Chinese, French companies agree on emission credit purchase deal

UPDATED: 08:51, October 26, 2006 Via Xinhuanews

State Grid Corporation of China (SGCC) said Wednesday in Beijing that Electricite de France (EDF) has agreed to purchase greenhouse gas emission reduction credits from its biomass power project.

The project, run by National Bio Energy Company, a subsidiary of the SGCC, has given the two companies an opportunity to cooperate under the Clean Development Mechanism (CDM), said Liu Zhenya, general manager of the SGCC, without revealing the value of the deal.

The CDM programs encourage China to improve energy efficiency and protect the environment by using clean energy for electricity generation, said Liu.

Established under the Kyoto Protocol, CDM is a market-based mechanism that allows developed countries to fulfill their greenhouse gas emission reduction obligations by investing in clean energy projects in developing countries such as China.

With rapid economic growth and a large population, China is currently the world's second largest energy consumer and producer and the third largest oil importer. Coal consumption has resulted in much of the atmospheric pollution in China.

National Bio Energy Company, which promotes China's renewable energy industry through biomass power generation, currently runs 14 projects across the country, with an aggregate capacity of 350,000 kilowatts.

The company aims to generate 55 percent of the country's biomass power in 2010, or three million kilowatts, in order to reduce carbon dioxide emissions by 1.2 million tons.

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