Holland Buys Emission Credits from a Windfarm in Poland

The Dutch government will buy carbon emission credits from new wind turbines in Poland.

AMSTERDAM, The Netherlands, NL, 2001-04-20 <SolarAccess.com> Economic Affairs Minister Annemarie Jorritsma has signed the first contract under the Emission Reduction Unit Procurement Tender to buy GHG emission reductions in eastern Europe. The credits will help The Netherlands to meet its commitments under the Kyoto Protocol, and are the first transactions of this size relating to the Joint Implementation procedure under the treaty. The contracts are worth NLG 79 million (US$32 million) and will involve the purchase of 4 megatonnes of CO2 reductions over five years. The emission credits will come from electricity generated at a 60 MW windfarm in Poland, a hydroelectric plant in Romania, a series of biomass-fueled boilers in the Czech Republic and two urban heating projects in Romania. The contracts were signed as a result of ERUPT, which is designed to purchase emission credits from projects in central and eastern Europe at a lower cost than reductions in domestic emissions. Poland, Romania and the Czech Republic will benefit from investments that stimulate sustainable economic growth, and the investors in the deal benefit from higher returns on their investments in renewable energy. Ratification of the Kyoto Protocol was jeopardized last year at a meeting in The Hague, when countries could not agree on an emissions trading plan. The United States, Canada and Australia wanted unlimited credits, but that proposal was opposed by Europe and many developing nations. The Netherlands has a policy to reduce half of its commitment under Kyoto from actual reductions, and the balance from credit trading. The wind farm will be installed by NUON in the northwest region of Poland near the German border. The facility of 30 turbines of 2 MW each will generate 125 million kWh per year. Construction will start next April, with completion by the end of 2002. The output will be sold for at least Euro 0.06/kWh, excluding VAT. About 95 percent of Poland’s electricity is supplied by coal, and most coal plants are 30 years old and need extensive updates. Under Kyoto, Poland must reduce its CO2 emissions by 6 percent, and the government is trying to stimulate the market for renewable energy by a new ordinance to the Energy Law that took effect last December. That law obliges utilities to generate 2.4 percent of electricity from renewables this year, and the percentage will rise each year to 7.5 percent by 2010. Nuon is one of the largest utilities in Holland, and it plans to source renewables for 10 percent of its electricity supply by 2010. This target is ten years ahead of the Dutch government’s same target for 2020. Locations for wind farms are difficult to acquire in the Netherlands, and Nuon must produce part of its renewable power abroad.

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