Carbon Credits Investment Management

Carbon markets

Carbon markets emerge from the buying-selling of emission allowances and credits of emission reductions to allow countries and companies meet their commitments for greenhouse gas emissions. The national allocation plans (NAPs) determine the limit of emissions for each facility, creating the necessary shortages to have a market.

Zeroemissions develops the management capabilities in carbon investment for third party companies.

The international emission trade allows the trade of assigned emission units (AEUs), and other credits from the Kyoto Protocol (CERs and ERUs after having been generated by a project), amongst Annex I countries.

It is a segmented market, and there are two basic types: regulated markets and voluntary markets. In these markets, the measurement unit is the ton of carbon equivalent (tCO2e). Other gasses with greater global warming power (GWP) take equivalence in this measure.

Carbon market products:

CERs. Permanent certificates of emission reduction, generated in projects in non-Annex I countries, or clean development mechanism, CDM. They are used for the fulfilling, perfect substitutes of emission allowances granted annually by the european governments to large issuing corporations (EUAs). They can be kept from a period to the next.
ERUs. Emission reduction units originated in projects amongst Annex I countries, or joint implementation, JI. They are replaced with EUAs and AAUs.
tCER/lCERs. Certificates of emission reduction with an expire date. They must be replaced. tCERs have zero risk once emitted. They can't be kept. They are not usable for the fulfilment in the european market until 2013. They can be sold directly to european countries or Japan.
VERs. Emission reductions resulting from voluntary actions to reduce greenhouse gas emissions which have been audited by an independent third party. They can be used for voluntary actions to reduce emissions.

Carbon Founds

Carbon Funds come from a portfolio of CDM projects group around a sponsor or promoter (the World Bank, a country or a private entity). The emission credits obtained due to CO2 reductions contribute to the fund. The participants in the Fund are committed to buy emission credits annually, according to the participation share.

Zeroemissions currently has an investment in CO2 funds of 23.3 MEUR, forecasted to increase this amount within 2008-2012. The carbon funds in which we are today participating are:

FEC. Fondo Español del Carbono, (Spanish Carbon Fund) 4,5 MEUR. Fund owned by The World Bank. Project at a global scale, preferably Latin America. Fields of renewable energies, destruction of gas, energy efficiency, and solid waste. This Fund has a size of 170 MEUR. Period of purchase until 2015.
MCCF. Multilateral Carbon Credit Fund, 6,5 MEUR . Fund owned by the European Investment Bank for Reconstruction and Development. Investing in projects of renewable energies in Europe and Asia, elimination of gasses, energy efficiency, and solid waste. The fund has a size of 165 million euros. Period of purchase until 2012
FC2E. Fondo para la empresa española (Fund for Spanish Companies). 10 MEUR Fund owned by Banco Santander and ICO. Global projects size of the fund: it is expected to reach 100 MEUR in the closing of the second tranche. Period of purchase until 2012
Bio Carbon Fund, 2,3 MEUR Fund Own by The World Bank. Europe and Asia. Investment in forestry projects and improvement of land use. The fund has a size of 10 MEUR.

Zeroemissions analyses new opportunities for investment in carbon funds in the range offered by the market.

Solutions