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| Sunday, 11 August 2002 |
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US expertise to obtain carbon credits An expert from a US company will be in Sri Lanka this week to meet the private sector to assist them to obtain carbon credits, said President of the National Chamber of Commerce of Sri Lanka Chandra Embuldeniya. This mission was arranged as a result of Embuldeniya's request to the US Ambassador Ashley Wills. Embuldeniya said carbon dioxide emissions is a major reason for global warming. Therefore, under the Kyoto Protocol, a person, company or country that reduces carbon emissions can get carbon credits under the World Bank-assisted projects - Clean Development Mechanism (CDM) and prototype Carbon Fund. He said that CDM has defined a technical procedure to get carbon credits. The reduction of carbon dioxide to the environment is calculated to get the credits. Once the credits are obtained, they can be traded with another country as a revenue source. Each ton of carbon is valued between two and four US dollars.He said carbon saving mechanisms could be tapped to generate foreign exchange to the country's coffers while protecting the environment at the same time. Power projects, renewable energy projects and reforestation projects are eligible for carbon credits. Malaysia and Thailand are very actively engaged in the CDM project and several projects in these countries have qualified to obtain the credits. In the USA, there are companies who broker to sell carbon credits, said Embuldeniya. All countries except USA have ratified the Kyoto Protocol. Concerns about the potentially damaging effects of global warming led to the 1992 United Nations Framework Convention on Climate Change which aims to reduce harmful gas concentrations in the atmosphere to a "safe" level. Under the Convention, the Kyoto Protocol on Climate Change signed by 83 countries in 1997, is due to come into force in 2008. Carbon dioxide, a byproduct of oil, gas and coal, accounts for most of the six greenhouse gases that scientists say are causing a potential rise in the earth's atmospheric temperature. The Kyoto Protocol commits most industrialised countries to reduce their carbon dioxide emissions to 5.2 per cent below the 1990 level by 2010. The protocol provides for a system of carbon trading, whereby countries can buy and sell parts of their quota. Those unwilling to meet their legal obligation to reach the target would have the option of buying unused carbon emission quota from other countries whose emissions were below their target level. Critics of carbon credits argue that this would allow industrialised countries to buy their way out without reducing the emissions. The Sydney Futures Exchange has announced plans to launch trading in carbon credit futures. In 1998 the state government of New South Wales became the first authority in the world to establish the legal basis for the ownership of carbon rights. There is also the issue of pricing, since some countries are attempting to sell at lower rates. There is no fixed pricing structure for selling carbon. The offer Sri Lanka has so far received for selling its carbon through CDM is a maximum of five US dollars, the sources said. |
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