the Design of Flexibility
Mechanisms to Manage
Joint Implementation (JI), a Clean Development
Mechanism (CDM) and emissions trading (ET) are
three Flexibility Mechanisms adopted in the Kyoto
Protocol to assist Parties to the Protocol to meet their
greenhouse gas (GHG) emissions commitments. The
rules for the operation and use of these mechanisms
are to be further deﬁned at future Conferences of the
Parties to the UN Framework Convention on Climate
The Flexibility Mechanisms are of great interest to
electricity companies because,if properly designed,they
may increase the number of cost-effective and efﬁcient
options available for the mitigation of greenhouse gas
emissions. The electricity sector can play an important
role in managing these emissions in both developed and
developing countries.This paper offers recommendations
for the development of the Flexibility Mechanisms from
the perspective of the E7,an international organization of
eight of the world’s leading electricity companies.
Energy has provided the basis for increased economic
productivity and improvements in the quality of life
throughout the twentieth century. Globally, electricity’s
share of energy use will continue to grow as developing
countries industrialize. The efﬁcient and greater use
of electricity can be an effective means for controlling
greenhouse gas emissions.
Government and industry must ensure that all sectors of
society contribute to greenhouse gas emission reductions
and that the burden does not fall disproportionately to
any industry,sector or country.In addition,all actions that
produce real and veriﬁable reductions in greenhouse gas
emissions should receive appropriate recognition.
The Flexibility Mechanisms promote cooperation between
developed and developing countries and entities therein
to undertake actions to achieve sustainable energy
development and manage greenhouse gas emissions.
The E7 is committed to sustainable development and
is working to reduce global greenhouse gas emissions
in response to the threat of global warming. Through
its experience in efﬁcient electricity generation in both
developed and developing countries, three Activities
Implemented Jointly and an emissions trading initiative,
the E7 is able to offer a unique insight into the development
of the Flexibility Mechanisms. In 1998, E7 published
“The E7 Proposal for International Guidelines” to
promote international electricity sector investments that
contribute to economic and social development and
the environmental quality of projects. The Guidelines
also encourage the use of the Flexibility Mechanisms
contained in the Kyoto Protocol.
On the basis of E7’s experience and environmental
commitment, this paper offers recommendations for
the resolution of key issues facing the development of
the Flexibility Mechanisms. The paper begins with a
review of E7 experience in managing GHG emissions,
both at home and abroad.
E7 COMPANY ACTIVITIES TO MANAGE
GREENHOUSE GAS EMISSIONS
The E7 Greenhouse Gas Management Strategy (1996)
formalizes the E7 commitment to sustainable development
and actions to reduce global greenhouse gas emissions.
The average carbon intensity of the electricity generated
by E7 members is about ﬁfty percent lower than the global
average,due to a very high proportion of hydroelectricity
and other renewable energies, and nuclear generation
in the generation mix, and the efﬁciency of E7 operated
fossil-fuelled generating stations.
E7 company actions to reduce GHG emissions are
summarized in Tables 1A-C.Each member’s approach to
managing GHG emissions reﬂects differences in available
natural energy resources,national energy policies,security
of supply,the existing energy mix and the structure of the
electricity market. Despite the differences, the strategies
are based on common principles and have many common
elements, ranging from improving supply side and end
use energy efﬁciency to international activities.
The E7 has initiated three Activities Implemented Jointly
(AIJ), located in Indonesia, Jordan and Zimbabwe. The
projects are described in Appendix A. In 1997, Ontario
Hydro and Southern California Edison (SCE) undertook
a trade of CO2 emission reduction credits (ERCs).
Ontario Hydro agreed to purchase from Southern
California Edison 10,000 tons of CO2 credits generated
by the Mohave Power Plant Heat Rate Improvement
Program.The ERCs were surplus to Southern California
Edison’s needs.The lessons learned about developing AIJ
projects and from the SCE-OH trade are summarized
in Appendix B.
FLEXIBILITY MECHANISMS IN THE KYOTO
The Flexibility Mechanisms introduced in the Kyoto
Protocol, Joint Implementation, a Clean Development
Mechanism and emissions trading, offer ﬂexibility and
choice to Annex 1 Parties for cost effective and efﬁcient
mitigation of GHG emissions. E7 companies plan to
use instruments such as the Flexibility Mechanisms, to
supplement domestic actions to reduce GHG emissions.
On the basis of our E7 projects,AIJ and emissions trading
experience, we offer our perspective on key issues facing
the development of operating guidelines for the Flexibility
The use of the Flexibility Mechanisms by electricity
companies to contribute to global greenhouse
gas emissions management is premised on three
❑ the environmental beneﬁts of reducing greenhouse
gas emissions are the same for any source or
❑ for an investing party, greenhouse gas emissions
might be reduced more cost-effectively abroad
than at home, and
❑ offshore greenhouse gas emissions reductions
can be credited against national GHG emissions
E7 RECOMMENDATIONS FOR THE DEVELOPMENT
OF FLEXIBILITY MECHANISMS
To ensure the greatest environmental beneﬁt and the
highest participation, the rules for the operation of the
Flexibility Mechanisms must be well deﬁned, based
on market principles, transparent, consistent globally,
and have longevity. The participation of the private
sector in the Flexibility Mechanisms should be on a
voluntary basis. In the development of the guidelines
for the implementation of these mechanisms, there are
many common issues to be resolved,such as additionality,
baselines, certiﬁcation or registration and quotas. This
section presents the E7 view of these issues.
The ultimate success of the Flexibility Mechanisms in
managing GHG emissions is tied to the success of all
three individual mechanisms, CDM, JI and ET. The
use of the three mechanisms should be promoted. In
addition to emissions reduction credits created through
voluntary domestic actions, CDM and JI projects can
generate emission reduction credits for trading in the
marketplace. A viable greenhouse gas emissions credits
trading market will further promote cost effective and
efﬁcient actions to mitigate GHG emissions. The Kyoto
Protocol places different ﬁnancial burdens on the three
Flexibility Mechanisms.Article 12.8 states that a share of
the proceeds from certiﬁed CDM projects shall be used
to cover administrative expenses and assist developing
country partners meet the costs of adaptation. The
Protocol does not set such a requirement for JI and ET.
To encourage maximum participation in CDM and all
other mechanisms, transaction costs and bureaucracy
should be minimized.
The deﬁnition of eligible projects for CDM and JI should
consider the following recommendations:
❑ All mechanisms should be applicable to any project
that produces real and measurable GHG savings and
other environmental,economic and social beneﬁts,
as long as the objectives of the Kyoto Protocol and
operating guidelines are met.
❑ The mechanisms should promote innovation in
energy efﬁciency and the use of non-GHG emitting
technologies such as hydroelectricity and other
renewable energies,or nuclear generation,depending
upon local conditions and priorities.
❑ The rules and modalities should allow for a broad
range of partnerships. Any entity should be able
to undertake projects and generate credits, e.g.,
developing countries,private entities,intermediaries,
❑ Projects should be selected based on priorities set
by the investor and the project host, such as cost
and type of project, e.g., technology, sequestration,
etc.The buyer and seller,not governments or other
agencies, should set the price of the credits.
❑ Activities Implemented Jointly which comply with
CDM guidelines should be given CDM status.
❑ CDM investments would be facilitated if developing
countries announce project eligibility criteria and
create the institutional mechanisms necessary for
project coordination and approval.
Clear and uniform international guidelines for
additionality must be established, because the lack of
consistent criteria creates problems for industry in
identifying potential projects. All types of projects,
including those that are commercially proﬁtable,should
qualify under the CDM or JI if they reduce GHG emissions
relative to a business as usual scenario based on local
A simple and common global certiﬁcation process will
lower transaction costs.The intent of the recommendations
presented in this section is to avoid situations in which
the trading of emission reduction credits on a secondary
market is restricted because of different certiﬁcation
requirements under different regimes.
The certiﬁcation issue has two aspects, certiﬁcation of
projects and certiﬁcation of credits.Emission reductions
credits are only certiﬁable once the reductions have been
achieved. However, to facilitate project planning and
ﬁnancing, a process of project review and certiﬁcation,
in accordance with CDM/JI guidelines, prior to project
initiation should be available. As part of this process,
the emission reduction potential of the project would
The project and credits certiﬁcation processes should
include the following steps:
Certification of Projects:
1. International entity establishes guidelines and
2. National entity establishes guidelines or qualiﬁcation
criteria consistent with the international
3. Projects are developed based on the guidelines,
4. Projects are submitted to the national governments
for forwarding to the international certiﬁcation
Certification of Credits:
5. Actual emissions reductions achieved by the project
should be auditable and veriﬁable. Private and
independent third party auditors exist to undertake
ﬁnancial and environmental audits. The use of
such auditors would enhance credibility and might
eliminate the need for creation of a government or
public body to carry out this task.
6. The audited report of achieved emissions reductions,
i.e., credits, is reported to the national authority.
7. The national authority submits these audited
savings to the international entity for certiﬁcation
or registration as certiﬁed emission reduction
8. The certiﬁed emission reduction units remain
the property of the project legal entities, i.e.,
project partners,for use in either meeting national
commitments or sale to other parties.
9. Only certiﬁed emission reductions units are
applied to country GHG emissions reduction
Certiﬁed emission reduction units or credits should
meet the following criteria:
❑ Credits should be based on achieved emissions
❑ Credits should belong to the participants that have
undertaken and implemented the projects.
❑ The origin of the credits should be well deﬁned.
❑ The credits created from the different mechanisms
should be fungible,that is tradable as one commodity
on a secondary market.
The baseline is important to the credibility of
the calculation of the emissions reductions. Some
considerations for the deﬁnition of the baseline are
❑ Baselines should include economic growth so
that society is not deprived of the benefits of
❑ Baselines should be based on local conditions and
standards, e.g., marginal unit of capacity, grid
connected project versus off-grid systems.
❑ Baselines should remain constant for the duration
of the project.
❑ Both the host country and the project investor
must agree with the methodology to calculate the
baselines and the ensuing reductions and credits.
The domestic efforts of E7 companies to reduce GHG
emissions, which are based mainly on voluntary actions,
underline E7 company commitment to sustainable
development and their responsibility,as leading electricity
companies, to contribute to the mitigation of global
Projects and credits generated under ET, JI and CDM
should not replace domestic efforts to manage GHG
emissions in total. Quotas for total emission reductions
to be achieved domestically may however limit the
use of Flexibility Mechanisms, and this could have
implications for the economic feasibility of their use. To
allow maximum ﬂexibility,any requirement for domestic
GHG emissions reductions should not constrain the use
of the Flexibility Mechanisms.
The Flexibility Mechanisms should include all six
greenhouse gases mentioned in the Kyoto Protocol, and
the associated sources and sinks.
The guidelines for all three mechanisms should be
consistent and ensure that the credits generated by the
different mechanisms can be traded.
The operation of the mechanisms should be guided by
market principles,without any constraints or restrictions,
which could impede transactions, trades or projects.
The administrative functions of the governing entities
should be self-sustaining ﬁnancially, transparent, lean,
accessible and shared between developed and developing
Governments or national authorities should be responsible
for the registration of GHG reductions.
Guidelines should be established as early as possible,
especially for the Clean Development Mechanism, so
that credit registration can begin in 2000.
Banking of credits obtained through the use of all three
mechanisms,for use in subsequent commitment periods,
should be allowed.
Direct Participation by Business Sector
Annex I countries should authorize the direct participation
of the business sector in the use of Flexibility Mechanisms.
This authorization should not however create market
distortion among members of the same business sector
in different countries.
Guidelines should provide for the registration and
reporting of projects by more than one Annex I country
when projects are undertaken by a group of Annex I
Transaction costs should be minimized.
It is recognized that the Flexibility Mechanisms, as with
any other business transaction, imply risks. It is the
responsibility of each partner in a project or trade to
mitigate these risks as part of the commercial contract,or
any other legal or commercial mechanism.
Project Evaluation and Implementation
To be effective and attract the interest of Parties, CDM
and JI must provide incentives to private sector entities
With the implementation of CDM and JI,projects which
in the past may not have been considered economic,
could become more attractive to investors because of the
potential marginal value of emission reduction credits.
All project proponents should be encouraged to evaluate
projects based on the inclusion of anticipated ﬁnancial
returns from emission reduction credits.This will increase
the competitiveness of projects,which otherwise,may be
either non-competitive, or only marginally competitive.
This in turn could lead to innovative and additional
investment opportunities,which contribute to sustainable
development, the objectives of the Kyoto Protocol and
an enhanced rate of return on investment.
Long term contracts between private entities related to
projects that produce a stream of emission reduction
credits should not be restricted. Such contracts will
enhance ﬂexibility and the ability to effectively manage
GHG emissions over the long term.
All mechanisms must be transparent.
As is the case with trading emission reduction credits
produced through Joint Implementation or the Clean
Development Mechanism, credits created by private
sector domestic actions which reduce emissions below a
baseline should be tradable under the Emissions Trading
mechanism. The E7 encourages voluntary actions by
parties and countries to initiate the trading market.
This document has provided the E7 electricity company
perspective on key issues facing the development of the
Flexibility Mechanisms adopted in the Kyoto Protocol.
The E7 supports the use of the Flexibility Mechanisms
and believes that they can contribute to reductions in
global greenhouse gas emissions, if properly designed
and implemented. The Flexibility Mechanisms provide
an opportunity to bridge the gap between developing
and developed countries and to foster sustainable energy
The E7 is ready to contribute to the ongoing efforts of
the UNFCCC Secretariat and other international bodies
as well as the national bodies in its member countries
to operationalize the Flexibility Mechanisms. The E7
will also continue to offer lessons from the current AIJ
projects and individual company emissions trading
initiatives as input towards the design of the Flexibility
Electricity companies, and the business community as
a whole, can play an important role in the success of JI,
CDM and ET and the E7 will work towards achieving
Foreign investment in the electricity sector in developing
countries must occur in a manner consistent with
sustainable development. The E7 Chairmen recently
published the E7 Proposal for International Guidelines
to promote economic and social development and
environmental quality in projects undertaken in the global
electricity industry. The use of Flexibility Mechanisms
is included within the E7 Proposal for International
Guidelines. The E7 has also issued an open letter calling
for support to further deﬁne a code of good practices
that would be acceptable and applicable to all players in
the international electricity business.
The E7 will consider undertaking CDM and JI projects to
contribute to the testing and reﬁnement of the guidelines
for their operationalization. In this regard, the E7 has
recently launched the E7 Fund for Sustainable Energy
Development, an instrument to initiate sustainable
Ontario Hydro and Southern California Edison have
undertaken an emissions reduction credits trade.The E7
encourages its members to build upon this experience
and undertake new trades.
APPENDIX A1: E7 Indonesia AIJ Renewable Energy
The E7 Indonesia AIJ - Renewable Energy Supply System
project will supply a limited, but reliable amount of
electricity through renewable energy to households and
community facilities in rural Indonesia.By harnessing solar,
wind and hydro energies, current levels of greenhouse
gas emissions should be reduced and living conditions
improved without producing additional emissions.
This Renewable Energy Systems AIJ project will include
installation of up to 1000 solar home systems,rehabilitation
of a micro-hydro plant for operation as a grid-connected
independent power producer, construction of three
stand alone micro-hydro plants, and construction of a
photovoltaic/wind hybrid system.The potential social and
economic beneﬁts of the project have been assessed based
on statistical household income surveys.E7 will provide
project management, training, education and ﬁnancing.
Several ﬁnancing options will be offered to potential
users to meet individual needs and to gain experience
with different ﬁnancing models. By pre-ﬁnancing the
initial investments,E7 will cover all related ﬁnancial risks.
Payments made by the users for the electricity consumed
will ﬂow to a community-managed fund.
In December 1996, the Government of Indonesia,
represented by the State Ministry of Environment and the
Director General of Electricity and Energy Development,
and the E7 signed a Letter of Intent and a Memorandum
The baseline estimates and data used for the CO2 offset
calculations are in accordance with methodologies used
by the World Bank for renewable energy projects in Sri
Lanka and Indonesia.The baseline consists of households
using kerosene for lighting and diesel-based battery
charging for other uses, and three village co-operatives
operating off-grid diesel generators to provide electricity
to health stations,schools and small,isolated village grids.
This baseline will be compared to the situation created
by the project, households converted to electric lighting
and photovoltaic-based battery charging as electricity is
provided by a 50 Wp solar home system per household,
and village co-operatives operating three micro-hydro
power plants (15 - 60 kW each) and one PV/wind hybrid
system (15/20 kW).
CO2 savings from this project over a period of 15 years are
projected to be approximately 13,000 tonnes.
Starting with the solar home systems in October 1998,
construction of all plants will be completed by the
end of 1999. Plant operation, maintenance etc. as well
as economic performance will be monitored for an
additional one to two years.
APPENDIX A2: E7 Jordan AIJ Power Plant Energy
The National Electric Power Company (NEPCO) is a
major source of GHG emissions in Jordan. This project
provides technical assistance and equipment to the
National Electric Power Company (NEPCO) to improve
power plant energy efﬁciency.
Three oil-ﬁred, conventional steam cycle units, 10 to 15
years old, at two plants are being studied. The heat rate
and efﬁciency of the units have decreased in recent years.
The project consists of ﬁve tasks,all of which can improve
unit performance and reduce CO2 emissions:
boiler and turbine heat rate and efﬁciency tests, boiler
combustion optimization, boiler water chemistry
management,energy efﬁciency training, and creation of
an energy efﬁciency audit program.
Following characterization of current levels of unit
performance, the E7 and NEPCO will jointly determine
the actions that the E7 will undertake to further improve
plant energy efﬁciency. The Minister of Planning has
recognized the project as an Activity Implemented Jointly.
Two Agreements, between the Ministry of Planning and
the E7, and between NEPCO and the E7 were signed
in September 1997.
APPENDIX A3 : E7 Zimbabwe AIJ Rural
The E7 Zimbabwe AIJ - Rural Electriﬁcation project
was announced during the 1996 World Solar Summit in
Harare. The project consists of installing a mini-hydro
plant at an existing irrigation dam and developing the
distribution infrastructure necessary to electrify a remote
zone of Zimbabwe and to support local economic and
social development. Partners are the E7, the Zimbabwe
Electricity Supply Authority (ZESA) and the Zimbabwean
Government.E7 and ZESA are ﬁnancing the project,with
ZESA ﬁnancing 40% of the distribution network.
Two 350 kW turbines will provide an installed capacity
of 700 kW and generate three million kWh per year.
The plant will be linked to ZESA’s national grid. CO2
savings relative to marginal coal supply will be 1400 t/y.
This project will provide the villages in the region with
access to electricity earlier than planned and also enable
small-scale developments which will contribute to local
The project has been designed to be self-sustaining,
with particular attention to the development of a self-
supporting revenue stream,capacity building,maintenance
and monitoring aspects.An estimated 70,000 inhabitants
could beneﬁt from this project.
ZESA will purchase power from the facility at 80% of the
going retail sales price.Some 120 kilometres of distribution
network will be added to link the facility to the grid and
provide access to local communities.
Electricity customers will pay ZESA’s retail rate.Revenue
from sales to ZESA will cover operation and maintenance
costs of the power plant and grid to reconstitute the initial
capital and ensure durability. The difference between
revenue from sales to ZESA and all costs (including
depreciation) will be placed in a fund to be used for local
development initiatives. A Trust structure comprising
all key players and local community representatives will
administer the fund.
APPENDIX B : E7 GHG Emissions Reduction
Activities and the SCE-OH Emission Credits Trade
❑ Stable political and economic outlooks in the host
country will facilitate project planning and the
development of a reliable baseline.
❑ The restructuring of host country participants may
❑ All parties must agree with the methodology to
calculate the baselines and ensuing GHG reductions
❑ Visible understanding and support of the ﬂexible
instruments by all project partners, as shown
by positions and activities at the Conferences of
Parties (COPs) to the UNFCCC, will facilitate the
development of the required agreements.
❑ Commitment from all partners to all aspects of
the project, including technical, ﬁnancial and
environmental, will facilitate the development of
the required agreements.
❑ Close contacts between the investing party country
and host country will facilitate projects.
❑ Projects should be adapted to local conditions,that
is, project parameters, technology, etc., must be
consistent with the skills, knowledge and resource
base as they exist in the host country.
❑ Local development needs must be considered and
❑ Guidelines should provide for the registration and
reporting of projects undertaken by a group of
international investors through more than one
Annex I country.
❑ Clear and uniform international guidelines for
additionality must be established. The lack of
a consistent deﬁnition for this criterion creates
problems for industry in identifying potential
❑ The source of emission reduction credits (ERCs)
must be acceptable to both the buyer and seller.
Constraints about the source of the ERCs may
relate to the type of reductions producing the
credits, e.g., energy efﬁciency initiatives, demand
side management, sequestration, etc., or the year
of credit creation.
❑ The ownership of the ERCs must be clear.
❑ Currently,because of the small number of trades,the
market price for ERCs is based on literature reviews
and perceptions of a fair price. ERC price will
reﬂect the risk associated with the trading process,
the credibility of the reductions, the availability of
❑ Certiﬁcation of the ERCs is a key aspect to any
trade and the certiﬁcation requirements of both
the buyer and seller should be deﬁned in advance
of any trade.
❑ A simple and universal certiﬁcation process will
lower transaction costs and promote trades.
❑ The cost for certiﬁcation must be factored into the
price of the ERCs. Small trades will have relatively
higher transaction costs.
❑ Standardized contracts allow all parties to understand
the terms of the sale in advance of the trade and
can reduce transaction costs.
❑ Companies interested in participating in the ERC
marketplace should have internal procedures to
support the sale, purchase and certiﬁcation of
Électricité de France Strategy
ENEL Strategy and negotiation of a long term voluntary agreement with
Environment and Industry Ministries is underway
Environmental Action Plan by Japanese Electric Power Industry (voluntary
action) New ERA Strategy
Corporate Strategy to Manage Greenhouse Gas Emissions approved 1995. An
annual progress report is submitted to Canada’s Climate Change Voluntary
Challenge and Registry Inc.
RWE GHG Strategy developed as part of the voluntary agreement between the
Federation of German industries and the Federal Republic of Germany.
Edison International Global Climate Change Policy Edison’s Climate Challenge
Accord with DOE (voluntary agreement)
TEPCO Environmental Action Plan by Japanese Electric Power Industry
ENEL Group target for reduction of CO2 emissions from thermal power: 20%
of 1990 level by 2003
Hydroelectricity accounts for 96% of Hydro-Québec’s generation.Hydro-Québec
does not have a GHG target.
Industry’s goal: Reduce unit CO2 emissions per kWh by 20% in 2010 compared
to 1990 levels.
Reduce the amount of greenhouse gases emitted per unit of energy Ontario
Hydro supplies to its customers, i.e., carbon intensity, by 5% by the year 2000
compared to the rate in 1990, that is 0.26 Tg CO2/TWh.
Stabilize Corporate net greenhouse gas emissions at the 1990 baseline level by the
year 2000 and further reduce emissions by 10% by 2005.
Overall national goal of the Federation of German Industries to reduce speciﬁc
CO2 emissions by 20% up to 2005 on the basis of 1990.
Two million ton reduction below 1990 levels 2000.
Industry’s goal: Reduce unit CO2 emissions per kWh by 20% in 2010 compared
to 1990 levels.
APPENDIX C1: E7 Member CO2 Reduction Strategie – Voluntary Agreements and Targets
APPENDIX C2: E7 Member CO2 Reduction Strategie – Supply Side
Improve plant energy efﬁciency.
Clean coal combustion projects and new plants, e.g., circulating
ﬂuidized bed boiler, gasiﬁed coal, combined cycle operation,
Develop co-generation in partnership with major industries.
Complete program to improve efﬁciency of existing oil-gas plants.
Complete repowering program.
Plans for combined cycle gas turbine, using steam turbines of
existing plants underway.
Plan increase in use of natural gas,but retain some coal/orimulsion/tar
and oil-gas plants to preserve security of supply.
Construct combined cycle gas turbine Increase use of LNG
Continuous improvement in efﬁciency of electricity generation
and transmission, year 2000 target: 1.1 Mtonne CO2/y savings
Two oil-ﬁred units converted to dual fuelling with natural gas.
Construct 965 MW lignite power station with optimized plant
technologies;target 43% efﬁciency versus 30% efﬁciency of older plants.
Replace existing lignite ﬁred power station with best available
ncrease use of cogeneration in lignite plants.
Use power station for district heating.
CO2 emission reduction target for lignite power plant in Rhine
land: -27% by 2030.
Improve energy efﬁciency of existing thermal power plants.
Edison Mission Energy development and operation of environmentally-
sound power generation technologies
Construct combined cycle power generation facilities. Increase
use of LNG. Energy security enhanced with oil and coal ﬁred
Renewable Energy Supply
Improve energy efﬁciency of hydroelectric plants.
Increase wind generation from 8 MW in 1997 to 500 MW in 2005.
25% target for Caribbean Island renewable energy supply by 2000.
10,000 solar water heaters installed in Caribbean and Reunion Islands,
600 new isolated customers provided with solar cells.Install geothermal
generation facilities where possible.
Plan to develop 940 MW by 2003 (hydro,geothermal,wind,photovoltaic).
Renewable energy subsidiary company created.Urban waste subsidiary
company created.Increase power purchases from other companies and
participate in bidding for construction and operation of new plants.
National target for renewable energy generation: Increase from
52 TWh (hydro, wind, geothermal) in 1997 to at least 73 TWh
Pursue hydroelectric development, e.g., Lower Churchill Falls.
Export power to US and other Canadian provinces to replace fossil
Build or purchase 100MW of wind power
Hydropower resource development
Renewable Energy Technologies Program target:
1 TWh by 2005 of wind, microhydro, PV.
Increase promotion of renewable energies program.
Purchase power from renewables (wind, biomass and geothermal).
Develop new renewable capacity through Edison Technology
Promote the use of renewable energy.
Improve energy efﬁciency
and capacity factor.
New nuclear power plants.
Improve capacity factor of
nuclear power station
Develop generation mix
based on nuclear power.
APPENDIX C3: E7 Member CO2 Reduction Strategies – End Use, Research and Other Initiatives
Price set to be consistent with the best use of electricity.
Established partnerships to increase efﬁciency in electric heating,promote
customer energy efﬁciency, promote electric vehicles and transportation,
and promote energy efﬁciency lighting.
Promote electrotechonologies in industry.
Provide ﬁnancial incentives to increase end use energy efﬁciency.
Promote rational use of electricity.
Promote market for Heat pumps (domestic and services)
Promote market and R&D for industrial electrotechnologies replacing
combustion technologies (+25 TWh by 2010, -12 Mtonne CO2)
Energy services (beyond meter) and Public Light management subsidiary
Electrical car battery reload grid design
Pursue research on batteries for electric cars and on engines for hybrid cars.
100,000 people’s Eco-family campaign (energy conservation in households.)
Promote and disseminate:
- Ice-storage air conditioning systems (Eco-Ice).
- Electric vehicles
Promote efﬁcient use of energy through various organizations
- Low-cost leasing program
- Funding for feasibility studies and demonstrations
- Water treatment services
Promote programs for energy saving measures
Promote research and development programs to improve end-use
Customer energy efﬁciency program (turn-key solutions; audit)
Promote program to develop a self-sustainable market for electric
Support customers’ efforts to conserve energy.
Expand use of thermal storage air-conditioning systems
Other Initiatives *
Purchase of electrical equipment to lower
Development of ﬂue gas CO2 recovery
GHG Offset Mechanisms,strive to develop
offsets equivalent to 4.8 Mtonnes CO2 by
2000.Purchase of GHG emission reduction
credits from SCE.
*Note: All companies have programs to promote
international technology transfer, and reduce
transmission and distribution grid losses.
Climate Change Research
Research and Development program
Monitoring high-altitude station for GHG
Study GHG emissions from decaying biomass
in hydro reservoirs.
Participate in international research related
to sequestration: - technology for large scale
afforestation on tropical forests – coastal
Participate in various Climate Change Research
Programs:IEA and MIT,Boston,on technologies
for mitigating climate change and modelling and
political assessment of ecological,economical
and social aspects of global warming.