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Design of the post-2012 climate regime: Sectoral approaches for greenhouse gas mitigation - Discussion paper: Incentives for mitigation investments / Björn Dransfeld, Axel Michaelowa, Martin Cames, Sean Healy. Umweltbundesamt, 2011, 22 p. (Climate Change Nr. 14/2011)http://www.umweltdaten.de/publikationen/fpdf-l/4145.pdfSummary : Compared to a project-based approach, sectoral mechanisms would result in a different role of role of emitters, investors and government. Under project-based mechanisms the host country government has mainly a supervising role while the economic responsibility remains with the project developer or project owner. Under a sectoral mechanism, the host country government would have a more active role and would have to ensure that the emission reductions are actu-ally achieved because otherwise no revenues to cover additional cost for greenhouse gas miti-gation measures would be achieved. On this background we scrutinise whether the shift in re-sponsibility from emitters or investors to host country government would limit or even elimi-nate emitters’ incentives to engage in seeking cost-effective mitigation options and if so, by which means such outcome could be avoided or limited. We analyse the challenges which may be caused by the different responsibility structure, discuss to which extent potential instru-ments and measures can provide the required incentive to seek for cost effective greenhouse gas mitigation options and provide a summary of the views of selected actors as well as a syn-opsis of relevant experiences gained so far in this context. We find that sectoral mechanisms involve strong governance skills of the host country government in implementing climate pol-icy and identify a number of potential policy instruments which would provided the required mitigation incentives with different degrees of direct or indirect linking with the global carbon market. As a conclusion we find that pilot scheme would help to establish confidence in the new mechanism and encourage its broader application. (© authors)