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Carbon Markets Update 17.10.2010

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Presentation in the Mekong regional Forum in Lao PDR.

Presentation in the Mekong regional Forum in Lao PDR.

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    Carbon Markets Update  17.10.2010 Carbon Markets Update 17.10.2010 Presentation Transcript

    • Carbon Markets Market outlook for renewable energy and energy efficiency projects ffi i j t 26th October 2010 Mr. Mr Juha Ruokonen firstname.lastname@greenstream.net Tel. 358 T l +358 40 840 8005
    • GreenStream Services Core competence Services offered • Fund management within carbon and renewable energy; current investment vehicles include - Multilateral Carbon Credit Fund (EBRD and EIB) Asset Management - Fine Carbon Fund Services - Blåfall - Nordic Carbon Fund - Fine Post-2012 Carbon Fund - Climate Opportunity Fund Intermediary • Brokerage of carbon credits and green certificates Services Green Certificates, Broker of the Year • Portfolio management services 2004, 2005, 2006, 2007, 2008, 2009 • CDM, JI and GIS project cycle management • Investment opportunities and financing solutions for Advisory Services Ad i S i renewable energy bl • Market analysis, policy design, carbon and renewable energy business strategies 26.10.2010 JR (c) GreenStream Network Plc 2
    • Kyoto Protocol and other trading schemes CANADA MGGRA • “Turning the • 6 States and 1 Corner" plan Province (CAN) • Start after • Cap-and-trade 2010 • -60-80% in the “long- long- CHINA • -20% by 2020 run” • Pilot scheme for 8 JAPAN (2006) cities and 5 provinces • Semi- • Target to reduce voluntary EU ETS scheme USA greenhouse gas • Cap-and-trade Cap and trade JVETS • Cap-and-trade intensity i t it • 2005-> started 2005 scheme proposal • -21% by the • Climate bill in Congress year 2020 incl. ETS in • -17% by 2020 from RGGI Parliament in 2005 level • 10 States autumn 2010 • Cap-and-trade WCI • -10% of the • 7 States and 4 TOKYO year 2009 level • Cap-and-trade Canadian provinces by the year • Started in 2010 • Cap-and-trade 2018 • -25% f 25% from 2000 • -15% from 205 level CCX by 2020 by 2010 • Voluntary CPRS, AUSTRALIA • Start in 2012 system • Cap-and-trade • -4% from the • Proposal rejected p j Ratified year 1998-2001 by Parliament. New level by the year proposal expected. Signed, not 2010 KYOTO PROTOCOL NZ ETS ratified VOLUNTARY • Start 2008 • Cap-and-trade CARBON • Mandatory for 37 developed countries • 2010- (2008) 2010 MARKET • -5% 2008-2012 No position • Strong • International Emission Trading, CDM/JI 26.10.2010 JR growth (c) GreenStream Network Plc 3
    • The rise of the global carbon and renewable energy markets Global New Investment in Sustainable energy EUR Global Carbon Market Value * Billion EUR Billion 130 140 140 122 60 118 120 120 103 50 100 100 Third party 86 82 40 investments 80 80 98 87 89 54 30 60 60 42.7 42 7 35 57 Govern. Govern 20 40 40 31 R&D, 24 14 Corporate 10 20 8.7 20 8.7 25 42.7 33 32 R&DD, 0.4 0.4 0 0 0 Small 2004 2005 2006 2007 2008 2009 2004 2005 2006 2007 2008 2009 distributed di ib d capacity Source: State and Trends of the Carbon Market 2006, Source: Global Trends in Sustainable Energy Investments 2007, 2008, 2007 2008 2009 and 2010 Th W ld B k d 2010, The World Bank 2010, 2010 UNEP SEFI 26.10.2010 JR (c) GreenStream Network Plc 4
    • Global CDM pipeline pp 3 000 Forestry Cumulative tota volume (Mt CO2e) 2 500 HFC & N2O reduction C Fuel switch 2 000 Energy efficiency 1 500 Methane reduction & cement Renewables 1 000 al 500 0 C Number of CDM projects (Total 5529) CER volume by 2012 (Total 2827 MtCO2e) (As of Oct 2010) (As of Oct 2010) Supply-side EE Methane Supply-side Methane 10 % 19 % EE 20 % 10 % Fuel switch 6% Fuel switch Demand- 2% side EE 1% Demand- side EE Forestry Source: 4% 1% CDMpipeline.org Renewables HFCs, PFCs Renewables Forestry 35 % & N2O 61 % 1% Transport 26 % 0% p HFCs, PFCs Transport & N2O 1% 2% 26.10.2010 JR (c) GreenStream Network Plc 5
    • Renewables and Energy Efficiency p j gy y projects Renewable Energy Project types, total 3351, Energy Efficiency Energy Project types, (As of Oct 2010) total 778, (As of Oct 2010) Solar S l EE Geothermal Tidal Households 2% 0% 0% 8% EE Service 3% Biomass energy EE Industry 21 % 18 % Hydro 45 % EE own Supply  generation side 58 % Wind EE Supply 32 % Energy distrib. side 2% 11 % Source: CDMpipeline.org Theoretical CER potential of the current pipeline: 988 MtCO2 by 2012 322 MtCO2 b 2012 by (35%from the total (11% from the total CDM pipeline) pp ) CDM pipeline) 26.10.2010 JR (c) GreenStream Network Plc 6
    • Regions g Cumulative total volume of expected CERs by 2012 by Cumulative total volume of expected CERs by host country 2012 by host country 3000 China 60 12 12 Vietnam Millio of expected CERs by 201 Millio of expected CERs by 201 2500 India 50 Thailand 2000 Brazil 40 Lao PDR South 1500 Korea 30 Cambodia Mexico 1000 20 Malaysia ons ons 500 10 0 0 Projects in Validation kCERs by 2012 Source: CDMpipeline.org Cambodia 7 1250 Lao PDR 3 651 Thailand 123 26112 Vietnam 127 26892 26.10.2010 JR (c) GreenStream Network Plc 7
    • CER price development p p 26.10.2010 JR (c) GreenStream Network Plc 8
    • CDM Challenges g • Development of the CDM projects takes time and resources: • Project lead times are long: it takes at least two years to develop project idea to a registered CDM project • There is risk that project will not get registered as a CDM project p j -> Impact of CDM financing to the construction decision is small but there are also exceptions in some project types • In general, there is capital gap in early stage project development and investment financing • Traditional financing is available for advance stage project 26.10.2010 JR (c) GreenStream Network Plc 9
    • Market outlook • Climate policy negotiations continue Demand&Supply of CDM/JI credits at international level Demand Supply • Cancun, Mexico, 2010: No major Total 1222 Total 1225 breakthrough expected EU 890 CDM 1030 • Johannesburg, South Africa, 2011: New Japan 300 JI 195 agreement for 2013- period? Other 32 • Flexible Mechanisms will be part of the Source: States and Trends of the Carbon Market new agreement 2010, The World Bank • CDM reform i.e. changes in the rules • New mechanisms: REDD (Forestry), sectoral approach and NAMA crediting • Carbon market will continue!! • CDM projects eligible in the EU ETS also in 2013-2020 i 2013 2020 • New cap-and-trade schemes are likely to include CDM and similar mechanisms 26.10.2010 JR (c) GreenStream Network Plc 10
    • 26.10.2010 JR (c) GreenStream Network Plc 11
    • GreenStream in Brief • GreenStream is a leading Northern European company focusing on: • Asset Management and investments in carbon and renewable energy markets bl k t • Climate Services covering tailored advisory and intermediary services • GreenStream is licensed by the Finnish FSA • GreenStream's clients are energy and industrial companies, financial institutions and governments • Some 40 professionals working in Helsinki, Oslo, Berlin, Stockholm, Vilnius, Kiev, Moscow, Beijing • China is a key market in which GreenStream is engaged in a considerable number of y g g projects, JV established with Juno Capital for cooperation on CDM projects and climate investments in China • CarbonStream Africa – JV with CEF to develop CDM p j p projects in Southern Africa • Chosen as the Best Broker in green certificate markets in EU (excl. UK) six years in a row by the readers of Environmental Finance as well as runner-up in the category EU Emissions Trading Scheme – Best Advisory in 2006 g y 26.10.2010 JR (c) GreenStream Network Plc 12