Standard Bank, Africa’s largest bank by assets, is to help replace kerosene lamps with hand-held LED lights in 31-million homes in Tanzania, funding the scheme by buying the carbon credits generated through the large scale replacement of fossil fuel lighting.
In terms of the Kyoto Protocol, such initiatives are registered for the allocation of carbon credits with the Clean Development Mechanism (CDM) Executive Board of the United Nations Framework Convention on Climate Change (UNFCCC).
By trading these credits in a market worth 180 billion US dollars globally, industrialised countries are able to invest in projects that reduce greenhouse gas emissions in developing countries.
This, in turn, enables industrialised nations to sponsor a net global reduction in carbon emissions at a lower overall economic cost for themselves.
Through its subsidiaries and branches in Africa, where it has been involved in the lives and businesses of citizens through traditional transactional banking, Standard Bank has been able to identify and develop projects that lend themselves to funding by means of carbon trading.
“We’ve been working very hard during the past two years to bring the projects to fruition – and the Tanzania LED light initiative is the first of several that will get off the ground in 2011,” says Fenella Auoane of Standard Bank’s London-based carbon trading division.
ILLUMI Nation Tanzania, which owns the LED project, estimates that it will save households with an average annual income of only 150 US dollars nearly one third of that income. The total national saving will be some 200 million US dollars.
Tanzania’s greenhouse gas emissions will be reduced by 800, 000 tonnes, benefiting the planet as a whole and significantly reducing health problems in Tanzania resulting from burn injuries and the inhalation of kerosene gas.
In addition to leading the use of carbon credits on the continent, Standard Bank is also pioneering the UNFCCC’s use of provisions for the “programmatic” Clean Development Mechanism. In this approach, rather than approving each individual installation, the UN approves a program of activities that is then audited for carbon credits.
This new mechanism is particularly suited to Africa, given that many sustainable development project opportunities in sub-Saharan Africa comprise the mass application of “micro” technologies, the statement noted.
“We believe that it’s possible to make a profound contribution to the physical and economic health and well-being of individual nations and the world at large by applying sophisticated financial instruments to the needs of grass roots populations,” Ms Aouane says.
“The fact that we’re on the ground in Africa positions us ideally to combine local insight with our global capability in carbon trading in order to tailor answers and funding that very accurately meet the need for sustainable development on the continent.”
The ILLUMI Nation project is only the second one in Tanzania since 2007 to be based on carbon trading. Standard Bank is also involved in a solar water heating project for low cost housing in South Africa.
Standard Bank, the United Nations Environment Programme (UNEP), and the German Government have launched the Africa Carbon Asset Development (ACAD) facility – a public private partnership between UNEP and African banks that aims to stimulate the growth of Africa’s carbon market through investor outreach and seed capital.
ACAD’s focus is on using carbon trading to provide wide-ranging economic, environmental and social benefits to Africa – including new revenue streams, access to energy, job creation and technology transfer – by deploying local, market specific solutions and partnerships.
At Sceptre, we have partnered with key companies within the carbon market to offer our clients the best quality credits available in both the voluntray and compliant markets. Sceptre is both a member of the Carbon Trade Exchange in London which has develped the worlds largest electronic spot trading platform for voluntary markets. The demand for these voluntary offsets, fuelled by corporate commitments to become “carbon neutral,” is growing rapidly.
Visit our website for more information: www.sceptreinternational.com