Goldman takes stake in carbon company Blue Source

NEW YORK (Reuters) - Goldman Sachs Group Inc has taken a minority equity stake in Blue Source, LLC, a U.S. developer of voluntary greenhouse gas emissions credits, the companies said on Monday.

Under the agreement, Goldman will market the carbon credit developer’s emissions reductions to clients including big polluters, such as utilities that have coal-burning power plants, according to Bill Townsend, Blue Source’s chief executive.

Terms of the deal were not released. A source close to the deal said Goldman will take a less than 10 percent equity stake.

Blue Source says it has logged nearly 40 million tonnes worth of voluntary greenhouse emissions credits on public registries and that it generates another 20 million tonnes of emissions reductions per year. Carbon registries verify the quality of greenhouse gas reductions.

Early movers in the sector hope the value of the credits logged on registries will rise if the United States regulates greenhouse gases. Both U.S. presidential candidates Barack Obama and John McCain say they support capping the gases blamed for warming the planet.

“Interest in the pre-compliance carbon market in the U.S. is growing rapidly and we are excited to be able to offer our clients immediate access to a diverse selection of emission reductions to manage their carbon risk,” Leslie Biddle, the global head of Goldman’s commodity sales said in a release.

Goldman will market verified emissions reductions from Blue Source projects including burning of the powerful greenhouse gas methane at coal mines, waste water treatment, landfills and animal waste. Other projects will include energy efficiency and carbon capture and storage from fertilizer and natural gas plants.

No commercial scale coal-fired plants in the United States practice CCS yet, but a handful could do so by late 2010 or early 2011. “Once construction begins on a few commercial scale facilities at coal plants that will be a bellwether for the industry,” Townsend said in an interview.

Reporting by Timothy Gardner, Editing by Marguerita Choy