Enel to acquire carbon credits worth 150 million euros from China

05 May 2008

Italy's largest power utility, Enel SpA today said that it would buy 150 million euros worth of carbon credits from China's second largest steel company by market cap, Wuhan Iron & Steel Co, which is building five coal-based ultra-supercritical power projects. Wuhan produces nine muillion tonnes of steel annually.

With this agreement Enel sqays it has become the second largest buyer of CDM in the world.

Enel is is implementing a cooperation agreement with China to promote clean coal technologies with specific reference to ultra-super critical power plants as well as cutting edge CO2 capture and sequestration techniques. If installed at all new coal power plants in China, these technologies would cut down about one billion tons of CO2 per year versus the overall emissions from China's coal power plants that exceed 4 billion tons of CO2 per year as estimated by 2015.

Through the agreement wiith Wuhan Iron & Steel , Enel would acquire 11.45 million metric tons of CO2 emissions allowances, supporting greenhouse gas abatement efficiency projects which are being carried out in the Chinese steel industry. Including this transaction, Enel says it has a Chinese market with a portfolio of CO2 credits from more than 60 greenhouse gas abatement projects, cutting emissions in excess of 70 million tons from 2007 to 2012. 

In addition it has signed a broader agreement for the reduction of greenhouse gas emissions with the  the Chinese ministry of science and technology, as a part of its own agreement with Italy's ministry for environment signed in 2004 to aid in reducing greenhouse gas emissionsto combat climate change.

Enel's agreement the Chinese ministry of science and technology is a part of the Sino-Italian Cooperation Program (SICP) launched in 2001 to identify opportunities for projects aimed at promoting a sustainable development path in China.