Peru could attract US$4 billion in carbon emission reduction certificates

Lima, March 7, 2008.- Peru currently has over 70 projects under the Clean Development Mechanism (CDM) with an approximate value of over US$4 billion through issue of carbon emission reduction certificates, CAF representative in Peru Eleonora Silva Elinor said on opening the workshop "Opportunities of Clean Development Mechanism (CDM) for the Peruvian public and private sectors."

The workshop was organized to promote formulation and evaluation of eligible projects, as well as the tools to facilitate identification, implementation, financial analysis and marketing.

The CAF representative said that Peru had great potential for the Latin American carbon market. Over 70 projects have been identified which could be placed on the market in coming years, of which 14 have been registered with the United Nations, making possible the production of Emission Reduction Certificates (ERC) for buyers.

In 2007 a total of 2.7 billion tons of CO2 were exchanged on the global carbon market, with a financial value of over 40 billion euros, 80% more than in 2006, the official added.

The keynote presentation of the workshop was given by Mary Gómez of the CAF Latin American Carbon Program, who explained that Emission Reduction Certificates (ERC) could be sold to countries which have carbon emission reduction obligations, such as the signatories of the Kyoto protocol.

Gomez estimated the international price of a ton of carbon at between 8 and 12 euros (US$12 to 18) on the primary market, 10 and 14 euros (US$16 to 21) on the secondary futures market, and on the spot market which is still small at 16 euros (US$24).

In August 2007 Peru had five projects registered to obtain the ERCs and now has 13. With this upward trend, the country has great possibilities, especially in the sectors of renewable energy, hydroelectricity, natural gas, sanitary landfills, public transport and energy efficiency projects in industry, the official said.

Lastly, Gómez said it was necessary to publicize this financing mechanism so that public companies and projects could obtain higher income.