The Multilateral Carbon Credit Fund (MCCF) has agreed to purchase a substantial portion of the 300,000 carbon credits generated from five sugar mills in Ukraine.
The emission reduction purchase agreement (ERPA) is the MCCF's first purchase contract in Ukraine and was established by the European Bank for Reconstruction and Development (EBRD) and the European Investment Bank (EIB) and negotiated by GreenStream Network Plc.
The sugar mills which will generate the carbon credits are owned by Astarta, a leading Ukrainian agribusiness holding and cover emission reductions occurring between 2008 and 2012 The expected emission reduction units (ERUs) are credits generated via the Joint Implementation (JI) flexible mechanism that aims to lower the cost of emission reductions. In addition to bringing new standards and practices to sugar production in Ukraine, the JI project prepares Astarta to participate in rapidly emerging carbon markets and generates much needed additional income.
JI was defined under the Kyoto Protocol and is a market-based approach for addressing global climate change specifically designed for cooperation between countries that both have binding targets.
Background Notes:
Multilateral Carbon Credit Fund
Launched by the EIB and EBRD in December 2006 and fully subscribed, with EUR 190 million in commitments, the MCCF is one of the few carbon funds specifically dedicated to helping countries from Central Europe and Central Asia. The MCCF includes six private (CEZ, Endesa, Gas Natural, PPC, Union Fenosa and Zeroemissions) and six sovereign participants (Finland, Belgium (Flanders), Ireland, Luxembourg, Spain and Sweden).
European Investment Bank (EIB)
The EIB is the European Union's long-term lending bank, promoting European objectives. Established in 1958, it operates within the 27 EU Member States and in more than 130 countries outside the EU. One of the EIB's priority objectives is the protection and improvement of the environment, which accounted for 38 percent of EIB loans within the EU-27 in 2007.
European Bank for Reconstruction and Development (EBRD)
The EBRD, owned by 61 countries and two intergovernmental institutions, aims to foster the transition from centrally planned to market economies in countries from Central Europe to Central Asia. Visit the EBRD's website: www.ebrd.com
GreenStream
This first deal in Ukraine was negotiated by GreenStream Network Plc., the Carbon Manager for MCCF in Russia, Ukraine, Belarus and Kazakhstan. GreenStream is a leading Northern European developer and manager of green investment vehicles, basing its excellence on a variety of advanced advisory and intermediary services. Visit their website: www.greenstream.net
Astarta-Kyiv
Agri-industrial holding Astarta-Kyiv is considered Ukraine's leading agricultural producer and since August 2006 has been listed at the Warsaw Stock Exchange (ASARTA). It owns 6 sugar plants and a further 60 agricultural companies, which have more than 160,000 ha of agricultural land under lease. The head office is located in Kyiv, with production assets located in the Poltava, Vinnytsya, Kmelnytsky and Ternopil regions. Visit the Astarta website: www.astartakiev.com