CAIRO: Companies and factories that reduce carbon dioxide emissions and apply environmentally friendly practices are in for a monetary reward in an effort to promote “clean business” techniques.
“For each ton of reduced CO2 emissions, companies receive a certificate, which acts as a bankable commodity sold in the open market or in financial institutions such as the World Bank,” said Maged Hamed, World Bank representative.
The reward the Clean Development Mechanism (CDM) initiative, a Kyoto Protocol that allows industrialized countries with a greenhouse gas reduction commitment to invest in emission reduction projects in developing countries, an alternative to more costly emission reductions in their own countries.
“Owners of a business or a factory are more concerned with the dollar sign rather than CDM. The truth is reducing emissions of greenhouse gas is an opportunity to generate future revenues and cash-flow streams through these certificates,” Hamed added.
“We’re aiming to fund companies that abate pollution and reduce CO2 emissions to encourage investment in CDMs and protect our environment,” said Ziad Bahaa El-Din, chairman of General Authority for Investment and Free Zones (GAFI). “Our role at GAFI is to open up investment opportunities in CDMs and clean energy, which act as a solid base for growth.”
In addition to reducing pollution, CDMs can also boost Foreign Direct Investments (FDI). It is turning into a global trend as several multinational companies and developed countries adopt CDMs.
So far, CDMs have poured in LE 500 million in FDIs. Furthermore, in the year 2006/07, over 235 million tons of CO2 have been reduced across different sectors including agriculture, industry, solid waste treatment, and fuel switching (from oil to gas).
“If more and more companies adopt cleaner [operational] practices, investment will flourish in the country,” Bahaa El-Din added.
Abu Qir Fertilizers is one of the most celebrated eco-friendly companies in Egypt. Last year, it adopted CDMs and managed to reduce around 1.8 million tons of CO2 annually. Other companies include Onyx Gas Capture and Flaring, Delta Fertilizers, KIMA Chemical Industries, and National Steel Company.
To qualify for the monetary certificate, Egypt’s National Council for CDM must first evaluate companies and ensure they meet criteria for environmentally friendly practices.
