First International Trade Signed for GHG Emission Allowances

Entergy Corp of the United States and Danish electricity supplier Elsam SA, have executed the first international trade in greenhouse gas allowances, under Denmark’s climate change program.

NEW ORLEANS, Louisiana, US, 2001-12-19 [SolarAccess.com] Elsam has several wind generating plants, and Denmark and Britain are the only countries with formal GHG trading programs to date. Independently verified emission reductions have been traded for several years, but government programs are creating ‘allowances’ that are likely to be preferred instruments for complying with emissions limitations. The transaction, brokered by Natsource LLC, involves Elsam selling 10,000 Danish emission allowances to Entergy, which intends to remove the allowances from the market and eliminate 10,000 metric tons of emissions. Entergy says its first priority is to reduce GHG pollution within its own operations. “We also believe that seeking out reductions elsewhere in the world will stimulate innovation and create incentives for finding new ways to aggressively cut pollution in the most practical, cost-effective manner possible,” says CEO Wayne Leonard. “The purchase of Elsam’s allowances shows that the global trading markets are an efficient and economical way to reduce greenhouse gas emissions.” The emissions trade is one of two dozen projects that Entergy is pursuing to achieve its emissions stabilization commitment, and the energy company claims to have identified 14 internal and 11 external projects with 3 megatonnes of CO2 reductions to be undertaken with resources provided by its Environmental Initiatives Fund. It intends a further long-term cap by 2005, plus new investments under its voluntary climate change initiative in a variety of other projects to cut emissions, besides its traditional power plant operations. Natsource of New York is a broker of energy products, and takes part in electricity, gas, coal and emissions allowance credit markets with 600 companies in the industry.
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