Has CDM come of age in the Philippines?

During the recently concluded Carbon Forum Asia 2008 held in Suntec City, Singapore, Michael Dreyer, vice president of Koelnmesse-Asia, co-organizer of the conference together with the International Emissions Trading Association (IETA), noted that “from 2006 to 2007, Asia's CDM market grew by nearly 200 percent, signaling the region's emerging dominance in the global Carbon Market".

The market he is referring to is where carbon credits are traded for projects under the Clean Development Mechanism (CDM) which is under the auspices of the Kyoto Protocol. This market has been growing at a torrid pace in the past three years; from $40.1 billion in 2006 to $66.4 billion in 2007 and should easily top the $100 billion mark by the end of this year. Despite this huge elephant of a market, it is largely invisible in the country.

The Conference noted however, that while China and India lead the pack in the number of CDM projects registered at close to 640, the Philippines, Thailand and Vietnam are not too far behind.

This is welcome news. Has CDM come of age here?

The Philippines is not considered a major contributor to the total greenhouse gas (GHG) emissions worldwide simply because we are not huge consumers of energy on a per capita basis. But we do have a large potential for projects that could generate carbon credits as Carbon Emissions Reduction (CER) certificates that could be traded on the Carbon Market.

 This potential is being watched by mostly foreign vulture investment funds and financing institutions which smell the fragrance of money. That such is the case can be seen by the keen interests of these foreign financiers to ante these projects.

 At the latest count, there are 20 CDM registered projects in the country while much more projects are in the pipeline. Being registered means the project is formally accepted by the Executive Board of the United Nations Framework Convention on Climate Change (UNFCCC), the body in charge of this activity, of a validated project as a CDM project activity. Registration is the prerequisite for the verification, certification and issuance of CERs related to that project activity.

These are, in the order of latest to earliest registered, and the date of registration:

 * First Farmers Holding Corporation (FFHC) Bagasse Cogeneration Plan-10 Sep 08

* Makati South Sewage Treatment Plant Upgrade With on-site powerR-24 Jun 08

* Hedcor Sibulan 42.5 MW Hydroelectric-06 Jun 08

* Laguna de Bay Community Waste Management Project: Avoidance of methane production from biomass decay through composting-16 Mar 08

* Quezon City Controlled Disposal Facility Biogas Emission Reduction Project-01 Feb 08

* The Anaerobic Digestion Swine Wastewater Treatment with On-Site Power Bundled Project-17 Dec 07

* Goldi-Lion Agricultural Development Corporation Methane Recovery and Electricity Generation Project-08 Sep 07

* Bondoc Realty Methane Recovery and Electricity Generation Project-07 Sep 07

* Superior Hog Farms Methane Recovery-07 Sep 07

* D&C Concepcion Farms, Inc. Methane Recovery and Electricity Generation Project-26 Aug 07

* Philippine Sinter Corporation Sinter Cooler Waste Heat Recovery Power Generation Project-05 May 07

* San Carlos Renewable Energy-13 Apr 07

* Paramount Integrated Corporation Methane Recovery and Electricity Generation-31 Jan 07

* 20 MW Nasulo Geothermal Project-10 Dec 06

* Gaya Lim Farm Inc. Methane Recovery-30 Oct 06

* Uni-Rich Agro-Industrial Corporation Methane Recovery and Electricity Generation-28 Oct 06

* Joliza Farms Inc. Methane Recovery-23 Oct 06

* Gold Farm Livestocks Corporation Methane Recovery and Electricity Generation-21 Oct 06

* Wastewater treatment using a Thermophilic Anaerobic Digestor at an ethanol plant in the Philippines-01 Oct 06

* NorthWind Bangui Bay Project-10 Sep 06

 The biggest in terms of carbon dioxide equivalent reduction is the bagasse co-generation plant at close to 120,000 tons/per annum. Other major ones include Hedcor’s Sibulan hydro (95,174 tons), ethanol plant (95,876 tons) and the Bangui Bay wind farm (56,788 tons). Most of the rest are fairly small with reductions in few thousands tons and the credits are better traded in an alternative voluntary carbon market in which smaller players can participate.

 Unfortunately, our businessmen, financial institutions, investment banks and entrepreneurs have not taken advantage of such opportunities mainly through lack of understanding or awareness that such opportunities exist.