Luxembourg, 07/05/2007 (Agence Europe) - The European Investment Bank (EIB) and banking group KfW have launched a joint programme for the purchase of carbon credits from the flexible joint implementation (JI) and clean development mechanism (CDM) projects. The €100 million programme is the follow up programme and second tranche of the KfW Carbon Fund. “This is an excellent opportunity for small and medium-sized European enterprises to participate in the market for emission reduction credits from CDM and JI projects,” said Detlef Leinberger, member of the Board of Managing Directors of KfW. “This initiative demonstrates how two of the major European financial institutions, by joining forces, can participate in effectively tackling the challenges of climate change,” said EIB Director Thomas Barrett.
The purpose of this EIB-KfW Carbon Programme is to finance the purchase of carbon credits by enterprises, particularly SMEs throughout Europe that have no access of their own to these projects yet wish to use the carbon credits as part of their compliance obligations, that is, to reduce their CO² emissions within the framework of the European Emissions Trading Scheme (EU ETS) by directly purchasing carbon credits. The programme also offers these companies a guaranteed delivery option. The new product will benefit not only European enterprises but also enterprises in developing, transition and industrialising countries that are able to offer appropriate CDM or other JI projects. KfW will manage the programme, which means that it will be the direct contract partner for the buyers and sellers of carbon credits. The EIB is a co-sponsor and will share the risks equally and will conduct the initial appraisals for down payments.
The programme will enable the EIB and KfW to further expand their activities in the carbon market. Both institutions have so far successfully placed their existing funds and purchase programmes in the market and will now be offering additional advantages to purchasers and sellers of credits under the new programme.
The EU ETS also allows the use of credits from the flexible joint implementation (JI) and clean development mechanism (CDM) under the Kyoto Protocol. Joint implementation (JI) refers to projects in the industrialised and transition countries and clean development mechanism (CDM) to projects in developing countries. (ol)