For Project Developers

The World Bank manages about one billion dollars to purchase credits of greenhouse gas emission reductions from projects that are expected to be registered for the purposes of the Kyoto Protocol's Article 12 (Clean Development Mechanism) or Article 6 (Joint Implementation). You may wish to take into account the following features as you consider next steps for your project:

1. We are able to work with you hand-in-hand to prepare all the carbon documentation for CDM and create the carbon asset. We are able to advance funds for the preparation of this documentation if you wish and would cap them in our Letter of Intent, which would provide with certainty and limit any unforeseen risks or costs. We would recover the costs of preparing the CDM documentation from our future carbon payments to the project.

2. We give you the option of buying VERs (Verified Emission Reductions) or CERs (Certified Emission Reductions) . When we purchase VERs, we will pay for the emission reductions when we complete our process of creating the carbon asset (upon an independent validation and issuance of a yearly or periodic verification reports), independent of how long it might take the UNFCCC to certify, issue and register the emission reduction. This constitutes a low-risk carbon cash flow to the project which the project can count on from a credit-worthy carbon buyer paying in hard currency. Unlike many Certified Emission Reduction (CER) contracts, the project is not penalized for regulatory delays outside their control. When the regulatory risk is low, ie. in projects where applicable baseline and monitoring methodologies have already been approved, or in sectors where the approval of the methodology is highly likely, you may elect to sell CERs to us, which would obtain a better price than VERs. However in those cases, payment depends on certification, issuance and registration by the UNFCCC and its bodies.

3. Since some projects may be somewhat marginal in terms of IRR, our value proposition also includes:
- A carbon payment stream beyond 2012 to ensure the viability of the project (most other buyers only buy carbon until 2012 when we purchase VERs.
- Up to 25% of the ERPA value payable upfront and undiscounted , i.e. at identified benchmarks after financial closure, in cases where it can be demonstrated that such advance payment is absolutely necessary.

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