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The Clean Development Mechanism (CDM) is one of the three greenhouse gas emission reduction and trading instruments of the Kyoto Protocol (KP). The CDM allows governments and business entities from developed countries to offset their emissions liabilities by reducing or avoiding emissions in developing countries, where it is often cheaper to do so. Examples of CDM projects include the installation of various renewable energy producing facilities, cutting the GHG emissions in industry and waste management, or projects focused on improving energy efficiency.
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