• 
• 

Published on April 2, 2008

Private companies in Thailand are beginning to pay more attention to benefits from carbon-credit trading, following their investment in projects that save energy and care for the environment.

However, since carbon-credit trading began with the implementation of the Kyoto Protocol in February 2005, there has been criticism that they are at least two years behind the action.

Due to climate change and the rising cost of energy, many local manufacturers have accelerated their investments in energy-saving projects, and are lowering their emissions of greenhouse gasses as a consequence. This can be used to generate indirect revenue from the carbon-credit business.

The Kyoto Protocol established carbon-credit trading so that greenhouse gas emissions can be reduced at the industrial level. Under what is called the Clean Development Mechanism, companies can be given an allowance of credits, with each credit permitting them to emit a specified volume of greenhouse gas. Those that reduce their emissions below their "allowance" are able to sell the unused credits, at a price set by market demand. This gives the buying company the right to increase its emissions as it has extra credits.

Ube Group (Thailand) has pioneered the world's first project for reducing emissions of nitrous oxide in the production of caprolactam. Nitrous oxide is a greenhouse gas.

Ube's project is expected to help it reduce nitrous oxide emissions by 550 tonnes per year, equivalent to 170,000 tonnes of carbon dioxide.

As well as reducing the emissions, president and CEO Charunya Phichitkul said Ube would gain more than US$1 million (Bt31.49 million) from trading its carbon credits.

The company has also completed a boiler project involving the incineration of waste to produce steam in its production process. It helps to reduce the amount of steam needed from the power plant and in this way reduces the amount of carbon dioxide discharged into the atmosphere.

"It's a shame we did not register this project at its start, because [as a result] we cannot trade carbon credits from this project," Charunya said.

Thailand Greenhouse Gas Management Organisation executive director Sirithan Pairojboriboon said many Thai operators had already missed the opportunity to gain benefits from trading carbon credits because public agencies had done very little to promote the Clean Development Mechanism.

He said 27 projects in Thailand had received letters of approval as creators of carbon credits. They will reduce greenhouse gas emissions by 2.03 million tonnes per year. Twenty-six projects await approval, with the ability to reduce emissions by a further 1.2 million tonnes per year.

Arthit Vechakit, managing director of Excellent Energy International, a firm under the global umbrella of Esco, said the Thai government should give full support to local operators and encourage them to learn about the Clean Development Mechanism. He said national authorities designated to deal with applications should change their role from that of regulators to facilitators.

"The process of getting a letter of approval in Thailand is very complicated and strict. If possible, the public agencies should focus on educating operators and helping to boost their projects to meet the conditions, rather than regulating them," he said.

The Siam Cement Group is planning to invest Bt15 billion to develop energy-saving projects to reduce carbon dioxide emissions. On its own, the group's waste-heat power-generation project, used in cement plants, will reduce carbon dioxide emissions by more than 300,000 tonnes per year.

The president of SCG's Sustainable Development Committee, Pramote Techasupatkul, said the group was studying a plan to trade carbon credits. He declined to give more details.

Among the local operators that have expressed interest in the Clean Development Mechanism are the CP Group, PTT, IRPC and TPI Polene.

Chalida Ekvitthayavechnukul

The Nation