The Evaluation Of Carbon Assets Under The Clean Development Mechanism

The purpose of this article is to find the right way to evaluate the carbon assets under the clean development mechanism by discussing the applicability of different kind of evaluation. Then we can get the enterprise’s entire value which includes carbon assets.The Kyoto protocol reached an agreement that the obligations of reduction of carbon emissions in developed countries should begin in2005, that in developing countries would be in2012. Developed countries have both a larger share of emission reduction and higher energy efficiency and the optimal energy structure, so it cost much to reduce emissions, while developing countries with smaller emission reduction pressure have the advantage of lower energy utilization. The asymmetry leaded the two sides have the motivation to change and then the carbon assets market was built. How to evaluate the value of carbon assets? First of all, from the angle of cost method, we can buy or build the same amount of carbon assets to obtain the value of assets, the direct method (to buy) carbon assets is to get the market transaction price, but it is difficult to get the supply’s curve and the demand’s curve of the same kind of carbon assets. This method is feasible. The indirect method (to build) is to purchase equipment and other costs which was used to reduce carbon emissions; Secondly, from the perspective of market method, we can choose the similar amount and transaction period of carbon assets to determine the price of carbon assets. Although it is easy to obtain the similar number of deals, the market price is not easy to get because of non publicity. The method is feasible, too. At last, from the perspective of the income method, we can measure the income of carbon assets in the next few years or the contribution of carbon assets to the value of the enterprise.The amount of the contribution is to measure the overall enterprise’s value with a carbon assets and the absence of carbon assets, the difference without the influence of the intangible assets is the carbon assets. Finally, I show the applicability of the income method and cost method by a case, then draw a conclusion that income method is the most suitable method.