The first Ukrainian TGF project reduces natural gas and electricity consumption through the recovery of waste heat in a coke plant in Alchevsk city, Luhansk region of eastern Ukraine. This is one of the largest industrial enterprises in the Donbass region.
The project consists of captive cogeneration with waste heat recovery at Alchevsk Coke Plant (OJSC Alchevskkoks) to displace the use of natural gas and (30 GWh p.a. of) grid electricity. The project entails installation of a waste heat recovery system, a highly efficient boiler firing coke oven gas (COG) and blast furnace gas (BFG) and a 9 MW turbine generator connected to the boiler, generating up to 54 GWh p.a. of net electricity. In total, the project is expected to reduce carbon dioxide emissions by over 1.1 million tonnes of carbon dioxide equivalent during 2008-12. These will result in Emission Reduction Units (ERUs), which will be procured by the TGF.
The project has been developed as a JI project by the Japanese Sumitomo Corporation which also has extensive international experience in the deployment of the project technology.
“We are pleased to conclude our first major Joint Implementation project in Ukraine, working with Ukrainian and Japanese partners to introduce low emission energy generation technology into this important industrial sector” stated Ash Sharma, Head of Carbon Finance and Funds at NEFCO.
The JI project has received a determination report from accredited entity Bureau Veritas Certification and Letter of Approvals from the Designated Focal Points of Japan (September 2009) and Ukraine (December 2009). The project is presented for final determination under the Ukrainian Track 1 of the JI mechanism.
The TGF has been active since 2004 in the Joint Implementation segment of the Kyoto market, with an emphasis on Russian Federation, the Baltic countries and since 2006, in Ukraine. Its focus has been renewable energy and energy efficiency. The EUR 35 million facility has now ceased its active procurement, and is in now in the portfolio management phase.
The transaction was arranged by CF Partners.
Information for Editors:
NEFCO is an international finance institution owned by the five Nordic countries. NEFCO finances investments and projects in Russia, Ukraine, Estonia, Latvia, Lithuania and Belarus, in order to generate positive environmental effects of interests to the Nordic region. Since 2004, it has been the Fund Manager of the Baltic Sea Region Testing Ground Facility (TGF) and in April 2008, it established the NEFCO Carbon Fund (NeCF).
In total, NEFCO's Carbon Finance and Funds team has approximately EUR 121.60 million of assets under management (AUM) and financial resources of up to EUR 135 million The CFF investor community now includes the five Nordic governments, Germany and 10 private companies. The TGF is a public-private partnership that is directed at both private investors who have obligations under the EU Emission Trading Scheme (EU ETS) and sovereign investors who have greenhouse gas emission targets under the Kyoto Protocol. The NeCF buys carbon credits from UN-approved emission reduction projects around the world on behalf of its investors. Investors can use these credits towards their international commitments.
For Further Information, please contact:
Ash Sharma, Senior Investment Manager, Head of Carbon Finance and Funds, NEFCO, tel. +358 400 811 327, e-mail: ash.sharma@nefco.fi
Ms Ruiko Kato, Manager, Sumitomo Corporation, e-mail: ruiko.kato@sumitomocorp.co.jp
Vasyl Viovchak, Director, Institute of Environment and Energy Conservation (representative of Alchevsk Coke Plant), e-mail: vovchak@ippe.org.ua
Hanna-Mari Ahonen, Project Manager, NEFCO, tel. +358 50 302 0370, e-mail: hanna-mari.ahonen@nefco.fi
Mikael Sjövall, Communications Manager, NEFCO, tel. +358 50 3535 045, e-mail: mikael.sjovall@nefco.fi
