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Access to
Carbon FinanceEU-EAGA BizTech Partnership
South Pole Carbon Asset Management Ltd
This report is solely for the use of client personnel. No part of it may be circulated, quoted, or reproduced
November 18, 2009
This report is solely for the use of client personnel. No part of it may be circulated, quoted, or reproducedor s r u on ou s e e c en organ z a on w ou pr o r wr en approva r om ou o e ar on sse
Management Ltd. This material was used by South Pole Carbon Asset Management Ltd during an oralpresentation; it is not a complete record of the discussion.
or str uton outs e t e c ent organ zat on w t out pror wrtten approva rom out o e
ar on ssetManagement Ltd. This material was used by South Pole Carbon Asset Management Ltd during an oralpresentation; it is not a complete record of the discussion.
Photo under the Creative Commons-license of Flickr. Photographer: Jeff Kubina.
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OVERVIEW
.
The Protocol e ec an sm The Process
The Statistics
Example of CDM projects
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Who is South Pole Carbon Asset Management?
Leading developer of carbon offset projects* headquartered in Zurich, Switzerland Offices in Bangkok, Beijing, Hanoi, Istanbul, Jakarta, Johannesburg, Mexico, New Delhi,
Taichung; offices are being set up in Venezuela and other countries
>70 carbon professionals Projects in over 20countries coveringvoluntar & certifiedemission reductions
Excellent regulatory
insights into CDM andvoluntary standards
Strong sales pipeline forcarbon offsets
Focus on high qualityemission reduction
projects, where possiblewith Gold StandardLabel
2 Source: ENDS Guide to Carbon Offsets 2008
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Overview of South Pole Services
Carbon AssetManagement
Manage regulatory process for approval of carbon offsets in line with UN orvoluntary standards
Sell CERs/VERs on behalf of project developers
Asset-backed and unsecured carbon pre-payments Build-Operate-Transfer (BOT) for carbon offset projects
anage pro ect eve opers pr ce r s t roug guarantee car on o set pr ces
Project finance
Buy CERs/VERs on behalf of compliance or voluntary buyers
Establish and operated dedicated CER/VER purchasing vehicles
Selling/sourcing
mandates forCERs/VERs
Will co-manage Gold Carbon Capital Fund to invest in carbon offset projectsthat generate Gold Standard certificates
FundManagement
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* Certified Emission Reductions under the Kyoto Protocol** Voluntary Emission Reductions
Source: South Pole Carbon Asset Management Ltd.
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The Kyoto Protocol
Commitments of industrialized countries to reduce emissions at,
between 2008 2012
Undertaken throu h Domestic Action
Or together throughflexible mechanisms:
m ss ons ra ng c eme;
Joint Implementation;
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The Clean Development Mechanism
The purpose of the Clean Development Mechanism is threefold:
(1) to contribute to the ultimate objective of the UNFCCC;
(2) to assist Annex I Parties in achieving compliance with their emissionlimitation and reduction commitments;
3 to assist non-Annex I Parties in achievin sustainable develo ment K otoProtocol Art.12,2).
The CDM has been developed to create opportunities for synergies betweencost-effective climate change mitigation and sustainable development.
The development of CDM projects can involve various combinations ofstakeholders. Both public and private entities and both host country-based and'foreign' entities are allowed to participate.
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CDM How does it work
Average emissionsin 2008 2012
Domesticreduction
1990 emissions
reduction
commitment
-
Emissionreductioncommitment
CertifiedEmissionReduction (CER)
CER
1990 levels
(Assiged Amount)
Project BAU
Reduction fromCDM
Emissions
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The ProcessFeasibility and DueDiligence
2 Documentation 3 Public consultation
4Validation byOperational Entity5
Approval byNational Authority
2Methodologicalapproval 6
Registration byExecutive Board
7 Implementation 8 Verification by OE
Issuance of CERs
by EB
10 Transaction of
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The Statistics
AnnualAverageCERs* ExpectedCERsuntilendof2012**
CDMprojectpipeline:>4200ofwhich: N/A >2,900,000,000
>
96arerequestingregistration 13,317,757 >40,000,000
* Assumption: All activities deliver simultaneously their expected annual average emission reductions
** Assumption: No renewal of crediting periods
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Typical projects that can qualify for voluntary or certified carbon credits
Methane capture from landfills and conversion toelectricity
electricity generation
Reduction of industrial greenhouse gas emissions(nitrous oxide, hydrofluorocarbons, perfluorocarbons,
Cogeneration with biomass & biofuels Hydropower Geothermal energy Wind power Solar power Methane capture from mines and conversion to
Forestry Energy efficiency
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CDM project example: Co-Composting at Palm Oil Mill
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Case study: co-composting project at POM 30 tons/hour
Price: US$4 / CER
Compost value:US$ 32 / ton
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CDM project example: methane capture at wastewater treatment plant
anaerobic digester; use of methane
for electricity generation/industrialheat
ro ec : arapan a m
Capex US$ 2.8 m for 45k CERper year
Replacement of diesel fuel s rom me ane cap ure
and fuel switching
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CDM project example: biogas production from industrial waste water
Reference case (what would happen in the
Project activity: installation of closed anaerobicdigester; use of methane for electricityeneration/industrial heat
Example project - Korat Waste to Energy:
Largest starch plant in Thailand ro uc ng , tonnes o cassava starc
per year
Capex 5.2m, for 1.95m CERs (325,000 p/afor 6 years)
CDM
CERs from methane capture and fuelswitching
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CDM project example: Geothermal Power Plant
CYCLONE ELECTRICAL
Geothermal Power Plant Cycle
UPTO
4K
M
SEPARATOR
CONDENSER
PSI
v v v v v v
V V V V V V
GENERATOR
PUMP
STEAM
TURBINE COOLING
TOWER
PUMP
CYCLONE
SCRUBBERSTEAM
STEAM
TURBINE STEAM EXHAUST
CONDENSATE
COLD CONDENSATE
FLASHING TO
STEAM-BRINE MIXTURE
IN BOREHOLE
RESERVOIR BRINEBRINE
INJECTION
WELL
CONDENSATE
INJECTION
WELL
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CDM project example: Hydroelectric Power Plant
Reference case (what would happenin the absence of the project):generating electricity using fossil fuel
Project activity: construction of hydropower plant
Example project Parlilitan Hydro
Installed capacity 7.5 MW
Capex US$13.4m for 32,550CERs/year Electricity sales: US$ 2.2m per
year (US$5 cents per kWh)
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CDM project example: Waste Heat Recovery
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Further information on CDM?
www.cdm.unfccc.int www.pointcarbon.com www.reuters.com/finance/ reenBusiness www.carbonpositive.net
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Thank you for your attention!
South Pole Carbon Asset Mana ement Ltd.
Paul Butarbutar
Regional Director
Phone: +62 21 726 [email protected]
. .
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