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Subject: [Nocarbontrade-l] [Fwd: Phnom Penh Post - Cambodia pioneering
world's first carbon trading cooperative]
Date: Wed, 17 Sep 2008 09:18:01 +0100 (BST)
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The Phnom Penh Post, Wednesday, 17 September 2008
Cambodia pioneering world's first carbon trading cooperative
Written by Anne-Laure Por?e
http://www.phnompenhpost.com/index.php/2008091621686/National-news/Cambodia-pioneering-world-s-first-carbon-trading-cooperative.html
With the global carbon trade booming, environmental projects in
developing countries have joined forces to finance their poverty
reduction efforts by selling carbon credits collectively
AS a rule, the world of carbon credits is dominated by large-scale
industrial projects backed by international companies with deep
pockets.
But Cambodia is proving to be the exception by playing host to the
first-ever carbon cooperative of NGOs and other small groups hoping
to increase their clout over climate change reform.
It has taken more than three years for the French NGO Geres
(Groupement ?nergies Renouvelables, Environnement et Solidarit?) to
prove that it could be an actor on the carbon credit market.
At first, many observers thought it was impossible.
Yet today, various Geres projects offset approximately 140,000
tonnes of CO2 annually, the most of any NGO operating in the carbon
market.
It is also the only NGO that funds its programs in their entirety by
selling carbon credits, which they accumulate through their projects
like low-carbon cook stoves - affordable clay grills that burn less
charcoal and are popular among Cambodians.
The Geres Climate Change Unit says it is an example of how a
small-scale, not-for-profit project can break into the carbon credit
market.
It has won the backing of ethical buyers, public development
agencies, academic institutions and governments, including that of
Cambodia.
From these successes, the idea of a cooperative, Carbon Solidarity
Asia (CSA), was born last year.
The CSA aims to provide the technical support needed by groups who
want to develop carbon offset projects. This could include, for
example, energy-efficient stoves, bio-gas or forest conservation.
The CSA will also work with individual projects to help them sell
their carbon credits on the global carbon markets.
Why trade carbon credits?
For Geres, entering the carbon market and off-loading the carbon
credits generated by their environmentally friendly projects was
key to maintaining the funding that kept the group going.
"When we began in 2004, the carbon credit was estimated at US$3 per
tonne. Today the same credit is worth around $30," said Minh Cuong
Le Quan, manager of Geres' Climate Change Unit.
"This is a huge incentive for organisations that are traditionally
reliant on donors and continually struggling to find funding for
their successful projects."
Secondly, the global carbon trading market is a means for NGOs to
gain the clout they need to influence international climate policy.
"We are very small in this market dominated by industries, banks,
pension funds, audit offices, which have a logic of profit," said
Minh.
"But the originality of our message makes our voice heard. It is no
secret that the international carbon markets do not do enough for
developing countries, [so] we decided to be actors on this market in
order to have an impact on it and in order to finance clean
development."
Moreover, she said runaway demand in Western countries far outstrips
supply in the carbon credit market, giving NGOs a foot into an
otherwise closed world of industrial dealings.
"Until now the supply of carbon credit is insufficient," Minh said.
"NGOs have to turn towards the carbon market," she added.
What is the carbon collective?
The idea of the carbon collective is to help small NGOs to better
access the carbon credit market, its backers say.
"To break into this market there are many challenges. It would be
difficult for one NGO alone to overcome the challenges," said Nanda
Ram Baidya, director of the Centre for Rural Technology in Nepal,
explaining why her organisation supports the coalition.
Feri Lumampao, director of the Asian Alliance of Appropriate
Technology Practitioners Inc (APPROTECH ASIA), said the CSA will
help small organisations to join the carbon market "with confidence
and integrity".
Last April, the inaugural meeting of the coalition took place in
Phnom Penh, where a dozen organisations adopted a founding charter
and formally created the CSA.
Since then, they have decided to base the cooperative in Singapore,
but both local or international NGOs from across the region can be
accepted as members, as well as eco/social-enterprises or
governmental projects if they accept the CSA's charter.
"The CSA will help projects which have a direct impact on
employment, on living conditions and quality of life for people,"
Minh said.
"Industrial projects or those with no impact on the poor can find
scores of consultants elsewhere to help them," he added.
In the interest of transparency, members commit themselves to
channelling their carbon credits through a common gateway, operated
by CSA.
This system guarantees that all carbon credits are registered and
can be sold only once.
"We also want to follow up the value of the credits and to push
them, not to let 80 percent of the value evaporate in the hands of
intermediaries," said Minh.
The CSA also hopes to give members access to affordable consulting
services that will equip them with the skills they need to negotiate
the carbon market on their own, according to Minh.
Joining forces
Cooperative members say one of the unique aspects of the CSA is the
wealth of internal expertise that they will be able to share in
order to level the carbon market playing field.
"In the Philippines, I see that my experience will enrich the CSA,"
said APPROTECH's Lumampao.
"While the CSA helps me to help others ... move efficiently to the
carbon market and make use of carbon finance to create greater
impact in poverty reduction and climate change mitigation."
The next phase for the cooperative is to review all the projects
that come under the group and identify best practices in Asia.
From this, the CSA will define standard procedures that similar
cooperatives will be able to use elsewhere for more efficient,
larger-scale projects.
The problems are the same for the Philippines, for Indonesia or
Cambodia, cooperative members say.
CSA members said they are preparing to role out the same carbon
market model in Africa.
Exactly What is a carbon credit?
A carbon credit is a financial instrument representing a reduction
in greenhouse gas emissions. One carbon credit represents the
reduction of one metric tonne of carbon dioxide. The Kyoto protocol
obliges states and companies to reduce their emissions of carbon
dioxide – or to “cap” their emissions. If they are below their
authorised cap of emissions, they receive carbon credits which they
can sell. There are two primary markets for carbon offsets. In the
larger compliance market, companies, governments or other entities
buy carbon offsets in order to comply with their emissions caps. In
the smaller voluntary market companies sell carbon credits to
commercial and individual customers who are interested in lowering
their carbon footprint. Carbon offsetters purchase carbon credits
from a carbon development company that has aggregated the credits
from individual projects. The quality of the credits is based partly
on the validation process of the company that acted as the sponsor
to the carbon project.
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