19 December 2008

Kyoto credits to cut energy bills

Revenues from selling emissions credits will fund energy-saving programs

By Bibiána Duhárová, The Prague Post, December 17th, 2008 issue

Environment Minister Bursík (left) and adviser Jan Kalaš signed a memorandum Dec. 11 allowing emissions trading with Japan. (COURTESY PHOTO)

Under the black cloud of an economy in turmoil, there’s at least a positive outlook on environmental gains coming out of the Czech Republic next year. Households and companies can make strides toward becoming more ecologically friendly in the New Year thanks to programs funded by money earned from emissions credits. The Czech Republic managed to collect an excessive amount of emissions credits under the Kyoto Protocol and stands to gain billions of crowns from emissions credit sales back to countries that have used all of theirs. The state plans to use those profits to invest in energy-saving projects around the country.

“Resources gained from the sales will help us with further decreasing greenhouse gas emissions, and will help households lower heating expenses,” said Environment Minister Martin Bursík. The Czech Republic has an extra 150 million credits, worth 10 billion Kč ($503.3 million) to 25 billion Kč, to sell.

Bursík took the first steps toward the program at a UN Climate Change Conference in Poznaň, Poland, last week. On Dec. 11, he signed a preliminary contract with World Bank Vice President Katherine Sierra, agreeing to trade emissions credits belonging to the Czech Republic under the Kyoto Protocol. Revenues from these sales will belong to the Czech State Environmental Fund and will be invested into ecological projects that support renewable energy sources and help decrease excessive consumption of natural resources.

“The condition that will allow the emissions credits sales is that any revenues must be reinvested into energy-saving projects. Even if we might want to invest them elsewhere, it would not be possible,” said Zdeněk Spies, the director of emissions trading at the Environment Ministry.

The State Environmental Fund is preparing programs that would grant revenues from the credits to residential, administrative and public building energy-saving projects.

“Donations will be mostly for households. We are looking to assess heat-cladding systems on houses, exchange old windows for energy-saving ones and change heating systems from brown coal to renewable energy resources,” said Lenka Brandtová, spokeswoman the State Environmental Fund. “It’s possible we’ll also give out energy-saving light bulbs, but all that depends on how we approach the projects, which we’re working on now,” added Brandtová. Households interested in participating can file their applications for donations in their regional offices.

Despite having credits left over, Czechs will still need to work toward decreasing CO2 emissions. The amount of per capita emissions in the country is 14 tons, markedly more than the average in EU member countries. While under the Kyoto Protocol, the Czech Republic has come out ahead, but that isn’t the case under a different treaty called the European Union Emissions Trading Scheme (EU ETS).

Under EU ETS, companies in the country are involved in their trading. “One allowance equals one ton of CO2 a year. The current national allocation plan strives for 86.6 million tons of CO2, but the current amount of Czech emissions reaches 142 million tons,” said Jakub Kašpar, spokesman for the Environment Ministry.

Under the Kyoto Protocol, the Czech Republic received a different package. Though the country continues to have pollution problems, emissions were limited compared with the past. “With Kyoto, we are committed to producing 8 percent less CO2 emissions compared with 1990. The Czech Republic currently produces 24 percent less than in 1990. The difference in percentage is what we can trade to other countries, and we are working on that now. We expect the first transactions to happen at the beginning of next year,” Kašpar said.

Japan is currently being considered as a partner in such a transaction. Bursík met with Japanese representative Hideaki Kumazawa and signed a memorandum Sept. 23 this year. The agreement from the Japanese side states that emissions trading can begin under the flexible mechanism of the Kyoto Protocol, according to a press release from the Environment Ministry. Japan must buy 1.1 billion credits in order to fulfill its commitment under the protocol. It is expected that the transaction amount between the Czech Republic and Japan would be in the millions of credits. In addition to Japan, the ministry is in discussions with Holland, Spain, Austria and New Zealand.

Credit trading under the Kyoto Protocol will last until 2012, at which point the protocol expires.

“Credits will be traded under bilateral contracts among countries, to private companies or through auctions on international commodity stock markets,” said Spies. “Everything is currently in the preparation phase.”

Unauthorized reproduction is strictly prohibited.

Read more... Sphere: Related Content

No comments: