Baker & McKenzie: Implementation of Kyoto protocol in Russia: New JI Projects Approved

On December 30, 2010, the Russian Ministry of Economic Development approved 18 projects as joint implementation projects under Article 6 of the Kyoto Protocol to the United Nations Framework Convention on Climate Change (by issuing Order No. 709).

The approved projects include, inter alia, projects for utilization of associated gas, for landfill gas collection and utilization and for modernization of metallurgical enterprises.

The approvals resulted from the second tender conducted by Sberbank – the Russian Government-appointed carbon units operator – in accordance with Russian Government Resolution No. 843 of October 28, 2009.

As for all Russian JI projects, Sberbank has to sign off on agreements for the transfer of emission reduction units (ERUs) under approved projects.

However, the procedure for signing off (or refusing to do so) is not established, which may entail certain risks for market participants.

Projects that were not approved and new projects may be submitted for selection and approval as joint implementation projects through future tenders to be conducted by Sberbank.

Should you have any questions, please contact members of the Energy Efficiency and Climate Change Practice Group of the Moscow office of Baker & McKenzie: Max Gutbrod, Partner; and Sergei Sitnikov, Counsel, at +7 (495) 787 27 00