Russia submits 1st Kyoto CO2 offset project to U.N.

LONDON (Reuters) - Russia has submitted its first clean energy project to a U.N. climate panel for registration to earn carbon credits under the Kyoto Protocol, the United Nations’ Convention on Climate Change (UNFCCC) said on Monday.

The project is located at Shaturskaya thermal power plant near Moscow and involves building an additional generating unit using a combined-cycle gas turbine.

The submission could signal a substantial increase in the number of projects in the Kyoto Protocol’s Joint Implementation (JI) mechanism, the UNFCCC said in statement.

The project is one of 15 the Russian government approved at the end of July, which a government official said would have the potential to generate 30 million carbon credits, called emissions reduction units (ERUs), up to 2012.

Under JI, companies can invest in carbon-cutting projects in nations that signed up to emissions targets under Kyoto, and in return receive ERUs, which can be used toward their own corporate emissions targets or sold for profit.

The projects must be approved by the host country first and then are subject to vetting by third-party certifiers and the JI’s supervisory committee (JISC) before they qualify to earn emission reduction units (ERUs).

The JI mechanism was worth $354 million last year, according to the World Bank.

“This is an extremely positive first step, considering that Russia is the country with the largest potential for JI. The carbon community has been waiting for this for four years, since the JISC launched the Track 2 procedure,” said JISC chair Benoit Leguet.

Registration should be finalised after 45 days, provided the project passes scrutiny by the JISC, the UNFCCC said.

According to U.N. data, Russia is home to 103 projects, or 61 percent of those in the JI pipeline. They are capable of cutting some 229 million tonnes of carbon dioxide by 2012, or 57 percent of the total estimated cuts.

Reporting by Nina Chestney; Editing by Jane Baird