Greentech Lead in America: The International Finance
Corp, a World Bank Group unit, may reduce its exposure to carbon projects that
generate emissions credits after 2012.
The unit says its fund for investing in carbon projects
that generate emissions credits after 2012, when the first commitment period of
theUnited Nations’ Kyoto Protocol ends, will probably shrink, according to a
The Carbon Facility Fund of the International Finance
Corp had raised $198 million when it closed in June. The fund faced suspension
in November after plummeting UN offset prices triggered a measure to protect
projects supplying the credits. Investors will probably scale back their
commitments to the fund, according to the corporation.
“I think the fund size will reduce. Watching where the
market settles is the prudent thing to do. The bank’s unit is looking at ways
of changing the structure of the fund and will make a decision around the end
of the month,” said Vikram Widge, head of climate financial products at the IFC
in Washington, said in a March 2 telephone interview.
JPMorgan Chase & Co (JPM), Royal Dutch Shell (RDSA),
and Mercuria Energy Group are among investors that committed to the fund, which
will provide credits that may be eligible for use in the European Union carbon
According to Bloomberg, United Nations carbon prices lost
60 percent in the past year as industrial production stagnated and climate
talks struggled to achieve progress on reaching a global agreement to reduce carbon
The IFC has access to a limited number of projects.
Before it was suspended, the fund had only committed to one carbon project. It
purchased credits for the seven years through 2020 from a biomass power project
in India developed by Shalivahana Green Energy, according to a statement in