Factories, utilities and airlines snapped up a flood of carbon offsets from Ukraine and Russia to comply with European Union emission targets in 2012 amid speculation the credits would face usage restrictions.
Ukraine supplied 169 million metric tons of United Nations Emission Reduction Units to EU emitters, a more than fivefold increase from 31.5 million tons in 2011, according to Bloomberg New Energy Finance, citing EU data published today. That’s the most of any country supplying credits, the data show.
ERUs are created from carbon-reducing projects in developed nations and countries in transition to a market economy such as Russia and Ukraine. The European Commission, the EU’s regulatory arm, wanted to restrict the use of some ERUs from countries that fail to adopt new carbon goals as of this year.
The use of Ukrainian and Russian ERUs soared on perceptions the credits may no longer be eligible for EU compliance, said Andrea du Rietz, an analyst in London for New Energy Finance.
Russia was the second-biggest supplier of ERUs with 98 million tons in 2012, according to New Energy.
China was the biggest provider of UN Certified Emission Reductions, or CERs, at 155 million tons, New Energy’s analysis of the EU data show. CERs are created from projects in developing countries under the UN’s Clean Development Mechanism.
Use of CERs representing reductions of gases emitted in the making of refrigerators and plastics reached a record 178 million tons last year, or about 81 percent of all offset submissions, the data show. The compares with 85 percent in 2011. The so-called grey CERs are banned from compliance by emitters in the EU cap-and-trade program starting this month.
Supplies of ERUs and CERs were at 2.1 billion tons as of today, according to data from the website of the UN Framework Convention on Climate Change. That’s more than the 1.7 billion tons allowed for compliance in the EU carbon market in the 13 years through 2020, according to that market’s rules.
To contact the reporter on this story: Mathew Carr in London at firstname.lastname@example.org
To contact the editor responsible for this story: Lars Paulsson at email@example.com