The Multilateral Carbon Credit Fund (MCCF), set up by the EBRD and the European Investment Bank (EIB), has agreed to buy carbon credits resulting from an energy efficiency project involving equipment rehabilitation for the Ukrainian Ivano-Frankivsk Teplokomunenergo State Municipal Enterprise.

This will be the MCCF’s first municipal transaction and fifth operation in Ukraine.

Ivano-Frankivsk Teplokomunenergo is the main heat and hot water supplier to Ivano-Frankivsk, a city of 250,000 inhabitants. The EBRD’s EUR 11.7 million loan to the city’s municipal utility company, Ivano-Frankivsk Teplokomunenergo, will finance its programme to reduce energy losses and reduce gas and electricity consumption.

The proposed project, using the Kyoto Protocol Joint Implementation (JI) mechanism will use biomass for heat and power production, alongside rehabilitation of existing boiler equipment. Using cogeneration technologies, both heat power generation and electric power consumption will be reduced, further lowering greenhouse gas emissions.

Key components of the project are replacement of old water heating equipment by more efficient, modern boilers, installation of cogeneration units in 5 separate boiler-houses and provision of three wood-fired boilers at two boiler-houses.

Carbon credits being bought through the MCCF will be generated from the Joint Implementation (JI) mechanism under the Kyoto Protocol.

Participants of the Multilateral Carbon Credit Fund include governments of Finland, Belgium (Flanders), Ireland, Luxembourg, Spain and Sweden, as well as five private sector participants. It is one of only a few funds specifically dedicated to central Europe and central Asian countries.

The Joint Implementation mechanism is a market-based approach for addressing global climate change that’s aims to achieve cost-efficient reductions in greenhouse gas emissions through targeted investments in transition economies. A Joint Implementation project generates carbon credits, also known as Emission Reduction Units. These can be traded internationally or used to meet a buyer’s compliance obligations.

This transaction was negotiated by GreenStream Network Plc., which acts as a carbon manager for the MCCF.

Background information:

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 protection and improvement of the environment and mitigation against climate change, which accounted for almost EUR 18bn of the EIB’s total lending activity in 2008.

In 2009 the European Investment Bank lent a total of EUR 16.9bn for projects supporting the fight against climate change, a 73% increase from 2008. These activities include Renewable Energy, Energy Efficiency, Sustainable Transport, climate change adaptation and innovation." For further information visit: www.eib.org

EBRD
The EBRD, owned by 61 countries and two intergovernmental institutions, is supporting the development of market economies and democracies in countries from central Europe to central Asia.

GreenStream
GreenStream is a leading Northern European developer and manager of green investment vehicles, basing its expertise on a variety of advanced advisory and intermediary services. Further information: www.greenstream.net