Govt eyeing up CDM projects
Govt eyeing up CDM projects
Dewi Santoso, Jakarta
Indonesia is in negotiations to secure two Clean Development
Mechanism (CDM) projects in the energy sector as part of the
Kyoto Protocol, which the House of Representatives endorsed last
month.
Deputy State Minister for the Environment Sudariyono said on
Thursday that the Dutch government and German-based drug producer
Bayer had shown interest in the projects, which will be in
cooperation with state enterprises and cement producer PT
Indocement respectively.
"We hope to strike the deal by the end of this year and start
the projects soon afterwards," said Sudariyono.
A Memorandum of Understanding (MOU) is now being drafted to
provide the basis for the cooperation, which includes the price
set for one ton of carbon emissions resulting from the program.
Sudariyono said the Dutch government might agree to pay 5 euro
per ton of carbon emission.
The CDM program is part of the Kyoto Protocol, in which
advanced countries are required to invest in developing countries
to reduce green house gas (GHGs) levels through clean energy
power plants and reforestation projects.
Although the protocol will not be legally binding in the world
until Russia ratifies it, Sudariyono said many European
governments would still utilize the project.
As an international treaty intended to lower greenhouse gas
emissions, the Kyoto Protocol was signed by 159 countries in
1997. Of the signatories, 123 countries have ratified it, 40 of
them are industrialized nations that agreed to bring down their
greenhouse gas emissions by 5.2 percent from their 1990 level by
2012.
By ratifying the protocol, Indonesia expects to open the door
for developed nations to "trade" carbon emissions by investing in
the use of renewable energy production and the replacement of
fossil fuels with renewable sources through clean energy and
reforestation.
Reforestation is likely more effective in lowering GHG levels
as it absorbs more carbon emission (a total of 28 million tons)
as compared to energy sector (8 million tons). But the former is
not as attractive to buyers.
"I think the reason is largely because unlike forests, which
can cover hundreds of hectares of land, the energy sector is
easier to control as it takes place in a limited area,"
Sudariyono said.