18 November 2005Kazakh Information Agency
Japan Carbon Finance Ltd. has singed a contract with Jincheng Anthracite Mining Group in China's Shanxi Province to purchase carbon credits equivalent to 2 million tons of methane gas in the course of six years, sources familiar with the matter said Thursday, Kazinform has learnt from Kyodo.
It is the first time the consortium -- comprised of the Japan Bank for International Cooperation and companies including Tokyo Electric Power Co. and Nippon Oil Corp. -- has inked a contract to buy carbon credits from China.Under the Clean Development Mechanism of the 1997 Kyoto anti-global warming treaty, companies in developed countries can obtain carbon credits in exchange for helping reduce greenhouse gas emissions in developing nations.The consortium is to purchase the greenhouse gas emission rights from 2007 to 2012 by supporting the Chinese company's construction of a 120,000-kilowatt thermal power station, which will use methane gas to be collected from its affiliated coal mines as fuel, the sources said.Methane gas is said to be about 21 times more powerful at warming the atmosphere than carbon dioxide.Using methane for power generation can help ease not only greenhouse gas emissions but also local power shortages.The JBIC and 32 leading Japanese companies joined hands in setting up the Japan Greenhouse Gas Reduction Fund last year.At the same time, the bank established Japan Carbon Finance with major investors in the fund.As part of risk aversion measures, JCF will first buy carbon credits from developing countries and then sell them to the fund.Companies investing in the fund can eventually receive carbon credits in proportion to the size of their investment.
