Huckbody Environmental has been commissioned by the World Bank to advise on safeguard issues for the green Investment Scheme in Poland.
International Emissions Trading (IET) is a mechanism under the Kyoto Protocol (KP) that allows Annex B (industrialized) countries to sell their surplus emission allowances (or Assigned Amount Units; AAUs) to other Annex B countries that are not able to meet their Kyoto commitments. Potential AAU buyers have indicated that support from their domestic constituencies for buying surplus AAUs could be secured only if the proceeds from IET transactions are used for projects or programs that reduce greenhouse gas (GHG) emissions or have other tangible environmental benefits. Therefore some EITs have proposed establishing a Green Investment Scheme (GIS) to satisfy potential buyers’ concerns that AAU proceeds be channeled to projects and programs that yield environmental benefits.
Poland has considerable amount of surplus AAUs and intends to sell about 100 million AAUs during the current Kyoto commitment period using GIS. The funds from the sale of AAUs would directly or indirectly result in emission reductions and would be used for investments a large-scale program to improve thermal insulation in houses and offices, and also to replace coal-and oil-fired boilers with new biomass units. The GIS priority sectors would include: (i) Biomass-fired power plants; (ii) Energy efficiency in district heating and co-generation; (iii) Energy management in public buildings; (iv) Agricultural biogas plants; and (v) Upgrading electricity grid for connecting renewable energy sources.
