United Kingdom-based carbon investor ICECAP has signed a deal to buy at least 1 million tons of carbon credits that Chinese energy firm Guizhou Jinyuan Energy Co. generates from installing small-scale hydro projects.
Under the Kyoto Protocol on global warming, rich countries can help meet their emissions targets by funding emissions reduction projects in poor countries, for example by installing clean energy like wind, solar, and hydro instead of plants that burn fossil fuels. That carbon market is attracting a growing band of intermediaries and speculative investors as countries take tougher action on climate change.
ICECAP said it expects its China deal to generate at least a million Certified Emission Reductions, each equivalent to avoiding one ton of carbon dioxide, one of six greenhouse gases covered by Kyoto.
“We’ve signed a preliminary agreement with them for 1 million tons, but we expect a bigger pipeline than that,” Ian Murphy, ICECAP chief operating officer, said. “It’s a route to market for them.”
As an intermediary, ICECAP already has signed a deal to supply 15 million tons of carbon credits to Italian power firm Enel; Greece’s main electricity utility, Public Power Corp.; and Japan’s Marubeni Corp. Those companies can then use the credits to help them meet their emissions targets in the European Union and Japan.
Guizhou Zhongshui Energy Development Co. is the project development arm of the Guizhou Jinyuan Energy Co. group of companies, the largest electricity generator in Guizhou Province and also involved in coal mining, chemicals, biofuels, and real estate.