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Magazine "Energie Libere" №2, 01.01.2012TRANSCRIPT
ÉNERGIE L IBRE
ISSUE #2, OCTOBER 2012
THE GREEN ECONOMY ARISES
FROM YOURSELF
PHYSICAL ECONOMY OF S. PODOLYNSKY.
IDEAS ABOUT ENERGY BUDGET OF THE
TERRITORY
GLOBAL WARMING: JUDGMENT BY
OURSELVES
ENERGY PROSPECTS FOR STATEWIDE
AUTOMATED MANAGEMENT SYSTEM.
EVERYTHING NEW
IS WELL-FORGOTTEN OLD
WORLD`S LARGEST CARBON FUNDS: CREATION,
PERSPECTIVES ON FUNCTIONING
AND DEVELOPMENT
n its path to global prosperity the global economy has ignored environmental
issues for too long. As a result nowadays the world faces a lot of problems, including
ecological catastrophes, environmental pollution, climate change, food and energy crisis.
Having assessed the risks related to such unconcern we should try to correct the current
situation by directing all means of the global economy.
In order to promote sustainable development of a planet, our magazine "Énergie Libre"
is focused on means and initiatives which try to achieve this goal, namely international
agreements on protection of environment, environmental economy, carbon market,
alternative energy and energy efficient technologies, etc.
From the editors of
“ÉNERGIE LIBRE”
O
ÉNERGIE LIBRE
BFSE.COM.UA
THE CONTENT OF THE ISSUE
POLICY
Global warning: judgment by ourselves……………………………………….…....4
ECONOMICS
Physical economy of S.Podolynsky. Ideas about energy budget of the
territory……………………………………………………………………………...6
FINANCE
World`s largest Carbon Funds: creation, perspectives on functioning
and development……...………………………………………...………………….11
FEUILLETON
The Green Economy arises from your self……………………………...……… ...17
TECHNOLOGIES
Energy prospects for Statewide Automated Management System.
Everything New is Well-Forgotten Old…………….………………..…………….20
BFSE.COM.UA
ÉNERGIE LIBRE
GLOBAL WARMING: JUDGMENTS BY OURSELVES.
o you know that according to sci-
entists’ predictions the population
of polar bears will shrink by two
thirds till 2050? In perspective polar bears
will be for our posterity what dinosaurs for
us are. Global warming is to blame for this,
as for 90% of problems of planetary scale.
All of us know theoretically the nature and
consequences of this phenomenon, but few
people realize its effects in full, and mainly
how soon we will feel real changes. So, we
continue to live our usual life passing the
buck to anyone – politicians, scientists, big
corporations, non-governmental organiza-
tions. The year 2010 was the hottest of the
last 130 years, and 12 of 15 last years were
the warmest by the average annual temper-
ature. According to some scientists’ re-
searches, this tendency will lead to the rise
of sea level by 1, 2 meters till the end of the
century. The problem is, this process is ir-
reversible. Even if humankind stops carbon
emission at all till 2100, New-York, Hong
Kong will be wiped off the map to the end
of the millennium, and small island coun-
tries like Grenada – even earlier. That’s
why Small Island State Union appeal to the
world community with the request to limit
global average temperature increase to no
more than 1,5°C above pre-industrial level
while it has already been exceeded by 0,8
degree. Otherwise it could be evaluated as
a genocide against island countries. One
more reason to sound the alarm is the
threat of fatal diseases spread - first of all
malaria. Rainfalls acceleration, tempera-
ture background and humidity rising create
favorable conditions for spread of malaria
agents and for expansion of its carriers –
mosquitoes. Annually 300-500 millions of
people have malaria, half a million of which
dies. Global warming will double these fig-
ures. Fever, cholera, meningitis, plague and
sleeping sickness will be widespread too.
In addition to that nutrition problems
D “Besides, two degrees warming worldwide means
3.5 °С warming in Africa.... “
There is little doubt that the burning of fossil fuels and deforestation have altered the Earth’s climate, some uncertainty remains about whether and when such changes will become unmanageable.
ÉNERGIE LIBRE POLICY
BFSE.COM.UA 4
will be accentuated. American scientists
assert, that climate changes will lead to
significant crop reduction in tropics and
subtropics turning formerly fertile territo-
ries into deserts. That’s why half of the
earth population will starve in the next
century. This situation will be aggravated
by water shortage and its poor quality.
Mass nation migration can be the main
consequence of it.
With regard to the flora and fauna
changes, 1,5 – 2,5°С rise of average annu-
al temperature will place 20-30% of exist-
ing animal and plant species in jeopardy,
where fishes and polar bears mentioned
before are at the head of the list
(according to Intergovernmental Panel on
Climate Change).
In the year 2009 London newspaper
«The Guardian» initiated publication of
article with appeal for solving the climate
change problem in 45 editions worldwide.
At that time in Copenhagen was taking
place UNO conference dedicated to world
climate changes.
German language business newspaper
«Handelsblatt» called this summit “climate
disaster in political dimension”. Despite
civil society expected adoption of agree-
ment that will reduce carbon emission
firmly, only declarative document was the
result of the summit. It was admitted that
2°С rise of average annual temperature
may have disastrous consequences ,but
clear mechanism of combating actions
wasn’t developed. At the same time appli-
cation of small island country’s Tuvalu rep-
resentative for correction of the summit
aims was rejected (he requested the aim
of the summit was to prevent 1,5°С rise of
average annual temperature instead of
stated 2°С). This 0,5°С may be crucial for
small island countries in future: they will
be inundated by rising seas. Besides, two
degrees warming worldwide means 3.5 °
С warming in Africa, that will lead to
droughts, famines, and millions of climate
refugees. However, one of the biggest pol-
luters – USA – recognized the necessity of
reducing 4% global warming pollution be-
low 1990 levels by 2020, while for achiev-
ing no more than 2 degrees warming re-
ductions must be at least ten times larger:
40% below 1990 levels by 2020. Naomi
Klein in her article “Better to have no deal
at Copenhagen than one that spells catas-
trophe” wrote USA “…have carved up the
last remaining unowned resource and allo-
cated it to the wealthy." Such a situation
was considered by world community as
“climate colonialism”. Concrete decisions
has been shifted to the Cancun conference
held in December 2010.
“Annually 300-500 millions of people have malaria, half a
million of which dies.”
POLICY ÉNERGIE LIBRE
5
Sourse:http://adoptanegotiator.org/2012/10/25/catastrophic-but-not
Logotip Cop15 - Copenhagen
Logotip Cop18 - Doha
Participants reached a settlement about
some aspects of the treaty that will replace
Kyoto Protocol in 2012. There have been
developed a number of decisions about for-
est protection and international technology
exchange. The final adoption of post- Kyoto
treaty will take place this year in Doha. So,
the effectiveness of the UNO in handling the
matter is being brought into question.
As for Ukraine, it has doubtful reputation
concerning participation in such a confer-
ences. On the one hand our country was
represented on both UNO conferences dedi-
cated to the climate changes and took part
indecision-making process. On the other
hand, Victor Yushchenko neglected the Co-
penhagen conference. That’s why activists in
city-center distributed leaflets with his photo
and inscription “Climate shame”on them. At
the Cancun Сonference Ukraine was award-
ed with anti prize “Dinosaur of the day” for
blocking the negotiation process. The reason
was unconstructive position in the negotia-
tions and refusal to disclose the information
about the use of money received from car-
bon emission reduction.
Big business can’t stay aside too because
it’s exactly big business who is being ac-
cused of intensive growth of harmful emis-
sion. Its superprofit is supposed to be made
at society’s cost .
That’s why term “social corporate re-
sponsibility” is used in every big business’s
annual report. But such an activity can be
considered not only in terms of realizing
one’s responsibility, but in terms of creating
one more competitive advantage and trib-
ute to company’s reputation saving. That’s
why it’s sometimes difficult for average citi-
zen to distinguish eyewash from real effec-
tive actions. .
Without any doubts mankind should
unite - it is the only way to postpone the
moment of disaster. But we should start
with ourselves. And the point is not only a
carbon emission reduction, but rational use
of nature at all. In my opinion our problem
lies in consumer world-view, in change of
value priorities - from spiritual to material
ones. Our ancestors was notable for respect-
ful attitude to the nature, they have made
the cult of it. What happened with our gen-
eration then? What caused so abrupt men-
tality change? Globalization, acculturation,
national self- identification crises? Should
we blame USSR, where nature was sacri-
ficed to the raising of the rate of production?
In any case the most important thing is
not to be indifferent. Simple things done by
everyone can yield significant results. Re-
ducing the amount of driving , preferring
bicycle, taking paper for recycling and using
the recycled paper (by the way, it doesn’t
differ in terms of price), rational use of elec-
tricity and running water, throwing rubbish
only in certain places – you don’t have to
change the way of life you used to do all of
this things. The most important thing: we
mustn’t lose heart – we still can gain time.
Myroslava Padalytsa
“Even if humankind stops carbon emission at all till 2100, New-
York, Hong Kong will be wiped off the map to the end of the
millennium, and small island countries like Grenada – even
earlier. “
ÉNERGIE LIBRE POLICY
Sourse http://www.environmentalcommunicator.com/151/
evidence-of-climate-change-global-warming.html
President Barack Obama speaks at the climate summit in
BFSE.COM.UA 6
PHYSICAL ECONOMY OF S.PODOLYNSKY.
t a time when the linear model of ag-
gressive economic growth seen in the
coordinates of "human - society",
"human - environment" we received a num-
ber of natural disasters, shortage of natural
resources and the devaluation of "financial
unit" as a market regulator.
Scientific research carried out by S.
Podolynsky on the edge of natural and so-
cial sciences. He was the first who com-
bined the physical processes with economi-
cal, methodologically demonstrating the
need of the synthesis of natural and cost
parameters store solar energy in the pro-
cess of economic activity. So today we can
apply a macroeconomic approach, which
would be focused on adequate outcomes of
natural systems , which consider the com-
ponents of the system: "human" - "society" -
"ecology" (Human? Economy? Ecology? ) in
reciprocal communication. Only in such
coordinates can find an optimal solution,
and for the further development of humani-
ty - to ensure sustainable development
(figure 1).
Difficulty links between different compo-
nents of this system does not permit today
to build such a conceptual model of it that
would adequately describe the interaction
between its components and the environ-
ment. Such model should meet the require-
ments of structural, dynamic and infor-
mation completeness. In such cases, carry
out decomposition of the system, under-
standing under this procedure - the selec-
tion and examination of all major subsys-
tems that affect the ultimate goal of the
system. It is possible on the basis of deduc-
tive approach.
Fgure 1 – Model of sustainable development
A
Today, from our point of view, due to some problems with of energy, raised by environmen-tal concerns such as environmental, it is im-portant analyze so-called energy budget of ter-ritory. Because we do not have well-established scholars over Ukraine's energy strategy, includ-ing appropriate plant operation, development of alternative energy sources, including prospects to develop agriculture. Study of Scientific Her-itage S. Podolynsky allows him to consider ap-proaches to improve the concept of our country in particular energy budget of its territory.
ÉNERGIE LIBRE ECONOMICS
Ukrainian scientist S.Podolynsky
BFSE.COM.UA 7
Using elements of deductive approach, the
energy budget of any territory can be pre-
sented in the scheme (figure 2).
In terms of system analysis of this struc-
ture can be classified as:
open system where matter and
energy are transformed;
system is not homogeneous, as its
structure can be distinguished as the set of
subsystems
a system in which signs of the
product (quantity, quality, etc.) make it
difficult to determine its value.
A key element of the studied system is
energy. On the one hand, it is one of the
basic properties of matter, the total meas-
ure of all forms of movement, on the other -
the ability to perform some work or the
source of the force, which will perform the
work. Hence the "energy" in general we
understand the ability to develop force. At
the same time converting and makes ener-
gy conservation work, this leads to its accu-
mulation at the disposal of mankind. The
role of energy conservation law in society
and the impact of people on the transfor-
mation of energy on Earth showed S.
Podolynsky. He gave an analysis and classi-
fication of types and sources of energy
available to mankind at that time. This -
solar energy (radiation, photosynthesis,
wind, falling water), energy of Earth's rota-
tion (inflows), accumulated on the Earth
Solar energy (coal, oil). Movement and
transformation of matter and energy in the
ecosystem is shown in Figure 3. Sun contin-
ues to offer us a huge amount of non con-
verted energy and its stock is still very
large. But it does not run that the distribu-
tion of energy on the Earth's surface would
be most beneficial to human life . Possibility
of the better distribution of the energy - to
some extent – is in the hands of the person.
Quantitative characteristic in this case is
“energy capacity”
Figure 2 – Scheme of the “Energy budget of territory”
Figure 3 – Scheme of movement and transformation
of matter and energy in ecosystems
ÉNERGIE LIBRE ECONOMICS
BFSE.COM.UA 8
- the property system to perceive, process,
absorb and transport the external energy,
and give it away outside the system. This
property is closely linked to productivity,
as evienced by the last unit of measure -
the mass or amount of energy that is con-
centrated in the mass. In a mass of differ-
ent substances are different amounts of
concentrated energy. Types of energy and
their characteristics are presented in Ta-
ble. 1.
Investigating energy, S. Podolynsky
proceeded from the fact that the amount
of energy is a universal value that is un-
changed. But in some parts of Earth it is
distributed unevenly, causing wide-
spread tendency to counterbalance it and
the gradual dissipation. Regarding energy,
as global figure S. Podolynsky showed
ability of the person to influence its
movement and accumulation. Natural sys-
tem receive external energy from the sun,
which emits gamma spectra of complex
rays in a wide range of wavelengths - from
0,1 to 3000 nm.
Conservation and energy conversion
based on the equation of energy balance.
Human play the role of the transformer,
obtained from the Sun to give energy
work. Structures which was built on Earth,
have a high price because of work, be-
cause they spent lots of solar energy.
Podolynsky never minimalized role of so-
cially useful work, he was more interested
in the accumulation of living matter on the
planet - or, more simply organic matter,
begotten by the Sun, as a precondition for
any work and most earthly wealth - abso-
lute capital.
Podolynsky showed that human labor is
useful, mainly in agriculture, reducing the
scattering of solar energy, increases its
fate, which piled on the Earth's surface in
the form of "transformed" energy. Also
S.Podolynsky made definition for the con-
cept "useful work" it is "all mechanical and
mental consumption of human and animal,
which increasing budget of transformed
energy on the earth's surface"
He distinguished two aspects of ener-
gy: physical and social .
Physical - to reduce all forms of energy
dissipation through the rational use of en-
ergy accumulated on the Earth.
Social - is to save energy (wealth) be-
tween generations. In relation to the whole
generation it has an integral character.
Exploring the system in general,
S.Podolynsky in the "work of man and its
relation to energy distribution" summariz-
es the components of energy budget areas:
• The total amount of energy derived
Earth's surface, gradually decreasing, but
also its accumulation at the disposal of
mankind under the influence of increased
labor rights and pets;
• Perfect machine is humanity with
all its economy (fields, droves, machines,
etc.). Productivity increases human con-
sumption of this work on the transfor-
mation of higher energies into the higher
(production of machines, etc.);
Types of energy
Characteristics
Internal energy Energy system, which depends on the internal state of the system (it includes all
forms of energy system components)
Mechanical energy The energy of mechanical motion and interaction of bodies or their parts (energy
magnetic field - magnetic energy, electromagnetic energy fields - electromagnetic
energy, energy of moving particles - the kinetic energy, energy particles fixed in a
gravitational field - potential energy, energy of the atomic nucleus - nuclear energy)
Heating energy Level or change the thermal state (heat) system (the body) during the process
Electric energy The energy of interaction and motion of electric charges
Table 1 - Types of energy and their characteristics
“The role of energy conservation law in society and
the impact of people on the transformation of energy
on Earth showed S. Podolynsky. “
ÉNERGIE LIBRE ECONOMICS
BFSE.COM.UA 9
• Use of solar energy as an engine and
direct preparation of nutrients from inorgan-
ic materials fundamental to the continuation
of the most advantageous energy storage on
the Earth;
• Actions that result in the phenomenon,
the opposite of work, is theft (scattering,
embezzlement) power of humanity, in partic-
ular - the war, an arbitrary limit of popula-
tion, production of luxury goods and unpro-
ductive consumption. Instead, improvement
of human life quantitatively increases the
energy budget of each individual.
Several types of energy in one area can
change one kind to another, it should be
viewed with exergety position [6], such as:
• considering the field of environment
and their impact on processes of energy con-
version;
• preventing the possibility of an equilib-
rium system and the environment.
In this case, the maximum work that can
be executed from a given quantity of heat is
determined by Carnot.
- am- bient tempera-
ture, К;
- temperature of the source, К.
Thus, we can build energy model of our
civilization in the form in which it exists in a
living reality. It should be remembered that
"the main purpose of humanity should be an
absolute increase in energy budget. The only
limit "best possible accumulation of energy
on Earth" is "only the absolute amount of
energy from the sun and organic materials
that are on earth"
So the problem of creating energy budg-
et of each territory is exists. And
S.Podolynsky proposed a method in which
we can easily create energy budget and use
this energy without any harm for nature.
Problem of using or not using alternative
sources of energy should be solved by hu-
manity in the way of rightly using alternative
sources of energy. Thus, we should create
energy budget of territory and widely use it.
Taras Reshetyuk
Photograph by Michael Melford Sourse :http://ngm.nationalgeographic.com/2009/09/solar/johnson-text
ÉNERGIE LIBRE ECONOMICS
“Investigating energy, S. Podolynsky proceeded from
the fact that the amount of energy is a universal value
that is unchanged. “
BFSE.COM.UA 10
The Carbon fund operations have demonstrated numerous opportunities for collaborating across sectors, and have served as a catalyst in bringing climate issues to bear in projects relating to rural electrification, renewable energy, energy efficiency, urban infrastructure, waste manage-ment, pollution abatement, forestry, and water resource management.
WORLD'S LARGEST CARBON FUNDS: CREATION,
PERSPECTIVES ON FUNCTIONING AND DEVELOPMENT
fter adoption of Kyoto Protocol to
the United Nations Framework Con-
vention on Climate Change, crea-
tion of the European Union Emis-
sions Trading Scheme (EU ETS) we faced a
tremendous growth on the global carbon
market. The major instrument on this mar-
ket is emission reduction, which allows to
emit the specific amount of greenhouse
gases. This market is called “carbon mar-
ket” and today the word “carbon” we also
use with widely known processes and insti-
tutions (such as financing, funds, exchange
etc.). Carbon market is a relatively new
market, where huge risks, low liquidity, the
lack of guarantees, specific goods and spe-
cial pricing conditions are present, as in
every new market worldwide. But despite of
numeral negative characteristics this mar-
ket increases the concentration of capital
from year to year very fast, becomes more
attractive for investors and integrates more
and more financial institutions (see Fig. .1).
One of such institutions is carbon fund,
which acts as guarantor, reduces risks, in-
creases liquidity and is responsible for the
evolution of the carbon market. The main
initiative to establish carbon funds are in-
ternational financial institutions financed by
private and public funds. In addition, there
are funds that are fully subordinated to cor-
porations and banks. Their main feature of
all funds is that they finance projects aimed
at reducing emissions and purchase of so
called “reduction units”. To show the
A
ÉNERGIE LIBRE FINANCE
BFSE.COM.UA 11
role of financial institutions in this market
we will try to demonstrate the size and char-
acteristics of some carbon funds. The largest
carbon funds in the world are:
a. Thirteen carbon funds of the
World Bank.
b. Six carbon funds of the Euro-
pean Investment Bank.
c. Carbon Funds of the European
Bank for Reconstruction and
Development.
d. Two carbon funds of the Asian
Development Bank.
e. Carbon fund sof the Kfw
(Kreditan-stalt für Wiederauf-
bau).
f. European Carbon Fund.
One of the largest international financial
institutions - the World Bank, also does not
evade the problem of climate change and
has pioneered the creation of has estab-
lished the maximum number of carbon
funds. Unlike other institutions, the World
Bank does not provide or guarantee loans
for projects, but purchases the reduction
units by paying for them one-off or periodic
payments after the units have been con-
firmed. Financial resources of the World
Bank all carbon funds of in 2010 amounted
to 2.3 bln. USD. First Carbon Fund of the
World Bank, called Prototype Carbon Fund
(PCF), was founded in 2000 (See Table 1).
Since then, almost all World Bank funds
CFU (Carbon Finance Unit) are formed by
private and government funds. Total number
of private companies that participated in the
formation of carbon funds of the World Bank
is 66, governments - 16.The activities of the
funds focus on projects within the Clean
Development Mechanism and Joint Imple-
mentation of Kyoto Protocol. The largest
number of reduction units is achieved by
carbon funds through the implementation of
projects in the field of alternative energy,
energy efficiency and reduction of industrial
fluorinated gases HFC-23. Geography of the
funds is Latin America, Europe, Asia and
Africa (see Table 2).
Considering the largest number of pro-
jects among the carbon funds of the World
Bank, we can identify Community Develop-
ment Carbon Fund (CDCF). Founded in
2003, the fund acquired reduction units in
28 projects, of which 43% - the projects in
the field of alternative energy. Interesting is
the fact that the founders
Fund name Fund budget (millions of USD)
Number of Projects Volume, (million tonnes of
CO2)
Prototype Carbon fund
128,6
24
28,2
Tabl.1. Key performance indicators of the Prototype Carbon Fund
Source: http://wbcarbonfinance.org
The World Bank Carbon
Finance Unit(СFU)
Number of Projects
Value of Projects (bln.
USD)
Volume, (million tonnes of
CO2)
155 1,7 208
Tabl.2. Investment portfolio of World Bank carbon funds
Fig.1. Global carbon market capitalization, bln. USD.
Source: http://wbcarbonfinance.org
ÉNERGIE LIBRE FINANCE
BFSE.COM.UA 12
of the fund include are the governments of
9 countries governments and 16 private
companies (see Table 3).
Among World Bank carbon funds, in
terms of amounts of funding and number of
emission reductions acquired, we can note
Umbrella Carbon Facility tranche 1.
This fund was founded in 2006 with capital-
ization of 775 million euros. By now Um-
brella Carbon Facility tranche 1 has 129
million of emission reduction units. These
units were acquired from Greenhouse Gas
Reduction Projects (HFC-23). Just after
Durban Climate Change Conference
(November/December 2011) the World
Bank, together with Deutsche Bank, GDF
Suez and Swedish Energy Agency an-
nounced the creation of a new carbon fund
- Umbrella Carbon Facility tranche 2.
The activities of this fund will allow project
developers to continue selling carbon cred-
its generated after 2012, under the Clean
Development Mechanism (CDM).
Other significant carbon funds of the
World Bank are: The Bio Carbon Fund,
Carbon Partnership, Spanish Carbon
Fund and Danish Carbon Fund (see Fig.
2).
Another significant player in the carbon
market is the European Investment Bank
(EIB). The appearance of a large number of
carbon funds managed by this organization
is caused by, firstly, the commitments made
by the European Union to reduce emissions
under the Kyoto Protocol, and secondly, the
introduction of European Union Emissions
Trading Scheme (EU ETS). The EIB started
to finance its carbon projects simultaneous-
ly with the World Bank – in March 2007.
International financial institutions are man-
aging the Carbon Fund for Europe with a
capitalization of about 50 million euros and
3.1 million metric tons of CO2 emission re-
ductions. Another 5 carbon funds are man-
aged by the EIB. (See Table 4).Carbon EIB
Funds are generated by private and govern-
ment resources. The financial resources of
the EIB carbon funds amount to about 809
million euros. Such institutions as KfW,
Caisse des Dépôts, Nordic Investment
Bank, Zeroemissions, CEZ and Endesa
contribute significantly in the financing of
these funds.
Tabl.3.Key performance indicators of Community Development Carbon Fund (CDCF)
Fund name Budget
(millions of USD) Number of Projects
Volume, (million tonnes
of CO2)
Community Development Carbon
Fund 128,6 29 7,1
Source: http://wbcarbonfinance.org
90,4 mln $ 140 mln €
The Bio Carbon Fund (Tranche1,2) Carbon Partnership Facility
220 mln €
90 mln $
Spanish Carbon Fund Danish Carbon Fund
Source: http://wbcarbonfinance.org
ÉNERGIE LIBRE FINANCE
Fig.2. Capitalization of some carbon funds of the World Bank
BFSE.COM.UA 13
Financial flows of the funds are aimed
both at development of relevant projects and
purchase of reduction units, under the Clean
Development Mechanism and Joint Imple-
mentation of Kyoto Protocol.
The European Investment Bank cooper-
ates very successfully not only with the
World Bank (they have a common carbon
fund), but also with the European Bank for
Reconstruction and Development (EBRD).
The result of such cooperation is Multilat-
eral Carbon Credit Fund (MCCF), created
in 2005 with a budget of 208.5 million euros.
MCCF focuses on projects in the field of
energy, energy efficiency, developing alter-
native sources of energy and other projects
aimed at reducing greenhouse gases emis-
sions. The fund is developing projects in
different countries of Eastern and Central
Europe and Central Asia etc.). In Eastern
Europe, in addition to the development of
projects under the Joint Implementation
Mechanism, MCCF works under the scheme
of "green investments". For this purpose the
fund has divided its budget into two parts:
Green Fund (58.5 million euros) and Project
Fund (150 million euros).
After 17 UN Conference in Durban
(South Africa) the future of the Kyoto Proto-
col remains indefinitely, creating a signifi-
cant risk for the use of Kyoto units that will
be issued after 2012. However, these cir-
cumstances do not apply to Carbon Fund
Post-2012, founded by the EIB and other 4
financial institutions with high credit rating.
The fund was launched in March 2008 with
a budget of 125 million euros. Post-2012
Carbon Fund focuses on buying carbon
credits to be received after 2012. The Fund
is interested in projects in the field of renew-
able energy, energy efficiency, projects to
reduce methane emissions at industrial
sites and projects for disposal of greenhouse
gases - Carbon Capture and Storage pro-
jects (CCS). Today the Post-2012 Carbon
Fund is dealing with projects for 1 million
tonnes of reduction units (see Table 5). As-
sets of this fund are managed by Connie
(Europe) Limited – an investment adviser to
the fund First Climate.
The international institution - Asian
Development Bank's (ADB) supported the
economies of low-carbon in Asia and the
Pacific, proposing to implement Carbon
Market Program (CMP). The main result
Name Period of generation, years Expected amount of reductions (СERs)
1. Nigeria Landfill Gas Project. 2013-2017 700,000
2. India Wind Energy Project. 2013-2020 260,000
Tabl.4. The largest carbon funds managed by the EIB
Tabl.5.Emission reduction projects, managed by the Post-2012 Carbon Fund
Source: http://www.eib.org/
Source: http://ngm.nationalgeographic.com/2009/09/solar/johnson-text
Name Budget (mln euros)
1. Multilateral Carbon Credit Fund 208,5
2. Mediterranean Carbon Fund 200,0
3. EIB/KfW Carbon Purchase Programme (I,II) 190,0
4. Post-2012 Carbon Fund 125,0
5. Carbon Fund for Europe 50,0
6. Fonds Capital Carbone Maroc 36,0
All together 809,0
ÉNERGIE LIBRE FINANCE
BFSE.COM.UA 14
of two new funds: Asia Pacific Carbon
Fund (APCF) and Future Carbon Fund
(FCF). Asia Pacific Carbon Fund was es-
tablished in 2007 in order to purchase re-
duction units generated by 2012. Portfolio
of this fund includes 48 projects (see Ta-
ble. 6).Such organizations as Fundo Portu-
gues de Carbono (Portugal), Swedish Ener-
gy Agency (Sweden), The Grand-Duchy of
Luxembourg, Climate Cent Foundation
(Switzerland) and others are among the
members of APCF. The activities of the
Future Carbon Fund, established in 2008,
is evidenced by its name. FCF focuses on
purchasing of reduction units to be gener-
ated after 2012. Fund's portfolio includes
25 projects (see Table. 7).The participants
of FCF included: FCF PMV (Belgium), Min-
istry of Strategy and Finance with Export-
Import Bank of Korea, Swedish Energy
Agency, POSCO (South Korea), Eneco En-
ergy Trade (Netherlands). Both funds are
focused on projects in the fields of renewa-
ble energy, energy efficiency, reducing
emissions of methane and cleaning water
(Clean Development Mechanism).
Another financial institution that plays
a leading role in the carbon market is KfW
(Kreditanstalt für Wiederaufbau) (see Ta-
ble. 8).
The financial institution KfW started its
activities in the carbon market in 2004,
creating KfW Carbon Fund in collaboration
with the Government of Germany, In addi-
tion to the cooperation with Government of
Germany, KfW Carbon Fund works to-
gether with the European Investment
Bank, the World Bank and private
Source:http://www.kfw.de/kfw/en/KfW_Group/Sustainability_and_Climate_Protection/Procurement_Programmes/
Participation_in_the_Post_2012_Carbon_Credit_Fund/index.jsp
Name Budget
(mlnUSD) Number of Projects
Volume, (million tonnes of
CO2)
AsiaPacificCarbonFund 151,8 48,0 10,2
Tabl.6.Key performance indicators of the Asia Pacific Carbon Fund (APCF)
Tabl.7.Key performance indicators of the Future Carbon Fund
Name Budget
(mln USD) Number of Projects
Volume, (million tonnes of
CO2)
Future Carbon 115,00 25 8,20
Name of the fund Founders Budget
(mln euros)
1. KfW Carbon fund KfW banking group. German Federal govern-
ment. 84,0
2. EIB-KfW Carbon Programme I KfW banking group. European Investment Bank 90,0
3. EIB-KfW Carbon Programme IІ KfW banking group. European Investment Bank 100,0
4. Post-2012 Carbon Fund
KfW banking group. European Investment
BankCaisse des Dépôts. Nordic Investment
Bank. Instituto de Crédito Oficial
125,0
5. Community Development Car-
bon Fund
KfW banking group. World bank. (other compa-
nies and government) 2,5
Tabl.8.Key performance indicators of the KfW (Kreditanstalt für Wiederaufbau)
Source: http://adb-apcf.org/project_cycles/
Source: http://adb-apcf.org/project_cycles/
ÉNERGIE LIBRE FINANCE
BFSE.COM.UA 15
companies. The main purpose of the KfW`s
funds is to support the development of the
Flexible Mechanisms under Kyoto Protocol
and participate in the European Union Emis-
sions Trading Scheme (EU ETS). KfW, to-
gether with the European Investment Bank,
has established the EIB-KfW Carbon Pro-
gramme I and EIB-KfW Carbon Programme
II. As a result of carbon financing, KfW has
signed contracts worth 40 million tonnes of
CO2 in the 92 projects. The KfW`s carbon
fund is acting in the countries of Asia, North
America, Africa and Europe. Projects in the
field of alternative energy form 73% of the
Fund's portfolio, of which 26% are wind
Power, 20% - for processing and utilization
of organic waste gases.
Established in 2005, European Carbon
Fund became one of the first private carbon
funds in the market. The Fund commenced
operations receiving financial support from
the CDC Climat (subsidiary Caisse des Dé-
pôts, France) and BNP Paribas-Fortis
(France). The list of investors includes addi-
tional twelve financial institutions. As a re-
sult, the resources of the Fund reached
142.7 million euros. The Foundation focuses
on projects under Article 12 of the Kyoto
Protocol (CDM) (see Table 9). Since its in-
ception, the Fund has bought 67 million of
Certified Emission Reductions (CERs),
gained from 27 projects. The fund acts in
countries from Asia, South America and Afri-
ca. Investors of the Fund are the companies
such as: Citadel group, Allianz, Societe Gen-
erale, UniCredit and others. The fund is
managed by Natixis Environnement &
Infrastruc -tures.
The research of selected international
and private carbon funds showed great in-
terest of international financial institutions
and private capital in development of low-
carbon economy and stimulation of the car-
bon market. The characteristic feature of
the carbon market is the presence of signifi-
cant risks, therefore it is logical that initia-
tors of most carbon funds are the interna-
tional financial institutions
(The World Bank, EIB, Asian
opment Bank, European Bank for
Reconstruction and Development).
Despite the turmoil in the global econo-
my, unresolved fate of the Kyoto Protocol
and reduce the price of emission permits
(see Fig.3), the funds do not reduce the
amount of financing projects and continue to
build up their portfolios. The most popular
among the carbon funds are reduction units
from projects in the field of alternative ener-
gy, energy efficiency and related projects to
reduce emissions of fluorinated gases.
Name of the project CDM Project Company Volume,
(million tonnes of CO2)
1.Essaouira, Morocco, 60 MW wind
farm. Office Nationaled’Electricit 1,400,000
2. Yangquan Coal Mine Methane
(CMM) Utilization for Power Gener-
ation Project.
Yangquan Coal Industry (Group)
2,136,174
3. Paulinia Land fill Gas Project. ESTRE 1,050,000
Tabl.6.Key performance indicators of the Asia Pacific Carbon Fund (APCF)
Source: http://www.europeancarbonfund.com/en_index.html
Gonta Andrey
Chief of civic Organization «Vilna Energia»
“…carbon fund, which acts as guarantor, reduces risks,
increases liquidity and is responsible for the evolution
of the carbon market.”
Source: http://www.climate-connect.co.uk/Home/?q=node/1779
Fig.3 Price trend of CER Spot prices at Bluenext Exchange
ÉNERGIE LIBRE FINANCE
BFSE.COM.UA 16
ost of the people haven’t hear so
much about green economy, but
majority see it as “a recent phe-
nomenon, something that has sud-
denly sprang up” and the time is not ripe
for action now. BUT the green economics is
the economics of the real modern world—
not just about the environment, but the
world of work, human needs, the Earth’s
materials, and how they mesh together
most harmoniously. It is about regenera-
tion (not about accumulation) of individuals,
communities and ecosystems. So every Hu-
man being and human worker can no longer
serve as cogs in the machine of accumula-
tion, be it capitalistic or socialistic. It’s a
brand new system, which has been chang-
ing all the spheres of people’s lives and
minds. So, you still think that it for all you
cares!?
Certainly we must move to harmonize
with natural systems. But doing this re-
quires great human creativity, tremendous
knowledge, and the widespread participa-
tion of everyone: individual, government,
businessmen, household, community. But I
would like to illustrate the impact of busi-
ness into the green world, to show the first
steps on the way of global green regenera-
tion. Today, green business is profitable
branch of the business world. Probably this
is the reason why such companies are criti-
cized. The green business is really in its
infancy, and the future of being green will
no doubt distill down to some very real and
definable goals and practices. But my aim is
to involve nonchalant individuals into the
green world, that’s why I’ll be consider
them as the most progressive link in the
green movement chain. Today’s business is
all about being green. From Wall-mart to
Apple, everyone is talking about how green
their approach, packaging, or methods are.
In order to be considered a green business,
a company must use practices which are
viewed as sustainable and environmentally
friendly. These practices might include the
use of organic and natural products to build
its factories, tighter protections against
emission, and environmentally responsible
sourcing of supplies.
Fashion
THE GREEN ECONOMY ARISES FROM YOURSELF
“Wal-Mart took up the "green" initiative, and introduced
plans for an environmental overhaul, including making
its trucks more efficient...”
M
It's time to see green economy as a pathway out of economic recession. Green economy is one that will drive investment and financial flows towards restoring our environ-
ment and generating a better quality of life for all.
ÉNERGIE LIBRE FEUILLETON
BFSE.COM.UA 17
For example, FedEx and United Parcel Ser-
vice using hybrid vehicles in an attempt to
cut costs and reduce their environmental
impact.
In 2005 General Electric launched
Ecomagination, representing a commit-
ment to produce technology that reduces
energy consumption and waste. Such com-
panies as Toyota and Honda continued to
improve their hybrid technologies. As a
result, as consumer concern about climate
change grew, these companies stood ready
to provide earth-friendly products. Compa-
nies like Nike Inc., which set targets to
reduce waste and packaging and become
"climate neutral", and Hewlett-Packard ,
which is working toward reducing waste
and setting up recycling services for elec-
tronic waste, made the “Global 100 Most
Sustainable Corporations in the World”, list
based on how well they managed environ-
mental risks and opportunities compared to
their competitors (Global 100 Most Sus-
tainable Corporations in the World
2011,2011). Companies like Alcoa and
Dupont, for example, have established sys-
tems to reduce carbon emission and other
harmful chemicals, the most likely targets
for government intervention. Wal-Mart
took up the "green" initiative, and intro-
duced plans for an environmental overhaul,
including making its trucks more efficient,
building new stores with strict energy con-
servation goals and pushing suppliers to
reduce packaging. Apple also becomes
greener: they started recycling in 1994 and
today they operate recycling programs in
countries where more than 82% of all Macs
and iPods are sold. Apple’s U.S. retail
stores take back unwanted iPods for envi-
ronmentally friendly disposal free of
charge. As an incentive, they even offer
ÉNERGIE LIBRE FEUILLETON
Source:http://powerelectronics.com/power_systems/smart-grid-success-rely-system-solutions-20091001/
BFSE.COM.UA 18
Inditex group obliged its 5000 shops
throughout the world to reduce energy use
by 30 % and cut water use by half till
2015. It’s the very least needed for LEED
(Leadership in Energy and Environmental
Design) certification.
Levi's has launched ecologic pro-
gram WaterLess, aimed at reduction of
water usage at all stages of jeans produc-
tion and people’s lives. It is claimed, that
settling this program will save on 20 mln l
— what is enough to supply the city with
population of 10 000 with drinking water.
In addition, Levi's stimulate customers to
save on water and hand over part of sales
return to charitable institution Water.org.
To highlight the seriousness of green
trend, let’s look at carbon market. “In a
market worth in excess of 188 Billion Dol-
lars, demand for Carbon Offsets is rising
dramatically due to companies such as
Marks &Spencer, Jaguar Land Rover,
Aviva & the Co-Operative, to name just
four, committing comprehensively to car-
bon neutrality with their competitors fol-
lowing suit, this drive for demand is conse-
quently pushing up the price of credits
fast”. So, look around, maybe you have
already been involved into the green life!?
But unconscious impassive usage is not
enough. I don’t want to incline you to
spending lots of money, time and force on
environmental protection. I want you to
start with easy tips:
-Save energy to save money (Set
your thermostat a few degrees lower in the
winter and a few degrees higher in the
summer. Install compact fluorescent light
bulbs. Unplug appliances when you're not
using them)
-Save water to save money (Take
shorter showers. Install a low-flow shower-
head)
-Less gas more money (and better
health!) (Walk or bike to work. Lobby your
local government to increase spending on
sidewalks and bike lanes.)
-Eat smart (Add one meatless meal a
week. Buy locally raised, humane, and or-
ganic meat, eggs, and dairy whenever you
can.)
-Skip the bottled water (Use a water
filter to
purify tap water instead of buying bot-
tled water. Bring a reusable water bottle.)
-Think before you buy.
-Borrow instead of buying.
-Buy smart (Invest in high-quality,
long-lasting products)
-Keep electronics out of the trash
(Keep your electronics as long as possible.
Donate or recycle them responsibly when
the time comes.)
-Make your own cleaning supplies
(All you need are a few simple ingredients
like baking soda, vinegar, lemon, and
soap). So, let’s start with ourselves!
“Wal-Mart took up the "green" initiative, and introduced
plans for an environmental overhaul, including making
its trucks more efficient...”
Natali Palyona
Source:http://www.thecorner.eu/2012/09/ferrovial-selected-for-dow-jones-
index-of-most-sustainable-companies/
ÉNERGIE LIBRE FEUILLETON
BFSE.COM.UA 19
ENERGY PROSPECTS FOR NATIONAL ECONOMY MAN-
AGEMENT SYSTEM. EVERYTHING NEW IS ACTUALLY
WELL-FORGOTTEN OLD Most of the ideas that now seem innovative and worthy of attention have a long and continuous
history of success and failures.
or example, one can recollect N.
Tesla’s idea of using alternating
current network to transfer energy
over long distances. For a long
time this idea could not be realized due to
resistance from the market monopolists,
who were threatened with the loss of their
profit. And just over time it became obvious
for everyone that such an approach was not
only innovative in the industry, but also
made it possible to implement a number of
projects in other sectors of economic and
social activities.
The same story happened with the pro-
posal for the creation of Statewide Auto-
mated Management System for Collection
and Processing of Information for the Ac-
counting, Planning, and Management of the
National Economy (in Russian, abbrevia-
tion, OGAS) by B.M. Glushkov. In the early
60's Mr. Glushkov was one the first who
saw the perspectives in the creation of such
a computerized system that would optimize
the business, economic and financial pro-
cesses in the state. The idea, which was
immediately accepted with a great enthusi-
asm and gained a considerable support at a
high level of management, eventually began
to lose its power. But at that time there
existed, a number of reasons, which signifi-
cantly hindered the development of this
project.
First of all, one should mention a State
Planning Commission (Gosplan), which was
a colossus - the embodiment of Lenin’s
vision of a planned economy, and bureau-
cratic apparatus, the abolition of which
would lead to necessity of retraining or cre-
ation of new working places for a huge
number of civil servants. Moreover, manag-
ers of state enterprises immediately real-
ized the extent of "elimination of the shad-
ow economy" and disclosure of operational
information about the actual performance
of their activities.
Secondly, implementation of such a large
project required significant funds. For ex-
ample, a project to build an automated con-
trol system (ACS) called for 4-5 billion
“roubles”1 , while OGAS needed almost 20
billion.
“….of three five-year periods this project was to bring
almost 100 billion “roubles” to the state budget.”
BFSE.COM.UA 20
ÉNERGIE LIBRE TECHNOLOGIES
F
However, at the end of three five-year
periods this project was to bring almost
100 billion “roubles”2. to the state budget.
Thirdly, another obstacle deterring fur-
ther development of such of such a sys-
tem was the level of IT technologies. At
that time the data had to be entered on a
periodic basis, which slowed down the pro-
cess of collecting and processing infor-
mation.
The procedure itself was cumbersome
and required a human directly involved in
the process. As a result, the project has
been implemented only in a few sectors.
This fact disallowed to realize all the bene-
fits of this innovative method and excluded
the possibility of creating an integral auto-
mated control system for
of production system existing for many
decades.
Today’s reality revealed the inability of
economy to operate in a market, where
high rates of growth of industrial produc-
tion are reached managing business , eco-
nomic and financial processes in the state.
Over time there have been changes that
have shown all imperfections
only through a more intensive use of the
limited non-renewable natural resources.
Such policy eventually resulted not only in
depletion of the existing resources stocks,
but also in degradation of natural environ-
ment3.
Taking into account such global meta-
morphosis, most of the states in the world
chose the policy to develop the renewable
energy sources. This decision gives them
good opportunities not only in the fight
against climate change, but also in the
economic and financial issues. However,
diversification of energy sources requires a
fundamental alteration of the existent pow-
er system. Bringing the share of renewable
energy sources in total energy consump-
tion to 20% in 2020 (plans of Europe and
USA) requires the implementation of a
system which would enable to regulate the
voltage drops in the network4 (see Fig. 1).
The new system, supplying electricity to
consumers, will also include the construc-
tion of power storages, which could extract
the surplus energy from the smart grid
during the over-voltage, and pump it back
in case of power shortage. Such system
resembles greatly the economic relations
in general, where there is a specific pro-
duction process with the results consumed
either immediately or when they are
moved to the surplus store for further im-
plementation in a time of scarce.
1.Kutsyk , Mahar , Stavchikov Problem of increasing the efficiency of ACS / BS Kutsyk, NV
Mahar, AI Stavchikov. - Moscow: Nauka, 1982. - S. 17.
2.Malinowski The history of computer technology in their faces. - K.: firm "KIT" VET "ASK",
1995. - 384 lopment: critical issues. - Organisation for Economic Co-operation and Development, 2001.
– Р. 69-71.
3.. Sustainable development: critical issues. - Organization for Economic Co-operation and
Development, 2001. – Р. 69-71.
Fig.1. Areas for modernization of existing smart grid supply in North America.
Source:http://powerelectronics.com/power_systems/smart-grid-success-rely-system-solutions-20091001/
ÉNERGIE LIBRE TECHNOLOGIES
BFSE.COM.UA 21
The idea of building a “reasonable net-
work” is implemented simultaneously in
Northern America and Western Europe.
And while European variant covers mainly
the most developed countries (e. g., Germa-
ny), American project approved by the
State Department of Energy and by Power
Transmission Office in 2003, stipulates the
construction of a network that would sup-
ply energy to nearly 130 mln people in the
early stages. Future expansion of the pro-
ject is provided by Mexico and Canada. 5
Up to year 2030, American project calls
for 165 billion dollars of investments (from
8.3 billion to 18 billion dollars per year).
However, the economic effect of this pro-
ject will range between 638 and 802 billion
dollars after its implementation (1 dollar of
investment will bring 4-5 dollars of profit)6.
At first glance, it seems that modern
power project and work by V.M. Glushkov
concern different spheres of economy. sys-
tem requires the availability of the levels,
similar to those that are introduced in the
project by V.M. Glushkov.
But it is the use of energy as a unit al-
lows to remove a number of the re-
strictions, with which our compatriot’s pro-
ject faced in his time
Firstly, implementation of Smart Grid
system requires the availability of the lev-
els, similar to those that are introduced in
the project by V.M. Glushkov.
Both projects have collected information
processing center (State Energy Company/
Agency) with adjoined regional units
(distribution companies), where breakdown
by industry takes place. At the bottom of
the chain there are consumers of electricity
using so-called "reasonable counters" that
facilitate the work of not only energy sup-
plier, but also for the user. Those devices
facilitate the work of power suppliers and
users.
The “Smart Grid” itself in North
America, according to the approved docu-
ments, will include the following compo-
nents:7
- national electricity supply system in
the USA;
- regional electricity supply systems in
Mexico and Canada;
- local networks for supplying electrici-
ty to final consumers.
Secondly, final consumers will get a spe-
cial device that every few seconds passes
the information about the amount of energy
consumed to the supplier. At the same
time, the consumer has the ability to regu-
late with his own hand the way and the
amount of electricity consumption, up to
determine the order of representation of
individual appliances.
Hence, it is possible to obtain the real-
time information about the necessary vol-
umes of electricity, and, as a result, the
management company receives an im-
portant tool for the planning of its activi-
ties.
Thirdly, taking into consideration the
existing methods of analyzing shadow econ-
omy, the most common is that one which is
based on a comparison of the volumes of
energy consumed by national economies.
The data show that almost 54% of the
national economy "operated in the shadow"
at the beginning of 2000 8.
Fourthly, it is necessary to recall the
work of technocrats led by H.Scot. They
were the first to count the balance of the
U.S. economy using power units, allowing
them to avoid fluctuations in the price
(excluding the destructive influence of mon-
etary factor) and get real out-
put9.Moreover, representatives of this
trend used power units to foresee the onset
of energy crisis of the 70’s in the USA.
Thus, the proposed integrated "smart
grid" is the real embodiment of ideas to
build OGAS as a system monitoring and
controlling of the entire country's economy.
The use of power units instead of modern
cash is an important prerequisite for long-
term and accurate planning of business
processes and protecting them from the
influence of inflation.
5 Richard J. Campbel. Smart Grid and Cybersecurity – Regulatory Policy and Issues / CRS Report for Congress, June 15,
2011. – P. 11.
6.Tony Seba. Solar Trillions - 7 Market and Investment Opportunities in the EmergingClean-Energy Economy. – First Beta
Edition, 2009. – P. 229.
7.Adrian T. Sobotta, Irene N. Sobotta, John Gøtze. Greening It. How Green IT Can Form a Solid Foundation For a Low-
Carbon Society. – The Green IT Initiative, 2009. – P. 143.
8.Freferich Schneider, Dominik Enste. Shadow Economies Around the World: Size, Causes and Consequences // Working
Paper 00/26. – Washington D.C.: International Monetary Fund, February 2000. – Р. 10.
Alexander Sushchenko, associate professor
Department of Finance KNEU them. Hetman
BFSE.COM.UA 22
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BFSE.COM.UA 23
“Climate change is the defining challenge of our age.”
Ban Ki-moon, CMP 3, Bali, Indonesia
Email address :
Website:
www.bfse.com.ua