Transcript EcoSecurities Group plc

CleanTech and Carbon in the
Pacific Northwest
Seattle, WA
November 8, 2007
© 2006 EcoSecurities Group plc
Carbon credits - origination to commercialisation
Presentation Preview
1) Environmental Markets Don’t Work without a Legal Framework
Oregon’s Bottle Bill in early 1970s
Portland vs. Vancouver, WA
Carbon Markets Today
US vs. Europe and Japan
2) Once the rules are set, there are many opportunities.
Will describe many concrete opportunities
Will describe how EcoSecurities partners with technology providers
© 2006 EcoSecurities Group plc
Carbon credits - origination to commercialisation
The Kyoto Protocol
Annex I
Non-Annex I
Not ratified
© 2006 EcoSecurities Group plc
Carbon credits - origination to commercialisation
Emissions Trading between Annex 1 Countries
> Based on historic emissions, each nation is granted a
certain number of allowances through a National
Allocation Plan.
> If Nation A emits less than its total number of allowances
(EUAs), it can sell it’s extra credits to Nation B.
> This trading can happen between nations or between
capped companies.
© 2006 EcoSecurities Group plc
Carbon credits - origination to commercialisation
Emissions Trading
between Annex 1 and non-Annex 1 Countries
U.N. – approved emissions reductions from a Non–Annex I
country can be sold – as CERs -- to an Annex I country
Non – Annex I (e.g. Mexico)
Annex I (e.g. England)
Carbon Credits (CERS)
A CDM project reduces
the GHG emissions
in the CDM country
Actual emissions
Emission
cap
Carbon value ($)
Buyer
© 2006 EcoSecurities Group plc
Seller
Carbon credits - origination to commercialisation
The EU ETS and European emissions
> The EU ETS sectors (turquoise) currently account for approximately 46% of
the emissions of the EU, over 2 billion tonnes of CO2 emissions per year
covering approximately 11,000 industrial installations
Services &
Agriculture
6
Household
15
31
3 Refineries
Transportation 24
3
8
Other Industry
© 2006 EcoSecurities Group plc
Power
13
6
Other Energies
Iron & Steel
Cement
Others
Carbon credits - origination to commercialisation
The Kyoto Protocol
Annex I
Non-Annex I
Not ratified
© 2006 EcoSecurities Group plc
Carbon credits - origination to commercialisation
Originating CDM Offsets:
Selling Non-Annex 1 Credits to Annex 1 Emitters
Finance & Accounting / HR /
Legal / IT / Marketing / CSR
Origination
Investment
© 2006 EcoSecurities Group plc
Implementation
Commercialisation
Consulting
Carbon credits - origination to commercialisation
EcoMethane Partnership
Aguascalientes project, Mexico
© 2006 EcoSecurities Group plc
Carbon credits - origination to commercialisation
N2O from nitric acid plants

EcoSecurities is the largest developer in the world (24 million tonnes from
27 projects)
© 2006 EcoSecurities Group plc
Carbon credits - origination to commercialisation
Other Kinds of Emissions Reduction Projects
Landfills
Small scale hydropower
Agricultural biodigestors
Pig waste biodigestors
Biomass and waste mgt
Industrial energy efficiency
Current projects use 18 technologies in 36 countries
© 2006 EcoSecurities Group plc
Carbon credits - origination to commercialisation
Future CleanTech Partnerships
1. Agricultural methane digesters for bovine and porcine
power generation.
2. Small dimensional wood pelletization for biomass fuel
switching.
3. High tech, GPS-guided precision agriculture.
4. Satellite-monitored avoided deforestation.
5. Programmatic energy efficiency.
6. Transportation.
© 2006 EcoSecurities Group plc
Carbon credits - origination to commercialisation
Implementation Process
EcoSecurities guides projects through this process
The project cycle is convoluted, time
consuming, and demands specialized skills
EcoSecurities implementation team has 64
skilled professionals, working with
sophisticated internal tools and systems
Experience leads to successful track record of
implementation:
>
13 new methodologies approved
>
Approximately 90 Projects Registered –
and growing every week
PIN=Project Idea Note, PDD=Project Design Document, PP=Project Participant,
DNA=Designated National Authority, DOE=Designated Operational Entity
© 2006 EcoSecurities Group plc
Carbon credits - origination to commercialisation
Supply considerations - I
CDM Risks and Rewards
High Risk with
binary outcome
Even on issuance,
ongoing performance
risk from project.
Requires close
relationship with
project to maximise
projected output
CER price
Import to EU ETS
Issuance
Verification
Monitoring
Registration
Validation
Host country approval
Production Cost
© 2006 EcoSecurities Group plc
Carbon credits - origination to commercialisation
Guaranteed Delivery Transaction
>
EcoSecurities delivers CERs from the portfolio, not specific projects
>
Delivery risk removed from buyer (firm volume)
>
EcoSecurities pays liquidated damages in case of non delivery
>
Utilising portfolio approach and adding value to the transaction
>
Projects kept in portfolio until final issuance
>
Sales price dependent on EUA reference price
Project A
“ secondary”
CERs
Project B
Project C
Project D
EcoSecurities
Net-Portfolio
Buyer
Delivery
Risk
Project E
© 2006 EcoSecurities Group plc
Carbon credits - origination to commercialisation
Recap
1) Environmental Markets Don’t Work without a Legal
Framework.
2) Once the rules are set, there are many opportunities. If
your technology significantly reduces GHG emissions,
contact us.
© 2006 EcoSecurities Group plc
Carbon credits - origination to commercialisation
Thank you.
Steve Gutmann
Senior Commercialisation Manager
EcoSecurities
[email protected]
503-333-7564
© 2006 EcoSecurities Group plc
Carbon credits - origination to commercialisation