1. General Carbon Newsletter
MONTHLY ENVIRONMENTAL COMMODITIES NEWSLETTER JUNE 2011, ISSUE:04
Point of View
PROJECT HIGHLIGHTS
The CDM Pipeline saw 141 new
The carbon market is digesting some interesting news projects entering in May (highest
flow with Germany's decision to shut all of the nation's since 2007-08) exemplifying the
nuclear power plants over the next 11 years. This 2012 rush amongst the project
decision comes in a sharp reversal to an earlier decision proponents.
to extend the life of the plants. With other nations likely to
revisit their Nuclear plans, price projections of carbon The issuance of CERs in May
offsets in the next phase has turned bullish again. EU was also high at ~19 MCERs
ETS data on emissions for 2010 was ~3% higher than
2009, showing that the economic recovery had not In May six new PoAs entered the
increased emissions above the cap for the 2008-2012 Pipeline taking the number of
PoAs in Africa to 20 or 22% of
trading phase. CERs accounted for 4.7% of all
the 92 existing PoAs. This is a
surrenders in 2008-2010. Data suggests that CERs are
much higher percentage than
being surrendered while EUAs banked for the next phase Africa‟s 2.6% of all normal CDM
indicating a soft pricing in the early years of the next projects.
phase. Policy makers could use this to show that greater
emission reduction can be done at an economic cost. Pace of registration under India‟s
REC mechanism has reduced in
The REC market witnessed another interesting trading May; 36 projects registered as on
session as well as more news flow. Changes in the 3rd June 2011
reporting/compliance period for RPO will have a major
impact on pricing and prevent a holdup by distribution
licensees. Regulatory clarity on the fine print with regards
REC PRICE WATCH
to electricity duty waiver and banking facility are awaited
in the coming months 25th May 2011 Session
IEX: Price (Volume)
Non solar -INR 1,500 (14,002)
Best,
Solar - (Not traded)
Satish Kashyap
PXIL: Price (Volume)
Non solar -INR 1,500 (4,500)
Solar - (Not traded)
Implementation hurdles in REC and the way forward
VCS VER PRICE WATCH
Unlike the March trading session, April and May witnessed India, China:
low price for Renewable Energy Certificates (RECs) Renewables, EE
certificates. The trading volumes though increased as Pre 2008 vintages
sellers lowered their price expectation to clear most of the US$ 0.50- 1.00
issued volume of RECs. News flow indicates that CERC‟s Post 2008 vintages
proposes to spread the renewable power purchase US$ 1.00-2.75

2. obligation (RPO) from an annual compliance to a more
frequent interval (i.e. biennial or quarterly). Renewables, EE- Pre CDM
Pre 2008 vintages
Initially RECs were conceptualized to be claimed only if RE US$ 0.50-2.00
Post 2008 vintages
power is sold to grid at a non-preferential tariff i.e. APPC US$ 2.00-3.50
(i.e. average power purchase cost) or at mutually agreed
price through third party sale or on power exchanges. Industrial gases, others
CERC‟s amendment to include captive power plants into Pre 2008 vintages
the ambit of REC mechanism is still raising some US$ 0.25-0.50
questions. As per the amendment, renewable based Post 2008 vintages
captive power plants (CPP) could avail REC if they do not US$ 0.50-1.00
receive concessional or promotional wheeling/transmission
charges, banking facility or electricity duty waiver. Rest of Asia, Africa:
Renewables, EE
Many captive generators are unclear with regards to Pre 2008 vintages
eligibility of their projects under REC. There are US$ 1.00-2.00
uncertainties regarding treatment of electricity duty waiver Post 2008 vintages
or exemption even within regulatory circles. This has led to US$ 2.00-4.00
multiple accredited captive cogeneration projects in
Maharashtra not getting registered with NLDC. Renewables, EE- Pre CDM
Pre 2008 vintages
The captive generators are awaiting clarity on issues US$ 1.50-3.00
Post 2008 vintages
related to banking, electricity duty exemption etc.
US$ 2.00-5.00
The numbers of projects under accreditation which was Industrial gases, others
growing at a rapid pace, has slowed down in May. May Pre 2008 vintages
witnessed major activity from Tamil Nadu which is the only US$ 0.25-1.00
state to have announced APPC. Post 2008 vintages
US$ 0.50-1.00
While at the regulation end, out of 23 SERCs (State
Electricity Regulatory Commissions), 21 have designated
the state agency and 19 of them have finalized the state
CARBON NEWS
level regulations. Andhra Pradesh, West Bengal and Delhi
have not taken any steps towards finalizing the
regulations. Only 7 states have started accrediting Global CO2 market growth stalls in
projects; these are Gujarat, Maharashtra, Chhattisgarh, 2010 amid uncertainty
Haryana, Rajasthan, J&K and Tamil Nadu.
Kenyan wind farm gets UN carbon
Though the capacity building at the state agency level is in
full swing across the country most of the states have yet to credit approval
see a project entering into the pipeline from its region.
These states also need to specify the APPC tariff and Carbon price may push up Kyoto
streamline the process of signing PPAs based on APPC.
bill
Most of the current projects in REC pipeline are the pre-
existing projects which are selling power on the exchange Designing Targeted Financing to
or through bilateral agreements. Key questions remain on Build Africa's Carbon Market
the ability to enforce RPO obligations on distribution
licenses and APPC numbers for most states.
California judge puts carbon
market on hold
Canadian Solar to build 600 MW
solar cell plant in China

3. Aviation Carbon Suit to Stir Trade
Carbon Credits from Watershed Management
Tension at Durban Talks, Derwent
Recently World Bank entered into an agreement with the Says
Himachal Pradesh Government (India) for buying the
carbon credits from the new forests being developed on Offsets „Crowding Out‟ Utility
degraded lands under a watershed management program.
Demand for Carbon, Orbeo Says
The main objective of this reforestation project in
watershed areas is to improve livelihoods and generate
carbon revenue for the community. It is proposed to China says EU airline CO2 cap
implement the project in 11 watershed divisions covering should protect poor countries
4000 hectares of land.
UN clean energy scheme grows,
While, reforestation activities sequester CO2 emissions
and also conserve the natural resources and are known to 3,000 projects so far
be eligible under CDM to earn carbon credits. Watershed
management programme also helps in sequestration of IATA sees 10 airlines joining
soil carbon through indirect activities like soil erosion carbon scheme this year
control, fertilizer leaching control etc. Electricity savings
from reduced use of pumps due to increase in ground
water level will also reduce carbon emission. But so far World Bank Auctions Adaptation
there is no approved methodology to assess credits from Fund CERs
watershed management activities in VCS, CDM and other
such similar standards. UK Sets GHG Emissions Tone for
Europe: Cut 50% by 2027
Cement firms eye biodiversity,
Other News water goals after CDM
disappointment
CERC could implement staggered RPO targets over
the year UN Proposes Changes to
Hydrofluorocarbon-Reduction
Over 90% RECs traded in the largest-ever Indian REC
trading session Projects
India takes unique path to lower carbon emissions PCRA to set up carbon credit
aggregation centre in Rajasthan
Govt panel says carbon growth cut possible by upto
35%
Turkana: Carbon Credits For
No environmental nod needed for solar power Africa‟s Largest Wind Farm
projects: MoEF
India's new trading schemes to curb carbon emissions EVENT WATCH
Torrent Power Ltd to enter renewable energy sector Clean Power Asia 2011
On 28-30 June 2011 at
India‟s Renewable Credits Trade Sees Volume Surge InterContinental Bangkok,
in May Session Thailand. This is Asia's largest
conference & exhibition focusing
on the latest global and regional
clean power technologies,
projects and initiatives

4. EDITORS
Vinodini Chitrakaran,
vinodini.c@general-carbon.com
Rameez Shaikh,
rameez.shaikh@general-
carbon.com
GENERAL CARBON PTE LTD
16 RAFFLES QUAY, #33-03 HONG
LEONG BUILDING,
SINGAPORE 048581.
This newsletter is brought to you
by General Carbon. Contact
gcnews@general-carbon.com if
you have any queries or
comments or wish to contribute
news and updates. We welcome
your suggestions and
contributions.
If you wish to unsubscribe from
this newsletter please reply to
this email with “unsubscribe” in
the subject line.
General Carbon is a leading
emission reduction consulting,
sustainability advisory and
investment firm with presence
across Singapore, India, Sri
Lanka, Thailand, Philippines,
Indonesia, South Africa, Nigeria,
Ethiopia and Kenya.