Carbon Portfolio Analysis
As a growing number of buyers of carbon credits are depending on CERs and ERUs from CDM and JI projects it is becoming increasingly important to do assessments of the quality of the projects.
A Carbon Portfolio Analysis from CVDTC takes into account all guidances and regulations issued by the Executive Board as well as the going practices of validators and verifiers within the Designated Operational entities (DOEs). It equally incorporates the recorded performance of similar projects. It allows compliance buyers and traders alike make evaluations of portfolios and informed assumptions on the actual generation from these projects. CVDTC works with a risk assessment tool that takes both regulatory risks and project performance risks into consideration, providing the client with valuable input for such evaluation.
As the estimates of global supply of Certified Emission Reductions, CERs, from CDM projects are lowered due to the increasing processing time on all stages of project documentation and registration the actual performance of contracted projects deserves particular attention. This is not least true for projects that have not yet reached registration with the Executive Board, which in the case of China counts more than 1200 projects. There is growing consensus that not all of these projects will reach registration, not least because the rules of the game have changed significantly since the start of the project activities.
CVDTC also takes the next step and offers strategic advice on how to remedy a troubled portfolio, first of all taking a closer look at the projects in the portfolio with proposals for accelerating their development. Where this doesn’t make up for the possible shortfall of credits an array of other options exist, which will be evaluated case by case to ensure that the risk of non-compliance is properly addressed at an early stage.