Washington, D.C. – Tranche 2 of the World Bank’s Umbrella Carbon Facility (UCFT2) is now operational with initial funding of € 68 million, contributed by Deutsche Bank, GDF SUEZ, and the Swedish Energy Agency.
This Tranche provides the opportunity for existing carbon projects to continue selling their carbon credits well beyond 2012. Seventeen projects and programs are being considered, with a potential to reduce a total of 26 megatons of carbon dioxide and other greenhouse gases during the 2013-2018 period, of which the UCF T2 intends to purchase a portion.
UCFT2 offers fund participants an expected portfolio of projects that is geographically and sectorally diverse. Some of these are located in less developed countries and range from landfill and composting projects to urban transport, energy efficiency and renewable energy initiatives. Four are located in Africa and several use a programmatic approach, continuing the World Bank’s efforts to expand the scope, scale and range of climate change mitigation activities in developing economies.
This Tranche has been developed to complement other carbon funds as it intends to purchase carbon credits far beyond the end of the Kyoto Protocol’s first commitment period, thus, offering project developers longer contract periods than available in the market at the moment. There is still an opportunity for new participants to join the Tranche, which will become fully subscribed when it reaches a total capitalization of €105 million.
“During a period of regulatory uncertainty, the UCFT2 is helping to maintain demand for post-2012 carbon credits. It means we have another tool to help bridge the gap in the carbon markets,” said Joëlle Chassard, Manager of the World Bank’s Carbon Finance Unit.
The funds raised for the UCFT2 increase the amount of capital managed by the World Bank Carbon Finance Unit to over US $ 2.5 billion. The World Bank manages 11 carbon funds and facilities comprised of both public and private sector participants that work to expand carbon markets.
For more information on the Umbrella Carbon Facility, visit: http://wbcarbonfinance.org/Router.cfm?Page=UCF&ItemID=9715&FID=9715
Source: The World Bank Press Release dated January 12, 2011.
