The planned 15 MW biomass power plant project in the central Chinese province of Hunan will have saved at least 300 thousand tons of CO2 by 2012. Emission reductions are sold under the Kyoto Protocol´s CDM (Clean Development Mechanism).

„Creating a significant prortfolio of emission certificates from CO2 emission certificates abroad is one of our strategic measures responding to the adopted energy-climatic package of the EU. In this respect, China offers a lot of prospective opportunities. In addition to that, we are also concentrating on developing renewable resources and extending our production portfolio by gas power plants and further nuclear power plant using within the context of CO2 emission reducing.,“ commented on the signing Martin Roman, Chairman of the Board of Directors and CEO of CEZ.

CEZ Power Company has already concluded five contracts and is preparing some others in China. One of them is, for instance, about purchasing emission credits, as a future product, from two 2 x 15 MW biomass power plants. In the future, emission credits from the operation of two wind power stations 2 x 50 MW, which are owned by Hecic, one of the largest Chinese energy firms, will be utilized half-and-half by Shell and CEZ.

So far, CEZ Group has entered into contracts to buy nearly 13 million emission credits to be delivered between 2008-2012. About 21 million pieces, which is roughly 10 % of the total amount of its emissions, can be imported by 2012. Between 60 and 70 % of emission credits will come from projects in China, the rest from other Asian countries, South America and Central and Eastern European countries.

JI (Joint Implementation) and CDM (Clean Development Mechanism) are Kyoto Protocol´s mechanisms enabling investments into projects that will save greenhouse gas emissions and import them to the European system to be used instead of emission allowances. Like other European energy companies, CEZ Group can cover emissions it produces by emission allowances and a ten-percent share of emission credits it gains from investments into ecological energy projects in the whole world in the current, second, trading period until 2012.

In accordance with the European Commission rules, if CEZ saves emission allowances, exchanged for emission credits, it can transfer them to the third trading period after 2013, when the price of CO2 allowances is expected to grow significantly due to new regulations by the EU (including planned auctions).