EIB, banks launch $200 mn post-2012 carbon fund
The European Investment Bank, along with four European banks, have launched a 125 million euro ($195.8 million) carbon fund which will invest exclusively in carbon emission credits to be issued after 2012, the group said on Monday.
LONDON: The European Investment Bank, along with four European banks, have launched a 125 million euro ($195.8 million) carbon fund which will invest exclusively in carbon emission credits to be issued after 2012, the group said on Monday. Initiator and principal investor the EIB said it is partnering with France's Caisse des Depots, Spain's Instituto de Credito Oficial, Germany's KfW Bankengruppe, and Finland's Nordic Investment Bank to purchase so-called post-Kyoto Protocol carbon credits from clean energy projects in developing countries.
"The EU is at the forefront of international efforts to combat climate change," said EIB President Philippe Maystadt in a statement. "This Fund, combined with other EIB carbon and climate change initiatives, positions the bank as a significant contributor to global climate change efforts." The EIB is committing the first 50 million euros, with the participants funding the remaining 75 million euros between them.
The United Nations' Kyoto Protocol agreement on global warming, which sets binding targets on greenhouse gas emissions, is set to expire in 2012 and governments are scrambling to agree on a new pact by the end of 2009. Absence of a successor agreement would cast uncertainty onto the booming $60 billion international carbon market. "By assuming the inherent regulatory risk, the fund will give a clear signal to the market of the EIB and its partners' confidence in the development of a post Kyoto regime while directly supporting environmental projects," the group said in a statement.
The Post 2012 Carbon Credit Fund, the first of its kind, will contract credits from projects under Kyoto's Clean Development Mechanism (CDM) and Joint Implementation (JI) schemes for delivery as far away as 2022. The CDM and JI schemes allow companies and governments in rich nations to invest in and buy offet credits from clean energy projects in developing countries. The fund's participants have appointed Conning Asset Management and newly-formed First Climate as fund managers. In March 2007, the EIB partnered with the World Bank to launch a similar European Carbon fund, worth some 50 million euro ($78.3 million).
"The EU is at the forefront of international efforts to combat climate change," said EIB President Philippe Maystadt in a statement. "This Fund, combined with other EIB carbon and climate change initiatives, positions the bank as a significant contributor to global climate change efforts." The EIB is committing the first 50 million euros, with the participants funding the remaining 75 million euros between them.
The United Nations' Kyoto Protocol agreement on global warming, which sets binding targets on greenhouse gas emissions, is set to expire in 2012 and governments are scrambling to agree on a new pact by the end of 2009. Absence of a successor agreement would cast uncertainty onto the booming $60 billion international carbon market. "By assuming the inherent regulatory risk, the fund will give a clear signal to the market of the EIB and its partners' confidence in the development of a post Kyoto regime while directly supporting environmental projects," the group said in a statement.
The Post 2012 Carbon Credit Fund, the first of its kind, will contract credits from projects under Kyoto's Clean Development Mechanism (CDM) and Joint Implementation (JI) schemes for delivery as far away as 2022. The CDM and JI schemes allow companies and governments in rich nations to invest in and buy offet credits from clean energy projects in developing countries. The fund's participants have appointed Conning Asset Management and newly-formed First Climate as fund managers. In March 2007, the EIB partnered with the World Bank to launch a similar European Carbon fund, worth some 50 million euro ($78.3 million).
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