reduction projects in developing or less developed countries (non-Annex I Parties) in return for credits that they may put towards their own emissions targets. Article 12 requires that projects have the approval of all parties involved, provide real and measurable benefits, and reduce emissions below the level that would have occurred otherwise. The CDM is supervised by its Executive Board, which in turn operates under the authority of the CMP.
  • Emissions Trading allows Annex I countries, and operators of regulated installations within them, to trade emissions credits in order to meet their targets under the Protocol (Article 17). An emissions trading scheme (ETS) is a 'cap and trade' mechanism, which requires Parties' governments to set an overall binding ceiling ('the cap') to greenhouse gas emissions from all regulated installations. In imposing the cap, governments also grant operators a certain quantity of emission allowances, each of which represents one tonne of 'carbon dioxide equivalent' that can be released into the atmosphere. Operators that use fewer allowances than those they have been granted, by achieving greater than expected reductions in their emissions, are entitled to sell their surplus allowances on the open market. Operators who choose to exceed their emissions cap can then purchase extra allowances from that market.

    The overall objective of an emissions trading scheme is to allow operators to decide the most cost-effective method for reducing their overall emissions, enabling those who achieve greater than required reductions to obtain an economic benefit. Operators may trade various types of units including: those initially assigned to them under the Protocol; Removal Units (RMUs) obtained through the employment of sinks; Emission Reduction Units (ERUs) gained through Joint Implementation projects; and Certified Emission Reductions (CERs) obtained via the CDM mechanism. Transfers of these units are to be tracked by registries at national and international level. For CCS in an emission trading scheme see EU Emission trading legislation.

Reporting requirements

Article 12 of the UNFCCC requires all Parties to the Convention to provide details of the steps they have taken to implement its requirements. Various national reports have to be submitted, including: national communications covering all aspects of implementation for Annex I and non-Annex I countries; greenhouse gas inventories containing annual data on emissions and removals, for Annex I Parties; and National Adaptation Programmes of Action to be submitted by the least developed nations outlining their needs and priorities for adaptation.

Kyoto contains more detailed provisions concerning the reporting and review of information submitted by Annex I Parties, as well as systems and methodologies for preparing greenhouse gas inventories. Annex I Parties were required to put in place, by the end of 2007, national systems for the estimation of emissions by sources and removals by sinks of greenhouse gases (Article 5). Parties must then submit annual greenhouse gas inventories and national communications demonstrating their compliance with the Protocol (Article 7), which will be reviewed by expert review teams (Article 8).

The 'approved methodologies' referred to in Article 5, which are to be used by Annex I Parties for estimating emissions and removals, have to be those accepted by the Intergovernmental Panel on Climate Change (IPCC). The IPCC first released guidelines for this purpose (The Guidelines for National Greenhouse Gas Inventories) in 1994, and a revised set was released in 1996.

Key legal issues concerning CCS

Research and development

  • Under the Protocol, Parties are required to undertake 'research on, and promotion, development and increased use of, new and renewable forms of energy, of carbon dioxide sequestration technologies and of advanced and innovative environmentally sound technologies' (Article 2.1(a)(iv)). Although 'carbon dioxide sequestration technologies' are not defined anywhere in the Protocol text, 'sequestration' here is likely to refer to the capture and geological storage of CO2 from power stations, rather than sequestration in terrestrial sinks such as forests or oceans. 

Measuring emission reductions from CCS

  • Under the Protocol, reductions in greenhouse gases made by removals from sources or through the employment of sinks, must be accounted for in a transparent and verifiable manner. The requirement to record removals and reductions in this way is partly based upon concerns about the permanence of storage techniques. In the absence of strict accounting mechanisms, once a credit has been awarded, there is little incentive to ensure the containment of a gas or to minimise its escape. Reductions made by CCS have raised concerns, because there remain issues regarding the security of stored CO2 and possible leakages.
  • Currently there are two accepted methodologies under the UNFCCC for measuring the reductions in greenhouse gases made by Parties: inventories for measuring national greenhouse gas emissions; and those accounting for greenhouse gas reductions under Kyoto's flexible mechanisms. The current IPCC Guidelines for National Greenhouse Gas Inventories 1996 (as revised) are used in the preparation of inventories to be submitted under the UNFCCC and Protocol. An IPCC Special Report published in 2005 described these Guidelines as insufficient to address certain issues. A new set of guidelines was adopted in April 2006, the IPCC 2006 Guidelines for National Greenhouse Gas Inventories ('the 2006 Guidelines'). These contained a complete methodology for the treatment of CCS.
  • The 2006 Guidelines provide Parties with an agreed methodology for estimating greenhouse gas inventories, which may be used for submitting their reports to the UNFCCC. Chapter 5 of Volume 2 ('Energy') provides emission estimation guidance on capture and compression, transport systems, injection systems and the storage of CO2.
  • The 2006 Guidelines have yet to be officially sanctioned by the COP or CMP, although at the 24th meeting of the SBSTA in May 2007, there was official recognition and consideration of the issue. The SBSTA, in its Draft Conclusions, recognised that there was a need 'for continued consideration of the 2006 IPCC Guidelines in the context of the revision of the UNFCCC reporting guidelines for Annex I Parties' (see document FCCC/SBSTA/2007/l.5). Furthermore, the SBSTA encouraged Parties to 'gain experience' with the 2006 Guidelines and submit details of those experiences to the Secretariat. At its 30th Session, in June 2009, the SBSTA continued its consideration of the 2006 Guidelines. At this session, it was confirmed that the process for Annex I Parties to implement the use of the 2006 IPCC Guidelines should be conditional upon a revision of the UNFCCC Annex I reporting guidelines and the consideration of methodological issues associated with it.

    Despite the fact that work has been undertaken on this issue, until a final decision is adopted regarding the 2006 Guidelines, there is uncertainty as to whether individual Parties can use these Guidelines, instead of the revised 1996 Guidelines, in the preparation of their national inventories.

  • On the view that the later 2006 Guidelines are more relevant and up-to-date, and that there is a gap in the scope of the 1996 Guidelines, the UK Department for Environment, Food and Rural Affairs (Defra) intends to use the 2006 Guidelines to incorporate any CCS activities. Norway has incorporated details of the Sleipner CO2 storage project in its national inventory report. Annex V of the Norwegian 2006 report, entitled, 'CO2 capture and storage at Sleipner West Field - storage site characterisation, monitoring methodology and results', provides a detailed summary of the amount of CO2 stored and the methodology used for these calculations. It is clear from this that Norway does not view the 1996 Guidelines, and their lack of explicit guidance in this field, as a bar to including stored CO2 in their national greenhouse gas inventory. 

CCS in the CDM

  • For the main features and key legal issues associated with CCS as CDM project activities see CCS in the CDM page.


Official documents





  • Redgwell, C., International Legal Responses to the Challenges of a Lower-Carbon Future in Zillman, D.; Redgwell, C; Omorogbe, Y; Barrera-Hernandez, L. (eds.),Beyond the Carbon Economy [Oxford University Press, 2008], Chapter 5.
  • Banks, N., Roggenkamp, M., Legal Aspects of Carbon Capture and Storage in Zillman, D.; Redgwell, C; Omorogbe, Y; Barrera-Hernandez, L. (eds.), Beyond the Carbon Economy [Oxford University Press, 2008], Chapter 15.



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The Kyoto Protocol 1997


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