International climate change negotiators gathered in Poznan, Poland to draft a follow-on to the Kyoto protocol appear to have rejected the talks’ most controversial proposal: giving a big boost to carbon capture and storage (CCS), whereby carbon dioxide produced by coal-fired power plants is trapped deep underground. The proposal was to award carbon credits to developing countries that installed CCS equipment — credits that they could then sell to industrialized nations or companies — but this morning opponents successfully tabled the proposal until next June, according to climate policy blog Climatico.

Countries pushing the credits-for-CCS proposal included Japan, Norway, Australia and Canada. All are major coal consumers eyeing CCS to meet their own greenhouse gas reduction targets and/or oil and gas producers that could dual-purpose captured CO2 for enhanced oil recovery. Japan and Canada also figure among the nations furthest behind in meeting emissions cuts mandated by the Kyoto protocol, and could be big buyers of CCS-generated carbon credits.

International Energy Agency executive director Nobuo Tanaka had also added his support (see video). Tanaka calls credits a means of accelerating development of capture and sequestration technologies, which the IEA sees as crucial to control emissions in countries such as China that will remain heavily dependent on coal for decades to come. “These technologies need all the financial help they can get,” says Tanaka.

But the idea remained red-hot among the climate activists swarming Poznan this week as it unites a controversial technology with an already controversial program. They see carbon sequestration as a potentially risky technology that could delay the transition from coal to solar, wind and other forms of renewable energy. Meanwhile the UN’s Clean Development Mechanism (CDM), which manages the awarding of carbon credits to developing nations, attracts scorn from those who see carbon trading as a numbers game by which countries will avoid making real emissions cuts.

Many question whether emissions cuts certified for millions of dollars worth of credits under the CDM wouldn’t have occurred anyway — whether they offer ‘additionality’ in the UN lingo flowing in Poland this week.

The UN acknowledged possible problems after spot-checking a leading CDM certification firm and identifying a series of “non-conformities” in its auditing practices. The firm, DNV Certification AS, was suspended but insists it is addressing the concerns identified to regain its accreditation.

Poznan’s ministerial-level talks start tomorrow and should wrap up Friday. Unless they pop CCS back onto the agenda the credits proposal will be stalled until next June’s followup meeting in Bonn. That meeting is a prelude to the big game that will define global energy policy: final negotiations and, if all goes as planned, the signing of a ‘Kyoto II’ treaty in Copenhagen next December.

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