The European carbon credit program, developed in conjunction with the United Nations, is working out just fabulously. Well… it’s at least working out fabulously for a few people. Similar to programs being developed here in the United States by climate warriors, it offers “flexibility” to various countries so it can be tailored to their individual needs. For example, if you are able to make big cuts in your carbon emissions, you get a lot of these “credits” applied to you. If there are other countries who are a bit fatter with cash but can’t manage the changes required to reduce their own emissions, they are able to purchase your credits from you. This provides a theoretical incentive all the way around for emissions to go down and for those doing the most in terms of reductions to be rewarded for their efforts. Pretty great, huh?

It’s worked out wonderfully for Russia and Ukraine in particular, where massive cuts in carbon emissions were achieved and other folks lined up to buy their credits for big dollars. Of course, as you might have expected, they really didn’t cut their emissions at all.

As a result of political horse trading at UN negotiations on climate change, countries like Russia and the Ukraine were allowed to create carbon credits from activities like curbing coal waste fires, or restricting gas emissions from petroleum production.

Under the UN scheme, called Joint Implementation, they then were able to sell those credits to the European Union’s carbon market. Companies bought the offsets rather than making their own more expensive, emissions cuts.

But this study, from the Stockholm Environment Institute, says the vast majority of Russian and Ukrainian credits were in fact, “hot air” – no actual emissions were reduced.

Let’s overlook the “Hot Air” crack for a moment in the interest of getting to the bottom of the story.

“Some early projects were of good quality, but in 2011-2012, numerous projects were registered in Ukraine and Russia which had started long before and were clearly not motivated by carbon credits,” said Vladyslav Zhezherin, a co-author of the study.

“This was like printing money.”

Imagine that. The Russians in particular did quite well by citing any number of programs, including one where they agreed to stop burning coal waste at mining facilities which was dumping massive amounts of carbon into the atmosphere. The catch was that the Russians had not previously been burning the coal waste. They only started doing it so they could stop and claim the credits for it. Of course, when the Russian representative was reached for comment, he said, “It’s simply not true.”

I guess that’s all cleared up, then. All in all, the Russians cashed in for more than two billion dollars worth of carbon credits on these activities.

Mighty good work if you can get it.