NEW DELHI: The Union government may set up a clean development mechanism (CDM) authority to take a centralised view on projects, which may qualify under the Kyoto Protocol's CDM trading mechanism.

A decision in this regard will be made after the UN climate change conference ends. The CDM authority will help the public and private associations handle projects and undertake research. The authority will comprise representatives from various ministries.

The CDM would enable developed countries to fund clean projects and offset the resulting credits against their Protocol targets.

The industry, however, is skeptical that US has opted out from the Kyoto Protocol. Being the biggest emitter among the developed countries, it would have been a big player in the CDM market. Its exit has just squeezed a market already wondering about the procedures — the UN is still preparing the detailed rules of the game.

The Union power ministry, pushing for opportunities under CDM in renewable energy, energy efficiency and improvement in existing power plants, is already discussing possible projects with Germany.

It has added up the tally of opportunities in hydro, renewables and thermal energy, even reduction of transmission and distribution losses, and pitches the total investment possibility at $173 billion.

An average improvement of one per cent in efficiency of thermal power plants in India, it says, would lead to annual coal savings of 6.69 million tonnes. It has, however, been forced to leave out nuclear energy.