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UN Approves Russian Joint Implementation CO2 Project by E.ON
2010-10-18 11:33:12.185 GMT
By Ewa Krukowska
Oct. 18 (Bloomberg) -- The United Nations approved its
first carbon-reduction joint implementation project in Russia
under a new procedure after giving the go-ahead to an energy-
efficient power plant by E.ON AG., Germany's biggest utility.
The project, created under a UN Kyoto Protocol mechanism,
will be located at the Shaturskaya Thermal Power Plant near
Moscow, the UN Framework Convention on Climate Change said in a
statement today. E.ON said it wants to register two more
projects in Russian power plants that will reduce CO2 emissions
by a combined 4.3 million metric tons by 2012.
The so-called JI projects generate tradeable emissions-
reductions units that countries can use for compliance in the
European Union's carbon market, the world's largest, and to meet
their obligations to cut greenhouse gases under the UN climate-
protection treaty. EU CO2 allowances for December 2012 traded at
16.08 euros a ton today.
"This is a major step for carbon markets," said Hervé
Touati, managing director of E.ON's climate and renewable unit.
"The approval of Russian JI projects will add liquidity to the
market and gives companies like E.ON the confidence to invest
further in carbon reduction projects in the region."
The Shaturskaya project assumes building an additional
electricity generation plant with an energy-efficient 400-
megawatt combined cycle gas turbine, which will save more than a
million tons of carbon by 2012, E.ON said. The project, one of
15 approved by the Russian government at the end of July, was
developed with the assistance of Dutch JI developer Global
Carbon BV.
Two More
E.ON. is planning to register two more JI projects in
Russia, comprising two 400-megawatt combined cycle gas turbines
in the Surgutskaya-2 power plant and one 400-megawatt combined
cycle gas turbine at the Yajvinskaya power plant.
The Shaturskaya project is the first in Russia under the
Track 2 procedure, where the verification of emission reductions
is supervised by the Joint Implementation Supervisory Committee.
Under Track 1, the verification procedures and the issuance of
emission-reduction units are left up to the host country.
"Joint Implementation is a great tool that countries can
use to incentivize private sector investment where it's
needed," John Kilani, director of the Sustainable Development
Mechanisms Programme at the UNFCCC secretariat, said in the
statement. "This first Track 2 project in Russia bodes well for
the health of the mechanism going forward."
'Name Change'
The majority of Track 2 projects are being developed in
Russia, Ukraine and other central and eastern European
countries, according to the UNFCCC. There are more than 200
Track 2 projects in the pipeline and 190 Track 1 projects
registered, accounting for potential reductions of about 400
million tons of carbon dioxide equivalent by the end of 2012, it
said.
" Track 2 has surprisingly been dubbed 'slow track',"
Benoit Leguet, the JISC chairman, said in the statement.
"However, since the first Russian projects to emerge are going
through Track 2, it may be time for a name change."
The Kyoto Protocol expires at the end of 2012, and climate-
change envoys worldwide are preparing for the next round of
negotiations on a new climate-protection framework. The talks
are due to start toward the end of November in Cancun, Mexico.
For Related News and Information:
Emission market news NI ENVMARKET <GO>
Today's top energy stories ETOP <GO>
European power-markets home page EPWR <GO>
--With assistance from Nicholas Comfort in Frankfurt. Editors:
Stephen Cunningham, Raj Rajendran.
To contact the reporter on this story:
Ewa Krukowska in Brussels at +32-474-620-243 or
ekrukowska@bloomberg.net;
To contact the editor responsible for this story:
Stephen Voss at +44-20-7073-3520 or sev@bloomberg.net
