Norway launches programme to buy 30 mln carbon credits

by Ben Garside
Monday, 25 November 2013 16:32 GMT

File illustration picture of Norwegian banknotes and coins of different denominations, taken in Trondheim, Oct. 31, 2008. REUTERS/SCANPIX Gorm Kallestad

Image Caption and Rights Information

LONDON, Nov 25 (Reuters) - Developers of emission reduction projects must submit by Jan. 8 proposals to sell U.N.-backed carbon credits to the Norwegian government, the state-owned NEFCO fund said on Monday, launching a process to purchase 30 million of the units.

Norway said in October it planned to buy the credits from the Clean Development Mechanism to help meet its 2020 greenhouse gas emission target and support projects at risk from collapse.

The CDM allows projects in the developing world to earn carbon credits that can be sold to companies and governments but investment has dried up as prices, at below $0.50, are too low to give a profitable return.

"Many projects are struggling to continue their operations with no or very low revenues from carbon sales. We hope that as many vulnerable projects as possible will be able to submit their proposals," said Ash Sharma of NEFCO, which is overseeing the process, in a statement.

NEFCO said purchase contracts will be for future deliveries of Certified Emission Reductions (CERs) earned from emission reductions made between Jan. 1 2014 and Dec. 31 2020.

It did not say how much it would pay for the credits, which are generated from schemes that include distributing energy efficient light bulbs and installing solar panels.

Norway is one of a few European governments to have pledged to support CDM projects by paying a premium over market rates.

The oil-rich nation has been one of the biggest buyers of CDM credits, purchasing 21.5 million to help meet a 2008-2012 target under the U.N.'s Kyoto Protocol.

The new purchases will help Norway meet its target under the 2013-2020 phase of Kyoto, the world's only legally-binding pact to limit greenhouse gas emissions blamed for global warming.

Our Standards: The Thomson Reuters Trust Principles.