First Asia Carbon Lanka (FACL), a newly formed subsidiary of Singapore based Asia Carbon Holding Pte Ltd, is to enhance the capacity among the Sri Lanka enterprises interested in participating Clean Development Mechanism (CDM) projects and voluntary carbon markets with the ultimate aim of providing services to mitigate the effects of global warming.
The company is making carbon trading expertise available for Sri Lankan companies, said Malcolm Chew Managing Director of the Asia Carbon Holding Pte Ltd in an interview with Business Times on the sidelines of the launching ceremony of First Asia Carbon Lanka in Colombo on Monday.
Mr. Chew revealed that FACL has already entered into an agreement with the Dhammika Perera-controlled mini hydro power company Vallibel Power Erathna Ltd (VPEL) to provide consultancy services in ‘carbon risk reduction’ and the company will calculate the ‘carbon footprint’ and develop a strategy for emission reduction. He noted that FACL provides specialised services for Vallibel Power and other local companies to use the CDM and trade carbon credits with developed countries.
VPEL owns and operates a 10 megawatt hydro power plant in Ratnapura while also currently in the process of developing two more projects; the Denawaka Ganga project in Ratnapura which is approved for 4.9 megawatts but has the potential for 7.2, and the Kiriwaneliya project in Nuwara Eliya which is approved for 3.8 megawatt but has the potential for 4.95 megawatts.
The last unit was solely owned by Country Energy which VPEL bought in 2009 for Rs. 200 million. Country Energy is also said to have Standardised Power Purchase Agreements with the Ceylon Electricity Board for both projects.
Among the range of services FACL offers will be CDM Consultancy, Alternative Energy, Energy Monitoring Services, Environment Impact Analysis and many other services ranging from Renewable Energy Consultancy and Water Management/ Water Treatment to Carbon Finance and Emissions Trading.
To control global warming and other extreme climate changes, developed countries that made commitments under the UN’s Kyoto Protocol have been required to reduce the amount of green house gases they release into the atmosphere.
However, if this is not directly possible, the UN’s CDM allows developed countries to implement emission-reduction projects in developing countries like Sri Lanka, he said. Reducing emissions of green house gases such as carbon dioxide, will not only benefit the environment, but can also translate into direct cuts in energy costs for local companies, he added.