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Projects : Carbon options for JSC "TNC Kazchrome"

Climate Focus has been contracted by JSC “TNC Kazchrome”, a subsidiary of the Eurasian Natural Resources Company (ENRC), to assess options for monetizing the emission reductions from a waste gas utilisation project at  the Aktobe Ferroalloy Plant in Kazakhstan. The project will reduce emissions with several 100,000 tonnes of CO­₂­ per year by using waste gas from ferroalloy production to dry chrome ore, to dry cokes and to generate power.

Among the various climate finance options, Joint Implementation (JI) and the forthcoming domestic cap-and-trade system stand out. Developing the emission reductions under JI may prove viable under the Cancun Agreements, adopted in the framework of the Kyoto Protocol in late 2010. However, issuance of tradable units is possible only once Kazakhstan obtains the so called Annex B status under the Protocol and receives an allocation of original emission units (AAUs).

Alternatively, the project may be developed under the Emission Trading Scheme (ETS) of Kazakhstan. Kazakhstan adopted a revision of the Ecological Codex on 3 December 2011 making way for a domestic cap-and-trade system. The revised codex entered into force on 18 December with a range of provisions, mostly on allocation of allowances, becoming effective on 1 January 2013.

As part of the assignment, Climate Focus will also look into possible overlaps and conflicts of the different schemes proposing, where necessary, remedies for the avoidance of double counting.