The Asian Development Bank (ADB) will grant China 600,000 U.S. dollars in aid to help the country benefit from the potential multi-billion dollar revenue from the Clean Development Mechanism (CDM).

Established under the Kyoto Protocol, the CDM program allows developed countries of the United Nations Framework Convention on Climate Change (UNFCCC) to fulfill their greenhouse gas emission reduction obligations by investing in emission reduction projects in developing countries such as China, the bank said in a statement.

By obtaining certified emission reductions (CERs) from projects in developing countries, developed countries can meet their greenhouse gas targets at lower cost, while promoting sustainable development elsewhere, it said.

"It is estimated that China could generate CER credits of between 150 to 225 million tons of carbon dioxide equivalent per year," said Anthony Maxwell, an ADB Environment Specialist.

This represents a potential annual revenue stream of up to 2.25 billion U.S. dollars, he said.

ADB has provided previous support to China for CDM activities, including successfully brokering CER credits for a loan project in Liaoning, providing technical assistance to build CDM capacity in the energy sector, and supporting CDM development for a coalmine methane project and Gansu Clean Energy Development.

The bank said the Chinese Government will finance about 200,000 U.S. dollars of the technical assistance project's total cost of 800,000 U.S. dollars. The technical aid will be carried out over about a year to the end of July 2007.

Source: Xinhua