CARBONyatra.com

1. Is there any outsourcing services in this sector?
Sure there is. You can outsource draft PDDs for simple projects (wind hydro biomass to power for grid supply), draft monitoring reports to professionals who will charge anywhere between Rs 30,000-Rs 3 lakh depending on the size, nature of project, number of log sheets/docs, turbines etc etc. The best part is that you do not have to pay the "success fees" from eventual sale of proceeds. Send carbonyatra.com your project specs and we can put you on to some good service providers who can perform basic data entry, draft documentation etc.

2. Sir how is CFI different from a CER in terms of 1. Application Process 2.Ease of finding Buyers 3.Minimum size of projects in terms of CERs to find buyers? Also I have found recently that buyers are not interested in projects with CERs less than 5000?How can such projects specially in rural areas benefit from carbon credits?I am a student at BITS-Pilani and we are working with local farmers to get carbon credits from their biogas plants through a Programmatic CDM model
The application process for CFIs is much simpler than the CDM. The CDM has a wait time of almost 2 years according to a recent world bank report. Unlike CERs, CFIs can only be traded on the exchange and sold to members listed on the exchange. The price of CFIs are $7 (as of May 19)per contract as opposed to Euro 15 and up for issued CERs. There is no minimum size if you go through an approved aggregator listed on the CCX exchange. Biogas digestors are given roughly 3.5 carbon credits for a 2 metric cube digestor capacity per year. Trading for CFIs are for vintage years 2003-2007 and futures till 2010. Convert small credits to CFIs, find an aggregator and go for trading would be ideal for small projects (although the price is $7 per CFI).

3. hello, you answered my last question very quickly, now i would appreciate if you can answer me this one as well. I am a regular visitor of your site, and I daily go through the price list. I would like to know how do you arrive at this numbers as , as per my understanding the market is not that transparent. The prices are not disclosed just like that... Also i am willing to know that what is the difference between Nymex, eex, ccx etc. Please reply.
Hi Ruchita, Primary CER pricing is not too transparent and depends on project owners and how they structure the deal.The prices of CERs which are displayed here are those of the secondary market and are applicable to daily trading which takes place across the various exchanges which carry and allow such trades. Hence they are displayed as s-CER prices. s-CER futures trading is already allowed and thriving. When we are informed about p-CERs we suitably highlight them, although they are hard to come by and not announced for confidentiality reasons. Again, the s-CER prices are available at all international and national commodity exchanges daily.

4. 1. What are the study courses for Carbon trading. Internationl as well as Indian.
Dear Anjan, I think you would do well to look at the Post Graduate Diploma in Energy Management course being offered by MIT in Pune (http://mitsde.com/energy.htm). The 2007 carbon market saw a sharp growth in carbon contracts from renewable energy and energy efficiency projects. Semester II at MIT is ideal for those looking to enter into the carbon market. It has the following topics: Renewable Sources of Energy New & renewable energy sources : Solar, biomass, wind, tidal, geothermal, microhydel, etc. – their availability & potential. Conversion of solar energy into various forms of energy (heat, electricity, mechanical etc.) Geothermal & tidal energy – basic principles, systems used in practice and applications, resource assessment criteria, status in India . Solar thermal energy : Solar thermal devices : Radiation geometry, various types of solar collectors, flat plate & concentrating collectors, their construction working & application, hot water & hot air systems, industrial hot water systems, low pressure steam generation, solar dryers, solar pond, space heating & space conditioning, design criteria and methodologies for solar thermal applications. Solar concentrator and their applications, solar thermal power generation. Use of solar thermal systems with existing systems, economic analysis of solar thermal systems, example of hybrid systems. Photovoltaic : Solar photovoltaic conversion: Basic principle of SPV conversion, types of solar cells, fabrication of SPV cells, modules. SPV systems : Different configurations, SPV system components and their characteristics, applications, hybrid SPV system. SPV system designing: Block diagram of general SPV system, load estimation, selection of inverter, battery sizing, array sizing, wiring for SPV system. Case studies. Wind energy : Wind energy conversion technologies, aerodynamics of wind turbine rotor, site selection. Wind resource assessment, various models to predict wind pattern and their analysis, concept of wind farms, various aspects of wind turbine design, hybrid wind energy systems – Wind + diesel power, wind + conventional grid, wind + photovoltaic system etc. Hydrogen & fuel cell : Hydrogen as a renewable energy source, source of hydrogen, fuel for vehicles. Hydrogen production: Direct electrolysis of water, direct thermal decomposition of water, biological and biochemical methods of hydrogen production. Storage of hydrogen: Gaseous, cryogenic and metal hydride. Utilization of hydrogen fuel cell – Principle of working, construction and applications. Hydel & integrated energy systems : Mini & micro hydel power (MHP) generation, classification of hydel plants, concept of micro hydel, merits, MHP plants – components, design & layout, turbines, efficiency etc, status in India. Integrated energy systems & their cost benefit analysis. Bio energy : Bio fuels : Types of bio fuels, production processes and technologies, bio fuel applications, ethanol as a fuel for IC engines, relevance with Indian economy. Bio based chemicals and materials : Commercial & industrial products, biomass feed stocks, chemicals, plastics, fibres, etc. Government policy and status of bio fuel technologies in India . Bio mass : Bio mass generation & utilization, properties of bio mass, agriculture crop & forestry residues used as fuels. Bio chemical & thermo chemical conversion, combustion gasification, biomass gasifiers and types, etc. Application of gasifiers to thermal power and engines, biomass as a decentralized power generation source for villages. Bio gas : Importance of biogas technology, different types of biogas plants. Aerobic and anaerobic bioconversion process, various substrates used to produce biogas (cow dung, human and other agricultural waste, municipal waste, etc.) Individual & community operated biogas engines and their use. Course fee: The fee amount for this course is Rs. 20000/- for Indian Residents and US $ 2000 for NRI/Foreign Residents including first attempt examination fees, which have to be paid in full at the time of admission in the form of Crossed Cheque / Demand Draft drawn in favour of "MIT School of Distance Education". Registration Fees: Rs. 500/- for Indian Residents and US $ 50 for NRI/Foreign Residents. Prospectus Fees: Rs. 500/- for Indian Residents and US $ 50 for NRI/Foreign Residents. Duration : One year. Note: Participant is expected to put in minimum ten hours of study per week. Validity of registration : Two years. Eligibility : Engineering Graduates/Diploma Holders/Science Graduates with two years experience.

5. Sir, how will the CDM market change if developing countries like India and China are being given targets in the same line as that of Annex I Countries?
Simple, the market will not exist-since there will be no sellers! The big question should be why should India take on emission caps? Our per capita GHG emissions are way lower than anyone else, so what's the point. Some studies indicate that we can in fact increase our emissions because our per capita emissions are so low. Compare that to the US, wherein the "floor" below which nobody in the U.S. can reach, no matter a person's energy choices, is 8.5 tons in per capita GHG emissions. Looking at the carbon market, if the two biggest sellers are forced to turn into buyers, where is the market to buy carbon credits??? The market needs the US to enter in a big way and cut emissions and include Indian carbon credits in their cap-and- trade system.The US elections in Dec 2008 will be a major trigger for the carbon market, it's a wait and watch approach till then.

6. If the project is in its registration stage and simultaneously you are also looking for a buyer, in that case pls suggest is it beneficial to go and sign the cerpa or wait for issuance of cer and go for the spot price... Also would like to know that does the price of CER also depend on the project..I mean country , technology used etc?
If you're already at the registration stage, I would suggest that you wait for CER issuance and final registration for low risk projects like wind and hydro. Prices depened on CERs on offer first, then project type and risk of commissioning, issuance, technology etc. Volume of CERs on offer is key and risk of UN issuance comes next. At registration, you are only looking at if UN accepts or rejects the project. Wait for registration, your price will be higher than what it is now. Anything over 50,000 CERs per year will make buyers line up outside your door.

7. I have been reading about additionality aspect expecially from small scale perspective, where the discussion of investment barrier entails IRR calculations and the like. I am really surprised that all wind projects from India show an IRR of around 10-12% whereas the project owners show an IRR of 18% for the project without which they cannot secure debt financing from the bank. What is the reason for this anomaly? Not many can answer this question but I am hopeful my quest will end here. Thanks
Dear Sanjana, You have touched upon the best kept secret in the carbon industry (until last year it was a secret). It's common knowledge that Indian wind projects (a majority anyway) are set up for tax purposes with 80% depreciation cost etc. Most (not all) of these so called wind project developers appear to have set up the project and then realised that there is carbon revenue to be earned, hence the IRR additionality differences. Check out this link for more (please copy cut paste in address bar) http://www.carbonyatra.com/news_detail.php?id=997

8. Sir, How does one enter this market. What are the qualifications needed?
The carbon market is growing at such a rate there's no skill set that is not required, from accountants, to public relations, to engineers. Environmental markets are thriving as the world wakes up to the accelerating problems of climate change, the depletion of natural resources, water shortages and growing mountains of waste. As the industry grows, opportunities are proliferating and salaries improving. Added to which there is a lack of skilled workers entering the sector. The industry could also provide a home for financial services specialists who have recently found themselves out of a job. For investment management roles, people who have a genuine track record and understanding of the regulatory and financing risks associated across the board are at a premium. As other areas are dropping off, people are looking for areas of growth. Climate change, alongside distressed debt, continues to be one of the key growth areas. The current shortage of skilled workers is such that it is holding the market back. There is also an abundance of opportunities in solar power.

9. Which period is critical for us in the carbon market. i.e.2008-2012 or beyond?
For now, the 2008-2012 or only Phase II matters. The 2007 emission release by Europe finally gave the direction the market missed in the recent weeks. On 2 April 2007 the European Commission made public in the Community Independent Transaction Log the available emission reports from Member States on their 2007 emissions under the EU ETS perimeter. The reports correspond to the emissions of the industrial installations covered by the scheme which in 2006 have represented about 94% of emissions. This means that emissions have increased by almost 15 Mt from 2006 to 2007. While not impressive in essence, this 0.7% rise is above market expectations, as rendered by various analysts forecasts published on the days before the release. These forecasts generally settled between 2040 and 2050 Mt, i.e., stable with respect 2006. The anticipated stability was due to the trend (GDP-driven) emission growth being compensated by good hydro availability in 2007 relative to 2006, and higher use of gas at the expense of coal during 2007 summer (low NBP prices). Obviously, the above EC result does not matter for Phase I, even if related to the last year of this Phase. Market has known for long that the first trading period has been largely over-allocated in EUA, and the 2007 figures do not in the least change this conclusion. The meaning of 2007 has to be understood dynamically, as a third data point - after 2005 and 2006 - giving additional elements on the emission path to 2012. This emission path is key for market participants to calculate the EUA shortfall (defined as the difference between emissions and EUA allowances), hence the supply-demand position of the market and the equilibrium price of the EUA over Phase II. Experts have revised their emissions in 2012 upwards by 28 Mt (to 2495 including aviation)

10. Sir I am very much thankful to you and I shall be surprised for the rest of the life for your jet speed reply.It is just amazing and unbelievable. Now I request you for the information about the Indian companies which are involved in HFC-23 CDM project or please guide me where can I get the information or any website? Once again I thank you whole heartedly.
Don't be suprised. In the carbon market, service time to client and time to close deals is critical. India has not been used to getting services at a click of a button, but that will change and you need to be more demanding. Your list of companies are Gujarat Fluoro, Chemplast Sanmar, Navin Fluorine, SRF and Hindustan Organics...these are the HFC-23 CDM projects from India so far. Don't be amazed, but please spread the carbonyatra word around.

11. Sir,I am very much grateful to you and thank you whole heartedly for your immediate response to my enquiry. Now I request you for the following information- Navin floro got the permission from UNFCC to generate carbon credit of 2.8mT every year from 1-5-07 for ten years. But the kyoto protocol shall Expire by 2012. What I feel is the company will sell the CER's which it will be recieving till 2012. I wanted to know what will the company do with the CER's it will be recieving in the further period and how far the company's technology partner INEOS Fluor Limited, UK (IFL) , shall be benefited by the company's sales? I shall be thankful to you for your reply.
You're welcome. You have referred to the uncertainty in the market post-Kyoto. The decision will only come by Dec 2009 on what happens in the 2013-2020 carbon market. What's positive is that there will be a market, we're waiting to know if more sectors will be included and if the US decides to join the market. Look around, you'll see carbon exchanges being launched almost every month-NYMEX, MCX, NCDEX etc. Buyers themselves only want 2008-2012 credits and most forward contracts are being traded for that period. The futures sec market too stops till Dec 2012. But some buyers that we know have already placed bets on the post2012 market and are picking the credits up at Euro 1-5 per credit. Some US buyers (even though the US has not joined Kyoto) are already asking sellers to trade the credits for the entire credting period (10, 21 yrs) in forwards now. But most buyers are waiting to see what structure the market takes post 2012 before buying credits, so naturally, sellers are also playing the wait and watch game-rightly so. Those involved in HFC-23 CDM projects will dominate the market due to the sheer volume of credits being generated and will continue to do so till their 10-yr crediting period. Once the US joins the market, which is certain after the Dec elections this year, there will be even more demand for credits. So its a wait and watch game for now. Dec 2008, Dec 2009 will decide how high we go, but the market will exist, it's only a question of which other sectors in A1 countries will also be included-such as aviation, shipping etc. Also, don't forget, you can also get into the VER market which is not being talked about and which runs parallel to the CER market. As long as there is climate change and nations show concern, there will be an emissions trading market-there is a price for carbon and corporates that realize the same, will stand to benefit.

12. Please help me out to know what is the starting date of the crediting period for the projects which goes for review requested or correction requested? Is it the date on which the project get register or the date on which the project is due to get register after request for registration or is it the expected crediting period mention in the PDD? kindly help me out....
Good question. I think the following example should clear you doubt on the matter. A project can get CDM registration prior to commissioning, but the carbon credits will be monitored, verified and issued only after the project is commissioned. Before that, the PDD will only show an estimate based on emission factors, meth used and validation report. There are projects which are on the UNFCCC list requesting registration right now, but which will only get commissioned (like hydro projects) only in 2011. So the owner or project proponents will decide the start date of the crediting period. So in this case, registration is say expected in 2009 (due to review requests or corrections), but crediting period will be 2011-2012, 2012-2013 etc for 10yrs or 21yrs as the case maybe. It is also the reason why during the PDD one might estimate that the CERs will be 20,000 per year, but after commissioning and monitoring you find that it is actually 19456 CERs or even more. Bottomline, your credit start date will be from date of commissioning of the project and is decided by the owner or consultant, but your registration date is in the hands of the UNFCCC...but you can begin your CDM registration process much before commissioining or credit start date. Check out the UNFCCC registration list and you will find that some projects have revised their credit start date.

13. How many CER's have been issued to Navin Flouro so far?
Dear Bhattad, The company has been issued 1214831 CERs as of March 14th 2008 in total. They are awaiting more CERs for the monitoring period between 16 Oct 2007 - 31 Dec 2007 and 01 Jan 2008 - 29 Feb 2008. Expect more CERs to be issued to them this year.

14. How will the linking failure of EU (ETS) and ITL affect the carbon market. Also The UK Ministry of the Environment said that the UK Government believes the (Kyoto-linked) carbon trading registry system must be established before November at the latest. Your thoughts would be appreciated. Thanks
In the absence of a link to the ITL, the Kyoto registry cannot track trades within the EU ETS, as intended. The failure of the EU Emissions Trading Scheme (ETS) to connect to the UN-administered International Transaction Log (ITL) is going to lead to a complicated reconciliation process later on, posing a logistical nightmare for registry operators. Germany, the largest emitter in the EU, have expressed concern over-issuing 2008 vintage EU allowances (EUAs) in the absence of a link to the ITL. This is because EUAs effectively become Kyoto Protocol ‘Assigned Amount Units’ (AAUs) from 2008 to 2012, which are tracked by the ITL. Only Austria and Denmark have so far met the deadline on Thursday 28 February 2008 to allocate permits to emit carbon dioxide to their industry. 28 February 2008 was the European Commissions’ deadline for all EU member states to allocate EUAs to over 10,000 European energy-intensive installations in 2008. (2008 is the first year of the second phase of the EU emissions trading scheme from 2008-12.) This delay will have a negative effect on the 2008 carbon spot market. Thirteen countries have submitted the necessary information to the Commission regarding allocation, but only five have received Commission approval to issue and just two countries have met the deadline. Of the remaining three, Britain and the Czech Republic have said they will not allocate EUAs, while the Commission said it was unsure about Finland's plans. Britain said that it would not issue EUAs until the European Commission announced when its EU emissions trading scheme would link with a separate carbon trading scheme under the Kyoto Protocol on global warming, which the Commission has previously said may not happen before 2009. The UK Ministry of the Environment said that the UK Government believes the (Kyoto-linked) carbon trading registry system must be established before November at the latest.

15. please tell me how is carbon trading on MCX done
Dear Richa, CER sellers are encouraged to purchase EUA futures on MCX to protect themselves against price volatility. Please check out the following story done sometime ago on trading and hedging on MCX. (cut and paste this link) http://www.carbonyatra.com/news_detail.php?id=1523

16. can i make a career with participating with your org.
Sure you can. We begin hiring in March 2009. We would request you to send in your resume for our database till then.

17. what is the amount paid for trading 1tonne of carbon?
Dear Uthappa, The price depends on volume on offer and stage of CDM project- if you're talking about primary or secondary CERs. Prices differ for EUA's and VERs. Please refer to our price charts on the homepage for daily price movements of secondary carbon credits and EUA's. At a recent workshop, the following prices were mentioned. Prices per CER: (1.5-5 Euro for post-2012 vintages), (6-8 Euro for medium-risk forwards), (9-13 Euro for low-risk forwards), (11-15 Euro for registered projects), (16-18 Euro for issued CERs), (17.3 Euro spot price on Nord Pool exchange)

18. Please tell me difference between EUA prices vs CERs Satish K.
Good question Satish. Europe for example, has imposed annual targets for carbon dioxide (CO2) emissions on each EU country. Each EU country then allocates its national allowance across their companies whose factories and plants are major emitters of carbon dioxide. Most installations across Europe have had annual carbon emission reduction targets set for them under National Allocation Plans (NAPs) for each EU country. The companies that own the installations are allocated a number of allowances, called EUAs, matching their target. Each EUA gives the owner the right to emit one tonne of carbon dioxide. Companies that don't use up all their allowances, that is, emit less than they are entitled to, can sell them. Companies which exceed their emission target must offset the excess emissions by buying EUAs, or pay a fine per tonne. The EUA prices refer to those in futures contracts struck in trade on the European Exchanges. The most traded is the December 2008 forward contract, the first year of the second phase of the EU ETS coinciding with the first commitment period of the Kyoto Protocol. Most of the EUA trade is in forward and futures contracts, where the price is agreed now but allowances and payment don't change hands until a set date in the future. There is little trade in the 'spot' market (buy now, exchange immediately) relative to the forward market. Companies that are covered under the EU ETS, so called ‘compliance’ buyers, buy and sell EUAs in an effort to manage their expected future needs of emissions permits. CERs on the other hand are not doled out by any government, but are issued only under the CDM (VERs are different). Prices in the primary market for CERs in India for yet to be issued from projects in various stages of development continue to attract prices of €8 to €15. Price variation reflects the stage of development of the project (pre-validation, validated/pre-registration, and registered), host country, technology type and perceived risks of failure. Hence issued CERs can get the best market price because there is no risk attached to them for the buyer-again this price depends on the volume on offer-50,000 CERs will get a higher price than 7000 CERs. A fundamental influence on the price of EUAs is the cost of energy, particularly the price of electricity and the 'spread' between coal and gas prices. More demand for power drives up the cost of electricity but also leads to more demand for EUAs to offset higher emissions from fossil fuels burnt to increase that power supply. The bigger the coal-gas spread gets, the greater the cost to power utilities of converting from coal to gas. Such a switch is the easiest strategy currently available to energy companies for reducing greenhouse emissions - burning gas produces less than half the greenhouse emissions of burning coal. So the greater the spread, the greater the cost and the less the attractiveness of switching. The less conversion, the more demand there is for EUAs as an alternative to meet emissions reduction targets. So please be careful in asking for EUA prices for CERs from your project-they will always differ.

19. What is the current price range of futures contract in carbon credits and what is the expected growth in their prices?
Dear Tanpreet, The CER Index prices by LEBA as of 20/12/07 are as follows 2008 Volume:60,000 WA (€): 16.98 2009 Volume:75,000 WA (€): 16.95 Average CER Closing Prices(Euro) 2008: 16.90 2009: 16.88 2010: 16.95 2011: 16.98 2012: 17.01 08-12 Strip:16.94 NORDPOOL Exchange Forward Contracts (Dec 21, 2007) CERDEC-08 EUR 16.65 CERDEC-09 EUR 16.65 CERDEC-10 EUR 16.70 CERDEC-11 EUR 16.75 CERDEC-12 EUR 16.80 The CCFE shows that CER Dec 08 futures are trading at USD $24.35 (Dec 21, 2007). Most recently, in the secondary market, the price of the Dec 08 CER forward delivery contract closed at €18 per tonne of CO2 on the Nord Pool exchange on December 4. Dec 09s traded 10 cents higher. Some experts have suggested that with a global framework not being in place before the end of 2009, but demand for project based credits probably soaring from 2010, it might be difficult to bridge the arising supply-gap at the end of phase II and in early phase III. But such is the volatility of the market that some brokers have openly suggested against holding onto their CERs in the hope that prices will only increase-they suggest a 50:50 approach to selling CERs. Prices in the primary market for CERs yet to be issued from projects in various stages of development continue to attract prices of €8 to €15 in forward contracts. Price variation reflects the stage of development of the project (pre-validation, validated/pre-registration, and registered), host country, technology type and perceived risks of failure. The market and prices are dependent on a host of factors and are volatile. I can tell you that buyers are coming to India to buy quality CERs and are paying upwards of Euro 10 per CER in forwards and upto Euro 17-18 for issued CERs based on volume on offer. Bottom line- if you have a volume of over 50,000 CERs per year in the pipleine, finding the right price and buyer will not be an issue. You can fill out our service request form if you have CERs for sale or any other requirement.

20. Is Hydrogen Really Green?
Not Right Now at least according to a recent report by JP Morgan. Hydrogen is an energy carrier . . . typically consumes fossil fuels to create. Hydrogen does not exist in the natural environment in quantities sufficient to harness, thus some other energy source must be used to create hydrogen, and that source has typically been fossil fuels. Natural gas has been the primary means to produce hydrogen but coal is also an alternative in the future, but both of these processes release CO2 into the atmosphere, which contributes to global warming. So although no CO2 is released in a pure H2 powered fuel cell at the site, CO2 was likely released to create the H2. Renewable sources to produce hydrogen also exist, including wind, solar and non-CO2 emitting nuclear power. Steam reforming through hydrocarbon fuels is the most economical way of producing hydrogen currently, and results in the release of CO2 and NOx. The equation is below: CH4 (Natural Gas) + H2O (g) CO + 3H2 Electrolysis by renewable fuels offers a pollution-free alternative to produce hydrogen. Hydrogen can be made from the electrolysis of water, which splits H2O into its oxygen and hydrogen components. A significant amount of heat and electricity is required to catalyze this action, however, which currently makes this technology more than 2x as expensive versus natural gas steam reforming. Only if alternative fuels such as solar, wind, geothermic, or hydro are used is the process carbon-neutral. Additionally, we note that nuclear could provide a carbon-neutral platform for electrolysis. Given the higher cost profile of electrolysis and likely higher cost of alternative fuels, however, we believe the technology remains far off that will offer a cost-competitive carbon-neutral means of mass producing hydrogen. But natural gas high efficiency fuel cells present a better environmental option versus existing fossil fuel technologies. The molten carbonate fuel cells manufactured by FCEL can run on natural gas that is reformed directly within the fuel cell. This conversion process is highly efficient and, when paired with cogeneration applications, is capable of producing efficiencies of 80%+—well above traditional coal and natural gas power plants. The amount of CO2 is lower with FCEL's products, and NOx and SOx levels are near zero, providing a carbonefficient way of producing base load on-site power generation that ultimately consumes less natural gas per amount of energy produced versus a power plant.

21. What is a fuel cell?
Fuel cells are electrochemical devices that convert the chemical energy of reaction directly into electrical energy (and some heat).

22. sir what is registration charges for registartion of our project in carbon credit market
CERs per year (Registration fees) <= 15,000($5,000) > 15,000 and <= 50,000 ($10,000) > 50,000 and <= 100,000 ($15,000) > 100,000 and <= 200,000 ($20,000) > 200,000 ($30,000) Based on the information provided in CDM-PDD, the level of reductions over the indicated crediting period will be estimated by the project participants. The estimate shall be confirmed by the DOE. The registration fee paid will be deducted from the share of proceeds for administration due at issuance of CERs. Registration fees for the clean development mechanism (CDM) are calculated as under: (a) USD 0.10 per certified emission reduction issued for the first 15,000 tonnes of CO2 equivalent for which issuance is requested in a given calendar year; (b) USD 0.20 per certified emission reduction issued for any amount in excess of 15,000 tonnes of CO2 equivalent for which issuance is requested in a given calendar year. The revised registration fee shall be the share of proceeds applied to the expected average annual emission reduction for the project activity over its crediting period . The maximum registration fee payable based on this calculation shall be USD 350,000. No registration fee has to be paid for CDM project activities with expected average annual emission reduction over the crediting period below 15,000 t CO2 equivalent. The registration fee shall be deducted from the share of proceeds for administrative expenses. In effect, the registration fee is an advance payment of the SOP-Admin for the emission reductions achieved during the first year. If an activity is not registered, any registration fee above USD 30,000 shall be reimbursed.

23. present CER price
The price depends on the volume of CERs on offer, credit risk of seller, stage of project etc. The spread between EUAs and CERs in the European market has begun to widen, currently just under €4. CERs and EUAs can be used interchangeably for compliance under the EU Emissions Trading Scheme. CERs trade anywhere between Euro8-15 per CER. The following recent examples should give you a better idea about the current market. JSW Steel Ltd, India's third-largest private steel manufacturer, has announced that they have sold accrued CERs of 1,337,555 at €14.90 per CER and received a consideration of Rs 111.10 crores. Suryachakra Power Corporation has recieved UN registration for the following two biomass to energy projects. 10 MW Bio based renewable energy plant in Amaravathi Dist Maharashtra. Period of Credit : January 01, 2008 to December 31, 2017. No. of CER's per annuam : 43.345 Registered: Sept 08, 2007 9.8MW Biomass based renewable energy plant in Champa Dist. Chattisgarh. Period of Credit : September 03, 2007 to September 02, 2017. No. of CER's per annuam : 37.947 Registered: Sept 03, 2007 Both companies are expected to earn carbon credits revenues at the rate of Euro 10.5 per CER for the years 2008 - 09 and 2007 - 08 (part of the year) respectively, said Suryachakra Power. If you look at the auction exchanges then the most recent Asia Carbon Exchange (ACX-Change) auction held on 31 August 2007 has resulted in the successful transaction of an Indian wind power project, which was still under the validation stage. About 59,499 CERs from five vintages from this project were shared by two buyers from Europe for €12.00 and €13.10 per CER. CARBONyatra.com is also involved in a few sales of CERs and is currently being offered anywhere between Euro 10-14.20 per CER for its projects. So I guess, Euro 10-14.90 should be a good range per CER.

24. I am carbon credit enthusiast,doing my 3rd engineering from BITS-Pilani,currently doing a study on possible benefits of carbon credits in rural India by turning to biogas plants for daily needs.Trying to put forth carbon credits as an economic incentive to turn to clean fuel.How feasible is it to take rural CDM projects to completion?What government and international resources can I look forward to? Regards,Abhishek
Dear Abhishek, Anandi Sharan from the Women for Sustainable Development is the person behind a famous CDM Biogas Project, which is similar to your research area. You might do well to contact her for more details. The Bagepalli CDM biogas project was financed innovatively by selling Certified Emission Reductions under the Clean Development Mechanism of the United Nations Framework Convention on Climate Change in advance. The Deenabandhu model of biogas plant was earlier generally built either with a large part of own funds (for richer rural households) and subsidies, or with a large part of own labor and subsidies (for poorer households). The availability of the product was limited by the subsidy amount available to each District every year through the Ministry of Non-Conventional Energy Sources. The baseline and monitoring methodology under the Clean Development Mechanism established by the project promoters allowed a new source of funds to be tapped, which not only allowed more plants to be built in the 5 Blocks of Kolar District in one year than in all the previous 5 years put together, but the promoters also were able to reduce their dependence on government, and enter into commercial agreements for the sale of a commodity (CERs) with an international renewable energy company listed on the French stock exchange.The new idea implemented here is the tapping of new source of funds, namely sale of CERs to construct biogas plants for poor households in rural areas. 5500 households benefited directly. Once the new amended methodology is approved, another 10 to 50 million households in India will switch from fuel wood to biogas. The new methodology will also be applicable for all other countries. Thus many millions in other countries will be benefited too. Each project size may be around 15'000 households. The new methodology is expected to be submitted in April 2007 and approved before CoP13 MoP3 in Bali in December 2007. Individual benefits: Reduced health hazards associated with unmanaged waste in back yards and village streets; and avoided health hazards from indoor air pollution; and reduced drudgery. Social benefits: The community as a whole becomes more productive as women can get the children fed easily in the morning, and the children get to school on time. Leisure is increased in the home, and cooking and eating together becomes a greater social pleasure, as the home is smoke-free. Training in chemistry of biogas for masons and users leading to improved scientific temper in community.Economic benefits: Savings to the national economy by providing renewable cooking fuel instead of kerosene or LPG which has to be imported at great cost as fuel wood is scarce and no longer socially acceptable; and higher productivity of workers as they have adequate cooking fuel supply and can thus eat better and relax more in the home after work; and the economy benefits from technological progress through local innovation improving the Deenabandhu biogas digester management, for example through recycling of dung, and Ph control, thus improving biogas yield and eliminating any residual methane emissions.Environmental benefits: Reduced local environmental pollution through a better waste management system; and soil improvement by providing high quality manure; and avoided global environmental pollution by switching from non-renewable biomass or fossil fuels such as kerosene to biogas, thus leading to reduction of GHG emissions. Project effects on companies: The project provides a new mechanism by which companies can commercialize domestic biogas through the revenue stream provided by CERs (certified emission reductions) without depending on subsidies. Project effects on governments: The Government of India is keenly interested in promoting such projects. Project effect on international organizations: Hedon newsletter, various cooking stove projects, Berkley Lab stove project, and others are keen to get the new methodology approved. Project effect on NGOs: Many NGOs have approached the project promoters to join in the new financing opportunities to bring the benefits to the people. Individuals - around 300 masons and 90 NGO staff members got employment out of the project, and 5500 users were paid as much as Rs 1100 for contributing their labor to their project, with which they were able to buy pressure cookers and other useful goods. Society: Other households – both rural and urban households are now encouraged to build biogas plants; A veritable biogas movement is spreading in Bangalore independently. The nominee is supporting urban households to build biogas plants. Economy: Biogas can reduce these fossil fuel energy requirements and make a large difference to the requirement for fossil fuel imports. The nominee is trying to persuade the Government of India to accept the need for emission reductions in India too, in order to create a greater momentum for biogas. A total of 1.1 million Euros was injected into the local economy. Environment: In addition to reducing greenhouse gases, biogas relieves the stress on trees in drought prone areas. Other corporate organizations - In future, the nominee expects to be able to show many new companies the way forward in the renewable energy field, by helping them understand how clean energy can generate Certified Emission Reductions or other new types of environmental market revenue streams. Sustainability: The project will save trees from being cut for to meet the cooking fuel needs of households; Biogas manure is excellent fertilizer for depleted soils; economically, a biogas plant is part of an integrated holistic local economy where dung from cows is an extremely useful by-product.

25. WILL SRF LTD INDIA BE ANY OBLIGATION TO CONTINUE DESTRUCTION OF HFC-22 EVEN AFTER THE END OF THE PROJECT. WHETHER SRF LTD INDIA HAVE TO RE-SUBMIT NEW CDM PROJECT FOR HCFC-22 AFTER 2014. AWAITING YOUR VALUED REPLY. WITH REGARDS, S.K.MURARKA
Dear Murarka, The GHG emission reduction by thermal oxidation of HFC 23 at refrigerant (HCFC-22) manufacturing facility of SRF Ltd has a crediting period of 01 Jul 04 - 30 Jun 14 (Fixed). Its up to the company after the crediting period to continue or not with the project without the benefit of carbon credits. The rules of the crediting period for each CDM project is "Project participants shall select a crediting period for a proposed project activity from one of the following alternative approaches: A maximum of seven years which may be renewed at most two times (maximum 21 years), provided that, for each renewal, a DOE determines and informs the EB that the original project baseline is still valid or that it has been updated taking account of new data where applicable; or A maximum of ten years with no option of renewal. SRF has taken the fixed 10 year crediting period, so that should answer question In regards to quesion 2, a UN report released yesterday states the following for HFC projects- "HFC-23 destruction projects at new HCFC-22 plants. The eligibility of such projects has been under negotiation for a few years. If approved, they could generate large quantities of CERs." So according to the report by the UN only new HFC projects henceforth would be allowed for CDM benefits.

26. sir how can i start my carbon credit business and how can i earn carbon credits
Dear Pankaj, Your options are many. It depends where you see youself, on the buyers (carbon credis) or sellers side. Also, are you entering the market as a project owner or as a project developer. Are you asking about how best to earn carbon credits from your own project or do you want to act as an agent on behalf of other project owners? Its hard to guide you without knowing the above. The market is very transparent and your options are many.

27. I have read about maximum limit for small scale cdm projects(15 MW,15 GWH etc.). please tell me about minimum limit for such project. I am learing CDM by net. please tell me where can I get formal training for PDD development and validation.
Dear Deepak, With the new Programme of Activites in place, many smaller projects can now be bundled under a single project activity. Research and experts suggest that a potential CDM project needs to generate at least 2000+ carbon credits per annum just to break even due to the high transaction costs (PDD costs, validation etc). So take that as your base before looking into the CDM potential. You might also want to read up on the VER market as well, just in case you find it hard to get CERs.

28. Please tell me about mba in carbon trading
Dear Richa, Current managers need information about emerging national and international science, policies and market opportunities, and they need to develop the relevant strategic tools so as to make confident decisions and engineer organisational change. This is exactly what the MBA in Strategic Carbon Management aims to deliver and it is the first and only course of its kind internationally. Please click on this link for more information http://www.carbonyatra.com/news_detail.php?id=522

29. What is “bundling”?
Bundling refers to the gathering of numerous small-scale CDM projects into one CDM project activity (i.e. one PDD). The main benefit stems from reducing the transaction costs. The number of projects that can be bundled is not limited as long as the total size of the bundled project activity does not exceed the criteria for any of the small-scale project type.

30. What MCF needs to be considered when waste is piled above ground or is disposed on land which is not designated “soild waste disposal site”?
The Meth Panel would like to clarify the following: i. The Tool is applicable for calculating baseline emissions of methane from waste that would in the absence of the project activity be disposed at solid waste disposal sites (SWDS). The definition of SWDS, as per IPCC 2006 Guidelines, can include both managed and unmanaged sites. As long as the land where the waste is disposed off satisfies the definition of either managed or unmanaged SWDS, then the Tool can be used. ii. If the land where the waste is to be disposed off satisfies the definition of unmanaged SWDS and the depth is less than 5 meters, then an MCF of 0.4 can be used. iii. The MCF values given in the Tool does not cover the case of piles since piles have a large surface area to volume ratio and therefore, anaerobic condition is not ensured as in the case of SWDS. However, the project proponents are welcomed to suggest revisions to the Tool which proposes MCF values for the case of piled waste.

31. What is the present SF6 emissions from electrical utilities in india and what measures need to be taken to reduce it and what is the expected reductions by them? Parag Jain parag.jain@iitkgp.ac.in
Quantification will be difficult. But protective measures like advanced gasket, Timing option for spark delay and advanced digital control for HT breakers are some of the options> You may contact me further at sray@cantorco2e.com

32. Dear Sir, From the little info I have about CERs and EAUs I understand that the prices of CERs will always be lower than EAUs as EAU is already granted but CERs will be issued after some period and performance of the project. Then Sir, How come the current EUA prices hover around 0.25 Euros and that of spot CER around 11-12 Euros. Thanks Rajiv Tated etated@gmail.com
You are right. EUA has stringent penalties for non performance. Hence higher the risk greater is the reward. What you are referring is EUAETS phase -1 upto 2005 which is trading at the price you mentined. EUETS phase-II is trading close to 20 EUROS per ton of CO2 reduction. You may contact me at sray@cantorco2e.com Thanks and happy CDM learning

33. Sir , We have access to more than 500 acres of barren land , which we would like to reforest and to sell carbon credits . How do i porceed ? From padmanaban padhujpsl@gmail.com
As per UNFCCC strictures the barren land before 1990 must not be under vegetation. You can claim CDM benefits by reforestation under these circumstances. Thanks pl contact me at sray@cantorco2e.com

34. What should i pay my broker for marketing of my CDM Project as i have resources to negotiate the ERPA? Siddharth Kumar convenienttruth@yahoo.com
Very difficult question my friend. I too am a broker and usually charge 5- 7% of success fee depending on the type of projects. Thanks sray@cantorco2e.com

35. WHAT IS THE LIKELY CER SPOT RATE IN EUROS IN THE YEARS TO COME?
Dear Mr Agrawal Phase I allowances traded under 30c for most of last week. With little interest coming from utilities the outlook for Phase I prices is bearish with prices below 50c to be expected for the rest of the year. The Phase II market was buoyed by the EC's strict ruling as well as a strong German power market. With buying interest for Phase II allowances increasing and little supply coming to the market, Phase II prices are set to stay strong over the year, unless there is a crash. Experts we've spoken to suggest that The price range varies. After discounts you could be looking at Euro 8-10 per CER. If buyers are coming in earlier into the project then the price would be lower than say if we were to enter the project just a few days away from registration. If you have already received registration you could get spot prices for CERs. The other thing that affects prices is whether projects are guaranteeing delivery or just best bet efforts. The price depends on the volumes. The key factor currently determining CER prices is the perceived shortage in the EU emissions trading scheme and the minimum price as defined by the Chinese government for CER sales by Chinese project developers. This currently is set at 8 Euro/CER.

37. When is the ideal time to start a CDM project?
Except in a few cases, it is advisable to start the CDM process early. This not only allows the project to claim CERs as early as possible but also attracts the debt lenders (e.g. investors) more early in the process. If unsure, contact a CDM advisor, who will be able to give a fair indication of CDM eligibility and CER yield based on the limited information. This will enable project proponents to decide whether to put further resources into exploring the CDM opportunity.

38. How can I demonstrate that a project activity is additional?
The CDM Executive Board has provided further clarification to assist project developers to demonstrate additionality. This includes: a) A flow-chart or series of questions that lead to a narrowing of potential baselines options; b) A qualitative or quantitative assessment of different potential options and an indication of why the non-project option is more likely; c) A qualitative or quantitative assessment of one or more barriers facing the proposed project activity; and/or d) An indication that the project type is not common practice in the proposed area of implementation and is not required by a Party's legislation or regulations.

39. Could you give me an approximate breakdown of costs associated with PDD, GOVERNMENT APPROVAL, APPLYING A METHODOLOGY, VALIDATION. Could you also tell me about the timelines associated with the whole process?
The following are approximate costs and timelines: 1. FILL IN A PROJECT DESIGN DOCUMENT (PDD) Cost : 15,000 Euro (with approved methodology) Cost : 45,000 Euro (new methodology) Preparing a PDD involved estimating your green house gas emissions from your project, reference scenarios and leakages. The PDD has to then build an argument to show that funds from CDM are needed for the project to go forward. This step is what attracts the high fees for PDD development. 2. APPLY FOR GOVERNMENT APPROVAL In India, National CDM authority clears sustainable development criteria for projects, usually within 60 days. 3. CHOSE AN EXISTING BASELINE/METHODOLOGY OR PROPOSE A NEW ONE. If the project is a first of it’s kind then it will probably have to propose a new methodology. (If an approved project methodology applies to the project, proceed to step 4) Cost : 30,000 Euro. Proposing a new methodology is a time consuming process. Consultants charge a lot more for projects that require a new methodology. The new methodology is reviewed by a panel of experts constituted by the Executive board called the "Methodologies Panel" before final board approval. This process can take 12-18 months to get approved. 4. Hire a Designated Operation Entity for Validation Cost: 7000-15,000 Euro There are 11 DOE’s worldwide and 5 operation in India. They review the projects to make sure they fulfil CDM criteria, and act as a intermediary between the project developer and the Executive Board. After the DOE clears the project it submits a request for registration to the UNFCCC Executive Board. 5. Wait for Approval from the Executive Board Cost : 4,000-25,000 Euro The CDM Executive Board meets 4-5 times a year, and is charged with giving final approval or registration to projects. 6. Hire a Designated Operational Entity for Verification Cost : (not known) The DOE’s are called in second time after the project is registered for the monitoring phase. For large scale projects, the DOE for Verification cannot be the same DOE as for the validation stage. Once the DOE is satisfied that the green house gas reductions that were set out have been achieved, those emission reductions are certified.

40. Reducing power and cooling to conserve on energy have become such "hot" issues in the IT industry. How much does it cost to power 100TB (raw) of storage, and how much CO2 emissions are generated per year
IT equipment energy costs need to reflect cooling costs that can be as much as twice those of the actual IT equipment, depending on the PUE (power usage effectiveness) of the data center. A typical gallon of gasoline will on average generate about 20 lbs of CO2. Approximately (this number is constantly changing) 78% of CO2 emissions in the U.S. are tied to electrical power generation. Carbon offset credits from organizations such as Terrapass can cost in the range of $250 per lb up to 10tons of CO2 and $200 per pound for larger quantities up to 35 tons of CO2. It all depends on the type of storage, the number and size of the disk drives, the cost per kWh of power, cooling costs and the average number of lbs of CO2 produced per kWh. One example is a single storage system using 750GB SATA disk drives yielding 144TB of raw storage in a single cabinet footprint, which would require less than 52,560 kWh and cost about $10,512 per year with an emissions footprint of about 39.42 CO2 tons. To account for cooling costs, simply double the above numbers for a worst-case scenario. By comparison, a 1999 Chevrolet Tahoe generates about 7 to 10 tons of CO2 per year, while a Lexus RX333, generates about 5-6 tons of CO2 per year, and a 24 cubic foot refrigerator yields about 1.22 tons of CO2 per year. Vendors are taking different approaches to power and cooling, with some like HP leveraging their services organization to perform energy audit assessments to tune and reduce cooling requirements. By reducing cooling requirements, HP has demonstrated in its own data centers that it can achieve quick reductions in energy consumption. Sun has partnered with PG&E to help its server customers gain energy rebates for using more energy efficient servers.

41. We, a NGO, do mass tree planting in villagers' farm lands. We need support in fund raising. How carbon credits can help us to raise funds?
What is the plantation, how big is the area, does it fall under UNFCCC guidelines. Typically a qualified reforestation area garners 8-13 CERS per Hectare. Thanks

42. Will the CER/ERU market become detached from the EU ETS? Basak Beyazay
Definitely not until 2012 sray@cantorco2e.com

43. I would appreciate any information on methods used to estimate GHG emissions from solid waste landfills. Of particular interest are those references where methods are compared to each other and those that focus on endorsements of certain methodologies - e.g., EU member country specified.
Mostly it is mathematical modelling. Can I request you to visit Approved Methodolgies AM oo2, AM003, AM010, AM011 in the UNFCCC web site pl. Thanks sray@cantorco2e.com

44. What is leakage and a project boundary?
Leakage is defined as the net change of anthropogenic emissions by sources of greenhouse gases (GHG) which occurs outside the project boundary, and which is measurable and attributable to the CDM project activity. The project boundary encompasses all anthropogenic emissions by sources of greenhouse gases (GHG) under the control of the project participants that are significant and reasonably attributable to the CDM project activity.

45. How do developing countries benefit from CDM?
The Kyoto Protocol (Article 12) states : “The purpose of the Clean Development Mechanism shall be to assist Parties not included in Annex I in achieving sustainable development and in contributing to the ultimate objective of the Convention, and to assist Parties included in Annex I in achieving compliance with their quantified emission limitation and reduction commitments”. The idea was that developed countries get some flexibility in emission reductions in exchange for bringing investment into developing countries for projects and technologies that reduce green house gases. International Buyers of CDM, Country governments in Annex I are the ultimate beneficiaries of CERs. However several private players are also involved in CDM, acting as brokers and intermediaries. Private funds that buy and sell CERs are also active.

46. my test question
my test answer goes here...

47. Does anyone have any background information on the reasons behind the expansion of this portion of the methodology (especially as it pertains to landfills)? It seems particularly onerous on the exhaust emissions. Can they not just measure the methane in the exhaust? Thanks in advance! Joy Williams joy.williams@carboncapitalmarkets.com
Unfortunately not my friend. Refuse has n no of components with varied methane emission factor and that goes on changing with the time and the extent of fill. Therefore assessing electronically say at the matured status of the landfill the Municipality does not like to invest on one such costly instrument. Even after capping the methane generation fluctuates. They have found a novel way to split the contract into operation and capping AND trading carbon. Hope I could address your querries, Thanks sray@cantorco2e.com

48. What is the typical price range for documentation preparation for credits (PIN, PDD, methodology) Aksgar
Depends on complexity of the project in any case. For PIN, PDD and registration for a large scale project will be around 6 lacs INR excluding validation and registration fee which comes seperate. Thanks sray@cantorco2e.com

49. How do you go about price discovery and will there be an Indian spot market for trading CERs?
Price discovery is market demand depending on demand supply projection and the strength of Climate change programs. Regards sray@cantorco2e.com